grand wireless, inc. v. verizon wireless, inc., 1st cir. (2014)
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7/26/2019 Grand Wireless, Inc. v. Verizon Wireless, Inc., 1st Cir. (2014)
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United States Court of AppealsFor the First Circuit
No. 13- 1149
GRAND WI RELESS, I NC. ,
Pl ai nt i f f , Appel l ee,
v.
VERI ZON WI RELESS, I NC. ; ERI N McCAHI LL,
Def endant s, Appel l ant s.
APPEAL FROM THE UNI TED STATES DI STRI CT COURTFOR THE DI STRI CT OF MASSACHUSETTS
[ Hon. Edwar d F. Har r i ngt on, U. S. Di st r i ct J udge]
Bef or e
Tor r uel l a, Ri ppl e* and Thompson,Ci r cui t J udges.
Phi l i p R. Sel l i nger , wi t h whom Davi d G. Thomas, Zachar y C.Kl ei nsasser, Todd L. Schl ei f st ei n and Gr eenber g Tr aur i g, LLP wer eon br i ef , f or appel l ant s.
Samuel Per ki ns, wi t h whom Br ody, Hardoon, Per ki ns & Kest en,LLP was on br i ef , f or appel l ee.
Mar ch 19, 2014
* Of t he Sevent h Ci r cui t , si t t i ng by desi gnat i on.
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RIPPLE, Circuit Judge. Gr and Wi r el ess, I nc. ( Gr and)
br ought t hi s act i on i n Massachuset t s st at e cour t agai nst Ver i zon
Wi r el ess, I nc. ( Ver i zon) and Ver i zon empl oyee Er i n McCahi l l . I t
al l eged a vi ol at i on of t he f eder al Racket eer I nf l uenced and Cor r upt
Or gani zat i ons Act ( RI CO) agai nst Ms. McCahi l l , as wel l as sever al
st at e l aw cl ai ms agai nst bot h Ms. McCahi l l and Ver i zon. The
def endant s r emoved t he case t o t he Uni t ed St at es Di st r i ct Cour t f or
t he Di st r i ct of Massachuset t s and moved f or an order compel l i ng
ar bi t r at i on of Gr and s cl ai ms. Gr and opposed t he mot i on. I t
cont ended t hat t he ar bi t r at i on cl ause shoul d be i nt er pr et ed
narr owl y and t hat , because Ms. McCahi l l was not a si gnat ory t o t he
cont r act cont ai ni ng t he ar bi t r at i on cl ause, t he cl ai m agai nst her
coul d not be arbi t r ated i n t hi s case. Adopt i ng Gr and s memorandum
i n opposi t i on t o t he mot i on, t he di st r i ct cour t deni ed t he
def endant s mot i on t o compel and al so deni ed t hei r subsequent
r equest f or r econsi der at i on.
The def endant s t i mel y appeal ed. They submi t t hat Gr and s
cl ai ms wer e wi t hi n t he scope of t he par t i es ar bi t r at i on agr eement
and t hat ar bi t r at i on of t he cl ai ms agai nst Ms. McCahi l l i s not
bar r ed despi t e her st at us as a non- si gnat or y of t he ar bi t r at i on
agr eement . We agr ee and t her ef ore r everse t he j udgment of t he
di st r i ct cour t and r emand t he case f or f ur t her pr oceedi ngs.
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I
BACKGROUND
A. Facts
I n September 2002, Gr and and Ver i zon ent ered i nto an
Excl usi ve Aut hor i zed Agency Agr eement f or Commerci al Mobi l e Radi o
Servi ce ( Agr eement ) . The Agr eement aut hor i zed Gr and t o act as a
Ver i zon sal es agent wi t hi n a def i ned geogr aphi c ar ea. The
Agreement governed t he busi ness r el at i onshi p bet ween Gr and and
Ver i zon. I t r equi r ed Gr and t o pr ovi de ser vi ces excl usi vel y f or
Ver i zon by of f er i ng cust omer s Ver i zon ser vi ces, such as sal es,
i nst al l at i on, war r ant y servi ce and equi pment mai nt enance. The
Agr eement al so addr essed t he r el at i onshi p bet ween Gr and, Ver i zon
and subscr i bers who pur chased pr oduct s and ser vi ces t hr ough Gr and.
On t hi s poi nt , t he Agr eement pr ovi ded t hat subscr i ber l i st s wer e
t he excl usi ve conf i dent i al pr oper t y of Ver i zon Wi r el ess. 1 The
Agr eement pr ovi ded f or an i ni t i al t er m of f i ve year s; at t hat
poi nt , t he Agreement woul d cont i nue on a mont h- t o- mont h basi s,
t er mi nabl e by ei t her par t y on t hi r t y days wr i t t en not i ce t o t he
ot her .
The Agreement cont ai ned a provi si on ent i t l ed, DI SPUTE
RESOLUTI ON AND ARBI TRATI ON. I t st at ed, i n pert i nent par t :
Except t o t he ext ent expl i ci t l y pr ovi dedbel ow, ANY CONTROVERSY OR CLAI M ARI SI NG OUT OFOR RELATI NG TO THI S AGREEMENT, OR ANY PRI OR OR
1 R. 20- 1 3. 3.
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FUTURE AGREEMENT BETWEEN THE PARTI ES, SHALL BESETTLED BY ARBI TRATI ON ADMI NI STERED BY THEAMERI CAN ARBI TRATI ON ASSOCI ATI ON ( AAA) I NACCORDANCE WI TH THE WI RELESS I NDUSTRYASSOCI ATI ON ( WI A) RULES OF THE AAA, ASMODI FI ED BELOW, AND J UDGMENT ON THE AWARD
RENDERED BY THE ARBI TRATORS MAY BE ENTERED I NANY COURT HAVI NG J URI SDI CTI ON. [ 2]
The subsequent paragraphs expl i ci t l y st at ed t hat t he di sput es not
cover ed i ncl uded sever al i nt el l ect ual pr oper t y i ssues, as wel l as
[ s] eeki ng t o compel ar bi t r at i on; 3 [ s]eeki ng t o conf i rm or
chal l enge any ar bi t r al awar d; 4 seeki ng j udi ci al rel i ef f or
br eaches of sect i ons 3. 3 and 7 of t he Agr eement ; and seeki ng
emer gency i nj unct i ve r el i ef pendi ng t he appoi nt ment of ar bi t r at or s.
Provi si ons f ol l owed addr essi ng t he pr ocedur al aspect s of commenci ng
and conduct i ng ar bi t r at i on.
Ther e i s no di sput e t hat , under t he Agreement , Gr and
oper at ed r et ai l l ocat i ons f or Ver i zon pr oduct s and ser vi ces
begi nni ng i n 2002 unt i l t he f i ve- year t er m expi r ed i n Sept ember
2007. The par t i es t hen cont i nued t hei r r el at i onshi p on
a mont h- t o- mont h basi s unt i l J ul y 19, 2011, when Ver i zon not i f i ed
Gr and of i t s i nt ent t o t er mi nat e t he r el at i onshi p. Ver i zon submi t s
t hat at Gr and s r equest , Ver i zon extended t he t er mi nat i on dat e t o
Oct ober 31, 2011, i n or der t o g[ i ] ve Gr and addi t i onal t i me t o
2 I d. 15.
3 I d. 15. 2. 1.
4 I d. 15. 2. 2.
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at t empt t o sel l cer t ai n of i t s st or es t o anot her Ver i zon Wi r el ess
agent . 5
I n Oct ober 2011, accor di ng t o Gr and s compl ai nt :
[ Ver i zon] mai l ed an over si zed ( 6 by 11)col or post car d, f eat ur i ng t he pi ct ur e of anat t r act i ve young woman, t o t he cust omers ofei ght r emai ni ng Gr and Wi r el ess st or es,pr ocl ai mi ng t hat t hese Gr and Wi r el ess s t or eshad CLOSED. The mai l i ng provi ded t hecust omers wi t h t he addr ess of t he near estcompet i ng Ver i zon Wi r el ess st ore. [ 6]
Gr and f ur t her al l eged t hat Ms. McCahi l l had aut hor i zed t he mai l i ng
and knew when t he mai l i ng went out t hat i t was f al se. 7 Gr and
st at ed t hat i t was, at t he t i me of t he mai l i ng, i n negot i at i ons
wi t h anot her wi r el ess provi der , T- Mobi l e, t o become an aut hor i zed
T- Mobi l e agent . Fur t her , Gr and al l eged t hat Ms. McCahi l l knew t hat
t he mai l i ng woul d deal a body bl ow t o Gr and Wi r el ess abi l i t y [ t o]
cont i nue i n busi ness as a T[ - ] Mobi l e out l et and t hat t he mai l i ng
was a del i ber ate at t empt t o el i mi nate Gr and Wi r el ess as a
compet i t or t o near by Ver i zon st or es. 8 Gr and al l eged t hat i t s
T- Mobi l e venture f ai l ed and t hat i t has si nce ceased oper at i ons.
5 Appel l ant s Br . 7. Gr and does not di sput e t hi s
r epr esent at i on. See Appel l ee s Br . 2.
6 R. 15 at 17, 11.
7 I d. at 17, 12.
8 I d. at 17, 13.
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B. Procedural History
Gr and i ni t i al l y f i l ed t he pr esent act i on i n Massachuset t s
st at e cour t . I t s compl ai nt al l eged t hat Ms. McCahi l l had vi ol at ed
RI CO, 18 U. S. C. 1961 et seq. , by engag[ i ng] i n a f r audul ent
scheme that used t he Uni t ed St at es mai l s t o t r ansmi t f al se
r epr esent at i ons t hat GRAND WI RELESS . . . HAS CLOSED, i n
vi ol at i on of t he f eder al mai l f r aud st at ut e, 18 U. S. C. 1341. 9
I t f ur t her al l eged t hat bot h Ms. McCahi l l and Ver i zon had vi ol at ed
a Massachuset t s st at ut e pr ohi bi t i ng unf ai r and decept i ve t r ade
pr act i ces. Fi nal l y, Gr and al l eged t hat bot h Ms. McCahi l l and
Ver i zon had commi t t ed t he t or t s of i nj ur i ous f al sehoods and
i nt ent i onal i nt er f er ence wi t h an advant ageous rel at i onshi p.
The def endant s r emoved t he case t o t he di st r i ct cour t ,
where Ver i zon and Ms. McCahi l l moved t o compel Gr and t o ar bi t r at e
i t s cl ai ms. Gr and opposed t he mot i on f or ar bi t r at i on. I t
submi t t ed t hat t he mot i on t o compel ar bi t r at i on shoul d be deni ed
f or t wo r easons: ( 1) t hat i t s cl ai ms f el l out si de of t he scope of
t he ar bi t r at i on cl ause; and ( 2) t hat Ms. McCahi l l coul d not enf or ce
t he ar bi t r at i on cl ause because she was not a par t y t o t he
Agr eement .
Bef or e t he deadl i ne had passed f or t he def endant s t o f i l e
t hei r r epl y br i ef , t he di st r i ct cour t deni ed t he mot i on t o compel .
I n r ul i ng, t he di st r i ct cour t di d not i ssue a wr i t t en opi ni on;
9 I d. at 18, 16- 17 ( Count I ) .
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i nst ead, i t si mpl y i ssued an or der st at i ng, Mot i on i s deni ed. The
cour t adopt s Pl ai nt i f f s Memor andum. So or der ed. 10 The def endants
moved f or r econsi der at i on. The di st r i ct cour t deni ed t hei r mot i on
i n anot her or der , st at i ng, Cour t has r econsi der ed Def endant s
Mot i on t o Compel Ar bi t r at i on and t o Di smi ss Compl ai nt or st ay
act i on pendi ng arbi t r at i on and agai n deni es same. So Or der ed. 11
The def endant s t hen brought t hi s t i mel y appeal . 12
II
DISCUSSION
We have j ur i sdi ct i on t o revi ew an order denyi ng a mot i on
under t he Feder al Ar bi t r at i on Act t o compel ar bi t r at i on. See 9
U. S. C. 16( a) ( 1) ( C) . Our r evi ew of such a deni al i s de novo
because whet her a mat t er i s arbi t r abl e i s a mat t er of cont r act
i nt er pr et at i on, and cont r act i nt er pr et at i on i s a mat t er of l aw.
Combi ned Ener gi es v. CCI , I nc. , 514 F. 3d 168, 171 ( 1st Ci r . 2008) .
To compel ar bi t r at i on, t he def endant s must demonst r at e t hat a
val i d agr eement t o ar bi t r at e exi st s, t hat t he[ y ar e] ent i t l ed t o
i nvoke t he ar bi t r at i on cl ause, t hat t he ot her par t y i s bound by
t hat cl ause, and t hat t he cl ai m asser t ed comes wi t hi n t he cl ause s
scope. Sot o- Fonal l edas v. Ri t z- Car l t on San J uan Hot el Spa &
10 R. 26.
11 R. 29.
12 The di st r i ct cour t st ayed t he pr oceedi ngs pendi ngr esol ut i on of t hi s appeal .
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Casi no, 640 F. 3d 471, 474 ( 1st Ci r . 2011) ( i nt er nal quot at i on mar ks
omi t t ed) . Fur t her mor e, as we al so not ed i n Sot o- Fonal l edas:
Under Sect i on 2 of t he FAA, a wr i t t enpr ovi si on i n a cont r act t o set t l e by
ar bi t r at i on a cont r over sy t her eaf t er ar i si ngout of such cont r act . . . shal l be val i d,i r r evocabl e, and enf or ceabl e, save upon suchgr ounds as exi st at l aw or i n equi t y f or t her evocat i on of any cont r act . 9 U. S. C. 2.The Supreme Cour t has st at ed t hat t he FAA wasdesi gned t o pr omot e ar bi t r at i on, and t hatSect i on 2 embodi es t he nat i onal pol i cyf avor i ng ar bi t r at i on and pl aces ar bi t r at i onagr eement s on equal f oot i ng wi t h al l ot hercont r acts.
I d. ( quot i ng AT&T Mobi l i t y LLC v. Concepci on, 131 S. Ct . 1740, 1749
( 2011) ; Buckeye Check Cashi ng, I nc. v. Cardegna, 546 U. S. 440, 443
( 2006) ) .
Her e, t he par t i es do not di sput e t he val i di t y of t he
Agr eement s ar bi t r at i on cl ause. I nst ead, t hey di sput e: ( 1) whet her
Gr and s cl ai ms ar e wi t hi n t he scope of t he ar bi t r at i on cl ause; and
( 2) whet her Ms. McCahi l l i s ent i t l ed t o i nvoke t he ar bi t r at i on
cl ause. We addr ess each cont ent i on i n t ur n.
A. Scope of the Arbitration Clause
We f i r st addr ess whet her Gr and s cl ai ms ar e wi t hi n t he
scope of t he ar bi t r at i on cl ause. Gr and and Ver i zon agr eed t o
ar bi t r at e any cont r over sy or cl ai mari si ng out of or r el at i ng t o
t hei r Agr eement . 13
13 R. 20- 1 15. ( These wor ds appear i n capi t al l et t er s i n t heAgreement . We have empl oyed r egul ar t ypef ace her e and i n l at er
( cont i nued. . . )
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As we have not ed ear l i er , t he di st r i ct cour t si mpl y
adopt ed Gr and s memorandum. Theref ore, t he di st r i ct cour t
necessar i l y t ook t hat document s vi ew t hat t he Agr eement s
ar bi t r at i on cl ause was nar r ow. Such a const r uct i on, accor di ng t o
t hat memor andum, woul d l i mi t appl i cat i on of t he ar bi t r at i on cl ause
t o bat t l es over t he Agency Agr eement , i . e. , t o cl ai ms t hat
r equi r e i nt er pr et at i on of t he Agr eement s t er ms. 14 The memor andum
al so asser t ed t hat nar r ow ar bi t r at i on cl auses ar e not ent i t l ed t o
a pr esumpt i on of ar bi t r abi l i t y.
I n t hi s appeal , Gr and t akes t he same posi t i on t hat i t di d
i n t he di st r i ct cour t . The def endant s cont end, however , t hat
Gr and s cl ai ms r el ate to t he Agr eement because t hey i nvol ve
mat t er s t hat occur r ed dur i ng t he cour se of t he agency r el at i onshi p.
Speci f i cal l y, Gr and s cl ai ms concer n Ver i zon s r i ght t o cont act
f r eel y i t s cust omer s and Ver i zon s t er mi nat i on of i t s r el at i onshi p
wi t h Gr and. The def endant s al so submi t t hat t he l anguage of t he
ar bi t r at i on cl ause i s br oad, and t her ef or e t he di sput e i s ent i t l ed
t o a pr esumpt i on of ar bi t r abi l i t y.
Unl ess t he par t i es cl ear l y and unmi st akabl y pr ovi de
ot herwi se, AT&T Techs. , I nc. v. Commc ns Worker s of Am. , 475 U. S.
643, 649 ( 1986) , t he court must r esol ve a di sagreement among t he
13( . . . cont i nued)uses of t hi s quot at i on f or r eadabi l i t y. )
14 R. 23 at 5- 6.
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par t i es as t o whet her an ar bi t r at i on cl ause appl i es t o a par t i cul ar
di sput e, Gr ani t e Rock Co. v. I nt l Bhd. of Teamst er s, 130 S. Ct .
2847, 2857- 58 ( 2010) . [ A] cour t may or der arbi t r at i on of a
par t i cul ar di sput e onl y wher e t he cour t i s sat i sf i ed t hat t he
par t i es agr eed t o ar bi t r at e t hat di sput e. I d. at 2856. When
deci di ng whet her t he par t i es agr eed t o ar bi t r at e a cer t ai n mat t er
. . . cour t s gener al l y . . . shoul d appl y or di nar y st at e- l aw
pr i nci pl es t hat gover n t he f or mat i on of cont r act s. Fi r st Opt i ons
of Chi . , I nc. v. Kapl an, 514 U. S. 938, 944 ( 1995) . We conduct our
anal ysi s wi t h t he f eder al pol i cy i n f avor of ar bi t r at i on i n mi nd,
such t hat , as wi t h any ot her cont r act , t he par t i es i nt ent i ons
cont r ol , but t hose i nt ent i ons ar e gener ousl y const r ued as t o i ssues
of ar bi t r abi l i t y. Mi t subi shi Mot or s Cor p. v. Sol er Chr ysl er -
Pl ymout h, I nc. , 473 U. S. 614, 626 ( 1985) . At a mi ni mum, t hi s
pol i cy r equi r es t hat ambi gui t i es as t o t he scope of t he
ar bi t r at i on cl ause i t sel f [ must be] r esol ved i n f avor of
ar bi t r at i on. Power Shar e, I nc. v. Synt el , I nc. , 597 F. 3d 10, 15
( 1st Ci r . 2010) ( al t er at i on i n or i gi nal ) ( quot i ng Vol t I nf o. Sci s. ,
I nc. v. Bd. of Tr s. of Lel and St anf or d J r . Uni v. , 489 U. S. 468,
475- 76 ( 1989) ) . Thi s pr esumpt i on i n f avor of ar bi t r at i on appl i es
unl ess t he par t y opposi ng ar bi t r at i on r ebut s i t . Di al ysi s Access
Ct r . , LLC v. RMS Li f el i ne, I nc. , 638 F. 3d 367, 379 ( 1st Ci r . 2011) ;
Paul Rever e Var i abl e Annui t y I ns. Co. v. Ki r schhof er , 226 F. 3d 15,
25 ( 1st Ci r . 2000) ( I t i s t r ue t hat , gener al l y speaki ng, t he
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pr esumpt i on i n f avor of ar bi t r at i on appl i es t o t he r esol ut i on of
scope quest i ons. ) .
To deter mi ne whether Gr and s cl ai ms f al l wi t hi n t he scope
of t he ar bi t r at i on cl ause, we f ocus on t he f act ual al l egat i ons
under l yi ng [ t he] cl ai ms i n t he [ c] ompl ai nt . Di al ysi s Access Ct r . ,
LLC, 638 F. 3d at 378. Gr and al l eged t hat Ver i zon s f al se and
del i ber at e mi sr epr esent at i on t o Gr and Wi r el ess cust omer s t hat Gr and
Wi r el ess had ceased t o do busi ness har med Gr and. 15 Gr and made
f act ual al l egat i ons r egar di ng Ver i zon s t er mi nat i on of i t s
r el at i onshi p wi t h Gr and. The compl ai nt descr i bed t he cust omer
mai l i ng and Gr and s bel i ef t hat Ver i zon and Ms. McCahi l l knew t hat
t he mai l i ng cont ai ned f al se i nf or mat i on yet aut hor i zed i t s
di st r i but i on i n or der t o har m Gr and i n a del i ber at e at t empt t o
el i mi nat e Gr and Wi r el ess as a compet i t or . 16
Based on t he al l egat i ons i n Gr and s compl ai nt , r esol ut i on
of t hi s di sput e wi l l ent ai l det er mi ni ng, at l east , t he st at us of
Gr and and Ver i zon s r el at i onshi p as of Oct ober 2011, whet her t he
cust omers cont act ed by Ver i zon were cust omers of Gr and, t he ext ent
of Ver i zon s knowl edge r egar di ng Gr and s t r ansi t i on of busi ness t o
T- Mobi l e, and whether Gr and s st or es wer e, i n f act , cl osed at t he
t i me of Ver i zon s mai l i ng. These f act ual i ssues r el at e t o t he
t er ms of t he Agr eement or , at a mi ni mum, t o t he rel at i onshi p
15 R. 15 at 13.
16 I d. at 17, 13.
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est abl i shed bet ween Gr and and Ver i zon under t he Agreement . Gr and s
al l egat i ons about Ver i zon s t er mi nat i on of t hei r busi ness
r el at i onshi p may i mpl i cat e extensi ve por t i ons of t he Agr eement
concer ni ng t er mi nat i on. Ot her al l egat i ons may r equi r e
consi der at i on of t he por t i ons of t he Agr eement r egar di ng Ver i zon s
r i ght s wi t h r espect t o cust omer s obt ai ned by Gr and. Gi ven t hat a
number of f act ual di sput es ar i si ng f r omGr and s cl ai ms l i kel y wi l l
have t o be r esol ved by ref er ence t o t he Agr eement , i t i s cl ear t hat
Gr and s cl ai ms ar i se out of or r el at e to t he Agr eement and
t her ef or e f al l wi t hi n t he scope of t he ar bi t r at i on cl ause.
Even wer e we l ess sure of t he ar bi t r at i on cl ause s
appl i cabi l i t y to Gr and s cl ai ms, we woul d appl y the pr esumpt i on of
ar bi t r abi l i t y her e. See Ki r schhof er , 226 F. 3d at 25 ( hol di ng t hat
t he pr esumpt i on of ar bi t r abi l i t y i s appl i ed t o scope quest i ons t hat
ar i se when t he par t i es have a cont r act t hat pr ovi des f or
ar bi t r at i on of some i ssues and i t i s uncl ear whet her a speci f i c
di sput e f al l s wi t hi n t hat cont r act ( i nt er nal quot at i on mar ks
omi t t ed) ) . Thi s pr esumpt i on i s par t i cul ar l y appr opr i at e wher e, as
her e, t he ar bi t r at i on cl ause i s br oadl y wor ded. AT&T Techs. , 475
U. S. at 650; see al so Gr ani t e Rock, 130 S. Ct . at 2858
( char act er i zi ng an ar bi t r at i on cl ause t hat cover ed [ a] ny cl ai m,
di sput e, or cont r over sy . . . ar i s i ng f r omor r el at i ng t o . . . t he
val i di t y, enf or ceabi l i t y, or scope of . . . t he ent i r e Agr eement
as br oad ( emphasi s added) ( i nt er nal quot at i on mar ks omi t t ed) ) . An
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or der t o ar bi t r at e t he par t i cul ar gr i evance shoul d not be deni ed
unl ess i t may be sai d wi t h posi t i ve assur ance t hat t he ar bi t r at i on
cl ause i s not suscept i bl e of an i nt er pr et at i on t hat cover s t he
asser t ed di sput e. Doubt s shoul d be r esol ved i n f avor of cover age.
Uni t ed St eel wor ker s of Am. v. War r i or & Gul f Navi gat i on Co. , 363
U. S. 574, 582- 83 ( 1960) . Thus, where t he l anguage of an
ar bi t r at i on cl ause i s br oad and [ i ] n t he absence of any expr ess
pr ovi si on excl udi ng a par t i cul ar gr i evance f r om ar bi t r at i on, we
t hi nk onl y t he most f or cef ul evi dence of a pur pose t o excl ude t he
cl ai mf r omar bi t r at i on can pr evai l . AT&T Techs. , 475 U. S. at 650
( quot i ng War r i or & Gul f , 363 U. S. at 584- 85) .
Gr and pr esent s us wi t h no such f or cef ul evi dence t o
r ebut t he pr esumpt i on of ar bi t r at i on. I nst ead, i t asks us t o appl y
convent i onal cont r act i nt er pr et at i on. 17 I n i t s vi ew, t he l anguage
ar i si ng out of or r el at i ng t o t hi s agr eement . . . unambi guousl y
l i mi t s t he scope of ar bi t r abl e cl ai ms t o t hose [ si t uat i ons] whi ch
depend f or r esol ut i on on i nt er pr et i ng or appl yi ng some pr ovi si on of
t he Agency Agreement . 18 Because no pr ovi si on of t he Agency
Agr eement cont r ol s, i s i mpl i cat ed, needs t o be r ead or sheds any
l i ght on t he adj udi cat i on of Gr and s mai l f r aud cl ai m, Gr and
17 Appel l ee s Br . 14.
18 I d. at 4 ( i nt er nal quot at i on mar ks omi t t ed) .
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submi t s, i t s cl ai ms ar e not wi t hi n t he scope of t he ar bi t r at i on
cl ause. 19
We cannot accept Gr and s vi ew. As we di scussed
pr evi ousl y, r esol ut i on of some of t he i ssues r ai sed by Gr and s
cl ai ms may wel l r equi r e r esor t t o t he Agr eement . Moreover , Gr and s
at t empt at r ebut t i ng t he pr esumpt i on of ar bi t r abi l i t y needed t o
show t hat t he par t i es i nt ended t o excl ude t hi s t ype of di sput e f r om
t he scope of t he ar bi t r at i on cl ause, see AT&T Techs. , 475 U. S. at
650, not mer el y that t he ar bi t r at i on cl ause l acked expl i ci t
l anguage cover i ng Gr and s cl ai ms. Cont r ary t o Gr and s vi ew, wher e
ar bi t r at i on cl auses i ncl uded br oad l anguage r equi r i ng ar bi t r at i on
of di sput es ar i si ng out of or r el at i ng t o par t i es cont r acts,
cour t s have f ound ar bi t r at i on appr opr i at e on a var i et y of cl ai ms
si mi l ar t o t hose pr esent ed her e. See, e. g. , Shear son/ Am. Expr ess,
I nc. v. McMahon, 482 U. S. 220, 223, 241- 42 ( 1987) ( hol di ng t hat
par t i es coul d be compel l ed t o ar bi t r at e RI CO cl ai ms r el at i ng t o,
i nt er al i a, maki ng f al se st at ement s and omi t t i ng mat er i al f act s
wher e br oker age agr eement st at ed, any cont r over sy ar i si ng out of
or r el at i ng t o my account s, t o t r ansact i ons wi t h you f or me or t o
t hi s agr eement or t he br each t her eof , shal l be set t l ed by
ar bi t r at i on ( i nt er nal quot at i on mar ks omi t t ed) ) ; cf . , e. g. ,
Commer ci al Uni on I ns. Co. v. Gi l bane Bl dg. Co. , 992 F. 2d 386,
387- 88, 391 ( 1st Ci r . 1993) ( hol di ng t hat def endant s Massachuset t s
19 I d. at 14.
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unf ai r and decept i ve t r ade pr act i ces count er cl ai m was subj ect t o
ar bi t r at i on wher e cl ause cover ed [ a] l l cl ai ms, di sput es and ot her
mat t er s i n quest i on ar i si ng out of , or r el at i ng t o t hi s Agr eement
or t he br each t her eof ) .
I n sum, i n adopt i ng Gr and s memorandum i n opposi t i on t o
t he def endant s mot i on t o compel ar bi t r at i on, t he di st r i ct cour t
appr oved Gr and s st atement t hat Ver i zon unambi guousl y rest r i ct ed
t he ar bi t r at i on cl ause t o bat t l es over t he Agency Agr eement , and,
t her ef or e, t he pr esumpt i on of ar bi t r abi l i t y woul d not ent er i nt o
pl ay. 20 Thi s concl usi on i s unsupport ed by t he case l aw and t he
f act s of t hi s case. The br oad l anguage of t he ar bi t r at i on cl ause
pr esent ed here encompasses t he di sput e descr i bed i n Gr and s
compl ai nt .
B. Ms. McCahills Ability to Invoke the Arbitration Clause
The al l egat i ons agai nst Ms. McCahi l l ar i se out of act i ons
t hat she al l egedl y t ook as part of her empl oyment by Ver i zon. She
t her ef or e want s t o avai l her sel f of t he ar bi t r at i on cl ause i n t he
Agr eement si gned by her empl oyer , Ver i zon. The di st r i ct cour t , by
adopt i ng Gr and s memor andum, must be under st ood t o have rul ed t hat
t he cl ai ms agai nst Ms. McCahi l l ar e not cover ed by t he ar bi t r at i on
cl ause because she was not a par t y t o t he Agreement and because t he
ar bi t r at i on cl ause does not cal l speci f i cal l y f or ar bi t r at i ng
di sput es wi t h i ndi vi dual empl oyees. Ver i zon and Ms. McCahi l l now
20 R. 23 at 5- 6.
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chal l enge t hi s det er mi nat i on. They t ake t he vi ew t hat , because
Ms. McCahi l l was act i ng as an agent of Ver i zon and t he cl ai ms
agai nst her r el ate sol el y t o her per f ormance as an empl oyee, she
i s ent i t l ed t o i nvoke t he ar bi t r at i on cl ause. 21
I n or der t o compel ar bi t r at i on of t he cl ai ms agai nst her ,
Ms. McCahi l l must est abl i sh t hat she i s ent i t l ed t o i nvoke t he
ar bi t r at i on cl ause. Sot o- Fonal l edas, 640 F. 3d at 474 ( i nt er nal
quot at i on mar ks omi t t ed) . [ T] he FAA does not r equi r e par t i es to
ar bi t r at e when t hey have not agr eed t o do so . . . . Vol t I nf o.
Sci s. , 489 U. S. at 478. [ N] or does i t pr event par t i es who do
agr ee t o ar bi t r at e f r om excl udi ng cer t ai n cl ai ms f r omt he scope of
t hei r ar bi t r at i on agr eement . I d. We r ecogni ze t hat , of cour se,
as a gener al pr oposi t i on, a cont r act cannot bi nd a non- par t y. We
al so recogni ze, however , t hat t her e ar e except i ons al l owi ng non-
si gnat or i es t o compel ar bi t r at i on and t hat [ a] non- si gnat or y may
be bound by or acqui r e r i ght s under an arbi t r at i on agr eement under
or di nar y st at e- l aw pr i nci pl es of agency or cont r act . Rest or at i on
Pr es. Masonr y, I nc. v. Gr ove Eur . Lt d. , 325 F. 3d 54, 62 n. 2 ( 1st
Ci r . 2003) . 22
21 Appel l ant s Br . 24.
22 Our deci si on i n Rest or at i on Pr eser vat i on Masonr y, I nc.v. Gr ove Eur ope Lt d. , 325 F. 3d 54, 62 n. 2 ( 1st Ci r . 2003) , ci t eswi t h appr oval cases f r om ot her ci r cui t s acknowl edgi ng t hatnon- si gnator i es may have r i ght s under an ar bi t r at i on cont r act undercer t ai n ci r cumst ances. See i d. ( ci t i ng Gr i gson v. Cr eat i ve Ar t i st sAgency, 210 F. 3d 524, 527 ( 5t h Ci r . 2000) ; Sunki st Sof t Dr i nks,I nc. v. Sunki st Gr ower s, I nc. , 10 F. 3d 753, 757 ( 11t h Ci r . 1993) ,
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Gr and s compl ai nt makes cl ear t hat Ms. McCahi l l s al l eged
act i ons wer e t aken i n her capaci t y as Ver i zon s agent or empl oyee.
She al l egedl y mai l ed ( or di r ect ed t o have mai l ed) post car ds t o t he
company s cust omers whi l e she was empl oyed f or t he company and i n
f ur t her ance of company busi ness. These al l egat i ons f or m t he sol e
basi s of l i abi l i t y agai nst Ver i zon and agai nst Ms. McCahi l l .
Gr and, i n nami ng Ms. McCahi l l i n i t s compl ai nt , i dent i f i ed her as
Di r ect or of I ndi r ect Communi cat i on, Er i n McCahi l l . 23 I t f ur t her
suggest ed t hat i t was sui ng Ms. McCahi l l i n her capaci t y as a
Ver i zon agent when i t st at ed t hat i t s cl ai ms wer e agai nst
Ms. McCahi l l and al l ot her [ Ver i zon] execut i ves who ai ded and
abet t ed her i n i ssui ng t he mai l ed announcement s. 24
Gr and put s f or war d but one argument as t o why
Ms. McCahi l l cannot i nvoke t he ar bi t r at i on cl ause: t hat t he ment i on
of empl oyees i n cer t ai n part s of t he Agr eement , combi ned wi t h the
l ack of ment i on of empl oyees i n t he ar bi t r at i on cl ause, makes cl ear
t hat t he par t i es never agr eed t hat cl ai ms agai nst empl oyees- - even
abr ogat ed by Lawson v. Li f e of t he S. I ns. Co. , 648 F. 3d 1166, 1171( 11t h Ci r . 2011) ; Hughes Masonr y Co. v. Gr eater Cl ark Cnt y. Sch.Bl dg. Cor p. , 659 F. 2d 836, 841 n. 9 ( 7t h Ci r . 1981) ) . Addi t i onal l y,i n Sour ci ng Unl i mi t ed, I nc. v. Asi mco I nt er nat i onal , I nc. , we not edt hat [ c] our t s r out i nel y recogni ze t hat ar bi t r at i on agr eement s mayr equi r e ar bi t r at i on even wher e al l par t i es t o t he di sput e di d not
si gn t he ar bi t r at i on agr eement . 526 F. 3d 38, 46 n. 8 ( 1st Ci r .2008) ( ci t i ng Zur i ch Am. I ns. Co. v. Wat t s I ndus. , I nc. , 417 F. 3d682, 687 ( 7t h Ci r . 2005) ) .
23 R. 15 at 13.
24 I d. at 18, 16.
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t hose sued f or act i ons t aken wi t hi n t he scope of t hei r
empl oyment - - coul d avai l t hemsel ves of t he ar bi t r at i on agr eement .
Eval uat i ng Gr and s cont ent i ons r equi r es us t o appl y New Yor k St at e
l aw, whi ch gover ns t he i nt er pr et at i on of t he cont r act . New Yor k
St at e r equi r es t hat t he cont r act be const r ued accor di ng t o i t s
pl ai n meani ng. MHR Capi t al Par t ner s LP v. Pr esst ek, I nc. , 912
N. E. 2d 43, 47 ( N. Y. 2009) . I t per mi t s the cour t t o r egar d t he
pl ai n wor di ng of t he i nst r ument as wel l as i t s st r uct ur e t o
ascer t ai n t hat pl ai n meani ng. Ni agar a Front i er Transp. Aut h. v.
Eur o- Uni t ed Cor p. , 757 N. Y. S. 2d 174, 176 ( App. Di v. 2003) .
We have exami ned t he Agr eement f r om st em t o st ern, bot h
wi t h r espect t o i t s wor di ng and wi t h r espect t o i t s st r uct ur e. We
see no basi s f or Gr and s asser t i on. I n t he cont r act , t he par t i es
do ref er t o empl oyees i n ot her cont exts, such as ensur i ng t hat
empl oyees of Gr and are not consi dered t he empl oyees of Ver i zon.
Gi ven t he nat ur e of t he r el at i onshi p est abl i shed by t he cont r act
bet ween t he t wo compani es, i t i s not at al l sur pr i si ng t hat t hi s
consi der at i on woul d be t he f ocus of speci al at t ent i on i n t he t ext
of t he agr eement . The r emai ni ng r ef er ences ar e l i kewi se i n areas
where speci f i c r ef erence t o empl oyees woul d be expect ed. We f ai l
t o see how such r ef erences and t he absence of an expl i ci t r ef er ence
t o empl oyees i n t he ar bi t r at i on cl ause i n any way evi nce an i nt ent
on t he par t of t he par t i es t o bar empl oyees, act i ng i n t he scope of
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t hei r empl oyment , f r om t he pr ot ect i on of t he ar bi t r at i on cl ause
adopt ed by t hei r empl oyer .
Ver i zon and Gr and cer t ai nl y wi shed t o have t hei r di sput es
set t l ed by ar bi t r at i on. Si nce Ver i zon coul d oper at e onl y t hr ough
t he act i ons of i t s empl oyees, i t woul d have made l i t t l e sense to
have agr eed t o arbi t r ate i f t he empl oyees coul d be sued separatel y
wi t hout r egar d t o t he ar bi t r at i on cl ause. Not abl y, cont r ar y t o
Gr and s asser t i on, t he ar bi t r at i on cl ause i s wr i t t en i n br oad
l anguage to encompass any cont r over sy or cl ai m ar i si ng out of or
r el at i ng t o t he Agr eement . Mor eover , t he par t i es ent er ed i nt o
t hi s agr eement knowi ng t hat t he l egal l andscape r ecogni zed t he
r i ght of empl oyees t o seek t he pr ot ect i on of t hei r empl oyer s
ar bi t r at i on cl auses.
I ndeed, a number of our si st er ci r cui t s have addr essed
t hi s i ssue, and al l have hel d t hat an agent i s ent i t l ed t o t he
pr ot ect i on of her pr i nci pal s ar bi t r at i on cl ause when t he cl ai ms
agai nst her are based on her conduct as an agent . 25 When t he
non- si gnator y par t y i s an empl oyee of t he si gnat or y cor por at i on and
t he under l yi ng act i on i n t he di sput e was under t aken i n t he cour se
of t he empl oyee s empl oyment , t hese ci r cui t s have f ashi oned,
25 See, e. g. , Pr i t zker v. Mer r i l l Lynch, Pi er ce, Fenner &Smi t h, I nc. , 7 F. 3d 1110, 1121 ( 3d Ci r . 1993) ; Roby v. Cor p. ofLl oyd s, 996 F. 2d 1353, 1360 ( 2d Ci r . 1993) ; Ar nol d v. Ar nol dCorp. - Pr i nt ed Commc ns f or Bus. , 920 F. 2d 1269, 1281- 82 ( 6t h Ci r .1990) ; Let i zi a v. Pr udent i al Bache Secs. , I nc. , 802 F. 2d 1185,1187- 88 ( 9t h Ci r . 1986) .
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uni f or ml y, a f eder al r ul e desi gned t o pr ot ect t he f eder al pol i cy
f avor i ng ar bi t r at i on. That r ul e, f ounded on gener al st at e l aw
pr i nci pl es of agency, i s t hat when a pr i nci pal i s bound under t he
t er ms of a val i d ar bi t r at i on cl ause, i t s agent s, empl oyees, and
r epr esent at i ves are al so cover ed under t he t er ms of such
agr eement s. Pr i t zker v. Mer r i l l Lynch, Pi er ce, Fenner & Smi t h,
I nc. , 7 F. 3d 1110, 1121 ( 3d Ci r . 1993) . Such a r ul e i s necessar y,
our si st er ci r cui t s have r easoned, because a cor por at e ent i t y or
ot her busi ness can onl y oper ate t hr ough i t s empl oyees and an
arbi t r at i on agr eement woul d be a meani ngl ess ar r angement i f i t s
t er ms di d not ext end t o t hem. See i d. at 1122. Any ot her r ul e, i n
t he vi ew of t hese cour t s, woul d per mi t t he par t y br i ngi ng t he
compl ai nt t o avoi d the pr act i cal consequences of havi ng si gned an
agr eement t o ar bi t r at e; nami ng t he ot her par t y s of f i cer s,
di r ect or s or empl oyees as def endant s al ong wi t h t he cor por at i on
woul d absol ve t he par t y of al l obl i gat i ons t o ar bi t r at e. See,
e. g. , Ar nol d v. Ar nol d Cor p. - Pr i nt ed Commc ns f or Bus. , 920 F. 2d
1269, 1281 ( 6t h Ci r . 1990) . I ndeed, l ong bef or e t he si gni ng of t he
cont r act i n t hi s case, our ci r cui t , al t hough not el abor at i ng t he
r ul e or t he r easons f or i t , had expr essed i t s appr oval of t he r ul e.
Hi l t i , I nc. v. Ol dach, 392 F. 2d 368, 369 n. 2 ( 1st Ci r . 1968) ( I f
ar bi t r at i on def enses coul d be f or ecl osed si mpl y by addi ng as a
def endant a per son not a par t y t o an ar bi t r at i on agr eement , t he
ut i l i t y of such agr eement s woul d be ser i ousl y compr omi sed. ) .
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Not abl y, t he hi ghest cour t of New Yor k St at e, t he st at e whose l aw
gener al l y gover ns t hi s cont r act i n t he absence of any f eder al
pr eempt i on, has t aken t he vi ew t hat t he need t o respect t he basi c
pol i cy of t he FAA- - t he pr ot ect i on of t he agr eement t o ar bi t r at e- -
r equi r es t he use of t he f eder al r ul e ar t i cul at ed by t hese ci r cui t s.
See Hi r schf el d Pr ods. , I nc. v. Mi r vi sh, 673 N. E. 2d 1232, 1233 ( N. Y.
1996) .
The Supreme Cour t s deci si on i n Ar t hur Ander sen LLP
v. Car l i sl e, 556 U. S. 624 ( 2009) , cal l s i nt o some quest i on t he
pr opr i et y of r el yi ng on a r ul e based on f eder al l aw i n t hi s
si t uat i on. I n t hat case, Car l i sl e and hi s associ at es had consul t ed
wi t h t he account i ng f i r mAr t hur Ander sen LLP about mi ni mi zi ng t hei r
t ax l i abi l i t y. I d. at 626. On t he basi s of t hat consul t at i on,
Car l i sl e ent er ed i nt o management cont r act s wi t h Br i col age Capi t al ,
LLC. I d. These management cont r act s cont ai ned ar bi t r at i on
cl auses. I d. Af t er t he I nt er nal Revenue Ser vi ce det er mi ned t hat
t he t ax st r at egy was i l l egal , Car l i sl e and hi s associ at es f i l ed a
di ver si t y act i on agai nst Ar t hur Ander sen, Br i col age and ot her s.
I d. at 626- 27. Cl ai mi ng t hat equi t abl e est oppel r equi r ed Car l i sl e
and hi s associ at es t o ar bi t r ate t hese cl ai ms under t he agr eement s
wi t h Br i col age, Ar t hur Ander sen sought a st ay of t he di ver si t y
act i on pendi ng ar bi t r at i on. I d. at 627. I n t he cour se of i t s
deci si on, t he Supr eme Cour t wr ot e:
Because t r adi t i onal pr i nci pl es of st at e l awal l ow a cont r act t o be enf or ced by or agai nst
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nonpar t i es t o the cont r act t hr oughassumpt i on, pi er ci ng t he cor por at e vei l ,al t er ego, i ncor por at i on by ref er ence,t hi r d- par t y benef i ci ar y theor i es, wai ver andest oppel , t he Si xt h Ci r cui t s hol di ng t hatnonpar t i es t o a cont r act ar e cat egor i cal l y
bar r ed f r om 3 r el i ef was er r or .
I d. at 631 ( emphasi s added) ( quot i ng 21 Ri char d A. Lor d, Wi l l i st on
on Cont r act s 57: 19, at 183 ( 4t h ed. 2001) ) .
Car l i sl e hol ds t hat , at l east as a gener al pr i nci pl e,
st at e l aw gover ns t he i nqui r y as t o whet her a non- par t y t o an
ar bi t r at i on agr eement can asser t t he pr ot ect i on of t he agr eement . 26
See i d. at 630- 32; Lawson v. Li f e of t he S. I ns. Co. , 648 F. 3d
1166, 1170- 71 ( 11t h Ci r . 2011) . Car l i sl e l eaves uncl ear , however ,
whet her t he Cour t i nt ended t o di st ur b t he uni f ormbody of pr ecedent
i n t he cour t s of appeal s, whi ch we j ust have exami ned, hol di ng t hat
a uni f or m f eder al r ul e i s r equi r ed wi t h r espect t o t he amenabi l i t y
26
The t ext of Ar t hur Ander sen LLP v. Car l i sl e, 556 U. S. 624( 2009) ,
l eaves somewhat uncl ear , however , whether , i n determi ni ngt he amenabi l i t y of a non- si gnat or y par t y t o an ar bi t r at i on cl ause,a cour t must consul t gener al pr i nci pl es of st at e cont r act l aw ort he pr eci se l aw of t he st ate whose l aw gover ns t he cont r act . As wej ust have not ed, t he Cour t at one poi nt speaks i n t er ms oft r adi t i onal pr i nci pl es of cont r act l aw, i d. at 631, but at anot her ,i t speaks i n t er ms of t he r el evant st at e cont r act l aw, i d. at632. We have chosen t o i nt er pr et Car l i sl e as r equi r i ng r ef er encet o t he pr ovi si ons of t he appl i cabl e st at e l aw. See Awuah v.Cover al l N. Am. , I nc. , 703 F. 3d 36, 42- 43 ( 1st Ci r . 2012) ( appl yi ngMassachuset t s l aw) . I n t hi s r espect , we have vi ewed Car l i sl e as
si mpl y f ol l owi ng t he gener al pr oposi t i on t hat i n deci di ng whet heran agr eement t o arbi t r ate i s t o be enf orced, we normal l y appl yor di nar y st at e- l aw pr i nci pl es t hat gover n t he f or mat i on ofcont r acts, i ncl udi ng val i di t y, r evocabi l i t y, and enf or ceabi l i t y ofcont r act s. Bezi o v. Dr aeger , 737 F. 3d 819, 822- 23 ( 1st Ci r .2013) ; see al so Fi r st Opt i ons of Chi . , I nc. v. Kapl an, 514 U. S.938, 944 ( 1995) .
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of empl oyees act i ng wi t hi n the scope of t hei r empl oyment t o t he
ar bi t r at i on cl auses i n t hei r empl oyer s cont r act s. As we have
noted ear l i er , t he cases r equi r i ng t hat t he empl oyees of a company
be bound by t he ar bi t r at i on agr eement s of t hei r empl oyer s ar e based
on t he speci f i c r at i onal e t hat such a r ul e i s necessar y to pr ot ect
t he f eder al pol i cy embodi ed i n t he FAA of f avor i ng ar bi t r at i on.
Wi t hout i t , accor di ng t o t he r at i onal e of t hose cases, a par t y
coul d f r ust r at e an ar bi t r at i on cl ause by si mpl y nami ng empl oyees as
par t y def endant s al ong wi t h the si gnat or y company i n a j udi ci al
acti on. Not hi ng i n Car l i sl e speci f i cal l y di sappr oves t he
f ashi oni ng of f eder al l aw t o avoi d t hi s speci f i c abuse. Not abl y,
at one poi nt i n Car l i sl e, t he Cour t seemi ngl y l i mi t ed t he scope of
i t s hol di ng; i t wr ot e:
We have sai d many t i mes t hat f ederal l awr equi r es that quest i ons of ar bi t r abi l i t y. . . be addr essed wi t h a heal t hy regar d f ort he f eder al pol i cy f avor i ng ar bi t r at i on. What ever t he meani ng of t hi s vaguepr escri pt i on, i t cannot possi bl y r equi r e t hedi sr egar d of st at e l aw per mi t t i ng ar bi t r at i onby or agai nst nonpar t i es t o t he wr i t t enar bi t r at i on agr eement .
556 U. S. at 630 n. 5 ( quot i ng Moses H. Cone Mem l Hosp. v. Mercury
Const r . Corp. , 460 U. S. 1, 2425 ( 1983) ) . Moreover , as we have
j ust not ed, i n Car l i sl e, t he Cour t speci f i cal l y not ed t hat t he
st at e l aw i n t hat case per mi t t ed ar bi t r at i on and was t her ef or e
compat i bl e wi t h and, i ndeed, suppor t i ve of t he f eder al pol i cy
embodi ed i n t he FAA. See i d.
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We need not deci de def i ni t i vel y whet her Car l i sl e has
abr ogat ed t hi s speci f i c l i ne of f eder al cases. Even i f t he Supr eme
Cour t s deci si on i n Car l i sl e does si gnal t he abr ogat i on of t he
pr i nci pl e t hat , as a mat t er of f eder al l aw, t he empl oyees of a
si gnat or y of an ar bi t r at i on agr eement ar e pr ot ect ed by t he
agr eement , Gr and has not suggest ed any pr i nci pl e of New Yor k l aw
t hat i mpedes t he i nt er pr et at i on of t he agr eement t o pr ot ect t he
empl oyee under t he cont r act . 27 I t r el i es sol el y on t he t ext of t he
cont r act - - a t ext t hat does not suppor t t he i l l ogi cal and
i mpr act i cal vi si on t hat an empl oyee who act s sol el y wi t hi n t he
scope of her empl oyment i s not pr ot ect ed by her empl oyer s
ar bi t r at i on cl ause.
Conclusion
The di st r i ct cour t i ncor r ect l y deni ed t he mot i on by
Ver i zon and Ms. McCahi l l t o compel Gr and t o ar bi t r at e i t s cl ai ms
agai nst t hem. Accor di ngl y, we r ever se and r emand t o t he di st r i ct
cour t f or f ur t her pr oceedi ngs consi st ent wi t h t hi s opi ni on.
REVERSED AND REMANDED.
27 As we not ed ear l i er , bef or e t he advent of Car l i sl e, t hecour t s of New Yor k St ate had r ecogni zed, emphat i cal l y, t he need f or
a uni f orm f eder al r ul e to gover n whet her an agent i s amenabl e tot he ar bi t r at i on agr eement of a pr i nci pal . See Hi r schf el d Pr ods. ,I nc. v. Mi r vi sh, 673 N. E. 2d 1232, 1233 ( N. Y. 1996) . Ther e i s noi ndi cat i on, and Gr and does not suggest , t hat New Yor k St ate woul dchoose a di f f er ent , and uni que, r ul e t o t he cont r ar y i f i t wer e t odet er mi ne, i n t he wake of Car l i sl e, t hat a f eder al r ul e was nol onger appl i cabl e.
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