Federal Law Defines 'Arbitration' Under FAA, 2nd Circ. Rules

Law360, New York (January 23, 2013, 6:03 PM EST) -- Weighing in on an issue that has split federal circuits, the Second Circuit ruled Wednesday that federal law, not state law, dictates the meaning of "arbitration" under the Federal Arbitration Act, siding with Lloyd's of London in a dispute over whether a disability policy clause on selecting doctors counts as an arbitration agreement.

Because the FAA does not provide a definition of "arbitration," courts have had to decide whether to apply federal common law or state law to fill in the gap. The Second Circuit joined...
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