Smith v. Spizzirri

This case arose when delivery drivers sued their employer in Arizona state court, alleging wage-and-hour violations. The employer removed the case to federal court and moved to compel arbitration, arguing that all claims were subject to arbitration agreements. The district court granted the motion and dismissed the case rather than staying it. The Ninth Circuit affirmed, holding that dismissal was permissible when all claims were arbitrable. The Supreme Court granted certiorari to resolve a circuit split over whether Section 3 of the Federal Arbitration Act requires a stay or allows dismissal. In a unanimous opinion by Justice Sotomayor, the Court held that Section 3 mandates a stay when a party requests one and the dispute is referable to arbitration. The ruling vacated the Ninth Circuit's judgment and remanded for further proceedings consistent with the stay requirement.

The Supreme Court unanimously held that Section 3 of the Federal Arbitration Act requires a stay, not dismissal, when a dispute is referred to arbitration and a party requests a stay.

Whether Section 3 of the Federal Arbitration Act requires a district court to stay, rather than dismiss, a lawsuit when all claims are referred to arbitration and a party requests a stay.

The decision resolves a longstanding circuit split and clarifies lower court procedure. It preserves a party's right to immediate appeal under the Federal Arbitration Act and ensures that courts retain jurisdiction during arbitration, which can affect case management and enforcement of arbitral awards.