Hall Street Associates, L.L.C. v. Mattel, Inc.

Supreme Court of the United States · 2008 · Contracts

552 U.S. 576 (2008)

Updated July 26, 2026

ContractsArbitrationFederal Arbitration ActFAAvacaturmodificationjudicial reviewcontractual expansion

Facts

Hall Street and Mattel were landlord and tenant under leases requiring the tenant to indemnify the landlord for costs resulting from failure to follow environmental laws. After a dispute over cleanup liability, the parties agreed, with District Court approval, to arbitrate and included a provision stating that the court could vacate, modify, or correct an award if the arbitrator's factual findings lacked substantial evidence or the arbitrator's legal conclusions were erroneous. The arbitrator initially ruled for Mattel, and the District Court vacated that award for legal error under the parties' agreement. After remand and a revised award favoring Hall Street, the enforceability of the agreement's expanded judicial-review provision became the central issue.

Issue

When parties seek judicial confirmation, vacatur, or modification of an arbitration award under the Federal Arbitration Act, may they contract for judicial review beyond the grounds listed in 9 U.S.C. §§ 10 and 11? More specifically, may they authorize a court to vacate or modify an award for legal error or lack of substantial evidence?

Rule

Under the FAA, §§ 10 and 11 provide the exclusive grounds for expedited judicial vacatur and modification of arbitration awards under §§ 9-11. Parties may not, by contract, supplement those statutory grounds with broader review such as review for legal error or evidentiary insufficiency.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Blue Mesa Design, LLC and Harbor Peak Fixtures, Inc. litigate a supply dispute in federal court in Denver. They then sign an arbitration agreement stating that any award may be vacated by the court if the arbitrator makes an error of law or reaches factual findings unsupported by substantial evidence.

After the arbitrator rules for Harbor Peak, Blue Mesa moves under the FAA to vacate solely because the arbitrator misread the contract. How should the court rule?

Explanation. When parties seek expedited review under FAA §§ 9–11, the grounds for vacatur and modification are limited to those listed in §§ 10 and 11. The majority held that parties may not supplement those grounds by contract with broader review for legal error or evidentiary insufficiency. A mere claim that the arbitrator misread the contract is therefore not a valid FAA basis for vacatur.