Today’s SCOTUS Arguments on Limiting the Federal Arbitration Act Sec. 1 ADR Exemption
By Sasha Hill & Russ Bleemer--Updated at 4:45 p.m. 3/25
The U.S. Supreme Court sought to draw a line Wednesday morning for the coverage of the Federal Arbitration Act’s Sec. 1 exemption from arbitration for last-mile delivery workers, and got straightforward answers from the attorney for one of the nation’s largest baked goods companies and the attorney representing one of its drivers.
But the Court didn’t much like either of the paths suggested in Wednesday's arguments in the case of Flowers Foods Inc. v. Brock, 24-935.
Flowers Foods’ attorney, Traci L. Lovitt, a Washington, D.C.-based Jones Day partner who is the firm’s practice leader for issues and appeals, led off and closed with a rebuttal asking for a bright-line rule. It would deploy Sec. 1’s language that transportation workers “engaged in foreign or interstate commerce” for workers to receive the FAA Sec. 1 exemption--and the last-mile delivery drivers in the case didn’t satisfy the "engaged in" requirement.
She maintained that Colorado trucker Angelo Brock wasn’t physically crossing the border, and loads his truck solely for intrastate work, and therefore wasn’t performing interstate transportation work that goes across state lines.
Justice Ketanji Brown Jackson immediately pushed back and said that the analysis ignored the goods. Lovitt’s view, Jackson said, “is puzzling to me” because it characterized workers along the goods' journey differently that were all part of the same interstate commerce sale.
Opposing counsel Jennifer D. Bennett, a principal in the San Francisco office of Gupta Wessler who represents respondent/original plaintiff Angelo Brock, didn’t have it any easier.
Bennett’s bright-line was the shipper’s destination intention—its declaration where it wants the goods to go, which would end the interstate commerce trail. Justice Samuel A. Alito Jr. questioned why such analysis is needed, because it would open up the need for potentially extensive inquiries when it seems obvious that the intended recipient is the consumer.
“Do we need to get into any of that?” he asked, “Why are we fussing over it?” He said the Court needs to decide Lovitt’s rule that the exemption doesn’t apply in interstate commerce where the individual does not drive across borders or interact with the interstate shipment.
Justice Neil Gorsuch suggested that Bennett's evidentiary approach was tough in the case—he called it “muddled”—and said that the path potentially was a rabbit hole that could breed litigation about the passage of title, the contract terms, and more. The Court pushed Bennett on caselaw that defined the journey’s end.
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This case arises out of a Tenth U.S. Circuit Court of Appeals decision, which held that the Federal Arbitration Act did not apply to an agreement between a large baked goods company—Flowers Foods makes Wonder Bread—and a “last-mile” driver, who delivers goods locally that originated out-of-state. See Brock v. Flowers Foods Inc., No. 23-1182 (10th Cir. Nov. 12, 2024) (available at https://bit.ly/42QO366).
Today’s specific issue—itself subject to discussion at the outset of the arguments, when Justice Sonia Sotomayor appeared to accuse Lovitt of redefining the scope of a concession Flowers Foods made on the definition of last-mile drivers--is whether workers like the respondent, who deliver locally goods that travel in interstate commerce, but who do not transport the goods across borders nor interact with vehicles that cross borders, are transportation workers “engaged in foreign or interstate commerce” for purposes of the FAA Sec. 1 exemption from arbitration for “any other class of workers engaged in foreign or interstate commerce.” That language is the century-old statute’s so-called residual clause that follows specific exemptions for “contracts of employment” of seamen and railroad employees.
Flowers Foods filed the cert petitions, successfully, contending that the Tenth Circuit incorrectly exempted the respondent and other local distributors from arbitration who are not directly involved with interstate commerce.
Original plaintiff Angelo Brock countered that Flowers Foods’ argument incorrectly groups two classes of workers together—“last-mile” drivers who transport goods on the final leg of their interstate journey to their intended destination, and local rideshare or food delivery workers who transport local goods to local customers.
For full background on the case including highlights from the 18 friend-of-the-court briefs filed on both sides, see CPR Speaks coverage at Sasha Hill, “Flowers Foods’ SCOTUS Return, Pt. 2: Support for 'Last-Mile Drivers' in FAA's Sec. 1 Arb. Exemption,” CPR Speaks (March 5) (available here); Sasha Hill, “Flowers Foods’ SCOTUS Return: Amicus Support for Limiting the FAA Sec. 1 Arbitration Exemption,” CPR Speaks (Feb. 13) (available here); Russ Bleemer, “Flowers Foods Gets Another SCOTUS Chance at Limiting the FAA Sec. 1 Arbitration Exemption,” CPR Speaks (Oct. 20, 2025) (available here), and Sasha Hill, “A Review: Supreme Court Considers Another FAA Sec. 1 Arbitration Exemption,” CPR Speaks (Sept. 22, 2025) (available here).
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In the Court on Wednesday, March 25, Traci Lovitt opened the arguments with a doomsday view of the effects of the Tenth Circuit decision: “Brock's approach would lead to unlimited chaos. It is a world where everything is dispositive and everything is relevant[. A]nd nothing is dispositive. We know that because that's what's happening in the First, Ninth, and Tenth Circuits today, all of which follow Brock's approach.” She said the decision sweeps in too many workers to the statutory exemption from arbitration.
But she ran into what became tough questions immediately. Lovitt avoided answering Justice Clarence Thomas’s opening question about Flowers Foods products’ “final destination,” noting that statutes and the Commerce Clause don’t provide guidance.
Justice Sonia Sotomayor interrupted and said the point was conceded in the cert petition where Flowers Foods said the contract was with local retailers. “I don't know why you're saying, ‘It depends,’” she said, “The concession told us.”
“Because it begs the question, last-mile driver of what?” responded Lovitt, “Of the goods or of the final mile of cross-border transportation?”
Sotomayor shot back, “Well, counsel, it's the goods, so the goods are traveling in interstate commerce. Now the question is, ‘Is this driver helping that interstate process?’”
Lovitt readily agreed that the driver is involved in interstate commerce under a Commerce Clause analysis. But, she added,
But this Court . . . twice in four years has held that Section 1 requires more than a Commerce Clause analysis. It requires an analysis of the actual work the worker is performing. And the worker is performing the work of a local delivery here, not any cross-border transportation.
Lovitt discussed Southwest Airlines Co. v. Saxon, 596 U.S. 450 (2022), telling the Court, “the question is, when does the interstate journey end? And it ends at the warehouse when the goods are unloaded by someone other than Mr. Brock.”
In response to Chief Justice John G. Roberts Jr., Lovitt stated that for the arbitration exemption to apply,
our position is you have to be performing the work of cross-border transportation. And Saxon says that begins at the loading process and it ends at the unloading process, and the cross-border movement in between is a relevant transportation. Mr. Brock loads for an intrastate journey and unloads on an intrastate journey and never performs any actual transportation work that . . . involves cross-border performance.
That’s when Justice Jackson said the analysis was puzzling, set up “in a way that would end up having different workers along the journey of a particular good being characterized differently.” Jackson and Lovitt discussed the interrelationship between the Court’s transportation workers definition, and the goods in transit.
Justice Gorsuch nodded when Lovitt confirmed a bright-line rule for applying the FAA Sec. 1 exemption. He asked her the standard: Is the worker “[e]ither interacting with [interstate] vehicles or crossing the borders themselves?” She agreed that was the standard her client sought; earlier, Lovitt said the bright-line rule came from the Court’s Saxon decision where a Chicago baggage handler was a transportation worker in interstate commerce for purposes of the exemption.
Gorsuch had concerns about the strength of the bright-line rule, specifically avoiding more litigation. He asked her to confirm that the Court wasn't being asked "to get into whether Brock takes title of the goods, whether the grocery stores order products from him or from you, how long the goods stay in a warehouse in Colorado after arriving from out of state, whether the goods are transformed or repackaged, whether the contract here . . . with a corporation is covered by . . . the FAA, or how much control Flowers has over Brock." Those issues, Lovitt confirmed, weren't part of her formulation of disposing of the case.
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Brock's lawyer, Jennifer Bennett, was grilled about her test for whether the exemption in FAA Sec. 1 applies to a last-mile bakery driver, after Justice Gorsuch suggested that analyzing the contract for its end point—for example, whether it was a contract of adhesion and against public policy—was problematic. “How far down the rabbit hole are you going to take us, Ms. Bennett?” he asked.
Bennett answered directly:
So the rule I would advocate for is intended final destination. And I hear you saying that sometimes that might have a line-drawing problem--usually, it doesn't, you know, because shippers know where they sent their goods. And if you say file a declaration under oath to where you intended these goods to go, unless they're lying under oath, that will answer the question.
Gorsuch looked skeptical, asking for case backup, and Bennett discussed Interstate Commerce Act cases contemporaneous with the 1925 passage of the Federal Arbitration Act.
Bennett identified three points, first noting that the case of Weigle v. Curtice Bros. Co., 248 U.S. 285 (1919), determined when cases are removed from interstate commerce—when the goods are on “separate journeys,” explained Bennett.
“The second kind of case,” Bennett continued, is “where manufacturers [are] essentially pre-shipping their goods and sending them to a place where they know a customer is going to order them, but the customer hasn't yet ordered them. The customer orders it either along the way or sometimes very quickly thereafter. You can think of part of Amazon's business like that.” (She later called it “anticipatory shipping.”)
Justice Alito had heard enough. He had been sitting back, eyes closed, and at this point pulled forward and interrupted Bennett's answer to Gorsuch's questioning. “I find . . . your argument extremely confusing,” Alito said, adding,
Maybe that is inherent in the pre-1925 case law. I would think that anybody who produces consumer goods intends for the final destination of those goods to be with the consumer because, unless the consumer pays for the goods, then the producer of the goods isn't going to make any money. So I don't understand what it means to ask, "What is the intended end point of the . . . distribution chain?"
Bennett countered that it’s like shipping at Fed Ex or UPS: “Where are you trying to get those goods to go to when you ship them? Not 'Where are they then going to . . . subsequently go after that?'” Here, she said, the end of the Flowers Foods’ journey is retailers.
Alito responded that Bennett was asking whether the Court would need to go back to the early cases to draw the limits on interstate commerce—“a body of case law with a lot of arbitrary lines.” Bennett emphasized that it wasn’t about the scope of the U.S. Constitution’s Commerce Clause, but the cases’ interpretation of “what relationship to interstate commerce an activity has to have to be regulable.”
At the conclusion of her argument, Justice Brett Kavanaugh asked Bennett to fill in her third point, and she added that it was the
obfuscation question, where a company was trying to obfuscate exactly what . . . commerce is happening or where the journey begins and ends. That was very common in 1925, where companies would try to get out of, say, the Interstate Commerce Act or [the Federal Employers’ Liability Act] by obfuscating where the beginning and . . . the end of the journey is.
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Flowers Foods was in the nation’s top Court just two years ago similarly attempting to limit the reach of the FAA Sec. 1 exemption from arbitration for its truck drivers. But the Supreme Court, in Bissonnette v. LePage Bakeries Park St. LLC, 601 U.S. 246 (2024) (available at https://bit.ly/4txWaA7) assessed the drivers’ exemption status and reversed a Tenth Circuit opinion in finding that the workers were exempt from contractual arbitration under the FAA.
Traci Lovitt argued the case for Flowers Foods--LePage Bakeries is a subsidiary--and Jennifer Bennett argued the case for the original plaintiff.
Bissonnette, written by Chief Justice John G. Roberts Jr. for a unanimous Court, held that “A transportation worker need not work in the transportation industry to be exempt from coverage under §1 of the FAA.” In Bissonnette, Flowers Foods argued that nearly all workers who load or unload goods would be exempt from arbitration by focusing on the transportation function.
“But,” the Court’s case summary notes, Section 1 “does not define the class of exempt workers in such limitless terms. Instead, as the Court held in Saxon, a transportation worker is one who is ‘actively’ ‘engaged in transportation’ of . . . goods across borders via the channels of foreign or interstate commerce.’ [Southwest Airlines Co. v. Saxon,] 596 U.S. [450 (2022)], at 458 (quoting Circuit City, 532 U. S. [105 (2001)], at 121). In other words, a transportation worker ‘must at least play a direct and ‘necessary role in the free flow of goods’ across borders.’ 596 U. S. at 458 (quoting Circuit City, 532 U. S., at 121). These requirements ‘undermine[] any attempt to give the provision a sweeping, open-ended construction,’ instead limiting §1 to its appropriately ‘narrow’ scope.”
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Hill is the CPR Institute’s 2025-2026 academic year intern from the Howard University School of Law ADR Program, where she is a second-year student in Washington, D.C. Bleemer edits Alternatives to the High Cost of Litigation for the CPR Institute.
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