United States District Court, W.D. North Carolina, Charlotte Division
GOD'S LITTLE GIFT, INC., doing business as HELIUM & BALLOONS ACROSS AMERICA also known as “HABAA”, and GARY PAGE, Plaintiffs,
CTI INDUSTRIES CORPORATION A/K/A CONTAINER TECHNOLOGIES INC. Defendant.
D. Whitney Chief United States District Judge
MATTER is before the Court on Defendant's Motion
to Compel Arbitration and Stay Proceedings (Doc. No. 2).
Plaintiffs filed a response (Doc. No. 5) stating that they do
not oppose Defendant's Motion (Doc. No. 2). Having
carefully considered the motion, supporting memorandum, and
the record in this case, the Court GRANTS Defendant's
26, 2017, Plaintiffs filed this action in the General Court
of Justice, Mecklenburg County. (Doc. No. 1-1). Defendant
removed the matter to this Court on September 12, 2017, based
upon diversity jurisdiction. Id. This cause of
action stems from Plaintiffs' business relationship with
Defendant. Id. Plaintiffs' complaint alleges
that this is a lawsuit for: (1) deceptive and unfair trade
practices for CTI having stolen balloon business from HABAA;
(2) breach of contract for certain commissions owed based
upon a commissions contract for Balloons sold by CTI; and (3)
deceptive and unfair trade practices and conversion for
unlawfully taking and expropriating certain proprietary
software developed by HABAA. Id. at 3.
September 15, 2017, Defendant filed its Motion to Compel
Arbitration and Stay Proceedings, citing a “Master
Representative Agreement” (“Master
Agreement”) and “Assignment Agreement”
signed by Plaintiff. (Doc. No. 2-1). Both agreements state
that they are governed by Illinois substantive law.
Id. at 4. The Master Agreement includes an
arbitration clause that states, in pertinent part:
13. Arbitration. Any controversy or claim arising
out of or relating to this Agreement, or the violation of any
term hereof, shall be settled by arbitration in Chicago,
Illinois, pursuant to rules of the American Arbitration
Association then in effect. Any judgment upon the award
rendered in such arbitration may be entered in any court of
Id. This arbitration clause incorporates the
relevant American Arbitration Association rules, which state
(a) 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 or to the arbitrability of any claim or
(b) The arbitrator shall have the power to determine the
existence or validity of a contract of which an arbitration
clause forms a part. Such an arbitration clause shall be
treated an agreement independent of the other terms of the
contract. A decision by the arbitrator that the contract is
null and void shall not for that reason alone render invalid
the arbitration clause.
(c) A party must object to the jurisdiction of the arbitrator
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 objecting. The arbitrator
may rule on such objections as a preliminary matter or as
part of the final award. American Arbitration Association
Commercial Arbitration Rules (2013 ed.).
Id. Defendant and Plaintiffs agree the arbitration
clause within the Master Agreement is enforceable under the
Federal Arbitration Act (“FAA”). (Doc. No. 2-1,
p. 4-6) (Doc. No. 5, p. 2).
mandates the enforcement of arbitration agreements where such
agreements (1) are valid under general principles of contract
law and (2) are part of a contract or transaction involving
interstate commerce. See 9 U.S.C. § 2.
Moreover, when an enforceable arbitration agreement exists,
and the issues in the dispute fall within its scope, a
federal district court must stay the proceedings on a
party's motion to compel when the other has
“failed, neglected, or refused to comply with an
arbitration agreement.” Gilmer v. Interstate
/Johnson Lane Corp., 500 U.S. 20, 25 (1991) (citing 9
U.S.C. §§ 3, 4); see also Adkins v. Labor
Ready, Inc., 303 F.3d 496, 500 (4th Cir. 2002) ...