United States District Court, E.D. North Carolina, Southern Division
TRIDENT ATLANTA, LLC, DUAL ENERGY, LLC, CYNERGETIC AR, LLC, MS. MARCIE BINDES d/b/a KS ENTERPRISES, LLC, MR. DALE ATKINSON & MRS. ROSE ATKINSON d/b/a ROSED ALE THREE, LLC, and MR. TRENT MOORE d/b/a LINDSTAN, INC., Plaintiffs,
CHARLIE GRAINGERS FRANCHISING, LLC, CHARLIE GRAINGERS FRANCHISING, INC., LOUIS CRAIG NORTH, GREGORY BRUCE GEORGE, and JASON MATTHEW NISTA, Defendants.
TERRENCE W. BOYLE CHIEF UNITED STATES DISTRICT JUDGE.
matter is before the Court on motions to compel arbitration
filed by defendants Gregory Bruce George and Jason Matthew
Nista. [DE 103, 112]. The motions are ripe for disposition.
For the reasons that follow, defendants' motions to
compel [DE 103, 112] are GRANTED. The individual
plaintiffs-Ms. Marcie Bindes, Mr. Dale Atkinson and Mrs. Rose
Atkinson, and Mr. Trent Moore-are directed to arbitrate their
claims against all three individual defendants, George,
Nista, and Louis Craig North. The action will be stayed
pending arbitration as to Ms. Bindes, Mr. and Mrs. Atkinson,
and Mr. Moore.
Court adopts, as if fully set forth herein, the factual and
procedural background provided in its February 4, 2019 order.
[DE 101]. At that time, the Court granted in part and denied
in part the individual defendants' motions to dismiss. In
particular, the Court found that plaintiffs had failed to
state civil claims under the Racketeer Influenced and Corrupt
Organizations Act upon which relief could be granted, and
therefore dismissed Counts 7, 8, and 9 of the plaintiffs'
amended complaint. The Court also found that plaintiffs had
alleged sufficient facts to state claims against the
individual defendants for fraud, negligent misrepresentation,
breach of fiduciary duty, and violation of North
Carolina's Unfair and Deceptive Trade Practices Act, and
therefore did not dismiss Counts 2, 3, 5, and 6. Counts 1, 4,
and 10 were brought only against the corporate defendants, as
to whom the case is currently stayed. [DE 84]. As such, the
Court expressed no opinion on those three causes of action.
the Court's February 4, 2019 order, the individual
defendants filed their answers to plaintiffs' amended
complaint. [DE 105, 110, 111]. A scheduling order was
entered. [DE 116]. But defendants George and Nista filed
motions to compel arbitration, arguing that the franchise,
agreements signed by the individual plaintiffs contained
binding arbitration provisions. [DE 103, 112]. Defendant
North, now proceeding pro se, did not move to compel
arbitration. Plaintiffs have responded in opposition to the
motions to compel. [DE 117].
Federal Arbitration Act (FAA), 9 U.S.C. § 1 et
seq., governs the resolution of private disputes through
arbitration. Patten Grading & Paving, Inc. v. Skanska
USA Bldg, Inc., 380 F.3d 200, 204 (4th Cir. 2004).
Section 2 of the FAA provides that a "written provision
in any ... contract evidencing a transaction involving
commerce to settle by arbitration a controversy thereafter
arising out of such contract. .. shall be valid, irrevocable,
and enforceable." 9 U.S.C. § 2; see also Arthur
Andersen LLP v. Carlisle, 556 U.S. 624, 629-30 (2009)
(construing 9 U.S.C. § 2 as making written arbitration
agreements binding unless the underlying contract is
"question of arbitrability" is to be decided by the
court unless the parties clearly and unmistakably provide
otherwise. AT&T Technologies, Inc. v. Communications
Workers of America, 475 U.S. 643, 649 (1986).
Courts have "no choice but to grant a motion to compel
arbitration where a valid arbitration clause exists and the
issues in a case fall within its purview." Adkins v.
Labor Ready, Inc., 303 F.3d 496, 500 (4th Cir. 2002)
(citation omitted). "[Q]uestions of arbitrability must
be addressed with a healthy regard for the federal policy
favoring arbitration." Moses H. Cone Mem'l Hosp.
v. Mercury Const. Corp., 460 U.S. 1, 24-25 (1983).
Accordingly, disagreements related to the scope of
arbitration are resolved in favor of arbitration.
AT&T, 475 U.S. at 650; Moses H. Cone,
460 U.S. at 24-25 ("The Arbitration Act establishes
that, as a matter of federal law, any doubts concerning the
scope of arbitrable issues should be resolved in favor of
arbitration, whether the problem at hand is the construction
of the contract language itself or an allegation of waiver,
delay, or a like defense to arbitrability."). Broad,
general, and vague agreements will not meet the
clear-and-unmistakable standard imposed on arbitration
agreements. See AT&T, 475 U.S. at 645 (holding
that the clause committing all "differences arising with
respect to the interpretation of this contract or the
performance of any obligation hereunder" did not permit
the arbitrator to determine arbitrability issues).
franchise agreements that the individual plaintiffs signed
between September 2015 and September 2016 contained the
16.03 Arbitration. Except as specifically provided
under this Agreement, any dispute or claim relating'to or
arising out of this Agreement must be resolved exclusively by
mandatory arbitration by and in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association ("AAA") or another arbitration service
agreed to by the parties. Arbitration will be conducted
solely on an individual, not a class-wide, basis, ;1 unless
all parties so agree. No. award in arbitration involving
Franchisor will have any effect of preclusion or collateral
estoppels in any other adjudication or arbitration. A single
arbitrator shall be selected in accordance with standard AAA
procedure, and the proceedings will be conducted at its
Wilmington, North Carolina, office. Each party shall bear all
of its own costs and attorneys' fees and one-half of the
arbitrator's expenses. The decision of the arbitrator
shall be final and binding.
16.04 Applicability. This dispute resolution section
applies to claims by and against all parties and their
successors, owners, managers, officers, directors, employees,
agents, and representatives, as to claims arising out of or
relating to this Agreement, except as stated above. This
dispute resolution clause shall survive the termination or
expiration of this Agreement.
16.05 Governing Arbitration Law. Notwithstanding any
choice of law provision of this Agreement, all issues
relating to arbitration or the enforcement of the agreement
to arbitrate contained in this Agreement are governed by the
U.S. Federal Arbitration Act (9 U.S.C. § 1 et
seq.) and the U.S. federal common law of arbitration.
This federal act preempts any state rules on arbitration,
including those relating to the site of arbitration. Judgment
on an arbitration award, or on any award for interim relief,
may be entered in any court having jurisdiction, and will be
16.06 Governing Law/Consent to Venue and
Jurisdiction. Except to the extent governed by the
Federal Arbitration Act, the United States Trademark Act of
1946 (Lanham Act, 15 U.S.C. Sections 1051 er seq.)
or other federal law, this Agreement shall be interpreted
under the laws of the state of North Carolina and any dispute
between the parties shall be governed by and determined in
accordance with the substantive laws of the state of North
Carolina, which laws shall prevail in the event of any
conflict of law. Franchisee and Franchisor have negotiated
regarding a forum in which to resolve any disputes, which may
arise between them and have agreed to select a forum in order
to promote stability in their relationship. Therefore, if a
claim is asserted in any legal proceeding involving
Franchisee, its officers, directors, managers or partners
(collectively, "Franchisee Affiliates") and
Franchisor, its parent, subsidiaries or affiliates and their
respective officers, directors and sales employees
(collectively, "Franchisor Affiliates") the parties
agree that the exclusive venue for disputes between them
shall be in the state and federal courts of North Carolina or
the Wilmington, North Carolina office of the AAA and each
party waives any objection they may have to the personal
jurisdiction of or venue in the state and federal courts of
North Carolina or the Wilmington, North Carolina office of
the AAA. Franchisor, Franchisor Affiliates, Franchisee and
Franchisee Affiliates each waive their rights to a trial by
16.07 Limitations on Actions. Except for payments
owed by one party to the other, and unless prohibited by
applicable law, any legal action or arbitration proceeding
brought or initiated with respect to any dispute arising from
or related to this Agreement or with respect to any breach of
the terms of this Agreement must be brought or instituted
within a period of two (2) years from the date ...