In the Courts: U.S. Supreme Court Addresses Power of Attorney in Arbitration Agreements

​In a decision regarding two consolidated lawsuits against a nursing home operator, the U.S. Supreme Court has found that a Kentucky Supreme Court ruling, which invalidated the arbitration agreements signed by the residents' attorneys-in-fact, discriminated against arbitration agreements in violation of the Federal Arbitration Act (FAA). As a result, the U.S. Supreme Court reversed the decision in part and remanded it in part.

The two original lawsuits pertained to the care of two residents. At the time of their loved ones' move into a nursing home operated by the defendant, the plaintiffs—the daughter of one resident and the wife of the other—held broadly worded powers of attorney for their loved ones. They used their powers of attorney to complete move-in paperwork, including signing an agreement to binding arbitration. After their loved ones died, they sued the defendant facility, alleging that...