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In addition to its textual implausibility, the approach Vaden advocates has curious practical consequences. It would permit a federal court to entertain a §4 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, e.g., Westmoreland, 100 F. 3d, at 268–269; 1 MacNeil §9.2.3.1, pp. 9:12–9:13 (when a federal-question suit has been filed in or removed to federal court, the court may order arbitration under FAA §4).15 Vaden’s approach would not accommodate a §4 petitioner who could file a federal-question suit in (or remove such a suit to) federal court, but who has not done so. In contrast, when the parties’ underlying dispute arises under federal law, the look through approach permits a §4 petitioner to ask a federal court to compel arbitration without first taking the formal step of initiating or removing a federal-question suitthat is, without seeking federal adjudication of the very questions it wants to arbitrate rather than litigate. See 1 id., §9.2.3.3, p. 9:21 (explaining that the approach Vaden advocates creates a totally artificial distinction based on whether a dispute is subject to pending federal litigation).

B

Having determined that a district court should look through a §4 petition, we now consider whether the court would have [federal-question] jurisdiction over a suit arising out of the controversy between Discover and Vaden. 9 U. S. C. §4. As explained above, §4 of the FAA does not enlarge federal-court jurisdiction; rather, it confines federal courts to the jurisdiction they would have save for [the arbitration] agreement. See supra, at 7–8. Mindful of that limitation, we read §4 to convey that a party seeking to compel arbitration may gain a federal court’s assistance only if, save for the agreement, the entire, actual controversy between the parties, as they have framed it, could be litigated in federal court. We conclude that the parties’ actual controversy, here precipitated by Discover’s state-court suit for the balance due on Vaden’s account, is not amenable to federal-court adjudication. Consequently, the §4 petition Discover filed in the United States District Court for the District of Maryland must be dismissed.

As the Fourth Circuit initially stated, the controversy between the parties arose from the alleged debt Vaden owed to Discover. 396 F. 3d, at 370. Discover’s complaint in Maryland state court plainly did not arise under federal law, nor did it qualify under any other head of federal-court jurisdiction. See supra, at 3, and n. 1.

In holding that Discover properly invoked federal-court jurisdiction, the Fourth Circuit looked beyond Discover’s complaint and homed in on Vaden’s state-law-based defense and counterclaims. Those responsive pleadings, Discover alleged, and the Fourth Circuit determined, were completely preempted by the FDIA. See supra, at 3–4. The Fourth Circuit, however, misapprehended our decision in Holmes Group. Under the well-pleaded complaint rule, a completely preempted counterclaim remains a counterclaim and thus does not provide a key capable of opening a federal court’s door. See supra, at 8–11. See also Taylor v. Anderson, 234 U. S. 74, 75–76 (1914) ([W]hether a case is one arising under [federal law] . . . must be determined from what necessarily appears in the plaintiff’s statement of his own claim . . . , unaided by anything alleged in anticipation o[r] avoidance of defenses which it is thought the defendant may interpose.).

Neither Discover nor The Chief Justice, concurring in part and dissenting in part (hereinafter dissent), defends the Fourth Circuit’s reasoning. Instead, the dissent insists that a federal court would have jurisdiction over the controversy Discover seeks to arbitratenamely, whether ‘Discover Bank charged illegal finance charges, interest and late fees.’ Post, at 1 (quoting App. 30). The dissent hypothesizes two federal suits that might arise from this purported controversy: an action by Vaden asserting that the charges violate the FDIA, or one by Discover seeking a declaratory judgment that they do not. Post, at 2.

There is a fundamental flaw in the dissent’s analysis: In lieu of focusing on the whole controversy as framed by the parties, the dissent hypothesizes discrete controversies of its own design. As the parties’ state-court filings reflect, the originating controversy here concerns Vaden’s alleged debt to Discover. Vaden’s responsive counterclaims challenging the legality of Discover’s charges are a discrete aspect of the whole controversy Discover and Vaden brought to state court. Whether one might imagine a federal-question suit involving the parties’ disagreement over Discover’s charges is beside the point. The relevant question is whether the whole controversy between the partiesnot just a piece broken off from that controversyis one over which the federal courts would have jurisdiction.

The dissent would have us treat a §4 petitioner’s statement of the issues to be arbitrated as the relevant controversy even when that statement does not convey the full flavor of the parties’ entire dispute. Artful dodges by a §4 petitioner should not divert us from recognizing the actual dimensions of that controversy. The text of §4 instructs federal courts to determine whether they would have jurisdiction over a suit arising out of the controversy between the parties; it does not give §4 petitioners license to recharacterize an existing controversy, or manufacture a new controversy, in an effort to obtain a federal court’s aid in compelling arbitration.16

Viewed contextually and straightforwardly, it is hardly fortuit[ous] that the controversy in this case took the shape it did. Cf. post, at 2. Seeking to collect a debt, Discover filed an entirely state-law-grounded complaint in state court, and Vaden chose to file responsive counterclaims. Perhaps events could have unfolded differently, but §4 does not invite federal courts to dream up counterfactuals when actual litigation has defined the parties’ controversy.17

As the dissent would have it, parties could commandeer a federal court to slice off responsive pleadings for arbitration while leaving the remainder of the parties’ controversy pending in state court. That seems a bizarre way to proceed. In this case, Vaden’s counterclaims would be sent to arbitration while the complaint to which they are addressedDiscover’s state-law-grounded debt-collection actionwould remain pending in a Maryland court. When the controversy between the parties is not one over which a federal court would have jurisdiction, it makes scant sense to allow one of the parties to enlist a federal court to disturb the state-court proceedings by carving out issues for separate resolution.18

Furthermore, the presence of a threshold question whether a counterclaim alleged to be based on state law is totally preempted by federal law may complicate the dissent’s §4 inquiry. This case is illustrative. The dissent relates that Vaden eventually conceded that FDIA §27(a), not Maryland law, governs the charges and fees Discover may impose. Post, at 1–2. But because the issue is jurisdictional, Vaden’s concession is not determinative. See supra, at 4–5, and n. 4. The dissent simply glides by the preemption issue, devoting no attention to it, although this Court has not yet resolved the matter.

In sum, §4 of the FAA instructs district courts asked to compel arbitration to inquire whether the court would have jurisdiction, save for [the arbitration] agreement, over a suit arising out of the controversy between the parties. We read that prescription in light of the well-pleaded complaint rule and the corollary rule that federal jurisdiction cannot be invoked on the basis of a defense or counterclaim. Parties may not circumvent those rules by asking a federal court to order arbitration of the portion of a controversy that implicates federal law when the court would not have federal-question jurisdiction over the controversy as a whole. It does not suffice to show that a federal question lurks somewhere inside the parties’ controversy, or that a defense or counterclaim would arise under federal law. Because the controversy between Discover and Vaden, properly perceived, is not one qualifying for federal-court adjudication, §4 of the FAA does not empower a federal court to order arbitration of that controversy, in whole or in part.19

Discover, we note, is not left without recourse. Under the FAA, state courts as well as federal courts are obliged to honor and enforce agreements to arbitrate. Southland, 465 U. S., at 12; Moses H. Cone, 460 U. S., at 25, 26, n. 34. See also supra, at 7–8. Discover may therefore petition a Maryland court for aid in enforcing the arbitration clause of its contracts with Maryland cardholders.

True, Maryland’s high court has held that §§3 and 4 of the FAA prescribe federal-court procedures and, therefore, do not bind the state courts.20 But Discover scarcely lacks an available state remedy. Section 2 of the FAA, which does bind the state courts, renders agreements to arbitrate valid, irrevocable, and enforceable. This provision carries with it duties [to credit and enforce arbitration agreements] indistinguishable from those imposed on federal courts by FAA §§3 and 4. 1 MacNeil §10.8.1, p. 10:77. Notably, Maryland, like many other States, provides a statutory remedy nearly identical to §4. See Md. Cts. & Jud. Proc. Code Ann. §3–207 (Lexis 2006) (If a party to an arbitration agreement . . . refuses to arbitrate, the other party may file a petition with a court to order arbitration. . . . If the court determines that the agreement exists, it shall order arbitration. Otherwise it shall deny the petition.). See also Walther v. Sovereign Bank, 386 Md. 412, 424, 872 A. 2d 735, 742 (2005) (The Maryland Arbitration Act has been called the ‘State analogue … to the Federal Arbitration Act.’ The same policy favoring enforcement of arbitration agreements is present in both our own and the federal acts. (internal quotation marks and citation omitted)). Even before it filed its debt-recovery action in a Maryland state court, Discover could have sought from that court an order compelling arbitration of any agreement-related dispute between itself and cardholder Vaden. At no time was federal-court intervention needed to place the controversy between the parties before an arbitrator.

* * *

For the reasons stated, the District Court lacked jurisdiction to entertain Discover’s §4 petition to compel arbitration. The judgment of the Court of Appeals affirming the District Court’s order is therefore reversed, and the case is remanded for further proceedings consistent with this opinion.

It is so ordered.

Opinion of Roberts, C. J.

SUPREME COURT OF THE UNITED STATES

BETTY E. VADEN, PETITIONER v. DISCOVER
BANK et al.
on writ of certiorari to the united states court of appeals for the fourth circuit
[March 9, 2009]

Chief Justice Roberts, with whom Justice Stevens, Justice Breyer, and Justice Alito join, concurring in part and dissenting in part.

I agree with the Court that a federal court asked to compel arbitration pursuant to §4 of the Federal Arbitration Act should look through the dispute over arbitrability in determining whether it has jurisdiction to grant the requested relief. But look through to what? The statute provides a clear and sensible answer: The court may consider the §4 petition if the court would have jurisdiction over the subject matter of a suit arising out of the controversy between the parties. 9 U. S. C. §4.

The §4 petition in this case explains that the controversy Discover seeks to arbitrate is whether Discover Bank charged illegal finance charges, interest and late fees. App. 30. Discover contends in its petition that the resolution of this dispute is controlled by federal lawspecifically §27(a) of the Federal Deposit Insurance Act (FDIA), 12 U. S. C. §1831d(a) (setting forth the interest rates a state-chartered, federally insured bank may charge notwithstanding any State constitution or statute which is hereby preempted). Vaden agrees that the legality of Discover’s charges and fees is governed bythe FDIA.** A federal court therefore would have jurisdiction … of the subject matter of a suit arising out of the controversy Discover seeks to arbitrate. That suit could be an action by Vaden asserting that the charges violate the FDIA, or one by Discover seeking a declaratory judgment that they do not.

The majority is diverted off this straightforward path by the fortuity that a complaint happens to have been filed in this case. Instead of looking to the controversy the §4 petitioner seeks to arbitrate, the majority focuses on the controversy underlying that complaint, and asks whether the whole controversy, as reflected in the parties’ state-court filings, arises under federal law. Ante, at 16 (emphasis added). Because that litigation was commenced as a state-law debt-collection claim, the majority concludes there is no §4 jurisdiction.

This approach is contrary to the language of §4, and sharply restricts the ability of federal courts to enforce agreements to arbitrate. The controversy to which §4 refers is the dispute alleged to be subject to arbitration. The §4 petitioner must set forth the nature of that disputethe one he seeks to arbitratein the §4 petition seeking an order to compel arbitration. Section 4 requires that the petitioner be aggrieved by the other party’s failure, neglect, or refusal … to arbitrate under a written agreement for arbitration; that language guides the district court to the specific controversy the other party is unwilling to arbitrate.

That is clear from the FAA’s repeated and consistent use of the term controversy to mean the specific dispute asserted to be subject to arbitration, not to some broader, full flavor[ed] or full-bodied notion of the disagreement between the parties. Ante, at 17, and n. 16. In §2, for example, the controversy is the one to [be] settle[d] by arbitration and the one to [be] submit[ted] toarbitration. 9 U. S. C. §2. In §10(a)(3), it is a ground for vacating an arbitration award that the arbitrator refused to hear evidence pertinent and material to thecontroversyobviously the controversy subject toarbitration, or the arbitrator’s refusal to consider the evidence would hardly be objectionable. In §11(c), an award may be modified if imperfect in matter of form not affecting the merits of the controversyagain, necessarily the controversy submitted to arbitration, and therefore the subject of the award.

There is no reason to suppose controversy meant the controversy subject to arbitration everywhere else in the FAA, but something quite different in §4. The issue is whether there is jurisdiction to compel arbitration to resolve a controversy; why would the pertinent controversy for assessing jurisdiction be anything other than the same one asserted to be subject to arbitration?

The majority looks instead to the controversy the state-court litigation seeks to resolve. This produces the odd result of defining controversy more broadly than the §4 petition itself. Discover’s petition does not seek toarbitrate its state-law debt-collection claims, but rather Vaden’s allegation that the fees Discover has beencharging her (and other members of her proposed class) violate the FDIA. See App. 30. The majority does not appear to question that there would be federal jurisdiction over a suit arising out of the subject matter of thatdispute. The majority finds no jurisdiction here, however, because a federal court could not entertain Discover’s state-law debt-collection claim. Ante, at 20, n. 19. There is no jurisdiction to compel arbitration of a plainly federal controversythe FDIA disputebecause there is no jurisdiction to compel arbitration of the debt-collection dispute. But why Discover should have to demonstrate federal jurisdiction over a state-court claim it does not seek to arbitrate is a mystery. Cf. Moses H. Cone Memorial Hospital v. Mercury Constr. Corp., 460 U. S. 1, 19–21 (1983) (affirming federal-court jurisdiction over a §4 petition seeking to arbitrate only one of two disputes pending in state-court litigation); Dean Witter Reynolds Inc. v. Byrd, 470 U. S. 213, 218–221 (1985) (when litigation involves multiple claims, only some of which are covered by an arbitration agreement, district court must compel arbitration of the covered claims if so requested).

The majority’s approach will allow federal jurisdiction to compel arbitration of entirely state-law claims. Under that approach the controversy is not the one the §4 petitioner seeks to arbitrate, but a broader one encompassing the whole controversy between the parties. Ante, at 16. If that broader dispute involves both federal and state-law claims, and the originating dispute is federal, ibid., a party could seek arbitration of just the state-law claims. The controversy under the majority’s view would qualify as federal, giving rise to §4 jurisdiction to compel arbitration of a purely state-law claim.

Take this case as an example. If Vaden had filed her FDIA claim first, and Discover had responded with a state-law debt-collection counterclaim, that suit is one that could be litigated in federal court. Ante, at 15. As a result, the majority’s approach would seem to permit Vaden to file a §4 petition to compel arbitration of the entirely state-law-based debt-collection dispute, because that dispute would be part and parcel of the full flavor[ed], originating FDIA controversy. Ante, at 16, 17. Defining the controversy as the dispute the §4 petitioner seeks to arbitrate eliminates this problem by ensuring that the actual dispute subject to arbitration is federal.

The majority’s conclusion that this controversy is not one qualifying for federal-court adjudication, ante, at 19, stems from its mistaken focus on the existing litigation. Rather than ask whether a court would have jurisdiction over the subject matter of a suit arising out of the controversy, the majority asks only whether the court does have jurisdiction over the subject matter of a particular complaint. But §4 does not speak of actual jurisdiction over pending suits; it speaks subjunctively of prospective jurisdiction over the subject matter of a suit arising out of the controversy between the parties. 9 U. S. C. §4. The fact that Vaden has chosen to package the FDIA controversy in counterclaims in pending state-court litigation in no way means that a district court would [not] have jurisdiction over the subject matter of a suit arising out of the FDIA controversy. A big part of arbitration is avoiding the procedural niceties of formal litigation; it would be odd to have the authority of a court to compel arbitration hinge on just such niceties in a pending case.

By focusing on the sequence in which state-court litigation has unfolded, the majority crafts a rule that produces inconsistent results. Because Discover’s debt-collection claim was filed before Vaden’s counterclaims, the majority treats the debt-collection dispute as the originating controversy. Ante, at 16. But nothing would have prevented the same disagreements between the parties from producing a different sequence of events. Vaden could have filed a complaint raising her FDIA claims before Discover sought to collect on any amounts Vaden owes. Because the originating controversy in that complaint would be whether Discover has charged fees illegal under federal law, in that situation Discover presumably could bring a §4 petition to compel arbitration of the FDIA dispute. The majority’s rule thus makes §4 jurisdiction over the same controversy entirely dependent upon the happenstance of how state-court litigation has unfolded. Nothing in §4 suggests such a result.

The majority glosses over another problem inherent in its approach: In many if not most cases under §4, no complaint will have been filed. See Hartford Financial Systems, Inc. v. Florida Software Servs., Inc., 712 F. 2d 724, 728 (CA1 1983) (Breyer, J.) (Normally, [§4] motions are brought in independent proceedings). What to look through to then? The majority instructs courts to look to the full-bodied controversy. Ante, at 17, n. 16. But as this case illustrates, that would lead to a different result had the state-court complaint not been filed. Discover does not seek to arbitrate whether an outstanding debt exists; indeed, Discover’s §4 petition does not even allege any dispute on that point. See App. 28–41. A district court would therefore not understand the §4 controversy to include the debt-collection claim in the absence of the state-court suit. Under the majority’s rule, the FDIA dispute would be treated as a controversy qualifying under §4 before the state suit and counterclaims had been filed, but not after.

The far more concrete and administrable approach would be to apply the same rule in all instances: Look to the controversy the §4 petitioner seeks to arbitrateas set forth in the §4 petitionand assess whether a federal court would have jurisdiction over the subject matter of a suit arising out of that controversy. The controversy the moving party seeks to arbitrate and the other party will not would be the same controversy used to assess jurisdiction to compel arbitration.

The majority objects that this would allow a court to hypothesiz[e] discrete controversies of its own design, ante, at 16, in an apparent effort to find federaljurisdiction where there is none. Not so. A district court entertaining a §4 petition is required to determine what a suit arising out of the allegedly arbitrable controversy would look like. There is no helping that, given the statute’s subjunctive language. But that does not mean the inquiry is the free-form one the majority posits.

To the contrary, a district court must look to the specific controversythe concrete dispute that one party has fail[ed], neglect[ed], or refus[ed] to arbitrateand determine whether that controversy would give rise to a suit under federal law. District courts do that sort of thing often enough; the exercise is closely analogous to the jurisdictional analysis in a typical declaratory judgment action. See Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust for Southern Cal., 463 U. S. 1, 19 (1983) (jurisdiction over a declaratory judgment action exists when, if the declaratory judgment defendant brought a coercive action to enforce its rights, that suit would necessarily present a federal question (emphasis added)). Looking to the specific controversy outlined in Discover’s §4 petition (whether its fees violate the FDIA), it hardly requires dream[ing] to conceive of a lawsuit in which Vaden would claim the FDIA has been violated and Discover would claim it has not. Ante, at 18.

Nor would respondents’ approach allow a §4 petitioner to simply recharacterize or manufacture a controversy to create federal jurisdiction. Ante, at 17. All of theestablished rules of federal jurisdiction are fully applicable in scrutinizing whether a federal court would have jurisdiction over a suit arising out of the parties’ underlying controversy.

For example, a federal question must be presented by the specific controversy the §4 petitioner seeks to arbitrate, not by some hypothetical federal issue lurking in the background. Gully v. First Nat. Bank in Meridian, 299 U. S. 109, 117 (1936) . A district court could not compel arbitration of a state-law dispute by pointing to a potential federal defense that the §4 petitioner is not seeking to arbitrate, because the claim itselfmust present a federal question to arise under federal law. Skelly Oil Co. v. Phillips Petroleum Co., 339 U. S. 667, 672 (1950) . Nor could a district court compel arbitration of a dispute that, though not federal in character, could lead to the filing of a federal counterclaim, for a counterclaim … cannot serve as the basis for [federal] jurisdiction of the state-law dispute itself. Holmes Group, Inc. v. Vornado Air Circulation Systems, Inc., 535 U. S. 826, 831 (2002) .

Accordingly, petitioners may no more smuggle state-law claims into federal court through §4 than they can through declaratory judgment actions, or any other federal cause of action. To the extent §4 brings some issues into federal court in a particular case that may not be brought in through other procedural mechanisms, it does so by enlarg[ing] the range of remedies available in the federal courts[,] … not extend[ing] their jurisdiction. Skelly Oil, supra, at 671.

That is why the majority’s recital of the basic rules of federal-court jurisdiction in Part II of its opinion is beside the point: No one disputes what those rules are, and no one disputes that they must be followed under §4 indeciding whether a federal court would have jurisdiction … of the subject matter of a suit arising out of thecontroversy between the parties. The issue is instead what suit should be scrutinized for compliance with those rules. In defining controversy by reference to existing litigation, the majority artificially limits the reach of §4 to the particular suit filed. The correct approach is to accord §4 the scope mandated by its language and look to a suit, arising out of the subject matter of the controversy the §4 petitioner seeks to arbitrate, and determine whether a federal court would have jurisdiction over such a suit.

The majority concludes by noting that state courts are obliged to honor and enforce agreements to arbitrate. Ante, at 20. The question here, however, is one of remedy. It is a common feature of our federal system that States often provide remedies similar to those under federal law for the same wrongs. We do not, however, narrowly construe the federal remediessay federal antitrust or civil rights remediesbecause state law provides remedies in those areas as well. Cf. Monroe v. Pape, 365 U. S. 167, 183 (1961) (It is no answer that the State has a law which if enforced would give relief).

* * *
Discover and Vaden have agreed to arbitrate anydispute arising out of Vaden’s account with Discover. Vaden’s allegations against Discover have given rise to such a dispute. Discover seeks to arbitrate that controversy, but Vaden refuses to do so. Resolution of the controversy is governed by federal law, specifically the FDIA. There is no dispute about that. In the absence of the arbitration agreement, a federal court would have jurisdiction … of the subjectmatter of a suit arising out of the controversy between the parties, 9 U. S. C. §4, whether the suit were brought by Vaden or Discover. The District Court therefore may exercise jurisdiction over this petition under §4 of the Federal Arbitration Act.
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