Correct. But in that case, the court appoints an arbitrator and the two parties are responsible for his/her fees; and then they have to come back to court once an agreement is made.
The key issue is the lawsuit filed. It has to be ajudicated in accordance with state and local laws. It cannot be disposed of using Sharia Law because the petitioner sought relief from the courts; not from the religious establishment.
Now the only other way, and this is not mentioned in the article, is that the judge could have dismissed the case on the basis of the petitioner withdrawing the suit when they came to realize they could settle outside using Sharia law.
At that point, it’s a non-issue. Unless of course, someone is beheaded. I think it comes back to court under a whole new set of laws. :-)
In my opinion, the key issue before the court was whether the parties were bound by an enforceable arbitration agreement (and I will add here given the tone of the thread, that did not have an unlawful purpose). Once so determined by the judge, he honored that agreement.
You can have the last word.