Noncompetition Agreements and Arbitration

Although the Federal Arbitration Act is federal legislation, that is, the law of the land, the frequency with which it is part of standard employment contracts means that state courts, rather than federal courts, are more frequently called on to apply the Act to a contract dispute. Thirty years ago, the U.S. Supreme Court said that the Act declares ” a national policy favoring arbitration.” More recently, it has firmly come down against what it regarded as a state supreme court’s ” judicial hostility” towards arbitration.

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