Supreme Court Rules Federal Arbitration Act Litigation Stays Provide Jurisdiction to Confirm Awards

Yesterday, in Jules v. Andre Balazs Properties, No. 25-83, slip op. (May 14, 2026), the U.S. Supreme Court resolved a  question concerning whether federal courts retain jurisdiction to confirm or vacate arbitral awards after staying an underlying case for arbitration.

CPR Speaks previously reported on the oral argument, which took place on March 30 (available here). Full details on Jules appeared in CPR Speaks posts when the case was under consideration for a Supreme Court hearing, here; when the Court granted cert, here, and in a March 27 CPR Institute YouTube panel discussion (available here).

Writing for a unanimous Court, Justice Sonia Sotomayor framed the issue as “whether a federal court that has previously stayed claims in a pending action under §3 of the Federal Arbitration Act (FAA), 9 U.S.C. §1 et seq., has jurisdiction to confirm or vacate a resulting arbitral award as to those claims under §9 and §10.”

The Court answered yes, affirming the Second Circuit, and holding

Because a federal court in this scenario has jurisdiction over the original claims and does not lose that jurisdiction while the case is pending arbitration, it retains jurisdiction to determine whether the arbitral award resolving those claims is valid and should be confirmed.

The decision clarifies the limits of Badgerow v. Walters, 596 U.S. 1 (2022), where the Court held that federal courts may not “look through” freestanding actions to confirm or vacate an arbitral award to find federal jurisdiction. The ruling meant that independent jurisdiction is needed for a federal court case seeking to confirm or vacate an arbitration award under FAA Sections 9 and 10.

Previously, in Vaden v. Discover Bank, 556 U.S. 49, 59 (2009), the Court permitted a look-through approach because FAA Sec. 4 contained language that allows a federal court to determine whether, “save for” an arbitration agreement, it would have jurisdiction over the underlying dispute.

But the Badgerow opinion held that no comparable language exists in FAA Sections 9 or 10 that would allow a federal court to use this approach. As a result, in order for a federal court to have jurisdiction over a freestanding action, there must be a basis for federal jurisdiction, such as federal-question or diversity jurisdiction, on the face of the FAA Sections 9 or §10 motion itself.

In Thursday’s decision, petitioner Jules, asserted that the case was “Badgerow all over again” because it involved a party asking a federal court to confirm or vacate an arbitral award under Sections 9 and 10.

The Court responded by contrasting the freestanding claims of Badgerow and Vaden, stating that in Jules, “however, there is an obvious third place to look for jurisdiction: the original claims themselves. Because those claims were sufficient to establish the District Court’s jurisdiction in this case under 28 U. S. C. §1331, they also established the District Court’s authority to resolve the motions to confirm or vacate the arbitral award resolving those claims.”

The case had gone to federal court on a request for an FAA Section 3 stay so that the matter could be arbitrated.

The Sotomayor opinion rejected Jules’s remaining counterarguments. First, Jules argued that “Badgerow makes clear that the FAA is a “reticulated” framework whose “text,” alone, governs federal jurisdiction over FAA disputes and requires an independent jurisdictional basis for all §9 and §10 motions.” The Court responded that this overread Badgerow, which it notes didn’t convert the “nonjurisdictional” FAA into a jurisdictional scheme, quoting Vaden.

Second, Jules argued that motions to confirm or vacate “should be treated as entirely ‘new federal actions’ for purposes of assessing jurisdiction,” even in pre-existing suits, because FAA Sections 9 and 12 require service and notice. The Court stated that, as it previously explained in Smith v. Spizzirri, 601 U.S. 472 (2024), “§3’s mandatory stay is aimed precisely at ‘avoid[ing] [the] costs and complications’ of ‘bring[ing] a new suit.’”

Third, the Court did not accept the petitioner’s argument that FAA Sec. 8, which deals with admiralty cases, applies.

Finally, the Court dismissed the policy argument that allowing federal jurisdiction to continue for confirming and vacating awards based on FAA Sec. 3 court actions will encourage parties to “engage in useless federal litigation for the sole purpose of creating a jurisdictional anchor” as “conjectural.”

The opinion concludes by summarizing that

In Badgerow, the question was whether anything in §9 or §10 of the FAA affirmatively authorized an unusual approach premising jurisdiction on claims never filed before the court. Here, the question is instead whether there is anything in the FAA that precludes the normal operation of federal jurisdiction regarding live claims that are still pending before a federal court. There is not. A federal court with jurisdiction to stay claims pending arbitration under §3 of the FAA has the same jurisdiction to resolve motions to confirm or vacate a resulting arbitral award.

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The author, completed her first year at the Northeastern University School of Law in Boston earlier this month, and is a 2026 CPR summer intern.

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