Arbitration Contracts and Nonsignatories: Law, Economics and Policy Analysis Governing ADR Agreements and Clauses with Certified Public Accountants.

• In Event: Auditing 2

Abstract

This paper will focus on the application of the Federal Arbitration Act to agreements in cases where parties to arbitration agreements bring litigation claims and causes of action against related parties who are nonsignatories to an arbitration agreement. The paper will focus on the policy ramifications and consequences, of the U.S. Supreme Court’s decision in Arthur Andersen LLP v. Carlisle, 129 S.Ct. 1896 (2009) which granted an immediate right of an interlocutory appeal by a nonsignatory of the arbitration agreement from a decision of the Sixth Circuit Court of Appeals, denying a stay of trial. The law and economics literature encompassing contracts law and civil procedure will be applied to whether third parties, who are not part of original arbitration agreements should be permitted to invoke an arbitration clause and avoid the trial process, specifically and solely in cases where one party is a Certified Public Accountant. Prior to the Andersen decision, the Federal Circuit Courts were split as to whether FAA Sections 3 and 16 which generally allow immediate interlocutory appeal, applied to non-signing parties.

Author

• Jerry David Golub, Northeastern University