The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge
MEMORANDUM OPINION AND ORDER
Defendant Continental Casualty Insurance Company ("CNA") moves to dismiss this case pursuant to Fed. R. Civ. P. 12(b)(1) or 12(b)(3), and to compel arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. § 1, et seq. For the reasons set forth below, the Court grants CNA's motion to compel arbitration, and denies CNA's motion to dismiss.
Plaintiff Molton, Allen and Williams, LLC ("MAW") filed its complaint for injunction and declaratory relief against CNA on November 3, 2009. (R. 1-1, Complaint.) An October 15, 2003 Agency Agreement (the "Agreement") governs the relationship between CNA and MAW. Pursuant to the Agreement, CNA granted MAW, inter alia, the authority to issue insurance contracts to third parties in exchange for commissions from CNA. (R. 13-1, CNA's Mot. Dismiss or Compel Arb., Ex. 1.) CNA contends that MAW exceeded its authority under the Agreement by binding CNA to a policy issued to Sabel Industries. This case arises from CNA's demand on MAW for reimbursement of $2,605,968.61 in defense and settlement costs that CNA made to Sabel Industries and William Lancaster as a result of a December 15, 2003 car accident.
The Agreement contains a mandatory arbitration clause which states: In the event of any dispute arising out of or relating to this agreement which cannot be resolved by negotiation, the parties shall endeavor to settle the dispute by non-binding mediation. Such mediation shall take place in Chicago, Illinois and the parties shall select a mediator from the JAMS Chicago Panel of Neutrals, unless otherwise agreed upon.
Any dispute which has not been resolved by mediation within 60 days of the demand for such procedure shall be resolved by final and binding arbitration under the Commercial Arbitration Rules of the American Arbitration Association. The arbitration shall take place before a panel of three arbitrators which shall be selected in accordance with American Arbitration Association Rule R-13. The arbitrators shall have no power or authority to award consequential, punitive or exemplary damages. Any award made may be confirmed in a court having jurisdiction. All arbitration shall take place in Chicago, Illinois unless otherwise agreed upon.
Notwithstanding the above, [CNA] may, in [its] sole discretion, pursue judicial relief in any case involving allegations of fraud, misconduct or where [CNA] believe[s] [MAW] ha[s] acted outside the scope of [its] authority, as set forth in the agreement.
The laws of the State of Illinois shall apply, without regard its conflict of law rules, to this agreement. (R. 13-1, Ex. 1, p. 5, § VII.O.)
Pursuant to these provisions of the Agreement, CNA submitted the dispute underlying this lawsuit to non-binding mediation, and the parties mediated the dispute unsuccessfully on January 14, 2009 and August 4, 2009. Accordingly, on September 4, 2009, CNA filed its demand for arbitration with the American Arbitration Association ("AAA"). On September 28, 2009, MAW filed its answer with the AAA, without challenging the enforceability of the arbitration provision contained in the Agreement. Thereafter, on November 3, 2009, MAW filed its complaint with this Court seeking a judgment declaring that it is not responsible for indemnifying CNA in the underlying dispute.
I. Rule 12(b) Motions to Dismiss
In assessing a defendant's motions to dismiss under Fed. R. Civ. P. 12(b)(1) for lack of subject matter jurisdiction and Fed. R. Civ. P. 12(b)(3) for improper venue, the Court must view the allegations in the complaint in the light most favorable to plaintiff and accept all well-pleaded facts in the complaint as true. St. John's United Church of Christ v. City of Chicago, 502 F.3d 616, 625 (7th Cir. 2007); Turnock v. Cope, 816 F.2d 332, 333 (7th Cir. 1987); Rotec Indus., Inc. V. Aecon Group, Inc., 436 F. Supp. 2d 931, 933 (N.D. Ill. 2006.) In considering a Rule 12(b)(3) motion to transfer venue, the Court may also examine facts outside the complaint. See Rotec Indus., Inc., 436 F. Supp. 2d at 933. Similarly, on a Rule 12(b)(1) motion, the Court may look beyond the jurisdictional allegations and consider other evidence submitted by the parties. Alicea-Hernandez v. Catholic Bishop of Chi., 320 F.3d 698, 701 (7th Cir. 2003).
II. Federal Arbitration Act
The Federal Arbitration Act ("FAA") "'is a congressional declaration of a liberal federal policy favoring arbitration agreements' and 'questions of arbitrability must be addressed with a healthy regard for the federal policy favoring arbitration.'" Continental Cas. Co. v. American Nat'l Ins. Co., 417 F.3d 727, 730 (7th Cir. 2005) (citing Moses H. Cone Mem'l Hosp. v. Mercury Const. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983)). Any doubts concerning the scope of arbitration issues are resolved in favor of arbitration. Id. Further, courts broadly interpret the FAA to govern the interpretation, enforcement, and validity of arbitration agreements in commercial contracts. See Moses H. Cone Mem'l Hosp., 460 U.S at 24.
The FAA provides that binding arbitration agreements "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2. Section 3 of the FAA provides that if an agreement is governed by a valid arbitration provision, the 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, providing the applicant for the stay is not in default in proceeding with such arbitrations." 9 U.S.C. § 3. "Thus, if one party to a contract containing an arbitration clause attempts to avoid arbitration and files suit in the district court, the other party may move to stay or dismiss the action on the ground that the FAA requires the arbitration clause of the ...