In this case we first address whether an order compelling arbitration and dismissing a party's underlying claims is a "final decision with respect to an arbitration" within the meaning of § 16(a)(3) of the Federal Arbitration Act, 9 U. S. C. § 16(a)(3), and thus is immediately appealable pursuant to that Act. Because we decide that question in the affirmative, we also address the question whether an arbitration agreement that does not mention arbitration costs and fees is unenforceable because it fails to affirmatively protect a party from potentially steep arbitration costs. We conclude that an arbitration agreement's silence with respect to such matters does not render the agreement unenforceable.
Respondent Larketta Randolph purchased a mobile home from Better Cents Home Builders, Inc., in Opelika, Alabama. She financed this purchase through petitioners Green Tree Financial Corporation and its wholly owned subsidiary, Green Tree Financial Corp.-Alabama. Petitioners' Manufactured Home Retail Installment Contract and Security Agreement required that Randolph buy Vendor's Single Interest insurance, which protects the vendor or lienholder against the costs of repossession in the event of default. The agreement also provided that all disputes arising from,
Randolph later sued petitioners, alleging that they violated the Truth in Lending Act (TILA), 15 U. S. C. § 1601 et seq., by failing to disclose as a finance charge the Vendor's Single Interest insurance requirement. She later amended her complaint to add a claim that petitioners violated the Equal Credit Opportunity Act, 15 U. S. C. §§ 1691-1691f, by requiring her to arbitrate her statutory causes of action. She brought this action on behalf of a similarly situated class. In lieu of an answer, petitioners filed a motion to compel arbitration, to stay the action, or, in the alternative, to dismiss. The District Court granted petitioners' motion to compel arbitration, denied the motion to stay, and dismissed Randolph's claims with prejudice. The District Court also denied her request to certify a class. 991 F.Supp. 1410 (MD Ala. 1997). She requested reconsideration, asserting that
The Court of Appeals for the Eleventh Circuit first held that it had jurisdiction to review the District Court's order because that order was a final decision. 178 F.3d 1149 (1999). The Court of Appeals looked to § 16 of the Federal Arbitration Act (FAA), 9 U. S. C. § 16, which governs appeal from a district court's arbitration order, and specifically § 16(a)(3), which allows appeal from "a final decision with respect to an arbitration that is subject to this title." The court determined that a final, appealable order within the meaning of the FAA is one that disposes of all the issues framed by the litigation, leaving nothing to be done but execute the order. The Court of Appeals found the District Court's order within that definition.
The court then determined that the arbitration agreement failed to provide the minimum guarantees that respondent could vindicate her statutory rights under the TILA. Critical to this determination was the court's observation that the arbitration agreement was silent with respect to payment of filing fees, arbitrators' costs, and other arbitration expenses. On that basis, the court held that the agreement to arbitrate posed a risk that respondent's ability to vindicate her statutory rights would be undone by "steep" arbitration costs, and therefore was unenforceable. We granted certiorari, 529 U.S. 1052 (2000), and we now affirm the Court of Appeals with respect to the first conclusion, and reverse it with respect to the second.
Section 16 of the Federal Arbitration Act, enacted in 1988, governs appellate review of arbitration orders. 9 U. S. C. § 16. It provides:
"(1) an order—
"(E) modifying, correcting, or vacating an award;
The District Court's order directed that arbitration proceed and dismissed respondent's claims for relief. The question before us, then, is whether that order can be appealed as "a final decision with respect to an arbitration" within the meaning of § 16(a)(3). Petitioners urge us to hold that it cannot. They rely, in part, on the FAA's policy favoring arbitration agreements and its goal of "mov[ing] the parties to an arbitrable dispute out of court and into arbitration as quickly and easily as possible." Moses H. Cone Memorial
Section 16(a)(3), however, preserves immediate appeal of any "final decision with respect to an arbitration," regardless of whether the decision is favorable or hostile to arbitration. And as petitioners and respondent agree, the term "final decision" has a well-developed and longstanding meaning. It is a decision that "`ends the litigation on the merits and leaves nothing more for the court to do but execute the judgment.'" Digital Equipment Corp. v. Desktop Direct, Inc., 511 U.S. 863, 867 (1994), and Coopers & Lybrand v. Livesay, 437 U.S. 463, 467 (1978) (both quoting Catlin v. United States, 324 U.S. 229, 233 (1945)). See also St. Louis, I. M. & S. R. Co. v. Southern Express Co., 108 U.S. 24, 28-29 (1883). Because the FAA does not define "a final decision with respect to an arbitration" or otherwise suggest that the ordinary meaning of "final decision" should not apply, we accord the term its well-established meaning. See Evans v. United States, 504 U.S. 255, 259-260 (1992).
The District Court's order directed that the dispute be resolved by arbitration and dismissed respondent's claims with prejudice, leaving the court nothing to do but execute the judgment. That order plainly disposed of the entire case on the merits and left no part of it pending before the court. The FAA does permit parties to arbitration agreements to bring a separate proceeding in a district court to enter judgment on an arbitration award once it is made (or to vacate or modify it), but the existence of that remedy does not vitiate the finality of the District Court's resolution of the claims in the instant proceeding. 9 U. S. C. §§ 9, 10, 11. The District Court's order was therefore "a final decision with respect to an arbitration" within the meaning of § 16(a)(3), and
Petitioners contend that the phrase "final decision" does not include an order compelling arbitration and dismissing the other claims in the action, when that order occurs in an "embedded" proceeding, such as this one. Brief for Petitioners 26. "Embedded" proceedings are simply those actions involving both a request for arbitration and other claims for relief. "Independent" proceedings, by contrast, are actions in which a request to order arbitration is the sole issue before the court. Those Courts of Appeals attaching significance to this distinction hold that an order compelling arbitration in an "independent" proceeding is final within the meaning of § 16(a)(3), but that such an order in an "embedded" proceeding is not, even if the district court dismisses the remaining claims.
We disagree. It does not appear that, at the time of § 16(a)(3)'s enactment, the rules of finality were firmly established in cases like this one, where the District Court both ordered arbitration and dismissed the remaining claims.
We now turn to the question whether Randolph's agreement to arbitrate is unenforceable because it says nothing about the costs of arbitration, and thus fails to provide her protection from potentially substantial costs of pursuing her federal statutory claims in the arbitral forum. Section 2 of the FAA provides that "[a] written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U. S. C. § 2. In considering whether respondent's agreement to arbitrate is unenforceable, we are mindful of the FAA's purpose "to reverse the longstanding judicial hostility to arbitration agreements . . . and to place arbitration agreements upon the same footing as other contracts." Gilmer v. Interstate/ Johnson Lane Corp., 500 U.S. 20, 24 (1991).
In light of that purpose, we have recognized that federal statutory claims can be appropriately resolved through arbitration, and we have enforced agreements to arbitrate that involve such claims. See, e. g., Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477 (1989) (Securities Act of 1933); Shearson/American Express Inc. v. McMahon, 482 U.S. 220 (1987) (Securities Exchange Act of 1934 and Racketeer Influenced and Corrupt Organizations Act); Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) (Sherman Act). We have likewise rejected generalized attacks on arbitration that rest on "suspicion of arbitration as a method of weakening the protections
In determining whether statutory claims may be arbitrated, we first ask whether the parties agreed to submit their claims to arbitration, and then ask whether Congress has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue. See Gilmer, supra, at 26; Mitsubishi, supra, at 628. In this case, it is undisputed that the parties agreed to arbitrate all claims relating to their contract, including claims involving statutory rights. Nor does Randolph contend that the TILA evinces an intention to preclude a waiver of judicial remedies. She contends instead that the arbitration agreement's silence with respect to costs and fees creates a "risk" that she will be required to bear prohibitive arbitration costs if she pursues her claims in an arbitral forum, and thereby forces her to forgo any claims she may have against petitioners. Therefore, she argues, she is unable to vindicate her statutory rights in arbitration. See Brief for Respondent 29-30.
It may well be that the existence of large arbitration costs could preclude a litigant such as Randolph from effectively vindicating her federal statutory rights in the arbitral forum. But the record does not show that Randolph will bear such costs if she goes to arbitration. Indeed, it contains hardly any information on the matter.
To invalidate the agreement on that basis would undermine the "liberal federal policy favoring arbitration agreements." Moses H. Cone Memorial Hospital, 460 U. S., at 24. It would also conflict with our prior holdings that the party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for arbitration. See Gilmer, supra, at 26; McMahon, supra, at 227. We have
The judgment of the Court of Appeals is affirmed in part and reversed in part.
It is so ordered.
Justice Ginsburg, with whom Justice Stevens and Justice Souter join, and with whom Justice Breyer joins as to Parts I and III, concurring in part and dissenting in part.
I join Part II of the Court's opinion, which holds that the District Court's order, dismissing all the claims before it, was a "final," and therefore immediately appealable, decision. Ante, at 84-89. On the matter the Court airs in Part III,
The Court today deals with a "who pays" question, specifically, who pays for the arbitral forum. The Court holds that Larketta Randolph bears the burden of demonstrating that the arbitral forum is financially inaccessible to her. Essentially, the Court requires a party, situated as Randolph is, either to submit to arbitration without knowing who will pay for the forum or to demonstrate up front that the costs, if imposed on her, will be prohibitive. Ante, at 91-92. As I see it, the case in its current posture is not ripe for such a disposition.
The Court recognizes that "the existence of large arbitration costs could preclude a litigant such as Randolph from effectively vindicating her federal statutory rights in the arbitral forum." Ante, at 90. But, the Court next determines, "the party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for arbitration" and "Randolph did not meet that burden." Ante, at 91, 92. In so ruling, the Court blends two discrete inquiries: First, is the arbitral forum adequate to adjudicate the claims at issue; second, is that forum accessible to the party resisting arbitration.
Our past decisions deal with the first question, the adequacy of the arbitral forum to adjudicate various statutory claims. See, e. g., Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) (Age Discrimination in Employment Act claims are amenable to arbitration); Shearson/American Express Inc. v. McMahon, 482 U.S. 220 (1987) (Claims under Racketeer Influenced and Corrupt Organizations Act and Securities Exchange Act are amenable to arbitration).
The arbitration agreement at issue is contained in a form contract drawn by a commercial party and presented to an individual consumer on a take-it-or-leave-it basis. The case on which the Court dominantly relies, Gilmer, also involved a nonnegotiated arbitration clause. But the "who pays" question presented in this case did not arise in Gilmer. Under the rules that governed in Gilmer —those of the New York Stock Exchange—it was the standard practice for securities industry parties, arbitrating employment disputes, to pay all of the arbitrators' fees. See Cole v. Burns Int'l Security Servs., 105 F.3d 1465, 1483 (CADC 1997). Regarding that practice, the Court of Appeals for the District of Columbia Circuit recently commented:
The form contract in this case provides no indication of the rules under which arbitration will proceed or the costs a
As I see it, the Court has reached out prematurely to resolve the matter in the lender's favor. If Green Tree's practice under the form contract with retail installment sales purchasers resembles that of the employer in Gilmer, Randolph would be insulated from prohibitive costs. And if the arbitral forum were in this case financially accessible to Randolph, there would be no occasion to reach the decision today rendered by the Court. Before writing a term into the form contract, as the District of Columbia Circuit did, see Cole, 105 F. 3d, at 1485,
For the reasons stated, I dissent from the Court's reversal of the Eleventh Circuit's decision on the cost question. I would instead vacate and remand for further consideration of the accessibility of the arbitral forum to Randolph.
Briefs of amici curiae urging affirmance were filed for the Consumers Union of the United States by Sally J. Greenberg; for Public Citizen by Alan B. Morrison and Paul Levy; for Trial Lawyers for Public Justice et al. by F. Paul Bland, Jr., Arthur H. Bryant, and Jeffrey White; and for Terry Johnson et al. by Daniel A. Edelman and James O. Latturner.
Briefs of amici curiae were filed for the Chamber of Commerce of the United States of America by Alan S. Kaplinsky, David H. Pittinsky, Thomas B. Roberts, and Robin S. Conrad; for the National Arbitration Forum by Edward C. Anderson, David F. Herr, and Michael C. McCarthy; for the National Association of Consumer Advocates by Patricia Sturdevant and Michael D. Donovan; and for AARP et al. by Stacy Canan, Jean Constantine-Davis, Nina F. Simon, Deborah Zuckerman, Michael R. Schuster, and Elizabeth Renuart.
In this Court, Randolph's brief lists fees incurred in cases involving other arbitrations as reflected in opinions of other Courts of Appeals, while petitioners' counsel states that arbitration fees are frequently waived by petitioners. None of this information affords a sufficient basis for concluding that Randolph would in fact have incurred substantial costs in the event her claim went to arbitration.