Originally from:

AAA Handbook on Arbitration Practice - Second Edition

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CHAPTER 30

ENFORCING ARBITRAL SUBPOENAS:
RECONSIDERING FEDERAL QUESTION
JURISDICTION UNDER FAA SECTION 7

Charles E. Harris II

I. Introduction

This article examines three issues pertinent to the enforcement of
arbitral subpoenas under FAA § 7:
(1) Does the nature and unique language of § 7 vest federal courts
with federal question jurisdiction?
(2) Can a § 7 action commenced in state court be removed to federal
court?
(3) (3) Can a state court dismiss a § 7 action on the ground that
federal courts have exclusive jurisdiction?

The weight of federal judicial authority favors the view that the plain
language of Section 7 of the Federal Arbitration Act (FAA) does not
authorize arbitrators to issue third-party subpoenas for pre-hearing
discovery. The rules of many alternative dispute resolution services,
however, do not expressly prohibit such subpoenas. Thus, arbitrators
regularly issue them, notwithstanding recent federal court decisions
refusing to enforce them. Instead, parties are optimistically initiating
enforcement proceedings in state courts, hoping to avoid this federal
court precedent. But can these actions be removed to federal court on the
ground that Section 7 confers original jurisdiction under the federal
question statute, codified at Section 1331 of Title 28 of the United States
Code? Courts have generally held that other provisions of the FAA do
not create a basis for so-called “federal question” jurisdiction under
Section 1331.

Although some courts have applied this principle to Section 7, none
have carefully considered whether the nature and unique language of
Section 7 vest federal courts with this jurisdiction. This article addresses
that topic as well as whether these actions can be removed to federal
court under Section 1441 of Title 28, based on the text of Section 7 or the
“substantial federal question doctrine.” It also considers whether state
actions may be dismissed because federal courts have exclusive
jurisdiction to consider such actions.

II. FAA Enforcement of Arbitral Subpoenas