FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CAPE FLATTERY LIMITED, No. 09-15682
Plaintiff-Appellee,
D.C. No.
v.
1:08-cv-00482-JMS-
TITAN MARITIME, LLC, a Crowley KSC
Company, DBA Titan Salvage,
OPINION
Defendant-Appellant.
Appeal from the United States District Court
for the District of Hawaii
J. Michael Seabright, District Judge, Presiding
Argued and Submitted
February 17, 2011—Honolulu, Hawaii
Filed July 26, 2011
Before: A. Wallace Tashima, William A. Fletcher, and
Marsha S. Berzon, Circuit Judges.
Opinion by Judge William A. Fletcher
9523
9526 CAPE FLATTERY LIMITED v. TITAN MARITIME
COUNSEL
Steven M. Egesdal, Nenad Krek, Erika Leina Togashi Lewis,
Duane Richard Miyashiro, CARLSMITH BALL LLP, Hono-
lulu, Hawaii, Eugene J. O’Connor, CHALOS O’CONNOR &
DUFFY LLP, Port Washington, New York, for the appellee.
John Robert Lacy, GOODSILL ANDERSON QUINN & STI-
FEL, Honolulu, Hawaii, Albert A. Peacock, James Arthur
Henry Marissen, KEESAL, YOUNG & LOGAN, Long
Beach, California, for the appellant.
OPINION
W. FLETCHER, Circuit Judge:
Plaintiff Cape Flattery Limited (“Cape Flattery”) sued
Defendant Titan Maritime (“Titan”) for gross negligence in its
salvage of Cape Flattery’s vessel, the M/V Cape Flattery.
Titan appeals the district court’s decision denying its motion
to compel arbitration of the dispute under the Federal Arbitra-
tion Act (“FAA”). Titan argues that the district court erred in
refusing to apply English arbitrability law. Titan further
argues that even under federal arbitrability law, the dispute is
arbitrable. We conclude that federal arbitrability law applies,
and that under federal arbitrability law the dispute is not arbi-
trable. We therefore affirm the district court.
I. Background
On February 2, 2005, the M/V Cape Flattery ran aground
on a submerged coral reef off Barbers Point, Oahu, Hawai’i.
CAPE FLATTERY LIMITED v. TITAN MARITIME 9527
Cape Flattery Ltd. v. Titan Maritime LLC, 607 F. Supp. 2d
1179, 1181 (D. Hawai’i 2009). In response, the U.S. Coast
Guard issued a Notice of Federal Interest in connection with
the vessel’s grounding and activated Unified Command to
respond to the threat of potential oil discharge. Id. Under 33
U.S.C. § 2702, Cape Flattery, as the vessel’s owner, was lia-
ble for the cost of removing the vessel from the reef. 33
U.S.C. §§ 2701(32)(A); 2702(a). Cape Flattery entered into an
agreement with Titan Maritime to salvage the vessel (the
“Agreement”). Cape Flattery, 607 F. Supp. 2d at 1181.
Under the Agreement, Titan agreed:
to use its best endeavors to salve, as quickly as rea-
sonably practicable, the [M/V Cape Flattery] by
means of the personnel and equipment specified in
Schedule 2, and/or such other personnel and/or
equipment as may from time to time be agreed
between Titan and the on-site Owners’ Representa-
tive . . . and deliver the [M/V Cape Flattery] to a
Place of Safety.
Schedule 2 provides a list of Titan’s “Typical Daily Personnel
& Equipment Rates.”
The Agreement also contains an arbitration clause. The
clause, titled “Arbitration,” provides:
Any dispute arising under this Agreement shall be
settled by arbitration in London, England, in accor-
dance with the English Arbitration Act 1996 and any
amendments thereto, English law and practice to
apply.
Titan succeeded in removing the M/V Cape Flattery from
the reef and eliminating the threat of oil discharge. Id. at
1181. At some point in the M/V Cape Flattery’s grounding or
removal, however, serious damage was inflicted on the reef.
9528 CAPE FLATTERY LIMITED v. TITAN MARITIME
Under 33 U.S.C. § 2702(b)(2), Cape Flattery is liable to the
United States government for all damage to natural resources
resulting from the grounding. See id. § 2702(a) (“[E]ach
responsible party for a vessel . . . which poses the substantial
threat of a discharge of oil . . . is liable for the damages speci-
fied in subsection (b) of this section that result from such inci-
dent.”); id. § 2701(32)(A) (owner of vessel is a responsible
party); id. § 2702(b)(2)(A) (damages recoverable under
§ 2702(a) include “[d]amages for injury to [or] destruction of
. . . natural resources . . . , which shall be recoverable by a
United States trustee”). On August 8, 2008, the government
informed Cape Flattery that it would likely be liable for dam-
ages in excess of $15 million. Cape Flattery, 607 F. Supp. 2d
at 1182.
On October 24, 2008, Cape Flattery filed a complaint in the
federal district court for the District of Hawai’i against Titan,
seeking indemnity and/or contribution based on the damage
Titan allegedly caused through gross negligence in removing
the M/V Cape Flattery from the reef. See 33 U.S.C. § 2709
(“A person may bring a civil action for contribution against
any other person who is liable or potentially liable under this
Act or another law.”); id. § 1321(c)(4) (parties rendering
“care, assistance, or advice” in removing vessels only liable
when “grossly negligent”). The complaint also sought to
enjoin Titan from requesting arbitration.
On December 17, 2008, Titan filed a motion to compel
arbitration based on the arbitration clause in the Agreement.
Cape Flattery, 607 F. Supp. 2d at 1182. On March 19, 2009,
after several rounds of briefing and a hearing, the district
court denied the motion. The court first rejected Titan’s argu-
ment that English law governed the arbitrability of the dis-
pute. Id. at 1184-85. The court concluded that under
Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.,
473 U.S. 614, 626 (1985), federal arbitrability law applies to
determine arbitrability. Cape Flattery, 607 F. Supp. 2d at
1184. The court noted the legal uncertainty concerning
CAPE FLATTERY LIMITED v. TITAN MARITIME 9529
whether federal arbitrability law allows parties to agree to
apply non-federal arbitrability law. Id. It concluded that even
if parties are allowed to contract out of federal arbitrability
law, the parties in this case had not done so. Id. at 1185.
The district court then concluded that under federal arbitra-
bility law, the current dispute did not “aris[e] under” the
Agreement. Id. at 1185-92. It first concluded that under our
decisions in Mediterranean Enterprises, Inc. v. Ssangyong
Construction Co., 708 F.2d 1458 (9th Cir. 1983), and Tracer
Research Corp. v. National Environmental Services Co., 42
F.3d 1292 (9th Cir. 1994), the “arising under” language in the
Agreement signifies a narrow arbitration agreement. Cape
Flattery, 607 F. Supp. 2d at 1185-86. Under these cases,
claims that relate “only peripherally” to the Agreement are
not arbitrable. Id. at 1188 (quoting Tracer, 42 F.3d at 1295).
The district court then held that because Titan’s duty to pre-
vent foreseeable damage to the coral reef is based on a federal
statute and is thus “separate from and above and beyond
Defendant’s duties under the Agreement,” id. at 1190-91,
Cape Flattery’s tort claims against Titan are not arbitrable.
Denials of motions to compel arbitration are immediately
appealable under 9 U.S.C. § 16(a)(1)(B) and (C). Titan timely
appealed.
II. Standard of Review
We review the district court’s decision on a motion to com-
pel arbitration de novo. Bushley v. Credit Suisse First Boston,
360 F.3d 1149, 1152 (9th Cir. 2004). We review a district
court’s choice-of-law decision de novo. Ticknor v. Choice
Hotels Int’l, Inc., 265 F.3d 931, 936 (9th Cir. 2001). We also
review the validity and scope of an arbitration clause de novo.
Moore v. Local 569 of Int’l Bhd. of Elec. Workers, 53 F.3d
1054, 1055 (9th Cir. 1995). We review the factual findings
underlying the district court’s decision for clear error. Bradley
v. Harris Research Inc., 275 F.3d 884, 888 (9th Cir. 2001).
9530 CAPE FLATTERY LIMITED v. TITAN MARITIME
III. Discussion
Titan argues that the district court erred in deciding that
federal arbitrability law applies, and in its application of that
law. We address Titan’s arguments in turn.
A. Choice of Arbitrability Law
The first issue is what law applies to determine the arbitra-
bility of the dispute. Titan argues that the Agreement’s provi-
sion that “[a]ny dispute arising under this Agreement shall be
settled by arbitration in London, England, in accordance with
the English Arbitration Act 1996 and any amendments
thereto, English law and practice to apply” constitutes an
agreement that English law applies to determine the arbitra-
bility of a dispute. Cape Flattery argues that parties cannot
contract out of federal arbitrability law, and that even if they
can, the parties did not do so in the Agreement.
[1] The Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et
seq., creates “a body of federal substantive law of arbitra-
bility, applicable to any arbitration agreement within the cov-
erage of the Act.” Moses H. Cone Mem’l Hosp. v. Mercury
Const. Corp., 460 U.S. 1, 24 (1983). Neither the Supreme
Court nor this court has decided whether federal arbitrability
law allows contracting parties to agree to apply a non-federal
law of arbitrability to interpret a given arbitration agreement.
If the parties can agree to apply a non-federal arbitrability
law, it is also undecided how courts should determine whether
the parties have so agreed.
1. Parties’ Power To Agree To Non-Federal Arbitrability
Law
In defending their respective positions regarding the power
of contracting parties to agree to a non-federal arbitrability
law, Cape Flattery and Titan rely on different Supreme Court
decisions. Cape Flattery relies on Mitsubishi Motors. Mitsu-
CAPE FLATTERY LIMITED v. TITAN MARITIME 9531
bishi and Soler entered into a sales agreement that included
the following arbitration clause: “All disputes, controversies
or differences which may arise between [Mitsubishi] and
[Soler] out of or in relation to . . . this Agreement or for the
breach thereof, shall be finally settled by arbitration in Japan
in accordance with the rules and regulations of the Japan
Commercial Arbitration Association.” 473 U.S. at 617 (first
two alterations in original). When a dispute arose, Soler sued
Mitsubishi alleging, among other things, violations of the
Sherman Act. Id. at 619-20. In determining whether the dis-
pute was arbitrable, the Supreme Court stated: “[T]he first
task of a court asked to compel arbitration of a dispute is to
determine whether the parties agreed to arbitrate that dispute.
The court is to make this determination by applying the ‘fed-
eral substantive law of arbitrability, applicable to any arbitra-
tion agreement within the coverage of the [FAA].’ ” Id. at 626
(quoting Moses H. Cone, 460 U.S. at 24).
Cape Flattery argues that because Mitsubishi does not sug-
gest any exception to the application of federal arbitrability
law, courts should always apply federal arbitrability law to
determine the arbitrability of a given dispute. It notes that dis-
trict courts, including the district court in this case, have sug-
gested, without directly holding, that federal arbitrability law
may apply despite an agreement to apply non-federal arbitra-
bility law. See Cape Flattery, 607 F. Supp. 2d at 1185 (sug-
gesting that there may be “a bright-line rule that the court
should apply federal law in determining arbitrability of an
agreement governed by . . . the FAA regardless of any choice-
of-law provision”); Chloe Z Fishing Co., Inc. v. Odyssey Re
(London) Ltd., 109 F. Supp. 2d 1236, 1252 (S.D. Cal. 2000)
(holding that for agreements covered by the FAA, the FAA
provides an “ ‘overriding basis’ for why the law under which
the case ‘arises’ . . . must apply to the question of whether
these parties agreed to arbitrate their disputes”).
[2] Titan does not contest that federal arbitrability law
applies generally, but argues that federal arbitrability law
9532 CAPE FLATTERY LIMITED v. TITAN MARITIME
requires courts to enforce contracting parties’ agreement to
apply non-federal arbitrability law. Titan relies primarily on
Volt Information Sciences, Inc. v. Board of Trustees, 489 U.S.
468 (1989). In Volt, the parties agreed to arbitrate any dis-
putes pursuant to the arbitration rules in the California Arbi-
tration Act (“CAA”). Id. at 470-71. The question before the
Court was whether the FAA preempts the CAA and requires
that, in disputes subject to the FAA, federal rules of arbitra-
tion apply. Id. at 470-73. The Court noted that the FAA pre-
empts state laws that render arbitration agreements entirely
unenforceable. Id. at 472, 478 (citing Southland Corp. v.
Keating, 464 U.S. 1, 10 (1984)); see also Doctor’s Associates,
Inc. v. Casarotto, 517 U.S. 681, 687 (1996) (FAA preempts
state law conditioning enforceability of arbitration clause on
compliance with special notice requirements applicable only
to arbitration provisions). It held, however, that the FAA does
not mandate certain rules of arbitration. “There is no federal
policy favoring arbitration under a certain set of procedural
rules; the federal policy is simply to ensure the enforceability,
according to their terms, of private agreements to arbitrate.”
Volt, 489 U.S. at 476. Titan argues that just as federal law will
enforce an agreement to arbitrate pursuant to non-federal rules
of arbitration, federal law should enforce an agreement to
determine arbitrability based on non-federal arbitrability law.
[3] We agree with Titan that, based on Volt, contracting
parties have the power to agree to apply non-federal arbitra-
bility law. The Court stated in Mitsubishi that courts should
determine arbitrability “by applying the federal substantive
law of arbitrability, applicable to any arbitration agreement
within the coverage of the Act.” Mitsubishi, 473 U.S. at 626
(citation and internal quotation marks omitted). But neither
party in Mitsubishi argued that anything other than federal
arbitrability law applied to the dispute. Thus, although Mitsu-
bishi states that federal arbitrability law applies to disputes
under the FAA, it does not address whether federal arbitra-
bility law allows the parties to agree to a non-federal arbitra-
bility law. Volt’s statement that the federal policy is “to
CAPE FLATTERY LIMITED v. TITAN MARITIME 9533
ensure the enforceability, according to their terms, of private
agreements to arbitrate,” 489 U.S. at 476, strongly suggests
that courts should respect contracting parties’ agreement to be
governed by non-federal arbitrability law.
Our conclusion is consistent with decisions of our sister cir-
cuits. Largely for the reasons just discussed, the Fifth Circuit
held that contracting parties could agree to apply Texas
arbitrability law in a case governed by the FAA. Ford v. NYL-
Care Health Plans of Gulf Coast, Inc., 141 F.3d 243, 248-49
(5th Cir. 1998). Several other circuits have applied non-
federal arbitrability law in cases governed by the FAA with
less detailed discussion. See, e.g., Motorola Credit Corp. v.
Uzan, 388 F.3d 39, 50-51 (2d Cir. 2004) (applying Swiss
arbitrability law); In re Oil Spill By the “Amoco Cadiz” Off
the Coast of France March 16, 1978, 659 F.2d 789, 793 (7th
Cir. 1981) (applying English arbitrability law).
[4] We therefore hold that courts should enforce contract-
ing parties’ agreement to have arbitrability governed by non-
federal arbitrability law.
2. Parties’ Choice of Arbitrability Law
[5] The more difficult question is how courts should decide
whether the parties have agreed to apply non-federal arbitra-
bility law. The general rule in interpreting arbitration agree-
ments is that courts “should apply ordinary state-law
principles that govern the formation of contracts.” First
Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995).
The general rule “would require the court to see whether the
parties objectively revealed an intent to” apply non-federal
arbitrability law. Id. If we were to apply the general rule in
this case, it may well be that English law would apply to
determine arbitrability.
[6] There are, however, some situations concerning the
determination of arbitrability in which courts require a higher
9534 CAPE FLATTERY LIMITED v. TITAN MARITIME
showing of intent. In Kaplan, the Supreme Court held that
courts should be cautious in determining whether the parties
have agreed to arbitrate arbitrability. The Court held that
“[c]ourts should not assume that the parties agreed to arbitrate
arbitrability unless there is clear and unmistakable evidence
that they did so.” Id. at 944 (citation, internal quotation marks
and alterations omitted). Under Kaplan, the usual presump-
tion that exists in favor of the arbitrability of merits-based dis-
putes is replaced by a presumption against the arbitrability of
arbitrability. Id. The Court reasoned that the question of
whether a given merits-based dispute is arbitrable
arises when the parties have a contract that provides
for arbitration of some issues. In such circumstances,
the parties likely gave at least some thought to the
scope of arbitration. And, given the law’s permissive
policies in respect to arbitration, one can understand
why the law would insist upon clarity before con-
cluding that the parties did not want to arbitrate a
related matter. On the other hand, the [question of]
“who (primarily) should decide arbitrability” . . . is
rather arcane. A party often might not focus upon
that question. . . . And, given the principle that a
party can be forced to arbitrate only those issues it
specifically has agreed to submit to arbitration, one
can understand why courts might hesitate to interpret
silence or ambiguity on the “who should decide
arbitrability” point as giving the arbitrators that
power, for doing so might too often force unwilling
parties to arbitrate a matter they reasonably would
have thought a judge, not an arbitrator, would
decide.
Id. at 945 (internal citations omitted).
Courts have taken different approaches to the question of
how to determine whether the parties have agreed to apply
non-federal arbitrability law. The Fifth Circuit in Ford
CAPE FLATTERY LIMITED v. TITAN MARITIME 9535
appears to have applied standard contractual analysis in con-
cluding that Texas arbitrability law applied. It held that the
combination of a clause providing that any claim must be set-
tled “in accordance with the Texas General Arbitration Act”;
a bold-typed, all-caps, underlined statement on the first page
of the agreement reading, “Notice: This Agreement is subject
to arbitration under the Texas Arbitration Act”; and the fact
that the agreement’s drafters opposed arbitration all demon-
strated that “the parties intended Texas law . . . to govern the
scope of the arbitration clause.” Ford, 141 F.3d at 246, 249.
The Third Circuit, on the other hand, has held that a general
choice-of-law provision is not enough to displace federal
arbitrability law. Becker Autoradio U.S.A., Inc. v. Becker
Autoradiowerk GmbH, 585 F.2d 39, 43 & n.8 (3d Cir. 1978).
Several district courts have taken the same approach as the
Third Circuit. In Chloe Z Fishing Co., 109 F. Supp. 2d at
1252-54, the district court concluded that a general choice-of-
law provision is insufficient to overcome the “overriding
basis” the FAA creates for applying federal arbitrability law.
In Sea Bowld Marine Group, LDC v. Oceanfast Pty., Ltd., 432
F. Supp. 2d 1305, 1311-12 (S.D. Fla. 2006), the district court
held that a general choice-of-law provision was ambiguous
concerning whether the parties specified the relevant arbitra-
bility law. It reasoned that “the Agreement here contains
choice-of-law and arbitration provisions that both reference
foreign law. While these designations are relevant to the sub-
stantive law to be used, and the location of arbitration, they
say nothing, and mean nothing, as to the threshold issue of
arbitrability.” Id. at 1312. The district court in this case gener-
ally followed the reasoning in Sea Bowld. See Cape Flattery,
607 F. Supp. 2d at 1185.
In concluding that a general choice-of-law provision does
not constitute an agreement to apply non-federal arbitrability
law, none of these cases specifically relied on Kaplan. How-
ever, just as Kaplan was concerned about interpreting a gen-
eral arbitration agreement to constitute an agreement to
9536 CAPE FLATTERY LIMITED v. TITAN MARITIME
arbitrate arbitrability, these courts were concerned about inter-
preting a general choice-of-law provision to constitute an
agreement to apply non-federal arbitrability law. We share
these concerns and conclude that our approach to this ques-
tion should be guided by Kaplan.
[7] Like the question of who should decide arbitrability,
the question of what law governs arbitrability is “rather
arcane.” In negotiating an agreement, parties are just as
unlikely to give thought to the applicable arbitrability law as
they are to give thought to the person determining arbitra-
bility. Thus, if courts were to interpret silence or ambiguity
concerning the applicable arbitrability law as providing for a
non-federal arbitrability law, parties could be subjected to a
foreign arbitrability law when they reasonably thought that
federal arbitrability law would apply. We therefore conclude,
following Kaplan, that courts should apply federal arbitra-
bility law absent “clear and unmistakable evidence” that the
parties agreed to apply non-federal arbitrability law. Kaplan,
514 U.S. at 944 (citation, quotation marks, and alterations
omitted).
[8] In this case, there is no clear and unmistakable evi-
dence that the parties agreed to apply English arbitrability
law. The arbitration provision states that “[a]ny dispute aris-
ing under this Agreement shall be settled by arbitration in
London, England, in accordance with the English Arbitration
Act 1996 and any amendments thereto, English law and prac-
tice to apply.” Under this provision, English arbitration law
clearly applies to disputes that are subject to arbitration, and
English law and practice are to be applied by the arbitrator.
See Cape Flattery, 607 F. Supp. 2d at 1185. However, the
agreement is ambiguous concerning whether English law also
applies to determine whether a given dispute is arbitrable in
the first place. Faced with such ambiguity, we conclude that
federal law applies to determine arbitrability.
CAPE FLATTERY LIMITED v. TITAN MARITIME 9537
B. Federal Arbitrability Law
Applying federal arbitrability law, we conclude that this
case is not arbitrable. The Agreement provides for arbitration
of “[a]ny dispute arising under this Agreement.” Our interpre-
tation of the phrase “arising under” is controlled by our prior
decisions in Mediterranean and Tracer. In both of those
cases, we held that the phrase “arising under” in an arbitration
agreement should be interpreted narrowly. We first discuss
the applicability of Mediterranean and Tracer to this case,
and then discuss their actual application.
1. Applicability of Mediterranean and Tracer
[9] Mediterranean involved a construction contract provid-
ing that “[a]ny disputes arising hereunder” would be settled
through binding arbitration. Mediterranean, 708 F.2d at 1461.
One of the parties to the contract sued, claiming breach of
contract, breach of fiduciary duty, conspiring to induce breach
of contract, quantum meruit, and conversion. Id. The defen-
dant moved to compel arbitration. One of the issues in the
case was whether the language “arising hereunder” was meant
to cover “any disputes between the parties,” or only disputes
“arising under the contract itself and . . . not . . . matters or
claims independent of the contract or collateral thereto.” Id.
at 1463 (internal quotation marks omitted). We noted that the
Second Circuit, in In re Kinoshita & Co., 287 F.2d 951 (2d
Cir. 1961), had narrowly construed the language “arising
under” and “arising out of.” Mediterranean, 708 F.2d at 1463.
We interpreted “arising hereunder” as “synonymous with
‘arising under the Agreement.’ ” Id. at 1464. We agreed with
the Second Circuit that when parties intend to include a broad
arbitration provision, they provide for arbitration “arising out
of or relating to” the agreement. Id. Because of the absence
of the “relating to” language in the arbitration provision, we
had “no difficulty finding that ‘arising hereunder’ is intended
to cover a much narrower scope of disputes, i.e., only those
9538 CAPE FLATTERY LIMITED v. TITAN MARITIME
relating to the interpretation and performance of the contract
itself.” Id.
Tracer involved a licensing agreement providing that “[i]n
the event any controversy or claim arising out of this Agree-
ment cannot be settled by the parties [ ], such controversy or
claim shall be settled by arbitration.” Tracer, 42 F.3d at 1295
(alterations in original). The case involved, among other
things, a tort claim for misappropriation of trade secrets based
on defendants’ continued use of trade secrets for which they
no longer had a license. Id. at 1294-95. We noted that Medi-
terranean “narrowly circumscribes the interpretation to be
given [the arbitration] clause.” Id. at 1295. We thus concluded
that because the tort claim constituted an “independent wrong
from any breach of the licensing and nondisclosure agree-
ments[,] . . . . it does not require interpretation of the contract
and is not arbitrable under Mediterranean Enterprises.” Id.
We also rejected the defendants’ argument that the dispute
was arbitrable because it would not have arisen but for the
contract. “The fact that the tort claim would not have arisen
‘but for’ the parties’ licensing agreement is not determina-
tive.” Id.
The language discussed in these cases — “arising hereun-
der,” “arising under,” and “arising out of” — is the same as
that at issue in this case. The Agreement between Cape Flat-
tery and Titan provides that “[a]ny dispute arising under this
Agreement” shall be subject to arbitration. Titan argues that,
notwithstanding the fact that the language in this case is the
same as that in Mediterranean and Tracer, we should inter-
pret “arising under” broadly. Titan argues that we should not
follow Mediterranean and Tracer because those cases were
decided before the Supreme Court’s more recent decisions
emphasizing the strength of the presumption in favor of arbi-
tration.
Titan is certainly correct that there is a presumption in
favor of arbitrating the merits of a dispute. “[A]ny doubts
CAPE FLATTERY LIMITED v. TITAN MARITIME 9539
concerning the scope of arbitrable issues should be resolved
in favor of arbitration, whether the problem at hand is the con-
struction of the contract language itself or an allegation of
waiver, delay, or a like defense to arbitrability.” Moses H.
Cone, 460 U.S. at 24-25 (footnote omitted). Courts should
thus “construe ambiguities concerning the scope of arbitra-
bility in favor of arbitration.” Mastrobuono v. Shearson Leh-
man Hutton, Inc., 514 U.S. 52, 66 (1995). However, this
presumption was established well before our decision in Med-
iterranean. Indeed, in Mediterranean we wrote that “federal
policy favors the enforcement of arbitration agreements,” 708
F.2d at 1463, and in Tracer we noted the “federal policy
favoring [arbitration],” 42 F.3d at 1294. A purportedly new
federal policy in favor of arbitration therefore cannot be a
basis for concluding that these decisions are no longer valid.
Titan notes that other circuits have relied on the federal pol-
icy favoring arbitration to construe broadly language that is
similar to the language in this case, disagreeing with our deci-
sions in Mediterranean and Tracer, and with the Second Cir-
cuit’s decision in Kinoshita. See Highlands Wellmont Health
Network, Inc. v. John Deere Health Plan, Inc., 350 F.3d 568,
577-78 (6th Cir. 2003); Battaglia v. McKendry, 233 F.3d 720,
724-28 (3d Cir. 2000); Gregory v. Electro-Mech. Corp., 83
F.3d 382, 383-86 (11th Cir. 1996); Peoples Sec. Life Ins. Co.
v. Monumental Life Ins. Co., 867 F.2d 809, 813 (4th Cir.
1989). Although Titan is correct that these circuits have dis-
agreed with our reasoning in Mediterranean and Tracer, out-
of-circuit cases provide no basis for us to ignore our own pre-
cedent.
Titan also notes that both our court and the Second Circuit
have significantly limited the application of Mediterranean,
Tracer, and Kinoshita. See Simula, Inc. v. Autoliv, Inc., 175
F.3d 716, 720-21 (9th Cir. 1999) (broadly interpreting the
phrase “arising in connection with” in an arbitration agree-
ment); Ace Capital Re Overseas Ltd. v. Central United Life
Ins. Co., 307 F.3d 24, 26 (2d Cir. 2002) (limiting application
9540 CAPE FLATTERY LIMITED v. TITAN MARITIME
of Kinoshita to the precise language at issue in that case).
However, it is one thing to limit the application of these cases
to the specific language at issue. It is quite another to simply
refuse to follow them.
There is a good reason to indicate clearly to contracting
parties what specific language will signify that the scope of
their arbitration agreement is narrow. Once they know the
specific language that is required, they can rely on that lan-
guage to produce a result they jointly desire. The Second Cir-
cuit relied on this rationale in declining to overturn Kinoshita,
reasoning that “contracting parties may have (in theory at
least) relied on [Kinoshita] in their formulation of an arbitra-
tion provision.” S.A. Mineracao Da Trindade-Samitri v. Utah
Intern., Inc., 745 F.2d 190, 194 (2d Cir. 1984). Similarly, in
this case, when Titan and Cape Flattery entered into the
Agreement, Mediterranean and Tracer had both been
decided. The Agreement concerned the salvage of a vessel
that had run aground in the Ninth Circuit. There is no reason
to believe that the experienced lawyers representing both par-
ties intended that the language they chose would be inter-
preted differently than it had been in those cases.
We conclude that because the language in the arbitration
provisions in Mediterranean and Tracer is the same as the
language in the Agreement, the narrow interpretation of “aris-
ing under” in those cases controls.
2. Application of Mediterranean and Tracer
Applying Mediterranean and Tracer, we have no difficulty
concluding that the present dispute is not arbitrable. The dis-
pute in this case is based on the Oil Pollution Act of 1990, 33
U.S.C. § 2701 et seq. Once the M/V Cape Flattery ran
aground, Cape Flattery was responsible for “removal costs
and damages” under 33 U.S.C. § 2702. Cape Flattery was also
liable for all damage to natural resources resulting from the
grounding. Id. §§ 2701(32)(A), 2702(a), 2702(b)(2)(A). Cape
CAPE FLATTERY LIMITED v. TITAN MARITIME 9541
Flattery could “bring a civil action for contribution against
any other person who is liable or potentially liable” for the
damage “under this Act or another law” under § 2709.
Because Titan was a party rendering “care, assistance, or
advice” in removing the vessel, Cape Flattery can hold Titan
contributorily liable if Titan was “grossly negligent.” Id.
§ 1321(c)(4). Cape Flattery alleged in its complaint that Titan
was grossly negligent, in violation of both Hawaii and general
maritime law, in deciding to use submerged, rather than float-
ing, tow lines, and that the submerged lines caused damage to
the coral reef.
[10] Mediterranean established that under an arbitration
agreement covering disputes “arising under” the agreement,
only those disputes “relating to the interpretation and perfor-
mance of the contract itself” are arbitrable. Mediterranean,
708 F.2d at 1464. Tracer similarly held that when a tort claim
constitutes an “independent wrong from any breach” of the
contract it “does not require interpretation of the contract and
is not arbitrable.” Tracer, 42 F.3d at 1295. Tracer further clar-
ified that a tort claim is not arbitrable just because it would
not have arisen “but for” the parties’ agreement. Id.
[11] The present dispute does not turn on an interpretation
of any clause in the contract. As the district court noted, “[t]he
parties point to no Agreement provision that Defendant alleg-
edly breached — the Agreement is silent regarding what tow
lines Defendant must use, how precisely Defendant must
salve the Vessel, and whether Defendant must take precau-
tions to prevent harm to the coral reef.” Cape Flattery, 607 F.
Supp. 2d at 1190 (footnote omitted). Nor does the dispute turn
on Titan’s performance under the contract. Instead the dispute
involves a tort claim based on Hawaii and maritime tort law,
incorporated as part of the Oil Pollution Act of 1990, and lim-
ited by that federal statute to grossly negligent acts.
[12] We therefore conclude that under the narrow interpre-
tation of “arising under” in Mediterranean and Tracer, the
present dispute is not arbitrable.
9542 CAPE FLATTERY LIMITED v. TITAN MARITIME
Conclusion
Based on the Supreme Court’s reasoning in Kaplan, we
conclude that courts should apply non-federal arbitrability law
only if there is clear and unmistakable evidence that the par-
ties intended to apply such non-federal law. Because there is
no clear and unmistakable evidence in this case, federal
arbitrability law applies. Under federal arbitrability law, our
decisions in Mediterranean and Tracer mandate a narrow
interpretation of a clause providing for arbitration of all dis-
putes “arising under” an agreement. Under this narrow inter-
pretation, the present dispute is not arbitrable. We therefore
affirm the district court’s careful and thorough opinion.
AFFIRMED.