Siding with the Fifth, Ninth and Second (unpublished) Circuits in a longstanding circuit split, the Sixth Circuit in United States ex rel. Paige v. BAE Sys. Tech. recently distinguished between disputes “arising under” and “related to” a contract for arbitration purposes. The Sixth Circuit held that an arbitration clause mandating arbitration of “any dispute arising from this Agreement” did not cover an employee’s statutory retaliation claim (under the False Claims Act), which the court described as “completely separate from the contract.” In its analysis, the Court distinguished cases involving arbitration clauses with broader language such as “related to” or “bearing on.”
The Eleventh Circuit has rejected such a distinction, interpreting phrases like “arising under” broadly to include merely “related” disputes. And the Seventh Circuit appears to have the most finely nuanced position, drawing a distinction in dictum between “arising under” and “arising out of” (with the latter deemed to be broader).
Although Paige was an unpublished decision, and therefore technically not binding, employers and others ought to err on the side of caution and use the broadest language in arbitration clauses for maximum protection from statutory, tort and other non-contract claims. As we have previously discussed, the Sixth Circuit frequently relies on unpublished cases for substantive propositions of law.
