Michael Schau v. Trisura Specialty Insurance Company; QBE Specialty Insurance Company; Gotham Insurance Company; and Summit Specialty Insurance Company

Summary

The United States District Court for the Western District of Oklahoma denied defendants' motion to compel arbitration and stay proceedings in an insurance coverage and bad-faith action. The court held that Oklahoma's insurance-contract exclusion in the Uniform Arbitration Act reverse preempts Chapter 2 of the Federal Arbitration Act under the McCarran-Ferguson Act. The court also declined to compel arbitration under equitable estoppel.

Holdings

1. Chapter 2 of the Federal Arbitration Act is an Act of Congress for purposes of the McCarran-Ferguson Act, and the Convention is treated as non-self-executing because it requires implementing legislation to have domestic legal effect.
2. Section 1855(D) of the Oklahoma Uniform Arbitration Act reverse preempts Chapter 2 of the FAA as applied to the insurance policy because the FAA provision does not specifically relate to insurance, section 1855(D) regulates the business of insurance, and compelling arbitration would impair or supersede section 1855(D).
3. Equitable estoppel does not provide a basis to compel arbitration where section 1855(D) reverse preempts Chapter 2 of the FAA and the arbitration clause is contained in an insurance contract covered by that exclusion.

Questions Presented

1. Whether Chapter 2 of the Federal Arbitration Act, which implements the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, is an Act of Congress subject to reverse preemption under the McCarran-Ferguson Act.
2. Whether Oklahoma Statutes title 12, section 1855(D), which excludes contracts referencing insurance from the Oklahoma Uniform Arbitration Act, reverse preempts Chapter 2 of the Federal Arbitration Act.
3. Whether defendants could compel arbitration under equitable estoppel despite the reverse-preemption effect of section 1855(D).

Disposition

other