Syllabus

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

Syllabus

MORGAN v. SUNDANCE, INC. CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT

No. 21–328. Argued March 21, 2022—Decided May 23, 2022 Petitioner Robyn Morgan worked as an hourly employee at a Taco Bell franchise owned by respondent Sundance. When applying for the job, Morgan signed an agreement to arbitrate any employment dispute. Despite that agreement, Morgan filed a nationwide collective action asserting that Sundance had violated federal law regarding overtime payment. Sundance initially defended against the lawsuit as if no ar- bitration agreement existed, filing a motion to dismiss (which the Dis- trict Court denied) and engaging in mediation (which was unsuccess- ful). Then—nearly eight months after Morgan filed the lawsuit— Sundance moved to stay the litigation and compel arbitration under the Federal Arbitration Act (FAA). Morgan opposed, arguing that Sundance had waived its right to arbitrate by litigating for so long. The courts below applied Eighth Circuit precedent, under which a party waives its right to arbitration if it knew of the right; “acted in- consistently with that right”; and “prejudiced the other party by its inconsistent actions.” Erdman Co. v. Phoenix Land & Acquisition, LLC, 650 F. 3d 1115, 1117. The prejudice requirement is not a feature of federal waiver law generally. The Eighth Circuit adopted that re- quirement because of the “federal policy favoring arbitration.” Id., at 1120. Other courts have rejected such a requirement. This Court granted certiorari to resolve the split over whether federal courts may adopt an arbitration-specific waiver rule demanding a showing of prej- udice. Held: The Eighth Circuit erred in conditioning a waiver of the right to arbitrate on a showing of prejudice. Federal courts have generally re- solved cases like this one as a matter of federal law, using the termi- nology of waiver. The parties dispute whether that framework is cor- rect. Assuming without deciding that it is, federal courts may not 2 MORGAN v. SUNDANCE, INC.

Syllabus

create arbitration-specific variants of federal procedural rules, like those concerning waiver, based on the FAA’s “policy favoring arbitra- tion.” Moses H. Cone Memorial Hospital v. Mercury Constr. Corp., 460 U. S. 1, 24. That policy “is merely an acknowledgment of the FAA’s commitment to overrule the judiciary’s longstanding refusal to enforce agreements to arbitrate and to place such agreements upon the same footing as other contracts.” Granite Rock Co. v. Teamsters, 561 U. S. 287, 302 (internal quotation marks omitted). Accordingly, a court must hold a party to its arbitration contract just as the court would to any other kind. But a court may not devise novel rules to favor arbi- tration over litigation. See Dean Witter Reynolds Inc. v. Byrd, 470 U. S. 213, 218–221. The federal policy is about treating arbitration contracts like all others, not about fostering arbitration. The text of the FAA makes clear that courts are not to create arbi- tration-specific procedural rules like the one here. Section 6 of the FAA provides that any application under the statute—including an appli- cation to stay litigation or compel arbitration—“shall be made and heard in the manner pr