Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.

1985-07-02

Headline: Auto dealer antitrust dispute is sent to international arbitration; Court enforces arbitration clause so Sherman Act claims can be decided abroad, affecting how cross-border commercial disputes are resolved.

Holding: The Court held that an agreement to arbitrate disputes arising from an international commercial contract can cover Sherman Act antitrust claims, and that international arbitration must be enforced despite domestic doctrines against antitrust arbitration.

Real World Impact:

Allows companies to compel arbitration of international antitrust disputes.
Makes it likelier plaintiffs must pursue Sherman Act claims in foreign arbitral forums.
U.S. courts can refuse to enforce arbitral awards violating public policy.

Topics: international arbitration, antitrust law, auto dealer disputes, Sherman Act, forum selection

Summary

Background

A Puerto Rico car dealer (Soler) and a multinational car maker (Mitsubishi) signed agreements governing vehicle sales. One clause required arbitration in Japan for certain disputes. Soler sued in U.S. court claiming Mitsubishi and its partner had conspired to restrict sales and transshipments, asserting claims under the Sherman Act and other statutes. Mitsubishi asked the U.S. court to compel arbitration under the Federal Arbitration Act and the international Convention on foreign arbitral awards.

Reasoning

The central question was whether antitrust claims arising from an international commercial agreement could be forced into arbitration. The Court explained that the Arbitration Act, earlier international decisions (including The Bremen and Scherk), and the Convention create a strong federal policy favoring enforcement of freely negotiated forum and arbitration clauses in international contracts. The Court held that when the parties’ agreement covers the dispute, international arbitration may be enforced even for Sherman Act claims, and doubts about arbitrability should be resolved in favor of arbitration. The Court affirmed in part and reversed in part the lower court rulings and sent the cases back for further proceedings consistent with that view.

Real world impact

The decision makes it easier for businesses to require international arbitration of U.S. statutory claims that arise in the context of international commercial contracts. It means plaintiffs asserting U.S. antitrust harms in cross-border deals may have to pursue claims before foreign arbitral tribunals first. U.S. courts remain able to block enforcement of awards that clearly violate American public policy or fail to address statutory rights.

Dissents or concurrances

Justice Stevens dissented, arguing arbitration should not replace U.S. courts for antitrust claims, stressing the public importance of treble-damages enforcement and congressional intent protecting judicial remedies.