Circuit City Stores, Inc. v. Adams

532 U.S. 105, 121 S. Ct. 1302, 149 L. Ed. 2d 234, 2001 U.S. LEXIS 2459
CourtSupreme Court of the United States
DecidedMarch 21, 2001
Docket99-1379
StatusPublished
Cited by1,275 cases

This text of 532 U.S. 105 (Circuit City Stores, Inc. v. Adams) is published on Counsel Stack Legal Research, covering Supreme Court of the United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S. Ct. 1302, 149 L. Ed. 2d 234, 2001 U.S. LEXIS 2459 (2001).

Opinions

[109]*109Justice Kennedy

delivered the opinion of the Court.

Section 1 of the Federal Arbitration Act (FAA or Act) excludes from the Act’s coverage “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 U. S. C. § 1. All but one of the Courts of Appeals which have addressed the issue interpret this provision as exempting contracts of employment of transportation workers, but not other employment contracts, from the FAA’s coverage. A different interpretation has been adopted by the Court of Appeals for the Ninth Circuit, which construes the exemption so that all contracts of employment are beyond the FAA’s reach, whether or not the worker is engaged in transportation. It applied that rule to the instant case. We now decide that the better interpretation is to construe the statute, as most of the Courts of Appeals have done, to confine the exemption to transportation workers.

I

In October 1995, respondent Saint Clair Adams applied for a job at petitioner Circuit City Stores, Inc., a national retailer of consumer electronics. Adams signed an employment application which included the following provision:

“I agree that I will settle any and all previously unas-serted claims, disputes or controversies arising out of or [110]*110relating to my application or candidacy for employment, employment and/or cessation of employment with Circuit City, exclusively by final and binding arbitration before a neutral Arbitrator. By way of example only, such claims include claims under federal, state, and local statutory or common law, such as the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, as amended, including the amendments of the Civil Rights Act of 1991, the Americans with Disabilities Act, the law of contract and [the] law of tort.” App. 13 (emphasis in original).

Adams was hired as a sales counselor in Circuit City’s store in Santa Rosa, California.

Two years later, Adams filed an employment discrimination lawsuit against Circuit City in state court, asserting claims under California’s Fair Employment and Housing Act, Cal. Govt. Code Ann. § 12900 et seg. (West 1992 and Supp. 1997), and other claims based on general tort theories under California law. Circuit City filed suit in the United States District Court for the Northern District of California, seeking to enjoin the state-court action and to compel arbitration of respondent’s claims pursuant to the FAA, 9 U. S. C. §§ 1-16. The District Court entered the requested order. Respondent, the court concluded, was obligated by the arbitration agreement to submit his claims against the employer to binding arbitration. An appeal followed.

While respondent’s appeal was pending in the Court of Appeals for the Ninth Circuit, the court ruled on the key issue in an unrelated case. The court held the FAA does not apply to contracts of employment. See Craft v. Campbell Soup Co., 177 F. 3d 1083 (1999). In the instant ease, following the rule announced in Craft, the Court of Appeals held the arbitration agreement between Adams and Circuit City was contained in a “contract of employment,” and so was not subject to the FAA. 194 F. 3d 1070 (1999). Circuit City petitioned this Court, noting that the Ninth Circuit’s [111]*111conclusion that all employment contracts are excluded from the FAA conflicts with every other Court of Appeals to have addressed the question. See, e. g., McWilliams v. Logicon, Inc., 143 F. 3d 573, 575-576 (CA10 1998); O’Neil v. Hilton Head Hospital, 115 F. 3d 272, 274 (CA7 1997); Pryner v Tractor Supply Co., 109 F. 3d 354, 358 (CA7 1997); Cole v. Burns Int'l Security Servs., 105 F. 3d 1465, 1470-1472 (CADC 1997); Rojas v. TK Communications, Inc., 87 F. 3d 745, 747-748 (CA51996); Asplundh Tree Co. v. Bates, 71F. 3d 592,596-601 (CA6 1995); Erving v. Virginia Squires Basketball Club, 468 F. 2d 1064, 1069 (CA2 1972); Dickstein v. DuPont, 443 F. 2d 783, 785 (CA1 1971); Tenney Engineering, Inc. v. United Elec. & Machine Workers of Am., 207 F. 2d 450 (CA3 1953). We granted certiorari to resolve the issue. 529 U. S. 1129 (2000).

II

A

Congress enacted the FAA in 1925. As the Court has explained, the FAA was a response to hostility of American courts to the enforcement of arbitration agreements, a judicial disposition inherited from then-longstanding English practice. See, e. g., Allied-Bruce Terminix Cos. v. Dobson, 513 U. S. 265, 270-271 (1995); Gilmer v. Interstate/Johnson Lane Corp., 500 U. S. 20, 24 (1991). To give effect to this purpose, the FAA compels judicial enforcement of a wide range of written arbitration agreements. The FAA’s coverage provision, §2, provides that

“[a] written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such [112]*112grounds as exist at law or in equity for the revocation of any contract.” 9 U. S. C. § 2.

We had occasion in Allied-Bruce, supra, at 273-277, to consider the significance of Congress’ use of the words “involving commerce” in §2. The analysis began with a reaffirmation of earlier decisions concluding that the FAA was enacted pursuant to Congress’ substantive power to regulate interstate commerce and admiralty, see Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U. S. 395, 405 (1967), and that the Act was applicable in state courts and pre-emptive of state laws hostile to arbitration, see Southland Corp. v. Keating, 465 U. S. 1 (1984). Relying upon these background principles and upon the evident reach of the words “involving commerce,” the Court interpreted §2 as implementing Congress’ intent “to exercise [its] commerce power to the full.” Allied-Bruce, supra, at 277.

The instant case, of course, involves not the basic coverage authorization under §2 of the Act, but the exemption from coverage under § 1. The exemption clause provides the Act shall not apply “to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 U. S. C. § 1. Most Courts of Appeals conclude the exclusion provision is limited to transportation workers, defined, for instance, as those workers “‘actually engaged in the movement of goods in interstate commerce.’” Cole, supra, at 1471.

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Bluebook (online)
532 U.S. 105, 121 S. Ct. 1302, 149 L. Ed. 2d 234, 2001 U.S. LEXIS 2459, Counsel Stack Legal Research, https://law.counselstack.com/opinion/circuit-city-stores-inc-v-adams-scotus-2001.