United States District Court, W.D. Arkansas, Fayetteville Division
MEMORANDUM OPINION AND ORDER
TIMOTHY L. BROOKS UNITED STATES DISTRICT JUDGE.
pending befre the Court are Defendant lncipio, LLC's
Second Motion to Compel Arbitration (Doc. 22) and Brief in
Support (Doc. 23), Plaintif Best in Class Suppliers,
LLC's Response in Opposition (Doc. 25), and lncipio,
LLC's Reply (Doc. 28). On August 20, 2019, the Court held
a hearing on the Motion, and the paries were aforded an
opportunity to present oral argument. At the close of the
hearing, the Court took the Motion under advisement. Now,
having reviewed the parties' briefing and considered
their arguments made during the hearing, the Motion (Doc. 22)
is GRANTED fr the reasons set forth below.
parties to this lawsuit are Defendant lncipio, LLC, a
California company that manufactures and sells cell phone
accessories, and Plaintif Best in Class Suppliers, LLC
("BICS"), an Arkansas company that brokers sales
between manufacturers and distributors of products and
Walmart, Inc., Sam's Club, Walmart.com, and Samsclub.com.
The facts relevant to the parties' dispute began on June
16, 2015, when BICS entered into a Non-Exclusive Sales
Representative Agreement (Doc. 21-1, "Agreement")
with lncipio Technologies, lnc.-a company the Defendant
describes as its predecessor in interest. The Agreement
identifies Incipio Technologies, Inc. as "Client"
and BICS as "Representative." Id. at 1.
overview of some of the more important provisions of the
Agreement is necessary in order to understand the
parties' current dispute about arbitration. Section 1.1
of the Agreement generally describes the parties'
business relationship, including the services that BICS
agreed to provide; BICS's obligation to "effectively
and diligently market and promote the sale of the
Products"; and BICS's promise to front all costs
associated with marketing Incipio's products to Walmart
in exchange for Incipio's agreement to pay BICS certain
commissions on sales. Id. Section 1.1 further
specifies that BICS "will not represent any other
manufacturer during the term of this Agreement" in such
a way that would constitute "direct competition with the
services to be performed by Representative for Client during
the term of this Agreement." Id. at 2.
2.1 and 2.2 explain the method for calculating commissions,
including the calculation of "Net Sales" and the
deadline by which commissions should be paid. Id. at
3.1 contemplates the termination of the parties' business
relationship as follows:
Termination With Notice. This
Agreement shall terminate immediately upon receipt of written
notice if: (i) upon the institution by or against either
party of insolvency, receivership or bankruptcy proceedings
or any other proceedings for the settlement of either
party's debts, (ii) upon either party making an
assignment for the benefit of creditors, or (iii) upon either
party's dissolution or ceasing to do business.
7.6 deals with the assignment or transfer of the parties'
rights under the Agreement as follows:
Assignment. The Agreement is not
assignable or transferable by Client. This Agreement is not
assignable or transferable by the Representative without the
written consent of Client, which consent shall not be
unreasonably withheld or delayed.
Id. at 7.
finally, the arbitration clause appears at Section 7.14 as
Arbitration. Any controversy,
dispute, or claim arising out of or related to this Agreement
or breach of this Agreement shall be settled solely by
confidential binding arbitration by a single arbitrator in
accordance with the commercial arbitration rules of JAMS in
effect at the time the arbitration commences. The award of
the arbitrator shall be final and binding. No. party shall be
entitled to, and the arbitrator is not authorized to, award
legal fees, expert witness fees, or related costs of a party,
The arbitration shall ...