                     United States Court of Appeals,

                            Eleventh Circuit.


                              No. 94-4984.

              KOTAM ELECTRONICS, INC., Plaintiff-Appellee,

                                   v.

            JBL CONSUMER PRODUCTS, INC., Defendant-Appellant.

                             Aug. 19, 1996.

Appeal from the United States District Court for the Southern
District of Florida. (No. 94-779-CIV-FAM), Federico A. Moreno,
Judge.

Before TJOFLAT, Chief Judge, KRAVITCH, HATCHETT, ANDERSON,
EDMONDSON, COX, BIRCH, DUBINA, BLACK, CARNES and BARKETT, Circuit
Judges.

        DUBINA, Circuit Judge:

        We voted to rehear this case en banc to determine whether the

holding in Cobb v. Lewis, 488 F.2d 41 (5th Cir.1974),1 that

antitrust claims are non-arbitrable, remains controlling precedent

in this circuit in light of intervening decisions of the United

States Supreme Court.     In 1985, the Supreme Court made clear that

antitrust disputes in the international context are arbitrable.

See Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473

U.S. 614, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985).       Today we hold

that antitrust disputes in the domestic context are arbitrable as

well.

                              I. BACKGROUND

     Plaintiff-Appellee Kotam Electronics, Inc. ("Kotam") sells and

        1
      In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th
Cir.1981) (en banc), this court adopted as binding precedent all
decisions of the former Fifth Circuit handed down prior to
October 1, 1981.
distributes consumer electronic products.             From approximately 1984

to 1992, Kotam entered into annual dealer and distributor contracts

with Defendant-Appellant JBL Consumer Products, Inc. ("JBL"). Each

of these contracts contained the following arbitration clause

explicitly requiring the parties to submit antitrust claims to

binding arbitration:

     22. GOVERNING LAW AND ARBITRATION

     b. Any controversy or claim arising out of or relating to this
     Agreement, or the breach or validity thereof, whether at
     common law or under statute, including without limitation
     claims asserting violation of the antitrust laws, shall be
     settled by final and binding arbitration in accordance with
     the Rules for Commercial Arbitration of the American
     Arbitration Association ("AAA") in effect at the time of the
     execution of this Agreement.

(emphasis added).

     In 1994, despite its agreement to arbitrate, Kotam filed suit

in federal district court against JBL alleging price discrimination
                                                                            2
in violation of the Robinson-Patman Act, 15 U.S.C. § 13(a).                      In

response,     JBL     moved    to    dismiss   the   complaint   or,   in       the

alternative, to stay the judicial proceedings pending arbitration

pursuant to section 3 of the Federal Arbitration Act (FAA), 9

U.S.C. § 3.    The district court, relying onCobb v. Lewis, 488 F.2d

41 (5th Cir.1974), denied JBL's motion.

     JBL appealed, and a divided panel of this court affirmed the

district court's judgment.           See Kotam Elecs., Inc. v. JBL Consumer

Products,     Inc.,    59     F.3d   1155   (11th    Cir.1995)   (Gibson,       J.,

dissenting).        A majority of the judges of this court in regular

     2
      There is no dispute that Kotam's single claim for price
discrimination falls squarely within the terms of the parties'
agreement to arbitrate "claims asserting violation of the
antitrust laws."
active service voted to rehear the case en banc, see Kotam Elecs.,

Inc. v. JBL Consumer Products, Inc., 69 F.3d 1097 (11th Cir.1995),3
and we now reverse the judgment of the district court.

                  II. JURISDICTION AND STANDARD OF REVIEW

           We have jurisdiction over this appeal pursuant to section 16

of the FAA, which provides that "[a]n appeal may be taken from an

order refusing a stay of any action under section 3 [of the FAA]."

9 U.S.C. § 16(a)(1)(A).        The district court denied JBL's motion to

stay       judicial   proceedings    pending      arbitration    based   on   its

resolution of a question of law. Therefore, we review the district

court's decision de novo. See Luckie v. Smith Barney, Harris Upham

& Co., Inc., 999 F.2d 509, 512 (11th Cir.1993).

                                III. DISCUSSION

           Kotam argues that the district court correctly held that Cobb

remains       controlling    precedent     in   the   Eleventh   Circuit.      In

contrast, JBL argues that in light of intervening decisions of the

Supreme Court, specifically Mitsubishi and its progeny, Cobb's

holding that antitrust claims are non-arbitrable can no longer be

considered controlling precedent in this circuit.                We agree with

JBL.

A. Cobb v. Lewis

       In 1974, the former Fifth Circuit held that, "as a general

matter,       antitrust     claims   are    not    appropriate    subjects    of

arbitration."         See Cobb, 488 F.2d at 47.             Cobb involved an


       3
      This order vacated the panel's opinion. See 11th Cir.R.
35-11 ("Unless otherwise expressly provided, the effect of
granting a rehearing en banc is to vacate the panel opinion and
to stay the mandate.").
agreement between the franchiser of a nationwide chain of motion

picture theaters and the owners of individual theaters. Id. at 43.

The individual theater owners filed a class action alleging, among

other things, violations of the Sherman Act, 15 U.S.C. § 1, and the

Clayton Act, 15 U.S.C. § 14.           Id. at 43-44.   In concluding that

antitrust claims are not appropriate subjects of arbitration, the

Cobb court followed the lead of the Second, Eighth, and Ninth

Circuits.     See Cobb, 488 F.2d at 47, relying on American Safety

Equip. Corp. v. J.P. Maguire & Co.,              391 F.2d 821, 825 (2nd

Cir.1968);    Helfenbein v. International Indus. Inc., 438 F.2d 1068

(8th Cir.), cert. denied, 404 U.S. 872, 92 S.Ct. 63, 30 L.Ed.2d 115

(1971);     A & E Plastik Pak Co. v. Monsanto Co., 396 F.2d 710 (9th

Cir.1968).

     Specifically, the Cobb panel expressly premised its holding on

"three major considerations" outlined by the Second Circuit in

American Safety:        (1) the important role of private litigants in

enforcing the antitrust laws;          (2) "the complexity of the issues

and the extensiveness and diversity of the evidence antitrust cases

usually     involve;"      and   (3)   "the   questionable    propriety   of

entrusting     the   decision    of    antitrust   issues    to   commercial

arbitrators, who "are frequently men drawn for their business

expertise,' when "it is the business community generally that is

regulated by the antitrust laws.' "           Cobb, 488 F.2d at 47 (citing

American Safety, 391 F.2d at 826-27).4

     4
      The American Safety court also relied on two other
considerations not cited by the Cobb court: (1) that arbitration
clauses might be contracts of adhesion; and (2) that the claim
in American Safety was "that the agreement itself was an
instrument of illegality." 391 F.2d at 827. (emphasis added).
B. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.

     In 1985, the Supreme Court explicitly rejected the American

Safety doctrine and each of the underlying considerations upon

which the Cobb court relied.         See Mitsubishi, 473 U.S. 614, 105

S.Ct. 3346.    In     Mitsubishi, the parties entered into a sales

agreement containing an arbitration clause.               The clause provided

for arbitration of all controversies arising out of the agreement

in accordance with the rules of the Japan Commercial Arbitration

Association.     Id., 473 U.S. at 617, 105 S.Ct. at 3349.                  When

disputes arose among the parties, Soler resisted the arbitration of

its antitrust claims on the basis of the American Safety doctrine.

Id., 473 U.S. at 620-23, 105 S.Ct. at 3350-52.                  However, the

Supreme   Court       explicitly     rejected       the     American     Safety

considerations      and   held   that,   in   the   international      context,

antitrust claims are arbitrable.

     First, the Court concluded that "[t]he importance of the

private damages remedy ... does not compel the conclusion that it

may not be sought outside an American court." Mitsubishi, 473 U.S.

at 635, 105 S.Ct. at 3358.         The   Mitsubishi Court reasoned that

arbitrators are bound, as are judges, to apply the antitrust laws,

and that there is no basis for assuming that arbitration will not

provide an adequate mechanism for enforcement of the antitrust



In Mitsubishi, the Supreme Court rejected the first
consideration, noting that "[t]he mere appearance of an antitrust
dispute does not alone warrant invalidation of the selected forum
on the undemonstrated assumption that the arbitration clause is
tainted." Mitsubishi, 473 U.S. at 632, 105 S.Ct. at 3357. While
the second rationale has not been called into question, it was
not relied upon by the Cobb court and does not apply under the
facts of this case.
laws.    Id., 473 U.S. at 635-37, 105 S.Ct. at 3358-60.                    Second, the

Court dismissed the consideration that antitrust suits are "prone

to complications" and are therefore ill-suited for arbitration.

Id., 473 U.S. at 633, 105 S.Ct. at 3357.                 The Court emphasized that

adaptability and access to expertise are hallmarks of arbitration

and noted that the "anticipated subject matter of the dispute may

be taken into account when the arbitrators are appointed."                          Id.

Third, the Court declined to assume that arbitration panels will be

hostile to the constraints on business conduct that antitrust law

imposes.      As    the       Court   stated,      "We   decline    to    indulge   the

presumption       that    the    parties     and   arbitral      body    conducting   a

proceeding    will       be    unable   or   unwilling      to   retain     competent,

conscientious, and impartial arbitrators."                  Id., 473 U.S. at 634,

105 S.Ct. at 3358.

      It is true, as Kotam points out, that the Mitsubishi Court

noted at the outset of its opinion that it found it "unnecessary to

assess the legitimacy of the American Safety doctrine as applied to

agreements to arbitrate arising from domestic transactions."                        473

U.S. at 629, 105 S.Ct. at 3355;                     see id. ("we conclude that

concerns of international comity ... require that we enforce the

parties' agreement, even assuming that a contrary result would be

forthcoming in a domestic context"). However, we do not think that

this language decides the issue currently pending before this

court.      While limited to the international context by its own

facts, Mitsubishi nevertheless substantially weakened the decision

in   Cobb    by    dismantling        all    of    the   American       Safety   policy

considerations underlying the former Fifth Circuit's holding in
Cobb.

       The   American    Safety     doctrine,      and   consequently      Cobb,   is

further undermined by Mitsubishi's emphasis on the "federal policy

favoring arbitration."            As the Supreme Court explained, " "the

preeminent concern of Congress in passing the [FAA] was to enforce

private agreements into which parties had entered,' a concern which

"requires that we rigorously enforce agreements to arbitrate.' "

Mitsubishi, 473 U.S. at 625-26, 105 S.Ct. at 3353 (citing Dean

Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 221, 105 S.Ct. 1238,

1242, 84 L.Ed.2d 158 (1985)).               Moreover, the         Mitsubishi Court

stated that a party, having agreed to arbitrate, should be held to

that    agreement    unless   Congress       has   "evinced       an   intention   to

preclude a waiver of judicial remedies for the statutory rights at

issue."      Mitsubishi, 473 U.S. at 628, 105 S.Ct. at 3354-55.

Finally,     the     Mitsubishi     Court     could      find     no   evidence    of

Congressional intention to preclude arbitration of antitrust claims

in the text or legislative history of either the Sherman Act or the

FAA.    See id., 473 U.S. at 628-29, 105 S.Ct. at 3355.                    Thus, we

conclude that JBL is correct in its contention that the decision in

Mitsubishi casts considerable doubt on the viability of                     Cobb in

this circuit.

C. Mitsubishi's Progeny.

       The Supreme Court itself has acknowledged that its rejection

of the American Safety considerations in Mitsubishi has application

outside the international context.            Two years after the Mitsubishi

decision,      the      Supreme     Court     rendered          its    decision    in

Shearson/American Express, Inc. v. McMahon, 482 U.S. 220, 107 S.Ct.
2332, 96 L.Ed.2d 185 (1987) (hereinafter "McMahon").      In McMahon,

the       Supreme   Court   again   rejected   the   American    Safety

considerations; however, it also discarded the distinction between

domestic and international transactions with respect to arbitration

of § 10(b) of the Securities Exchange Act of 1934, and civil RICO

claims.       Most notably, the Supreme Court rejected the Second

Circuit's holding that the American Safety doctrine was still good

law, despite Mitsubishi, on the ground that Mitsubishi pertained

only to international transactions.      Id., 482 U.S. at 238-42, 107
S.Ct. at 2344-46. The Supreme Court concluded that "[a]lthough the

holding in Mitsubishi was limited to the international context,

much of its reasoning is equally applicable [to domestic civil RICO

claims]."      McMahon, 482 U.S. at 239, 107 S.Ct. at 2344;     see also

id. 482 U.S. at 232, 107 S.Ct. at 2341 (declining to limit its

earlier decision in Scherk v. Alberto-Culver Co., 417 U.S. 506, 94

S.Ct. 2449, 41 L.Ed.2d 270 (1974), which involved the arbitrability

of § 10(b) claims, to cases arising in an international setting).5

      Furthermore, the Supreme Court has since cited Mitsubishi for

      5
      In McMahon, the Supreme Court also revisited an earlier
case, Wilko v. Swan, 346 U.S. 427, 74 S.Ct. 182, 98 L.Ed. 168
(1953), and that Court's concerns about arbitration. The McMahon
Court noted that Wilko stood for the proposition that arbitration
would "weaken [a plaintiffs'] ability to recover" under the
securities laws, and that the arbitration agreement in that case
was unenforceable "only because arbitration was judged inadequate
to enforce the statutory rights created by § 12(2) [of the
Securities Act, 15 U.S.C. § 77l(2) ]." McMahon, 482 U.S. at 228-
31, 107 S.Ct. at 2338-40. Questioning that reasoning, the Court
stated "[i]t is difficult to reconcile Wilko's mistrust of the
arbitral process with this Court's subsequent decisions involving
the Arbitration Act." McMahon, 482 U.S. at 231-32, 107 S.Ct. at
2340 (citing Mitsubishi). Ultimately, the Court overruled Wilko
in Rodriguez de Quijas v. Shearson/American Express Inc., 490
U.S. 477, 109 S.Ct. 1917, 104 L.Ed.2d 526 (1989), relying largely
on McMahon and Mitsubishi.
the general proposition that antitrust claims are arbitrable.

Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28, 111 S.Ct.

1647, 1652, 114 L.Ed.2d 26 (1991) ("claims under [the Sherman Act]

are appropriate for arbitration").         See also Matsushita Elec.

Indus. Co. v. Epstein, --- U.S. ----, ----, 116 S.Ct. 873, 883, 134

L.Ed.2d 6 (1996) ("As [McMahon ] demonstrates, a statute conferring

exclusive federal jurisdiction for a certain class of claims does

not necessarily require resolution of those claims in federal

court.").

D. Other Circuits' Treatment Of This Issue.

     Finally, we find it persuasive that since the Supreme Court's

ruling in Mitsubishi, four other circuits have expressed the view

that the American Safety doctrine is incompatible with the Supreme

Court's intervening decisions and that domestic antitrust claims

are therefore arbitrable.   The Ninth Circuit found that:

     Given the Court's meticulous step-by-step disembowelment of
     the American Safety doctrine, this circuit will no longer
     follow American Safety. We hold that Mitsubishi effectively
     overruled American Safety and its progeny.

Nghiem v. NEC Elec., Inc., 25 F.3d 1437, 1441-42 (9th Cir.), cert.

denied, --- U.S. ----, 115 S.Ct. 638, 130 L.Ed.2d 544 (1994)

(citations   omitted).   Likewise,   the   Second   Circuit   affirmed,

without opinion, a district court's holding that "the reasoning of

Mitsubishi should apply with equal force to domestic claims" and

that " "none of the justifications for the American Safety doctrine

retain their vigor.' "   Hough v. Merrill Lynch, 757 F.Supp. 283,

286 (S.D.N.Y.), aff'd without op., 946 F.2d 883 (2d Cir.1991)

(citations omitted).

     The Seventh Circuit, while not explicitly deciding the issue,
has stated in dicta that companies "may agree to arbitrate their

antitrust disputes—certainly so for international transactions, ...

and likely so for domestic transactions."      Sanjuan v. American Bd.

of Psychiatry and Neurology, Inc., 40 F.3d 247, 250 (7th Cir.1994),

cert. denied, --- U.S. ----, 116 S.Ct. 1044, 134 L.Ed.2d 191

(1996);   see also Smokey Greenhaw Cotton Co., Inc. v. Merrill

Lynch, Pierce, Fenner and Smith, Inc., 785 F.2d 1274, 1282 (5th

Cir.1986) (per curiam, on petition for rehearing and suggestion for

rehearing en banc ), cert. denied, 482 U.S. 928, 107 S.Ct. 3211, 96

L.Ed.2d 698 (1987) (stating, though not in an antitrust context,

that "although Mitsubishi arose in an international antitrust

dispute and its holding purports to be limited to that context, we

believe that its broad language may carry significance for domestic

disputes as well").

                             IV. CONCLUSION

     In light of Mitsubishi and its progeny, as well as the

persuasive authority from our sister circuits, we hold that Cobb is

no   longer   controlling   precedent    in   this    circuit      and   that

arbitration agreements concerning domestic antitrust claims are

enforceable. Accordingly, we reverse the district court's judgment

denying   JBL's   motion    to   stay   judicial     proceedings     pending

arbitration and remand this case for further proceedings consistent

with this opinion.

     REVERSED and REMANDED.
