Ge Energy Power Conversion Fr. Sas, Corp. v. Outokumpu Stainless USA, LLC

590 U.S. 432, 140 S. Ct. 1637, 207 L. Ed. 2d 1
CourtSupreme Court of the United States
DecidedJune 1, 2020
Docket18-1048
StatusPublished
Cited by167 cases

This text of 590 U.S. 432 (Ge Energy Power Conversion Fr. Sas, Corp. v. Outokumpu Stainless USA, LLC) 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
Ge Energy Power Conversion Fr. Sas, Corp. v. Outokumpu Stainless USA, LLC, 590 U.S. 432, 140 S. Ct. 1637, 207 L. Ed. 2d 1 (2020).

Opinions

Justice THOMAS delivered the opinion of the Court.

*1642The question in this case is whether the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, June 10, 1958, 21 U.S.T. 2517, T.I.A.S. No. 6997, conflicts with domestic equitable estoppel doctrines that permit the enforcement of arbitration agreements by nonsignatories. We hold that it does not.

I

In 2007, ThyssenKrupp Stainless USA, LLC, entered into three contracts with F.L. Industries, Inc., for the construction of cold rolling mills at ThyssenKrupp's steel manufacturing plant in Alabama. Each of the contracts contained an identical arbitration clause. The clause provided that "[a]ll disputes arising between both parties in connection with or in the performances of the Contract ... shall be submitted to arbitration for settlement." App. 171.

After executing these agreements, F.L. Industries, Inc., entered into a subcontractor agreement with petitioner GE Energy Power Conversion France SAS, Corp. (GE Energy), then known as Converteam SAS. Under that agreement, GE Energy agreed to design, manufacture, and supply motors for the cold rolling mills. Between 2011 and 2012, GE Energy delivered nine motors to the Alabama plant for installation. Soon thereafter, respondent Outokumpu Stainless USA, LLC, acquired ownership of the plant from ThyssenKrupp.

According to Outokumpu, GE Energy's motors failed by the summer of 2015, resulting in substantial damages. In 2016, Outokumpu and its insurers filed suit against GE Energy in Alabama state court. GE Energy removed the case to federal court under 9 U.S.C. § 205, which authorizes the removal of an action from state to federal court if the action "relates to an arbitration agreement ... falling under the Convention [on the Recognition and Enforcement of Foreign Arbitral Awards]." GE Energy then moved to dismiss and compel arbitration, relying on the arbitration clauses in the contracts between F.L. Industries, Inc., and ThyssenKrupp.

The District Court granted GE Energy's motion to dismiss and compel arbitration *1643with Outokumpu and Sompo Japan Insurance Company of America. Outokumpu Stainless USA LLC v. Converteam SAS , 2017 WL 401951 (SD Ala., Jan. 30, 2017).1 The court held that GE Energy qualified as a party under the arbitration clauses because the contracts defined the terms "Seller" and "Parties" to include subcontractors. Id. , at *4. Because the court concluded that both Outokumpu and GE Energy were parties to the agreements, it declined to address GE Energy's argument that the agreement was enforceable under equitable estoppel. Id. , at *1, n. 1.

The Eleventh Circuit reversed the District Court's order compelling arbitration. Outokumpu Stainless USA, LLC v. Converteam SAS , 902 F.3d 1316 (2018). The court interpreted the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention or Convention) to include a "requirement that the parties actually sign an agreement to arbitrate their disputes in order to compel arbitration." Id. , at 1326 (emphasis in original). The court concluded that this requirement was not satisfied because "GE Energy is undeniably not a signatory to the Contracts." Ibid. It then held that GE Energy could not rely on state-law equitable estoppel doctrines to enforce the arbitration agreement as a nonsignatory because, in the court's view, equitable estoppel conflicts with the Convention's signatory requirement. Id. , at 1326-1327.

Given a conflict between the Courts of Appeals on this question,2 we granted certiorari. 588 U.S. ----, 139 S.Ct. 2776, 204 L.Ed.2d 1156 (2019).

II

A

Chapter 1 of the Federal Arbitration Act (FAA) permits courts to apply state-law doctrines related to the enforcement of arbitration agreements. Section 2 of that chapter provides that an arbitration agreement in writing "shall be ... enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2. As we have explained, this provision requires federal courts to "place [arbitration] agreements ' "upon the same footing as other contracts." ' " Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior Univ. , 489 U.S. 468, 474, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989) (quoting Scherk v. Alberto-Culver Co. , 417 U.S. 506, 511, 94 S.Ct. 2449, 41 L.Ed.2d 270 (1974) ). But it does not "alter background principles of state contract law regarding the scope of agreements (including the question of who is bound by them)." Arthur Andersen LLP v. Carlisle , 556 U.S. 624, 630, 129 S.Ct.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Mauricio Usme v. CMI Leisure Management, Inc.
106 F.4th 1079 (Eleventh Circuit, 2024)
Winifredo Herrera v. Cathay Pacific Airways Limited
94 F.4th 1083 (Ninth Circuit, 2024)
United States v. Ernst Jacob
D. Puerto Rico, 2023
Lastephen Rogers v. Tug Hill Operating, LLC
76 F.4th 279 (Fourth Circuit, 2023)

Cite This Page — Counsel Stack

Bluebook (online)
590 U.S. 432, 140 S. Ct. 1637, 207 L. Ed. 2d 1, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ge-energy-power-conversion-fr-sas-corp-v-outokumpu-stainless-usa-llc-scotus-2020.