McGehee v. Synchrony Bank

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
VICTORIA A. MCGEHEE, 	)
)
Plaintiff, 	)
)
vs. 	) 	Case No. 4:25-cv-0933-MTS
)
SYNCHRONY BANK, 	)
)
Defendant. 	)
MEMORANDUM OPINION
Victoria McGehee filed a Motion to Vacate Arbitration Award in this Court
seeking vacatur of an arbitrator’s $24,207.99 award against her to Synchrony Bank
(“Synchrony”). 	Synchrony filed an Answer, which included a counterclaim seeking to
confirm the same arbitration award. 	Neither party, though, has satisfactorily explained
the basis of the Court’s subject matter jurisdiction over this matter, and the Court sees
none. 	See Sac & Fox Tribe of the Miss. in Iowa, Election Bd. v. Bureau of Indian Affs.,
439 F.3d 832, 836 (8th Cir. 2006) (“Even in the absence of a challenge from any party,
courts have an independent obligation to determine whether subject matter jurisdiction
exists.”). For this reason, the Court will dismiss this matter without prejudice.
*
Contrary 	to 	McGehee’s 	position, 	Doc. 	[9] 	¶ 4, 	the 	Federal 	Arbitration 	Act
(“FAA”) “does not itself create jurisdiction,” Badgerow v. Walters, 596 U.S. 1, 4 (2022).
Rather, this Court must have “an ‘independent jurisdictional basis’ to resolve the matter.”
Id. (quoting Hall Street Assocs. v. Mattel, Inc., 552 U.S. 576, 582 (2008)). 	Synchrony
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recognizes this point. 	See Doc. [23] ¶ 8. 	But Synchrony also maintains that the Court
has “federal-question jurisdiction under 28 U.S.C. § 1331” because “the underlying
claims here arise under federal law.” Id. That is incorrect. Badgerow, which Synchrony
itself cites, holds that the “look-through” approach to jurisdiction does not apply to
requests to confirm or vacate arbitral awards under the FAA’s Sections 9 and 10.
Badgerow, 596 U.S. at 5; see also SmartSky Networks, LLC v. DAG Wireless, LTD., 93
F.4th 	175, 	178 	(4th 	Cir. 	2024) 	(recognizing 	Badgerow 	held 	that 	“‘look-through’
jurisdiction only applies to petitions to compel arbitration under Section 4 of the FAA”).
Thus, neither position advanced by the parties establishes the Court’s subject matter
jurisdiction, and the Court sees no other jurisdictional basis.
McGehee and Synchrony’s dispute in this matter “raise[s] no federal issue”
because “the two are now contesting not [whether Synchrony violated the Fair Credit
Billing Act] but the enforceability of an arbitral award.” 	See Badgerow, 596 U.S. at 9.
“That award is no more than a contractual resolution of the parties’ dispute—a way of
settling legal claims. 	And quarrels about legal settlements—even settlements of federal
claims—typically involve only state law, like disagreements about other contracts.” 	Id.
(internal citations omitted). 	This Court therefore lacks federal question jurisdiction over
this matter. See 28 U.S.C. § 1331; see also Trs. of N.Y. State Nurses Ass’n Pension Plan
v. White Oak Glob. Advisors, LLC, 102 F.4th 572, 595 (2d Cir. 2024) (recognizing that
federal question jurisdiction over a petition to confirm, modify, or vacate an arbitration
award cannot be premised on the underlying claims that were arbitrated).
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Nor does it appear that there is diversity jurisdiction under 28 U.S.C. § 1332(a),
which requires complete diversity among the parties and an amount in controversy
exceeding $75,000. 	See Badgerow, 596 U.S. at 9 (“If [the application] shows that the
contending parties are citizens of different States (with over $75,000 in dispute), then
§ 1332(a) gives the court diversity jurisdiction.”). 	Neither McGehee nor Synchrony has
shown the amount in controversy exceeds $75,000. 	What is more, filings show the
amount in controversy is far less than $75,000, under both the demand approach and the
award approach that federal courts use. 	See Doc. [1-3] at 1, 14 (showing a $33,492.00
demand and a $24,207.99 award); Pershing, L.L.C. v. Kiebach, 819 F.3d 179, 182 (5th
Cir. 2016) (recognizing courts have followed one of two approaches in determining
whether the amount in controversy for establishing diversity jurisdiction over a petition to
confirm an arbitration award—the amount awarded by the arbitration panel or the amount
previously sought in the arbitration proceeding). 	This Court therefore lacks diversity
jurisdiction over this matter.
* 	* 	*
In 	sum, 	the 	parties 	have 	not 	explained 	how 	this 	Court 	has 	subject 	matter
jurisdiction over this matter, and this Court “see[s] no . . . independent basis” for it. 	See
King v. Universal Health Servs. of Hartgrove, Inc., No. 23-3154, 2024 WL 3649598, at
*2 (7th Cir. Aug. 5, 2024) (unpublished) (vacating a district court’s confirmation of an
arbitration award and remanding for the district court to dismiss the case for lack of
subject matter jurisdiction). 	For this reason, the Court will enter herewith an Order of
Dismissal, which will dismiss this matter without prejudice. See County of Mille Lacs v.
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Benjamin, 361 F.3d 460, 464–65 (8th Cir. 2004) (“A district court is generally barred
from dismissing a case with prejudice if it concludes subject matter jurisdiction is
absent.”).
Dated this 9th day of December 2025.
MATTHEW T. SCHELP
UNITED STATES DISTRICT JUDGE
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