American Heritage Life Insurance Company; et al v. John D. Orr, Betty E. Sanford, Frankie L. Moore, Jimmie Martin and Nathaniel Henley

Borrowers who obtained consumer loans which included the purchase of credit life and credit disability insurance brought action in state court against lender and insurers, alleging, inter alia, fraudulent misrepresentation and conspiracy to sell unnecessary insurance at an exorbitant premium. Lender and insurer brought separate action in federal court seeking to compel arbitration under the Federal Arbitration Act (FAA) and stay the sate court proceedings. The United States District Court for the Northern District of Mississippi, Glen H. Davidson, Chief Judge, entered order compelling arbitration and staying state court proceedings, and ordered the case closed. Appeal was taken. The Court of Appeals, Little, Chief District Judge, sitting by designation, held that: (1) District Court's order closing the case was a final, immediately appealable decision under the FAA; (2) McCarran-Ferguson Act did not reverse-preempt the application of the FAA to the arbitration agreements at issue; (3) borrowers were not entitled to jury trial under FAA or the Seventh Amendment; and (4) alleged high cost of arbitration did not render arbitration agreements unenforceable.

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