PRIA, Government Policy, Made Personal

Summary

Federal district courts may send civil cases, including bankruptcy adversary proceedings, to arbitration when the parties agree. Courts may not do this for cases that claim a violation of a right under the U.S. Constitution, for cases where the court’s authority comes from section 1343 of this title, or when the money damages asked for are more than $150,000. Until national rules are made under chapter 131, each district court must adopt a local rule under section 2071(a) to make sure any agreement to arbitrate is given freely and with understanding, and that no party or lawyer is harmed for refusing to arbitrate. A court may assume damages are $150,000 or less unless a lawyer files a statement saying they exceed that amount. Arbitration programs under Title IX of the Judicial Improvements and Access to Justice Act (Public Law 100–702), as amended by section 1 of Public Law 105–53, are not affected.

Title 28, §654

Judiciary and Judicial Procedure, Source: USLM XML via OLRC

(a)Referral of Actions to Arbitration.—

Notwithstanding any provision of law to the contrary and except as provided in subsections (a), (b), and (c) of section 652 and subsection (d) of this section, a district court may allow the referral to arbitration of any civil action (including any adversary proceeding in bankruptcy) pending before it when the parties consent, except that referral to arbitration may not be made where—

(1)the action is based on an alleged violation of a right secured by the Constitution of the United States;

(2)jurisdiction is based in whole or in part on section 1343 of this title; or

(3)the relief sought consists of money damages in an amount greater than $150,000.

(b)Safeguards in Consent Cases.—

Until such time as rules are adopted under chapter 131 of this title relating to procedures described in this subsection, the district court shall, by local rule adopted under section 2071(a), establish procedures to ensure that any civil action in which arbitration by consent is allowed under subsection (a)—

(1)consent to arbitration is freely and knowingly obtained; and

(2)no party or attorney is prejudiced for refusing to participate in arbitration.

(c)Presumptions.—

For purposes of subsection (a)(3), a district court may presume damages are not in excess of $150,000 unless counsel certifies that damages exceed such amount.

(d)Existing Programs.—

Nothing in this chapter is deemed to affect any program in which arbitration is conducted pursuant to section title IX of the Judicial Improvements and Access to Justice Act (Public Law 100–702), as amended by section 1 of Public Law 105–53.

Notes & Related Subsidiaries

Editorial Notes

References in Text

Title IX of the Judicial Improvements and Access to Justice Act (Public Law 100–702), as amended by section 1 of Public Law 105–53, referred to in subsec. (d), is title IX of Pub. L. 100–702, Nov. 19, 1988, 102 Stat. 4659, which enacted this chapter and provisions set out as notes under section 651 and 652 of this title. section 1 of Pub. L. 105–53, Oct. 6, 1997, 111 Stat. 1173, amended section 905 of title IX of Pub. L. 100–702, which is set out as a note under section 651 of this title.

Amendments

1998—Pub. L. 105–315 amended section generally, substituting provisions relating to arbitration for provisions relating to arbitration award and judgment.

§654 Arbitration