SCOTUS Resolved Circuit Split.

Adrian Jules sued his former employer, Chateau Marmont, in federal court in New York alleging employment discrimination under federal and state law. The district court stayed the case pending arbitration under FAA §3. Ruling against Jules, the arbitrator awarded sanctions to respondents. When respondents returned to federal court to confirm the award under FAA §9, Jules argued the court lacked jurisdiction because §9/§10 motions to confirm or deny an award presented no independent federal question and the parties were nondiverse with less than $75,000 at stake. The Supreme Court unanimously held a federal court previously staying claims under §3 retains jurisdiction to confirm or vacate the resulting arbitral award — no independent jurisdictional basis on the face of the §9/§10 motion is required. Jules v. Andre Balazs Properties, 25-83 (S.Ct. 5/14/26).

Comment. Previously, the Fourth Circuit had held that motions to confirm or vacate an award required an independent jurisdictional basis in federal court. In contrast, the Second, Third and Seventh Circuits held that a pre-existing federal case provided a jurisdictional basis to confirm or vacate an award, and thus an independent jurisdictional basis to confirm or vacate an award was only needed if the motion to do so was made as a freestanding action rather than in a pre-existing federal case. The resolution of the split in favor of the Second, Third, and Seventh Circuit should remove jurisdictional uncertainty when the motion to confirm or vacate an award is made in a pre-existing federal case. It will be possible to “look through” to the pre-existing federal jurisdiction in the pre-existing federal case to support federal jurisdiction for the motion to vacate or confirm the award..