In Vaden v. Discover Bank, et al., No. 07-773 (U.S. Sup. Ct. March 9, 2009), the United States Supreme Court held last week that under the Federal Arbitration Act (FAA), the district court is to “look through” a petition to compel arbitration to determine whether the underlying claim states a federal question that would allow for removal of the case from state court to federal court. As part of its holding, the Court noted that the FAA does not itself confer subject matter jurisdiction and such jurisdiction does not arise because of the content of a counterclaim, much like the traditional rule that a counterclaim will not supply the jurisdictional basis for removal of a case from state to federal court.
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