Betty E. Vaden v. Discover Bank et al. (556 U.S. 49)
U.S. Supreme Court · decided March 9, 2009 · Supreme Court Database (Spaeth)
- Citation
- 556 U.S. 49 · 129 S. Ct. 1262
- Decided
- March 9, 2009
- Term
- October Term 2008
- Vote
- 5–4
- Majority author
- Justice Ginsburg
- Issue area
- Federalism
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Conservative
Opinion excerpt
Justice Ginsburg delivered the opinion of the Court. Section 4 of the Federal Arbitration Act, 9 U. S. C. §4, authorizes a United States district court to entertain a petition to compel arbitration if the court would have jurisdiction, “save for [the arbitration] agreement,” over “a suit arising out of the controversy between the parties.” We consider in this opinion two questions concerning a district court’s subject-matter jurisdiction over a § 4 petition: Should a district court, if asked to compel arbitration pursuant to §4, “look through” the petition and grant the requested relief if the court would have federal-question jurisdiction over the underlying controversy? And if the answer to that question is yes, may a district court exercise jurisdiction over a § 4 petition when the petitioner’s complaint rests on state law but an actual or potential counterclaim rests on federal law? The litigation giving rise to these questions began when Discover Bank’s servicing affiliate filed a complaint in Maryland state court. Presenting a claim arising solely under state law, Discover sought to recover past-due charges from one of its credit cardholders, Betty Vaden. Vaden answered and counterclaimed, alleging that Discover’s finance charges, interest, and late fees violated state law. Invoking an arbitration clause in its cardholder agreement with Vaden, Discover then filed a § 4…
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