The opinion of the court was delivered by: Gettleman, District Judge.
MEMORANDUM OPINION AND ORDER
Defendant has brought a motion to compel arbitration and to
stay these proceedings pending arbitration in Bucharest, Romania.
Although plaintiff objected to this motion in open court based on
the public policy exception to the enforcement of arbitration
agreements, plaintiff now agrees that given the arbitration
clause in the sales agreement, Count II should be arbitrated.
Plaintiff objects to sending Count I to arbitration, however.
Plaintiff states that it does not object to staying the entire
action, including Count I, pending arbitration of Count II, but
reserves the right to present Count I to this court when the
arbitration proceedings are concluded. Defendant replies that
Count I should be submitted to arbitration along with Count II.
As an initial matter, defendant contends that the arbitrator,
and not this court, should decide whether Count I should be
arbitrated. Defendant offers no support for this proposition.
Contrary to defendant's argument, the Supreme Court has held that
as long as the parties do not have an agreement to submit the
arbitrability question itself to an arbitrator, "the court should
decide that question just as it would decide any other question
that the parties did not submit to arbitration, namely,
independently." First Options of Chicago, Inc. v. Kaplan,
514 U.S. 938, 943, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995). "Courts
should not assume that the parties agreed to arbitrate
arbitrability unless there is `clea[r] and unmistakabl[e]'
evidence that they did so." Id. at 944, 115 S.Ct. 1920. Because
there is no evidence that the parties agreed to arbitrate
arbitrability in the instant case, this court will decide the
The arbitration clause in the Sales Agreement in the instant
case reads: "Any disagreement between the contracting parties
deriving from the conclusion, interpretation or the performance
of the agreement or in connection with it . . . will be submitted
for settlement to the Arbitration Court of the Chamber of
Commerce and Industry in Bucharest. . . ." "[W]here the contract
contains an arbitration clause, there is a presumption of
arbitrability in the sense that `[a]n order to arbitrate the
particular grievance should not be denied unless it may be said
with positive assurance that the arbitration clause is not
susceptible of an interpretation that covers the asserted
dispute. Doubts should be resolved in favor of coverage.'" AT &
T Technologies, Inc. v. Communications Workers of America,
475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (quoting
United Steelworkers of America v. Warrior & Gulf Nav. Co.,
363 U.S. 574, 582-83, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960)). The
presumption of arbitration applies with special force to cases
such as this one in which the arbitration clause is quite broad.
The Seventh Circuit has concluded that when an arbitration
clause states that it covers all disputes "arising out of" an
agreement, it "reaches all disputes having their origin or
genesis in the contract, whether or not they implicate
interpretation or performance of the contract per se." Sweet
Dreams Unlimited, Inc. v. Dial-A-Mattress International, Ltd.,
1 F.3d 639, 642 (7th Cir. 1993). The language of the arbitration
clause in the instant case is even broader than that in Sweet
Dreams, in that it states that all disputes that arise "in
connection with" the Sales Agreement will be arbitrated. See,
e.g., Hytran Corp. v. Aktiengesellschaft, 1995 WL 443926, *5
(N.D.Ill. July 24, 1995) (concluding that the language "in
connection with" is broader than the language in the arbitration
clause at issue in Sweet Dreams).
Plaintiff does not offer any argument in support of its
contention that Count I is not arbitrable. Defendant argues that
Count I is arbitrable because it arises in
connection with the Sales Agreement. In Count I, plaintiff
alleges that it performed valuable "accounting services" for
defendant, including: making payments to defendant's vendors and
suppliers; negotiating contracts for defendant, including
contracts with hotels to house defendant's flight crews and
catering contracts; and assisting defendant in resolving disputes
with third parties. Although plaintiff states in the complaint
that these accounting services were "completely independent of
its rights and obligations under the Sales Agreement," at least
some of these services are clearly covered by the Sales
Agreement. In the Sales Agreement plaintiff not only agreed to
sell airline tickets for defendant, but also agreed "to undertake
any effort meant to increase the good reputation of [defendant]
within the territory of the [plaintiff]," including "relations
with government authorities, . . . press, public, and any other
persons" and to represent and assist defendant in negotiations
with all authorities, governmental or otherwise, who exert
jurisdiction or control over plaintiff's territory. These
provisions certainly cover "resolving disputes with third
parties," one of the accounting services plaintiff allegedly
Moreover, all of the accounting services plaintiff alleges
arguably have their genesis in the Sales Agreement, in that
plaintiff began performing these services for defendant only
after the parties had entered into the Sales Agreement. See,
e.g., Sweet Dreams, 1 F.3d at 643 (holding that a tort claim for
interference with business relations had its genesis in a
contract because the formation of the contract marked the
beginning of those business relations).
Given the vagueness of plaintiff's allegations in Count I, the
broad duties plaintiff assumed under the Sales Agreement, and the
Supreme Court's admonition that "any doubts concerning the scope
of arbitrable issues should be resolved in favor of arbitration,"
Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp.,
460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983), the court
concludes that both Count I and Count II fall within the ambit of
the arbitration clause.
For the foregoing reasons, the court grants defendant's motion
to compel arbitration. Because this matter is already pending
before an arbitrator in Romania, "the Court can see no reason to
retain jurisdiction and allow this action to languish on the
docket in Chicago." Merchant v. Weissman, 1997 WL 695674, at *5
(N.D.Ill. Nov.3, 1997). "The weight of authority clearly supports
dismissal of the case when all of the issues raised in the
district court must be submitted to arbitration." Alford v. Dean
Witter Reynolds, Inc., 975 F.2d 1161, 1164 (5th Cir. 1992)
("Because it determined that all of [the plaintiff's] claims were
subject to arbitration, the district court acted within its
discretion when it dismissed this case with prejudice."). Rather
than stay these proceedings pending arbitration, the court
dismisses this case without prejudice to plaintiff reinstating
the case, if necessary, after arbitration is completed.
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