NINA Y. WANG, Magistrate Judge.
This matter comes before the court on the "Motion of Respondents and Counter-Movants Timothy Fitz and Kelly Fitz to Confirm Arbitration Award," ("Motion to Confirm"), [#21, filed August 2, 2017]. The Motion to Confirm is before the undersigned Magistrate Judge pursuant to 28 U.S.C. § 636(b)(1)(A) and (B), Fed. R. Civ. P. 72(a) and (b), the Order Referring Case dated June 2, 2017 [#4], and the memorandum dated August 3, 2017 [#27]. After carefully reviewing the Motion to Confirm and related briefing, the entire case file, and the applicable case law, this court
Petitioner Can D. Gidding ("Petitioner" or "Mr. Gidding") initiated this civil action on May 25, 2017 by filing pro se a Petition To Vacate Arbitral Award (the "Petition") as to Timothy Fitz and Kelly Fitz (collectively, "the Fitzes" or "Respondents"). [#1]. On August 2, 2017, the Fitzes filed an Answer to the Petition, [#20], along with the pending Motion to Confirm, asking the court to confirm the arbitration award. [#21]. The following facts are drawn from the record before the court, including the Petition, the Fitzes' Answer, [#20], the Motion to Confirm Arbitration Award, [#21], and from the language of the Interim Arbitration Award ("Interim Award"), [#21-1], and Final Arbitration Award ("Final Award") [#21-2].
Beginning in 2003, Mr. Gidding "portrayed a designer on television," specifically, the Home and Garden TV Network ("HGTV"), [#1 at ¶ 6; #21 at 2], and he acted with the help of his father, John R. Gidding, also known as Janus Arch. [#1 at ¶ 6].
In 2013, the Fitzes purchased a residence located on Dahlia Street in Denver, Colorado (the "Dahlia Street property"). They subsequently engaged Midshore to design the interior space of the residence. [Id. at ¶ 10]. On October 31, 2013, the Fitzes entered into an agreement with Midshore for the complete remodel of the Dahlia Street property ("the Agreement"). [#1, ¶¶ 5, 10, 11]. Mr. Gidding asserts that John R. Gidding and Ms. Spencer negotiated the Agreement with the Fitzes. [Id. at ¶¶ 6, 9, and 11].
On November 21, 2013, Ms. Spencer established Four Year Gap, LLC ("FYG"), to assist with Midshore's renovation business "as Midshore planned to phase out home renovation and return to the manufacture of furniture by the end of 2014." [#1 at ¶ 12; #21 at 2]. In February 2014, FYG offered the Fitzes the option of remaining in the Agreement and allowing FYG to manage the project, or terminating the Agreement and signing a new contract with FYG. [#1 at ¶ 13]. The Fitzes elected to remain in the Agreement, permitting FYG to manage the project. [Id. at ¶ 13-14]. On October 10, 2014, the Fitzes entered into a contract for construction on the Dahlia Street property, and the contract identified "Gidding & Spencer" as a professional partnership and the Fitzes' architect. [Id. at ¶ 15].
By all accounts, the renovation of the Dahlia Street property went poorly. [#21-1 at 2]. In February 2015, legal counsel for the Fitzes approached Ms. Spencer to sign a contract "that retroactively extended the liability of `Gidding and Spencer, a general partnership,' to December 22, 2014." [Id. at ¶ 17]. Ms. Spencer refused to sign, and, in April 2015, the Fitzes terminated the Agreement and stopped payments. [Id. at ¶¶ 17-18].
On May 8, 2015, based on the terms of the Agreement, Midshore commenced arbitration against Mr. Fitz through the American Arbitration Association ("AAA"), seeking to recover amounts claimed to be due under the Agreement. [#1 at ¶ 19; #20 at 4]. Mr. Fitz served an answer and asserted counterclaims and, on July 7, 2015, moved to join the following as counter-respondents: "Can D. Gidding a/k/a Can Danny Gidding a/k/a John Gidding; Krystee Manifold a/k/a Krystee Manifold Spencer a/k/a Krystee Spencer; Janus Arch; and Gidding & Spencer." [#1 at ¶ 21; #20 at 5]. On July 19, 2015, FYG joined in the arbitration. [#20 at 6]. On September 16, 2015, through a Rule 7 joinder process, Mr. Fitz's motion to join was granted.
On May 5, 2016, Daniel Gross (the merits arbitrator) held a preliminary hearing at which he set a multi-day evidentiary hearing to begin February 13, 2017. [#21-1 at 5]. On June 17, 2016, Ms. Spencer filed for bankruptcy individually; the arbitration was stayed as to her and she was ultimately dismissed as a party. [#20 at 8; #21-1 at 5]. On August 12, 2016, the Fitzes filed and served amended counterclaims, which asserted as follows: breach of contract; violation of the Colorado Trust Fund Statute, § 38-22-127, C.R.S.; breach of fiduciary duty; violation of the Colorado Civil Theft Statute, § 18-4-405, C.R.S.; conversion; an accounting of the funds disbursed to counter-respondents; negligent design; negligent misrepresentation; promissory fraud; and to pierce the veil of the alleged entities Midshore, Janus Arch, FYG, and Gidding & Spencer. [Id.] Midshore ultimately abandoned its claims against the Fitzes, and the arbitration went forward as to the Fitzes' counterclaims only.
On February 10, 2017, three days prior to the evidentiary hearing set by the arbitrator, Mr. Gidding emailed the parties to the arbitration and the arbitrator advising that, "[b]ecause I am not, nor have I ever been, a signatory to the agreement to arbitrate any dispute with Timothy or Kelly Fitz, I reject the jurisdiction and authority of this Arbitrational Court . . . [and] I reserve all of my rights, positions, and defenses." [#21-1 at 6]. On February 13, 2017, the evidentiary hearing went forward as planned; the Fitzes were the only parties in attendance and the only parties to put forth evidence. None of the counter-respondents appeared and none sought to testify by remote means. [#20 at 9]. On March 2, 2017, the arbitrator issued the Interim Award, which awarded $670,192 in damages to the Fitzes and directed them to submit evidence of prejudgment interest, costs, and attorneys' fees. On March 22, 2017, the arbitrator entered the Final Award for the amount of $819,926.66 "in favor of Timothy and Kelly Fitz and against Midshore Marketing, Inc., Janus Arch, Four Year Gap, LLC, Can D. Gidding a/k/a John Gidding, and Gidding & Spencer, a general partnership, jointly and severally." [#1 at ¶ 33; #1-12].
On May 25, 2017, Mr. Gidding filed the Petition seeking to vacate the Final Award on account of fraud, that he was not a signatory to the Agreement, that the AAA tribunal did not obtain personal jurisdiction over him, that his procedural due process rights were violated, and pursuant to the equitable doctrine of unclean hands. See [#1]. On July 13, 2017, the undersigned presided over a Status Conference at which the Parties represented they required no discovery, and discussion was held regarding the anticipated briefing schedule for the anticipated Motion to Confirm. See [#15]. On August 2, 2017, the Fitzes filed their Answer to the Petition and the pending Motion to Confirm, and the affidavits of two attorneys and of Mr. Fitz in support thereof. [#20; #21; #23; #24; #25]. The same day, the Fitzes filed an opposed motion to join asking the court to join as counter-respondents to the Motion to Confirm the entities that were party to the arbitration, i.e., Gidding & Spencer, FYG, Midshore, and Janus Arch (the "Other Parties"), for the purpose of asking the court to confirm the Final Award as to them. On November 6, 2017, this court granted the motion to join, [#49], and the Clerk of the Court issued the appropriate Summons. The returns of service as to the Other Parties were filed on December 22, 2017, reflecting service on December 1, 2017 [#54, #55, #56, #57], but none of the Other Parties has entered an appearance in this action.
On December 28, 2017, the Fitzes filed a Motion for Entry of Default pursuant to Federal Rule of Civil Procedure 55(a) as to "Midshore Marketing, Inc.; Midshore Marketing, Inc. d/b/a Janus Arch; Four Year Gap, LLC; and Four Year Gap, LLC d/b/a Gidding & Spencer," on the basis that these entities "failed to plead or otherwise defend in response to the Fitzes' Motion to Confirm Arbitration Award." [#58 at 1-2]. Accordingly, this Recommendation pertains to Mr. Gidding only, given the non-appearance of the Other Parties. The court exercises jurisdiction over this action pursuant to 28 U.S.C. § 1332.
The Parties agree that the Federal Arbitration Act, 9 U.S.C. § 9 ("FAA") governs the issues raised herein. See, e.g., Comanche Indian Tribe of Okla. v. 49, L.L.C., 391 F.3d 1129, 1131 (10th Cir. 2004) (stating that the FAA "applies to all arbitration agreements `involving commerce,' and `create[s] a body of federal substantive law of arbitrability, applicable to any arbitration agreement within the coverage of the Act.'" (alteration in original) (quoting 9 U.S.C. § 2; Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)); see also id. at 1132 ("The requirement that the underlying transaction involve commerce `is to be broadly construed so as to be coextensive with congressional power to regulate under the Commerce Clause.'" (quoting Foster v. C.F. Turley, Jr., 808 F.2d 38, 40 (10th Cir. 1986)). Section 9 provides that "[i]f the parties in their agreement" to arbitrate:
9 U.S.C. § 9. Section 10 permits the court "in and for the district wherein the award was made" to vacate the arbitration award upon the application of any party to the arbitration, under the following circumstances:
Id. at § 10.
"Once a dispute is properly before an arbitrator, the function of the courts in reviewing the arbitrator's decision is quite limited." Denver & Rio Grande Western Railroad Co. v. Union Pacific Railroad Co., 119 F.3d 847, 849 (10th Cir. 1997) (citation omitted). And, "[o]nce an arbitration award is entered, the finality that courts should afford the arbitration process weighs heavily in favor of the award, and courts must exercise great caution when asked to set aside an award." Foster v. Turley, 808 F.2d 38, 42 (10th Cir. 1986) (citation omitted). "A court may only vacate an arbitration award for reasons enumerated in the Federal Arbitration Act, 9 U.S.C. § 10, or for a handful of judicially created reasons." Denver & Rio Grande Western Railroad, 119 F.3d at 849 (citations omitted). See Sheldon v. Vermonty, 269 F.3d 1202, 1206 (10th Cir. 2001) (listing the judicially created reasons as "violations of public policy, manifest disregard of the law, and denial of a fundamentally fair hearing"); ARW Exploration Corp. v. Aguirre, 45 F.3d 1455, 1463 (10th Cir. 1995) (acknowledging a judicially-created basis for vacating an award when the arbitrators acted in "manifest disregard" of the law, which requires a finding that the decision exhibits "willful inattentiveness to the governing law."). So as to "protect the finality of arbitration decisions, courts must be slow to vacate an arbitral award on the ground of fraud." Foster, 808 F.2d at 42 (citation omitted). The party claiming fraud must establish the fraud "by clear and convincing evidence," and "must show that due diligence could not have resulted in discovery of the fraud prior to arbitration." Id. (citations omitted). "[A]s long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, that a court is convinced he committed serious error does not suffice to overturn his decision." Advisor Dealer Services, Inc. v. Icon Adviser's, Inc., 557 F. App'x 714, 717 (10th Cir. 2014) (quoting Int'l Bhd. of Elec. Workers, Local Union No. 611, AFL-CIO v. Pub. Serv. Co. of N.M., 980 F.2d 616, 618 (10th Cir. 1992)) (further citation omitted).
The Parties also assert that the Colorado Revised Uniform Arbitration Act, ("CRUAA"), Colo. Rev. Stat. § 13-22-222 et seq. applies, to different ends.
The Parties here do not represent that the Agreement provided for the CRUAA to apply, and the Agreement contains no such language. See [#1-2; #25-5; #25-13, #25-14]. See also Lane v. Urgitus, 145 P.3d 672, 684 n.1 (Colo. 2006) (Eid, J. dissenting) (noting in the dissent that § 13-22-203, the statute on which the Fitzes rely, simply allows parties to agree to apply an earlier version of the CRUAA: § 13-22-203 "specifies that the new statute will apply only to agreements to arbitrate made on or after August 4, 2004, unless the parties otherwise agree, on the record," and "[s]ince the parties do not agree that the arbitration statute applies at all, they clearly have not agreed to application of the 2004 Act."). In this case, the arbitration agreements only specified that any disputes would be settled by arbitration by the AAA under its Construction Industry Arbitration Rules, and "judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof." [#1-2 at 3; #1-3 at 3; #1-4 at 3; #1-5 at 3]. When initiating the arbitration, Midshore did not reference or invoke the CRUAA, see [#24-4], and neither arbitrator referred to the CRUAA in the Interim or Final Award, or the Order on the Rule 7 joinder. [#24-2, #21-1, #24-16]. Additionally, no Party cites any legal authority from either this District or the Tenth Circuit that suggests that the provisions of the FAA and CRUAA apply concurrently, or that parties to an arbitration agreement can specify after the fact that the Acts should apply concurrently, and Plaintiff's reliance on Byerly v. Kirpatrick Pettis Smith Polian, Inc., 996 P.2d 771 (2000) does not persuade this court otherwise. Accordingly, this court applies the FAA only.
The Agreement specifies that any claim arising out of or relating to it, or any breach thereof, will be arbitrated by AAA pursuant to its Construction Industry Arbitration Rules (the "Rules"). No Party contests this provision. The Rules provide in particular relevant part as follows.
Rule 4 states that the party wishing to initiate arbitration shall file with the AAA the demand for arbitration, the fee, a copy of the arbitration agreement, and "shall simultaneously provide a copy of the demand and the applicable arbitration agreement to the opposing party (`the respondent')." American Arbitration Association, Construction Industry Arbitration Rules and Mediation Procedures, R-4(a) (July 1, 2015) available at https://www.adr.org/sites/default/files/Construction%20Rules.pdf.
Rule 7 governs joinder of parties, and requires the appointment of an arbitrator for the limited purpose of determining the joinder issue; a merits arbitrator is thereafter appointed. Construction Industry Arbitration Rules and Mediation Procedures at R-7(a), supra. Where the party sought to be joined is not a party to an ongoing arbitration administered by the AAA, the party seeking joinder shall comply with the provisions of Rule 4(a) as to that party. Id. at R-7(c).
Rule 9 provides that the arbitrator "shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope or validity of the arbitration agreement" and "shall have the power to determine the existence or validity of a contract at which an arbitration clause forms a part." Construction Industry Arbitration Rules and Mediation Procedures at R-9(a)-(b), supra. "A party must object to the jurisdiction of the arbitrator or to the arbitrability of a claim or counterclaim no later than the filing of the answering statement to the claim or counterclaim that gives rise to the objection." Id. at R-9(c).
In the Petition, Mr. Gidding asserts multiple arguments in asking the court to vacate the Final Award. The court addresses first Mr. Gidding's assertion that he was improperly joined to the arbitration proceedings and that the Final Award was procured by fraud. [#1 at 10, 14, 17]. Mr. Gidding also argues that "the AAA tribunal did not obtain personal jurisdiction over [him]"; his procedural due process rights were violated in that he did not have an opportunity to participate in the selection of the arbitrator; and the equitable doctrine of unclean hands supports vacating the award. [Id. at 9, 13, 19].
In the Motion to Confirm, the Fitzes ask the court to confirm the Final Award, award additional prejudgment interest from the date of the Award until when judgment enters in this matter, and award attorney fees and costs pursuant to the CRUAA, Colo. Rev. Stat. § 13-22-225(3). See [#21]. Mr. Gidding argues in response that the arbitration award is "manifestly unreasonable" and that the arbitration did not guarantee "equality" between the parties. [#37 at 4]. There is no statutory basis under the FAA for vacating an arbitral award based either on "manifest unreasonableness" or because "the arbitration did not guarantee equality between the parties." See 9 U.S.C. § 10. But Mr. Gidding is proceeding pro se, and pursuant to a liberal construction of his papers, see Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991), the court interprets this argument as a contention that the arbitrator exhibited manifest disregard of the law.
Mr. Gidding's arguments regarding the arbitrator's error in joining him to the proceedings and the basis for vacating the Arbitration Award on account of fraud are intertwined in the sense that the purported fraud involves allegations that Mr. Fitz and his legal counsel took action to misrepresent Mr. Gidding and Ms. Spencer, or cause them to misrepresent themselves, as General Partners of Gidding & Spencer. I address first, and together, the issue of the arbitrator's authority and Mr. Gidding's argument that joinder was improper because he was not a signatory to the Agreement. I address second Mr. Gidding's allegations of fraud. As described below, the Agreement delegated the issue of arbitrability to the arbitrator who acted within his authority in joining Mr. Gidding, and the record does not support a finding of fraud or manifest disregard of the law.
"[A]rbitration is a matter of contract," and the court cannot require a party "to submit to arbitration any dispute which he has not agreed so to submit." Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 84 (2002) (citation omitted). Accord Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63, 67 (2010) ("arbitration is a matter of contract," and courts must "place[ ] arbitration agreements on an equal footing with other contracts, and . . . enforce them according to their terms.") (citation omitted). "Just as the arbitrability of the merits of a dispute depends upon whether the parties agreed to arbitrate that dispute, so the question `who has the primary power to decide arbitrability' turns upon what the parties agreed about that matter." First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943 (1995) (emphasis in original). The parties may agree to arbitrate arbitrability. AT & T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 648 (1986). And, when the parties so agree, "they delegate to an arbitrator all threshold questions concerning arbitrability," including "whether the parties are bound by a given arbitration clause." Belnap v. Iasis Healthcare, 844 F.3d 1272, 1280 (10th Cir. 2017) (citing in part BG Grp. PLC v. Republic of Arg., ___ U.S. ____, 134 S.Ct. 1198, 1206, 188 L.Ed.2d 220 (2014)) (additional citations omitted).
"[Q]uestions of arbitrability encompass two types of disputes: (1) disputes about `whether a particular merits-related dispute is arbitrable because it is within the scope of a valid arbitration agreement,". . . and (2) `threshold disputes about who should have the primary power to decide' whether a dispute is arbitrable." Belnap, 844 F.3d at 1280 (quoting First Options, 514 U.S. at 944-45, 942) (emphasis in original). When addressing the second type of dispute, i.e., whether parties have agreed that arbitrators rather than the court should decide arbitrability, courts "should not assume the parties agreed to arbitrate arbitrability unless there is `clea[r] and unmistakabl[e]' evidence that they did so." Id. (quoting First Options, 514 U.S. at 944) (additional citations omitted).
Here, it is undisputed that the Parties agreed to an arbitration to be governed by the AAA Rules. In turn, the Rules reserve for the AAA arbitrators the question of arbitrability, Construction Industry Arbitration Rules and Mediation Procedures at R-9, supra, and the Agreement expressly states that the Rules shall govern any disputes arising therefrom. See [#1-2]. Thus, the court has before it clear and unmistakable evidence that the Parties agreed that the arbitrator should resolve questions of arbitrability. See Belnap, 844 F.3d at 1279, 1281-82 (reviewing a similar rule of the Judicial Arbitration and Mediation Service ("JAMS") and concluding, within the context of a motion to compel arbitration, that "by incorporating the JAMS Rules into the Agreement, Dr. Belnap and SLRMC evidenced a clear and unmistakable intent to delegate questions of arbitrability to an arbitrator") See also id. at 1283 (citing "in an analogous context," sister circuits that have addressed the issue and "unanimously concluded that incorporation of the substantively identical (as relevant here) AAA Rules constitutes clear and unmistakable evidence of an agreement to arbitrate arbitrability."). Upon such a finding of clear and unmistakable evidence, the court "must allow an arbitrator to decide issues of arbitrability in the first instance"; there is no provision for the use of discretion. See id. at 1292-93.
In considering that arbitration is a matter of contract, courts generally apply "ordinary state-law principles that govern the formation of contracts." First Options, 514 U.S. at 944. Accord Arthur Andersen LLP v. Carlisle, 556 U.S. 624, 630-31 (2009) (holding that the issue of whether a nonsignatory can be bound by or compel arbitration under an arbitration agreement is governed by state law). "Under Colorado law, both signatory and nonsignatory parties may be bound by an arbitration agreement if so dictated by ordinary principles of contract law." Meister v. Stout, 353 P.3d 916, 920 (Colo. App. 2015) (citing Smith v. Multi-Financial Sec. Corp., 171 P.3d 1267, 1272 (Colo. App. 2007) (further citation omitted)). In this state, "the association of two or more persons to carry on as co-owners a business for profit forms a partnership, whether or not the persons intend to form a partnership." Colo. Rev. Stat. § 7-64-202(1). Colorado law has also defined a partnership as "an express or implied contract between two or more persons to place their money, skill, effects or labor into a business, and to share the profit and losses." In re Palilla, 493 B.R. 248, (Bankr. D. Colo. 2013) (quoting Larsen v. Consolidated Pet Foods, Inc. (In re S & D Foods, Inc.), 144 B.R. 121, 158 (Bankr. D. Colo. 1992)). No written agreement is required; the partnership may be formed by the conduct of the parties. Id. Accord Stratman v. Dietrich, 765 P.2d 603, 605 (Colo. App. 1988). The Colorado Uniform Partnership Act provides that all partners in a general partnership are liable jointly and severally for all partnership obligations unless otherwise agreed or provided by law. Colo. Rev. Stat. § 7-64-306(1).
In the arbitration, the Fitzes asserted that Midshore, Janus Arch, Gidding & Spencer, and FYG "were mere shells and that Gidding and Spencer were actually doing business as partners in a general partnership," and, alternatively, that if those entities "were real companies, the Fitzes were entitled to pierce the corporate veil and hold Gidding and Spencer individually liable." [#20 at 18]; see [#24 at ¶ 12; #24-10]. The arbitrator concluded that Mr. Gidding and Ms. Spencer were operating as a general partnership called Gidding & Spencer and that Mr. Gidding was accordingly bound by the arbitration provision in the Revised Services Agreement, which superseded the Agreement, and was liable for breach of contract, among other claims. [#20 at 18]; see [#24-2; #24-16]. Courts are to "give `extreme deference' to the determination of the arbitrator, as the standard of review of arbitral awards is amongst the narrowest." THI of New Mexico at Vida Encantada, LLC v. Lovato, 864 F.3d 1080, 1083 (10th Cir. 2017) (quoting Brown v. Coleman Co., 220 F.3d 1180, 1182 (10th Cir. 2000)). Even if this court were convinced that the arbitrator committed serious error (and it is not), the conclusion would not serve as a proper ground to vacate the arbitration award. Id.
This court finds that the arbitrator acted within his authority, and thus turns to Mr. Gidding's allegations of fraud and arguments regarding manifest disregard of the law.
I begin with the various contracts entered into by the Parties. The Agreement was between Mr. Fitz and Janus Arch as a d/b/a Midshore, and was signed by Ms. Spencer as "CEO" of Janus Arch. See [#1-2]. The logo on the Agreement reads, "Janus Arch/John Gidding." Id. The arbitrator found, following the evidentiary hearing, that "[a]round March 11, 2014, Gidding & Spencer assumed responsibility for Midshore's obligations under [the Agreement] via a proffered revised services agreement (the `Revised Services Agreement'. . .)." [#21-1 at 4]. The Revised Services Agreement included a signature block for Gidding & Spencer and provided for Ms. Spencer's signature as "Partner"; the cover email for the Revised Services Agreement referred to Ms. Spencer as "Senior Partner" of Gidding & Spencer. [Id.] The arbitrator noted that Mr. Fitz testified at the evidentiary hearing that while neither he nor Mrs. Fitz signed the Revised Services Agreement, "they considered it to be in effect at the time it was received," and the arbitrator found as a matter of law that "the Fitzes and Gidding & Spencer treated the proffered form that Ms. Spencer signed as the parties' agreement." [Id. at 5, n.2]. See also [#1-17 at 32-41]. The arbitrator then discussed the history of the professional relationship between Mr. Gidding and Ms. Spencer and the Fitzes as follows:
capacity as partner of Gidding & Spencer. [citation omitted]. [Id. at 6-7]. The arbitrator then found that "the commonality of the persons involved (Mr. Gidding and Ms. Spencer) and the manner that the agreements were entered into and performed establishes that the corporate entities were a sham and support a piercing of the corporate veil of Midshore." [Id. at 7]. Finally, the arbitrator concluded that "since Mr. Gidding performed professional services under both agreements, he is properly subject to the arbitration provision in the two agreements and is individually liable to the Fitzes for his failure to provide services that meet the standard of care of an architect." [Id.]
In the Petition, Mr. Gidding asserts that the Revised Services Agreement "misrepresents `Gidding & Spencer' as a professional partnership and as Fitzes' architect of record." [#1 at 4, ¶ 15]. Mr. Gidding further asserts that the Final Award is the product of fraud because Richard Hill, serving as counsel to the Fitzes, "hatched" a "scheme of creating a partnership named `Gidding & Spencer' (with added spaces) . . . which misrepresented Gidding & Spencer as a professional partnership of architects." [Id. at 17, ¶ 64]. Mr. Gidding contends that Mr. Hill "pressured [Ms. Spencer] into signing documents that misrepresented her as an architect and as a partner in a professional partnership." [Id.] For support, Mr. Gidding cites the declaration of Ms. Spencer, in which she attests that the Revised Services Agreement, which she and Mr. Gidding refer to as the "AIA-Contract," "misrepresents the fanciful name of Gidding&Spencer (without spaces) as Gidding & Spencer (with spaces) making it appear to be a professional partnership of architects." [#1-17 at 4, ¶ 14]. Ms. Spencer further attests, "I am not in a partnership with any member of the Gidding family, nor am I an architect." [Id.] Ms. Spencer echoes Mr. Gidding's assertion that Mr. Hill, serving as counsel to the Fitzes, asked her "to sign documents misrepresenting myself as an architect and a partner in a partnership"; and that when she told Mr. Hill that she and Mr. Gidding were not architects and were not partners and refused to sign these documents, Mr. Hill "threatened me with non-payment unless I signed the documents," and she signed documents misrepresenting herself out of intimidation. [#1-17 at 4, ¶ 15].
Plaintiff's assertions of fraud simply are not supported by the evidence of record, including the exhibits to which Ms. Spencer cites in her Declaration. [#1-17 at 6-93]. There is no correspondence from Ms. Spencer suggesting that she balked at signing the documents at any time. See [id.] There is also no correspondence, either between Mr. Hill and Ms. Spencer, or between Ms. Spencer and anyone else, to suggest that Mr. Hill pressured her into signing any documents. [Id.] And, it does not strike this court as persuasive that the placement of spaces between "Gidding&Spencer" promotes the appearance of an entity of professional architects more so than without the spaces. Nor is the court swayed by the suggestion that Mr. Hill or his associates nefariously inserted spaces to somehow mislead a yet-to-be identified arbitrator for an arbitration that was ultimately initiated by Midshore, not the Fitzes. Indeed, it appears that individuals associated with Gidding & Spencer also used spaces between the last names to identify their company affiliation. See [#25-1 at 1]. Ms. Spencer's subjective feelings of intimidation do not establish fraud on the part of Mr. Hill, and other than Ms. Spencer's affidavit, Mr. Gidding introduces no evidence to support his allegations that Mr. Hill somehow defrauded the arbitrator into making a determination adverse to his interests.
It also does not appear that the arbitrator manifestly disregarded the law. The Tenth Circuit has interpreted "manifest disregard of the law" to mean "willful inattentiveness to the governing law." Bowen v. Amoco Pipeline Co., 254 F.3d 925, 932 (10th Cir. 2001). Based on the record before him, the arbitrator determined that Spencer & Gidding held itself out, through Ms. Spencer, as a General Partnership and that Mr. Gidding was appropriately joined to the arbitration in his partner capacity. See [#1-17 at 62, 74-75, 76, 77]. See also [#1-17 at 81]. At the core, Mr. Gidding takes issue with how the arbitrator interpreted the facts presented and applied the law. But the court's power to vacate an arbitrator award is limited, and the FAA does not authorize the court to engage in a general review of an arbitration proceeding to look for an arbitrator's legal errors. See Hall Street Assoc., LLC v. Mattel, Inc., 552 U.S. 576, 584 (2008). Rather, to establish "manifest disregard of the law," Mr. Gidding would need to demonstrate that the arbitrator knew of the law and explicitly disregarded it. Bowen, 254 F.3d at 932. Mr. Gidding points to neither applicable law that the arbitrator disregarded, nor evidence that the arbitrator engaged in misconduct. Nor does he point to evidence that the arbitrator somehow precluded him from participating in the arbitration; Mr. Gidding voluntarily declined to participate. There simply is no evidence that the arbitrator knew the law and willfully misapplied it. And it is not this court's role to re-adjudicate the facts presented to the arbitrator. Id. at 935. I find that the record does not support Mr. Gidding's contentions of fraud or manifest disregard of the law, and certainly does not provide clear and convincing evidence of such. And the fact that Mr. Gidding disagrees with the arbitrator's conclusion, even if it were flawed, is also not a ground to vacate the arbitration award.
Accordingly, because the record does not support a finding that the arbitrator manifestly disregarded the law, or a finding of fraud under § 10(a)(1), I recommend the court deny the request to vacate on these bases. I turn next to Mr. Gidding's argument regarding insufficient service of process.
Mr. Gidding asserts the Final Award should be vacated due to insufficient service, and represents that he was never served with the demand to arbitrate, Mr. Fitz's motion to join, the Fitzes' amended counterclaims, the arbitrator's Interim Award, or the Final Award. [#1; #1-15]. It is not clear to this court which of the § 10 grounds Mr. Gidding wishes to invoke with this argument, but, to the extent the argument is cognizable under that section, this court respectfully rejects it. As the Fitzes assert, the Rules do not require personal service that comports with the Federal Rules of Civil Procedure. See [#47 at 9]; Construction Industry Arbitration Rules and Mediation Procedures at R-4, supra.
It appears from the record that the Fitzes served, by certified mail, copies of their demand for arbitration and answer and counterclaims in the arbitration to Ms. Spencer's address in Atlanta, Georgia, which is the address that was listed on the Agreement and Revised Services Agreement, and Ms. Spencer received and signed for the documents. See [#24 at 2, ¶ 9; #24-7 at 1]. On the same date that copies of these documents were sent by certified mail, duplicate copies were sent by Federal Express to the same address and were delivered on June 26, 2015. See [#24-8]. The package was addressed to "Midshore/Krystee Spencer/Can Danny Gidding/Krystee Manifold/Janus Arch." [#24-7 at 1]. The arbitration demand listed the following as respondent: "Midshore, Gidding, Spencer, JanusArch," and identified John R. Gidding as the representative. [Id. at 2]. Pending return of the receipt for the first copy of documents sent via certified mail, counsel for Mr. Fitz sent a third copy of the documents by certified mail to the same Atlanta address. Ms. Spencer signed for those documents on July 3, 2015. See [#24-9]. On July 7, 2015, Mr. Fitz moved to join the following parties as additional Counter-Respondents: "Can D. Gidding a/k/a Can Danny Gidding a/k/a John Gidding; Krystee Manifold a/k/a Krystee Manifold Spencer a/k/a Krystee Spencer; Janus Arch; and Gidding & Spencer." The certificate of service attached to the motion to join indicates that each party was provided a copy at their respective email addresses. See [#24-10].
As an initial matter, the record shows that the Fitzes complied with the Rules. As a secondary matter, the court notes that any confusion on the Fitzes' part concerning the precise entities and individuals to whom to give notice is frankly of Mr. Gidding, Ms. Spencer, and John R. Gidding's own doing. The record demonstrates that John R. Gidding, who is not an attorney, initiated the arbitration on behalf of Midshore, see [#1-16 at 3, ¶¶ 11, 12]; and he continued to represent Midshore until ordered by the arbitrator to retain outside counsel, [#1-16 at 5, ¶ 22],
Finally, and in addition to the fact the record reflects that the Fitzes complied with the Rules, the arguments advanced by Mr. Gidding with respect to personal service do not articulate fraud as contemplated by § 10(a) of the FAA. See Bapu Corp. v. Choice Hotels International, Inc., 371 F. App'x 306, 310-11 (3d Cir. 2010) (affirming that franchisor was not entitled to vacatur of arbitration award based on franchisee's erroneous service of demand on wrong entity). As in Bapu Corp., there is no evidence suggesting that the Fitzes fraudulently served the wrong Mr. Gidding, or failed to serve him in an effort to defraud the court, and Mr. Gidding undeniably had notice of and an opportunity to participate in the arbitration. See id. (citing Bonar v. Dean Witter Reynolds, Inc., 835 F.2d 1378, 1383 (11th Cir. 1988) (articulating the following test to determine whether an arbitration award should be vacated for fraud: the movant must establish (1) by clear and convincing evidence, (2) fraud that was not discoverable through the exercise of due diligence prior to or during the arbitration, and (3) was materially related to an issue in the arbitration)).
As to Mr. Gidding's remaining arguments regarding procedural due process and the doctrine of unclean hands, these are not bases under the FAA for vacating the Final Award. See Bowen, 254 F.3d at 932 ("Mindful of the strong federal policy favoring arbitration, a court may grant a motion to vacate an arbitration award only in the limited circumstances provided in § 10 of the FAA . . . or in accordance with a few judicially created exceptions"); Denver & Rio Grande Western Railroad, 119 F.3d at 849 (listing examples of "a handful of judicially created reasons"). Cf. Dominion Video Satellite, Inc. v. Echostar Satellite L.L.C., 430 F.3d 1269, 1275, 1278 (10th Cir. 2005) (rejecting six arguments that arbitration award should be set aside, including on the grounds of preemption, violation of the First Amendment of the Constitution, claim preclusion, doctrine of legal impossibility, and justiciability, as none "are grounds for vacating the arbitration award," and finding the appeal of the award to be frivolous). Even were the court inclined to consider equitable remedies, the record does not support Mr. Gidding's argument that "it would be in the interest of justice for this court to dismiss the Fitzes claims with prejudice [sic] and remand the case for entry of judgment in Midshore's favor." [#1 at 19]. Accordingly, finding no basis for vacating the award, I respectfully recommend that the Motion to Confirm be GRANTED, consistent with the mandate of 9 U.S.C. § 9.
Finally, with respect to the requested prejudgment interest, the Fitzes cite the Interim Award that grants them $670,192 in damages and prejudgment interest per annum under Colo. Rev. Stat. § 5-12-102(b). The Final Award ultimately granted the Fitzes $72,234.75 in prejudgment interest on $586,321 in damages. The Fitzes seek additional prejudgment interest in the amount of $146.89 per day, calculated on the principal amount of damages under the Interim Award or, alternatively, interest in the amount of $128.51 per day, calculated on the principal amount of damages under the Final Award. [#21 at 6].
State law applies when determining the issue of prejudgment interest. Hicks v. Cadle Co., 355 F. App'x 186, 199 (10th Cir. 2009) (remanding matter to district court to enter award of prejudgment interest). "[T]he purpose of prejudgment interest is to reimburse the plaintiff for inflation and lost return." Goodyear Tire & Rubber Co. v. Holmes, 193 P.3d 821, 826 (Colo. 2008) (citing Mesa Sand & Gravel Co. v. Landfill, Inc., 776 P.2d 362, 364 (Colo. 1989) ("Section 5-12-102 recognizes the time value of money."). Section 5-12-102, C.R.S. serves as Colorado's "general prejudgment and postjudgment statute," Farmers Reservoir and Irr. Co. v. City of Golden, 113 P.3d 119, 133 (Colo. 2005), and provides for the payment of interest at the rate of eight percent per annum compounded annually. Colo. Rev. Stat. § 5-12-102(1).
"[T]he determination of whether prejudgment interest should be added to an award of damages in an arbitration is for the arbiters to decide." Levy v. American Family Mut. Ins. Co., 293 P.3d 40, 50 (Colo. App. 2011). Cf. Duncan v. Nat'l Home Ins. Co., 36 P.3d 191, 192-93 (Colo. App. 2001) (holding the addition of prejudgment interest upon confirmation of the arbitration award was an impermissible modification of the award when plaintiff did not request prejudgment interest during the arbitration proceedings but only when confirming the arbitration award). There is no dispute that the matter of prejudgment interest was before the arbitrator and the arbitrator included prejudgment interest in the sum of damages awarded to the Fitzes. Furthermore, the Fitzes have not received payment of the award. See Columbine Valley Construction Co. v. Board of Directors, Roaring Fork School Dist. RE-1J, 626 P.2d 686, 694-95 (Colo. 1981) (en banc) (affirming application of § 5-12-102 to allow interest on arbitration award from the date of the award).
Thus, the question presented here is what amount of prejudgment interest since the date of the Final Award should the Fitzes receive. The Fitzes suggest first that the court confirm as prejudgment interest an amount that corresponds to the principal amount of damages specified in the Interim Award, issued on March 2, 2017; they propose in the alternative that the court confirm as prejudgment interest an amount that corresponds to the smaller, principal amount of damages specified in the Final Award, issued March 22, 2017. Compare [#21-1] with [#21-2]. The Fitzes provide no explanation, and I can discern none, as to why the court should apply the principal amount of damages specified in the Interim Award as opposed to the Final Award, when the Final Award is clearly the final order of the arbitration proceedings. Furthermore, the arbitrator states in the Final Award that "prejudgment interest should be based on $586,321, which is the difference between the total award of $670,192 and the Architectural Wood award of $83,871," for a total annual compounded interest award of $72,234.75. [#21-2 at 4]. Accordingly, I find that the court should award prejudgment interest at the rate of eight percent calculated on $586,321, from March 23, 2017, the day after entry of the Final Award, through the date of entry of judgment in this matter.
The Fitzes also request attorney fees and costs pursuant to Colo. Rev. Stat. § 13-22-225, which provides in pertinent part:
Sections 13-22-222, 13-22-223, and 13-22-224 refer to proceedings in Colorado state court to confirm, vacate or modify an arbitral award, and the FAA does not provide for the award of attorneys' fees and reasonable litigation expenses to the prevailing party. This court found no instance in which a federal court applied § 13-22-225 to award a prevailing party its attorneys' fees and reasonable litigation expenses. Based on the authority before me, I have concluded that the CRUAA does not apply to the Agreement, and the Fitzes cite no authority that permits the court to award them attorneys' fees under the CRUAA in a proceeding governed by the FAA. Nor do the Fitzes cite alternative authority under which the court may award attorneys' fees and costs, and this court found none. I thus respectfully recommend that the court deny this relief.
For the foregoing reasons, I respectfully
Bryan E. Kuhn, Katherine Winnette Beckman, Bryan E. Kuhn, Counselor at Law, P.C., Denver, CO, for Plaintiff.
Peter Francis Munger, Jackson Lewis, P.C., Denver, CO, for Defendants.
Wiley Y. Daniel, Senior United States District Judge
On October 17, 2013, plaintiff, Stephen P. Wolford, filed this suit against defendants, Flint Trading, Inc. and Ennis Paint, Inc. (collectively "the Defendants"), alleging the following claims arising out of Wolford's termination and the Defendants' alleged failure to properly pay employment bonuses: (1) violation of the Colorado Wage Claim Act, COLORADO REVISED STATUTES § 8-4-109, et seq.; (2) violation of the Fair Labor Standards Act, 29 U.S.C. § 201, et seq.; (3) wrongful discharge in violation of public policy; (4) breach of contract; (5) unjust enrichment; (6) conversion; and, (7) promissory estoppel. On June 8, 1998, defendant, Flint Trading, Inc. ("Flint"), hired plaintiff, Stephen P. Wolford, as a sales representative. Wolford received multiple bonuses and pay increases and was eventually promoted to Regional Sales Manager in 2000. On April 2, 2012, Flint and defendant, Ennis Paint, Inc. ("Ennis"), merged and began doing business as Flint-Ennis. After the merger, Wolford alleges that the Defendants failed to properly pay him bonuses. Wolford inquired as to why he was not receiving his bonuses to multiple persons, including Regional Sales Director, Kirk Ebert. After Ebert notified Wolford that he would not receive a bonus for a specified portion of his sales, Wolford sent an email to Bernadette Young, a Human Resources representative, regarding the Defendants' failure to pay him bonuses. Wolford alleges that the Defendants terminated him within thirty minutes of him sending the email to Young.
On November 18, 2013, the Defendants filed a Motion To Dismiss And Compel Arbitration [ECF No. 11] arguing that this Court lacks subject matter jurisdiction over Wolford's claims because the arbitration clause in the Employment Agreement ("the Agreement") [ECF No. 11-1] between Flint and Wolford mandates that all claims arising out of the Agreement "shall be settled by arbitration . . ." ECF No. 11-1, p. 9, § 14. Wolford argues that: (1) his claims are not subject to the Agreement's arbitration clause because he terminated the Agreement by letter on December 3, 2013; and, (2) Ennis cannot demand arbitration because he is not a party to the Agreement.
The Defendants request that I compel the parties to arbitrate Wolford's claims pursuant to the Agreement's arbitration clause.
The Federal Arbitration Act ("FAA"), 9 U.S.C. § 1, et seq., represents the strong federal public policy favoring arbitration. Vaden v. Discover Bank, 556 U.S. 49, 58 (2009) (quotation marks and internal citations omitted) ("In 1925, Congress enacted the FAA [t]o overcome judicial resistance to arbitration, and to declare a national policy favoring arbitration of claims that parties contract to settle in that manner"). Pursuant to § 2 of the FAA:
"The question whether the parties have submitted a particular dispute to arbitration, i.e., the `question of arbitrability,' is `an issue for judicial determination unless the parties clearly and unmistakably provide otherwise.' "Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 83 (2002) (quoting AT & T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 649 (1986)). The Agreement does not contain any language evidencing the parties' intent to arbitrate the issue of arbitrability. Thus, I must determine whether to compel arbitration of all or any of Wolford's claims against the Defendants. In resolving this question, I follow the three part inquiry set forth by the United States Court of Appeals for the Tenth Circuit in Cummings v. FedEx Ground Package Sys., 404 F.3d 1258, 1261 (10th Cir.2005). In Cummings, the Tenth Circuit stated:
proceedings, arbitration is inappropriate. See COLORADO REVISED STATUES § 13-21-102(5) ("Unless otherwise provided by law, exemplary damages shall not be awarded in administrative or arbitration proceedings, even if the award or decision is enforced or approved in an action commenced in court"). I disagree.
The plaintiff in Willingham v. Omaha Woodmen Life Ins. Soc'y, 2009 U.S. Dist. LEXIS 73411 (D.Colo. Aug. 19, 2009), posited an argument similar to Wolford's. Specifically, the plaintiff argued that "because he is requesting exemplary damages on the bad faith claim, and because C.R.S. § 13-21-102(5) prevents arbitration tribunals from awarding exemplary damages, he is entitled to have at least the bad faith claim heard by a jury." 2009 U.S. Dist. LEXIS 73411 at *2. While noting that the FAA governed the arbitration clause at issue, the Court stated that the plaintiff failed to provide any authority supporting his position and held that "the Plaintiff is free to pursue all his claims and requested remedies, including exemplary damages, in an arbitral forum." Id. at *4. The court in Pyle v. Securities U.S.A., Inc., 758 F.Supp. 638, 639 (D.Colo. Mar. 8, 1991), came to a similar conclusion when it stated that "[b]ecause there has been no showing that the parties agreed that Colorado arbitration law should govern in this FAA action, Colo.Rev.Stat. § 13-21-102(5) does not apply." The FAA governs the Agreement's arbitration clause. Therefore, Colorado state law will not dictate the outcome of any issue regarding arbitration under the Agreement. Cf. Volt Info. Scis. V. Bd. of Trs. 489 U.S. 468, 479 (1989) ("Where, as here, the parties have agreed to abide by state rules of arbitration, enforcing those rules according to the terms of the agreement is fully consistent with the goals of the FAA . . ."). As such, Wolford's request for exemplary damages does not preclude arbitration.
Upon reading the parties' briefs, three issues regarding arbitration are before me: (1) whether the Agreement's arbitration clause survived Wolford's termination of the Agreement on December 3, 2013; (2) if the arbitration clause survived, what claims are arbitrable; and, (3) whether Ennis, as a non-signatory of the Agreement, can invoke the Agreement's arbitration clause.
Pursuant to § 18(a) of the Agreement, "[t]he Employee or the Company may voluntarily elect to terminate this Agreement at any time provided that the party electing to terminate must deliver to the other party fifteen (15) days written notice of such termination." ECF No. 11-1, p. 10. § 18(a). On November 20, 2013, Wolford sent a letter to Flint stating that "I, Stephen P. Wolford, personally and through my counsel, do hereby provide my Notice to Terminate The Agreement in writing to the Company's principal office, effective in fifteen (15) days of this mailing, on or before December 3, 2013." ECF No. 13-3, p. 1, ¶ 1. Wolford also states in the letter that due to his express termination of the Agreement, "the Arbitration Clause in Section 14 shall be null and void." Id. at ¶ 2. Wolford argues that his November 20, 2013 letter terminated the Agreement and therefore he is not bound by the Agreement's arbitration clause. I disagree.
The law under Riley is clear, the "parties" must expressly indicate or clearly imply their intention to repudiate the arbitration clause. This language contemplates action by both parties. Here, there is only unilateral action: Wolford's express repudiation of the arbitration clause. There is no evidence before me that the Defendants responded to Wolford's repudiation by expressly indicating their intent to repudiate the arbitration. In fact, there is no evidence before me that indicates the Defendants even responded to Wolford's termination letter. Thus, under Riley, the parties did not expressly indicate or clearly imply their intent to repudiate the arbitration clause. Therefore, the arbitration clause survived Wolford's termination of the Agreement.
"[T]he policy of the Arbitration Act requires a liberal reading of arbitration agreements . . ." Moses H. Cone Mem'l Hosp., 460 U.S. at 23 n.27. "[A]ny doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration . . ." Id. at 24-25. As previously noted, the Agreement's arbitration clause is broad. "When a contract contains a broad arbitration clause, matters that touch the underlying contract should be arbitrated." Brown, 220 F.3d at 1184. With this understanding, I turn to whether Wolford's claims are arbitrable.
The substance of Wolford's seven claims is that the Defendants failed to pay bonuses and commissions owed to Wolford and that the Defendants' termination of Wolford is against public policy because it was in retaliation for Wolford questioning the Defendants' failure to pay the bonuses and commissions. It is clear that Wolford's termination arises out of the Agreement. Regarding bonuses and commission, Wolford argues that the "commission and bonus compensation plans were not contemplated by The Agreement in 1998, they in no way arise out of The Agreement which provides Mr. Wolford with a base salary and they say nothing about bonuses or commissions in any way." ECF No. 13, p. 8, ¶ 3. I agree with Wolford that the Agreement does not expressly mention bonuses or commission. However, that fact does not preclude a finding that a dispute regarding bonuses and commission is not arbitrable. Bonuses and commission are part and parcel to an employee's salary, especially in sales. Further, the Agreement provides that Wolford's salary would be renegotiated every year. ECF No. 11-1, p. 4, § 3 / p. 5, § 3. Wolford's bonuses and commission on sales is undoubtedly included in these annual renegotiations. Thus, I find that the any claim arising from the dispute regarding Wolford's bonuses and commission "touch[es]" the Agreement and is therefore arbitrable. Brown, 220 F.3d at 1184. I therefore conclude that all of Wolford's claims are arbitrable under the Agreement.
Arbitration arises from a contract between parties, and therefore "a party cannot be forced to arbitrate any issue he has not agreed to submit to arbitration." Commun. Workers of Am. v. Avaya, Inc., 693 F.3d 1295, 1300 (10th Cir.2012) (citations omitted). However, "[a] non-signatory to an arbitration agreement may be bound to arbitrate under general contract law and agency principles." 31-903 MOORE'S FEDERAL PRACTICE—Civil § 903.06.
There is no dispute that Wolford and Flint are the only signatories to the Agreement. The Defendants argue that Ennis, a non-signatory to the Agreement, may invoke the Agreement's arbitration clause under the doctrine of equitable estoppel. This Court recognizes the doctrine of equitable estoppel as a vehicle to compel non-signatories to arbitrate with signatories. Adams v. ModernAd Media, LLC, 2013 U.S. Dist. LEXIS 25263, *14 (D.Colo. Feb. 25, 2013); GATX Mgmt. Servs. LLC v. Weakland, 171 F.Supp.2d 1159, 1166-67 (D.Colo. Nov. 14, 2001); Cherry Creek & Party Shop, Inc. v. Hallmark Mktg. Corp., 176 F.Supp.2d 1091, 1098-99 (D.Colo. Dec. 24, 2001). In Cherry Creek Card & Party Shop, Inc., Judge Babcock relied on a case from the United States Court of Appeals for the Second Circuit to explain equitable estoppel in the arbitration context. Judge Babcock stated:
176 F.Supp.2d at 1098. Judge Babcock further stated that "application of equitable estoppel is warranted when the signatory to the contract containing an arbitration clause raises allegations of substantially interdependent and concerted misconduct by both the nonsignatory and one or more of the signatories to the contract." Id. Wolford alleges all seven of his claims against both Flint and Ennis. All seven of Wolford's claims arose after Flint and Ennis merged and began doing business as Ennis-Flint. In fact, according to Wolford's allegations in his Complaint [ECF No. 1], the merger created the conflict which forms the basis of this lawsuit. As such, I find that Wolford alleges "substantially interdependent and concerted misconduct" by both Flint and Ennis such that Ennis, a non-signatory to the Agreement, may enforce the Agreement's arbitration clause and join in the arbitration. Cherry Creek Card & Party Shop, Inc., 176 F.Supp.2d at 1098.
Under the FAA, when a district court decides an issue is "referable to arbitration," the district court "shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement . . ." 9 U.S.C. § 3. In their Motion To Dismiss And Compel Arbitration [ECF No. 11], the Defendants "request that the Court
After careful consideration of the matter before this Court, it is
ORDERED that the Defendants' Motion To Dismiss And Compel Arbitration [ECF No. 11] is
The motion is
FURTHER ORDERED that the parties
FURTHER ORDERED that this action is
Not Reported in F.Supp.3d, 2014 WL 3747177, 2014 Wage & Hour Cas.2d (BNA) 164,692
