The Federal Arbitration Act (FAA) is the federal law that governs arbitration. It is possible to petition the state or federal courts to compel arbitration. Filing in federal court is ideal, since federal courts have a strong policy of favoring arbitration. However, there are specific criteria that must be met to bring an arbitration suit in federal court. Some of the criteria are:

  • diversity of citizenship
  • the dispute must be worth at least $75,000

What other criteria must be met to file a suit to compel arbitration in federal court?

2 Answers 2



To file a suit to compel arbitration in federal court, the court must have subject matter jurisdiction and personal jurisdiction, venue must be proper, special considerations must be met for certain kinds of defendants, and there must be a basis on the merits alleged to compel arbitration.

Subject Matter Jurisdiction In Domestic Cases

One set of rules applies in cases where all parties to the case are U.S. persons.

Some of the criteria are:

  • diversity of citizenship
  • the dispute must be worth at least $75,000

While this is usually the case, the requirements of 28 U.S.C. § 1332 pertaining to diversity jurisdiction don't always apply to motions to compel arbitration in federal court.

The FAA, 9 U.S.C. § 1 et seq., does not itself confer federal-question jurisdiction—the federal courts must have an independent jurisdictional basis to hear a case under the FAA. Hall Street Associates, L.L.C. v. Mattel, Inc., 552 U.S. 576 (2008).

A federal court can compel arbitration under Section 4 of the FAA, however, if, on a “look through” basis, the underlying dispute were to give rise to federal question jurisdiction, even in the absence of diversity of citizenship. Vaden v. Discovery Bank, 556 U.S. 49 (2009). In these cases, there is no minimum amount in controversy and diversity of citizenship is not required.

But, Vaden’s “look through” approach to determining federal jurisdiction does not apply to requests to confirm or vacate arbitral awards under Sections 9 and 10 of the FAA. Bagerow v. Walter, 596 U.S. ____, Case No. 20-1143 (March 31, 2022).

A motion to compel arbitration could also be brought in federal court if the United States government was one of the parties to the case.

Case law has also created some exceptions to the general rule that diversity jurisdiction is present when there is diversity of citizenship and the amount in controversy is in excess of $75,000. The most important of those exceptions are for family law matters and for probate cases. Most family law arbitration cases involve agreements of a Jewish married couple to submit certain marital disputes to arbitration before a Jewish law tribunal arbitration. Most arbitration requirements in probate cases are established in an instrument such as a will under which the case arises.

It is also possible for the parties to contractually agree to waive a federal forum for any purpose whatsoever. This is frequently done, for example, in cases involving marijuana business transactions in which the businesses are legal under state but not federal law.

Subject Matter Jurisdiction In International Cases

The subject matter jurisdiction analysis (but not the personal jurisdiction analysis) is usually different in international arbitration cases to which treaty agreements usually apply.

Enforcement of an international arbitration treaty will usually constitute a federal question under 28 U.S.C. § 1331, and provide a basis for federal court subject matter jurisdiction that would be absent under the FAA. As noted here:

In 1970, the United States acceded to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”), which requires all of its 157 State-Parties to enforce arbitration agreements and awards rendered in other countries or which are non-domestic. In the implementing legislation, Congress established that any arbitration agreement or award that was commercial and international in nature fell under the New York Convention. 9 U.S.C. § 202.

Congress also provided that “An action or proceeding falling under the Convention shall be deemed to arise under the laws and treaties of the United States.” 9 U.S.C. § 203. This confers federal jurisdiction on any motion to compel arbitration or any enforcement action regarding an international arbitration.

Congress also provided extremely broad removal powers whenever a state court action “relates to” an international arbitration agreement or award. 9 U.S.C. § 205 allows for removal “at any time before the trial” and says that the grounds for removal “need not appear on the face of the complaint but may be shown in the petition for removal.”

Every circuit that has analyzed this has found that it confers broad jurisdiction on the federal courts to hear claims “whenever an [international] arbitration agreement . . . could conceivably affect the outcome of the plaintiff’s case.” Infuturia Global Ltd. v. Sequus Pharaceuticals, Inc., 631 F.3d 1133, 1138 (9th Cir. 2011); Reid v. Doe Run Resources Corp., 701 F.3d 840, 844 (8th Cir. 2012); Beiser v. Weyler, 284 F.3d 665, 669 (5th Cir. 2002).

The New York Convention will not always apply, however, in consumer cases and in other cases that are not commercial in nature, even if they are international.

Personal Jurisdiction

In addition to having "subject matter" jurisdiction over the type of controversy involved, a party filing suit in a U.S. District Court must establish that the court has "personal jurisdiction" over the parties. This analysis is the usually same as it would be if the suit were filed in a state court concerning the same matter. See Federal Rule of Civil Procedure 4(k).

Thus, the defendant must either be (1) subject to general personal jurisdiction in that state, because the defendant has a headquarters, place of incorporation, or a domicile in that state, or (2) the defendant must be subject to specific personal jurisdiction in that state (i.e. the specific controversy must involve conduct of the defendant that links the defendant to that state).

The scope of general jurisdiction over entities was greatly narrowed by the U.S. Supreme Court in Daimler A.G. v. Bauman, 134 S. Ct. 746 (2014), with respect to the prior rule under the longstanding U.S. Supreme Court holding of International Shoe Company v. Washington, 326 U.S 310 (1945) (which allowed a company or person to be sued on any matter anywhere that the defendant had an office for the conduct or business or a permanent agent). The law of personal jurisdiction, however, after many decades of great clarity, is now ridden with uncertainty and internal doctrinal ambiguities as a result of several recent U.S. Supreme Court rulings in this area. See, e.g., Richard D. Freer, "From Contacts to Relatedness: Invigorating the Promise of "Fair Play and Substantial Justice" in Personal Jurisdiction Doctrine" 73 Alabama L. Rev. 583 (2022).

Often, a forum selection clause in a contract containing an arbitration clause will supply a partial basis for a court to assert specific personal jurisdiction over a case. But the forum must still have some connection to the parties or the transaction or matter to support a federal court's personal jurisdiction over the case.

There are also some narrow exceptions to the usual personal jurisdiction rules requiring that either general jurisdiction or specific jurisdiction be present. These include "tag jurisdiction" over natural person defendants that allows them to be tried in a federal court in a state if the defendant was personally served with process in the case in that state, see Burnham v. Superior Court, 495 U.S. 604 (1990), "in rem" jurisdiction, and "quasi-in rem" jurisdiction. Tag jurisdiction is not available against entities, however. See Martinez v. Aero Caribbean, 764 F.3d 1062 (9th Cir. 2014).

For personal jurisdiction (but not venue) purposes, every U.S. District Court District in a state is on an equal footing. Facts necessary to establish personal jurisdiction in a U.S. District Court do not all have to be present in the judicial district in question if the facts establish that any state courts in the entire state in which the U.S. District Court is located would have personal jurisdiction over the case.

The defendant must also be properly served with process in the manner set forth in Federal Rule of Civil Procedure 4 in order to be subject to the personal jurisdiction of the federal court.


Venue is proper in a U.S. District Court if the state in which the U.S. District Court is located has personal jurisdiction over the case, and, in states with more than one U.S. District Court, one or more of the parties has the proper connection to that particular U.S. District Court. See generally 28 U.S.C. § 1391. The general rule under that statute is that:

A civil action may be brought in—

(1)a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located;

(2)a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated; or

(3)if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court’s personal jurisdiction with respect to such action.

If a U.S. District Court has personal jurisdiction over the parties, but the plaintiff has chosen an improper venue, then the usual remedy is a motion to change the venue and transfer the case to a different district, rather than to dismiss the case.

Other Considerations

Additional steps must be taken to protect a defendant's rights in order to commence a case in federal court to compel arbitration if a defendant is in military service (to which the Soldier's and Sailor's Civil Relief Act, 50 U.S.C. §§ 101-165, applies), if a defendant is a minor, or if a defendant is incompetent.

Stating A Claim Upon Which Relief Can Be Granted

Of course, there must also be allegations of a valid basis to compel arbitration on the merits - e.g., allegations that an arbitration agreement was entered into and that it binds the party against whom arbitration is sought to be compelled, and that it involves a matter that can be subject to arbitration.

  • Thanks for your amazing response! Is the requirement that a dispute be worth $75K+ also waived when filling a suit is filed to compel arbitration if the court has subject matter jurisdiction (or only the requirement of diversity)?
    – S.O.S
    Dec 20, 2022 at 23:46
  • 1
    @S.O.S. the $75K requirement only applies if diversity jurisdiction is the basis of the subject matter jurisdiction between domestic parties; it does not apply if the claim is based upon federal question jurisdiction (subject to some exceptions that apply where look-through gives federal interpleader jurisdiction, where the look through gives special diversity jurisdiction statute jurisdiction in certain class actions lawsuits, and in certain junk fax law cases).
    – ohwilleke
    Dec 21, 2022 at 1:26

There must be an arbitration agreement that covers the dispute

Arbitration is a contract-based alternative dispute resolution process that must be voluntarily entered into by both parties. These are typically covered by an arbitration clause in a contract between the parties (although the arbitration agreement is a separate contract under the severability principle) or a separate agreement that the parties enter specifically to resolve the dispute before them.

Either way, the arbitration agreement will have a scope defining which disputes it covers, and the dispute in question must fall within the scope. An arbitration agreement may be broad (e.g. "any and all disputes between the parties"), narrow (e.g. "disputes under the contract" - which would exclude tort and equity-based disputes), or stupidly narrow (e.g. "disputes regarding payment").

The court must have jurisdiction to hear the dispute were it not for the arbitration agreement

A court can only compel arbitration if the dispute would fall into its jurisdiction but for the arbitration agreement. So, for example, if the dispute rests entirely on State law, a Federal court cannot compel arbitration.

If it has jurisdiction, the court will refer the matter to arbitration unless the making of or the performance of the arbitration agreement is in issue, in which case it will hold a summary trial on the merits of those issues and, depending on the outcome, refer the matter to arbitration or not. Note that this is different from most other parts of the world where the referral would be automatic, and the tribunal would decide issues of jurisdiction itself.

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