JAMES C. CACHERIS, District Judge.
This matter is before the Court on Defendant S & S Service Center Inc. t/a Woodbridge Public Auto Auction's (WPAA) Motion to Dismiss [Dkt. 4]. For the following reasons, the Court will grant Defendant's motion.
On August 18, 2010, Plaintiff pro se Carl Crews
Plaintiff asserts that shortly after he left the dealership, the vehicle broke down. (Id. ¶ 9.) As a result, Plaintiff contacted
Plaintiff asserted two Virginia state law claims at the arbitration hearing on October 12, 2011. (Arbitration Opinion [Dkt. 5-1] at 1.) The first was for breach of the implied warranty of merchantability under Virginia Code § 8.2-314. (Id.) The second claim was for a violation Virginia Consumer Protection Act (VCPA), Virginia Code § 59.1-200 et. seq. (Id. at 1.)
On October 17, 2011, the arbitrator issued an opinion finding in favor of WPAA on both claims. (Id. at 5.) In considering the first claim, the arbitrator evaluated "whether the Magnusson-Moss Warranty Act, 15 U.S.C. § 2308 et. seq. (the MMWA) renders ineffective WPAA's intended disclaimer of all implied warranties by expressly stating in the contract documents that the sale of the vehicle was `as is' with no applicable warranties." (Id. at 2.) The arbitrator noted that under the MMWA, a supplier may not disclaim implied warranties when the same supplier provides to the purchaser an express warranty concerning the subject vehicle. (Id.) But the arbitrator made a factual determination that the supplier of the warranty was PAM. (Id.) As a result, the arbitrator found that the MMWA did not preclude WPAA from disclaiming all implied warranties. (Id. at 3.) In considering the second claim, Plaintiff asserted that the salesman misrepresented to him, at the time of purchase, that the subject vehicle had not been involved in any prior accident. (Id.) The arbitrator found that Plaintiff had not met his burden of proof on this claim. (Id.)
Plaintiff seeks to vacate the Arbitration Opinion pursuant to the Federal Arbitration Act, specifically 9 U.S.C. § 10, on the grounds that the arbitrator acted in "a manifest disregard of the law" and "exceed[ed] his powers." (Compl. ¶¶ 31-32.) As to his implied warranty claim, Plaintiff alleges that the arbitrator "relied on extensive amounts of Parol Evidence," thereby "ignoring substantive and well-settled law in Virginia regarding contract disputes that is when the language of a contract is clear, unambiguous, and explicit, a court interpreting it should look no further than the four corners of the instrument under review." (Id. ¶¶ 28, 30.) As to his VCPA claim, Plaintiff states that "the Arbitrator correctly stated the law" but contends that he failed to follow it by dismissing the claim "without any discussion on the misrepresentation." (Id. ¶ 29.)
Plaintiff also requests this Court to order this case to another arbitrator. (Id. at 6.) Finally, Plaintiff requests a jury trial and $72,000 in actual and punitive damages. (Id.)
Plaintiff filed the Complaint on October 31, 2011. [Dkt. 1.] On November 23, 2011, Defendant moved to dismiss the Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). [Dkt. 4.] Defendant argues that this Court does not have subject matter jurisdiction over this case. (Def.'s Mem. in Supp. [Dkt. 5] at 4-6.) Specifically, Defendant asserts that there is no jurisdiction under the following statutes: 9 U.S.C. § 10, 15 U.S.C. §§ 1640(e), 2201, 2301, and 28 U.S.C. §§ 1331, 1337. (Id.;) Def.'s Reply [Dkt. 13] at 1.)
Defendant's Motion to Dismiss is now before the Court.
Pursuant to Rule 12(b)(1), a claim may be dismissed for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). Defendants may attack subject matter jurisdiction in one of two ways. First, defendants may contend that the complaint fails to allege facts upon which subject matter jurisdiction may be based. See Adams v. Bain, 697 F.2d 1213, 1219 (4th Cir.1982); King v. Riverside Reg'l Med. Ctr., 211 F.Supp.2d 779, 780 (E.D.Va.2002). In such instances, all facts alleged in the complaint are presumed to be true. Adams, 697 F.2d at 1219; Virginia v. United States, 926 F.Supp. 537, 540 (E.D.Va.1995).
Alternatively, defendants may argue that the jurisdictional facts alleged in the complaint are untrue. Adams, 697 F.2d at 1219; King, 211 F.Supp.2d at 780. In that situation, "the Court may `look beyond the jurisdictional allegations of the complaint and view whatever evidence has been submitted on the issue to determine whether in fact subject matter jurisdiction exists.'" Virginia v. United States, 926 F.Supp. at 540 (quoting Capitol Leasing Co. v. FDIC, 999 F.2d 188, 191 (7th Cir.1993)); see also Velasco v. Gov't of Indonesia, 370 F.3d 392, 398 (4th Cir.2004) (holding that "the district court may regard the pleadings as mere evidence on the issue and may consider evidence outside the pleadings without converting the proceeding to one for summary judgment") (citations omitted).
In either circumstance, the burden of proving subject matter jurisdiction falls on the plaintiff. McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178, 189, 56 S.Ct. 780, 80 L.Ed. 1135 (1936); Adams, 697 F.2d at 1219; Johnson v. Portfolio Recovery Assocs., 682 F.Supp.2d 560, 566 (E.D.Va.2009) (holding that "having filed this suit and thereby seeking to invoke the jurisdiction of the Court, Plaintiff bears the burden of proving that this Court has subject matter jurisdiction").
The question before this Court is whether it has subject matter jurisdiction to consider the merits of Plaintiff's petition to vacate the arbitration award, brought under 9 U.S.C. § 10. Beginning with the statute, there is no provision in § 10 of the Federal Arbitration Act (the FAA) that excludes federal court adjudication.
In considering the case law, the Supreme Court has explicitly stated that the FAA does not create federal question jurisdiction. See, e.g., Hall Street Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 581-82, 128 S.Ct. 1396, 170 L.Ed.2d 254 (2008). Yet, Plaintiff asserts that this Court has federal question jurisdiction under 28 U.S.C. § 1331, which vests in federal district courts jurisdiction over "all civil actions arising under the Constitution, laws, or treaties of the United States." (See Compl. ¶ 5.) And, in a recent decision the Supreme Court held that
Mims v. Arrow Fin. Servs., LLC, ___ U.S. ___, 132 S.Ct. 740, 742, 181 L.Ed.2d 881 (2012), January 18, 2012 (noting that Congress must "expressly or by fair implication, excludes federal-court adjudication").
Despite the tension, this Court believes it is bound to follow the Supreme Court's more specific finding that the FAA does not create federal question jurisdiction. In assessing whether the grounds for vacating arbitration awards that are set out in § 10 were exclusive, the Supreme Court stated "[a]s for jurisdiction over controversies touching arbitration, the [Federal Arbitration] Act is `something of an anomaly in the field of federal-court jurisdiction' in bestowing no federal jurisdiction but rather requiring an independent jurisdictional basis." Hall Street Assocs., L.L.C., 552 U.S. at 581-82, 128 S.Ct. 1396; see also Vaden v. Discover Bank, 556 U.S. 49, 129 S.Ct. 1262, 1271 n. 9, 173 L.Ed.2d 206 (2009) (assessing § 4 petition to compel arbitration under the FAA and noting the FAA's anomaly with respect to jurisdiction); Choice Hotels Int'l, Inc. v. Shiv Hospitality, LLC, 491 F.3d 171, 175 (4th Cir.2007) (applying this interpretation of jurisdiction under the FAA in assessing a § 9 petition to confirm an arbitration award and a § 10 petition to vacate an arbitration award). And, the Supreme Court has specifically stated that "[w]hile the [FAA] creates federal substantive law requiring the parties to honor arbitration agreements, it does not create any independent federal question jurisdiction under 28 U.S.C. § 1331 or otherwise." Southland Corp. v. Keating, 465 U.S. 1, 15 n. 9, 104 S.Ct. 852, 79 L.Ed.2d 1 (1984). Thus, this Court finds that the 9 U.S.C. § 10 petition does not provide § 1331 federal question jurisdiction.
If the 9 U.S.C. § 10 petition does not itself create subject matter jurisdiction, the Court might still have federal question jurisdiction based on the underlying claims raised in the arbitrated dispute.
9 U.S.C. § 4. And, the Court found that this language "confines federal courts to the jurisdiction they would have `save for [the arbitration] agreement.'"
Similar text is missing in § 10. There is nothing in § 10 to suggest that this Court should consider its hypothetical jurisdiction absent the arbitration agreement when faced with a petition to vacate an arbitration award. As a result, this Court declines to apply the "look through" test to § 10, because the "unique jurisdictional language" of § 4 that gave rise to the test is absent in § 10. See Med-Tel Int'l Corp. v. Loulakis, 403 F.Supp.2d 496, 499 (E.D.Va.2005) (finding no subject matter jurisdiction over a petition to vacate an arbitration award, even though the underlying dispute between the parties purportedly implicated federal securities law, because the "look through" test was inapplicable). Thus, the Court will not look through the petition to any of Plaintiff's claims involving the MMWA or any other ground Plaintiff suggests might give rise to jurisdiction.
The Court recognizes that a petition to vacate an arbitration award would rarely be based on an independent violation of federal law. Under § 10, a claim to vacate the arbitration award is limited to the types of cases that § 10 enumerates, as
As a result, in rejecting the "look through" test as a way to gain subject matter jurisdiction over a § 10 petition, there is the "practical consequence[]" that "it [] permit[s] a federal court to entertain a § [10] petition only when a federal-question suit is already before the court, when the parties satisfy the requirements for diversity-of-citizenship jurisdiction, or when the dispute over arbitrability involves a maritime contract." See Vaden, 129 S.Ct. at 1275 (discussing the consequences in the context of § 4). But this anomaly where a party can use diversity jurisdiction to obtain the FAA's expedited judicial review of the arbitration award, but can rarely obtain federal question jurisdiction to do so, is not necessarily that anomalous. If for example, Plaintiff "first [took] the formal step of initiating or removing a federal-question suit" then the court would have jurisdiction over the case.
For these reasons, the Court will grant Defendant's Motion to Dismiss.
An appropriate Order will issue.