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UNITED STATES 1008
United States District Court, Eastern District of Texas, Sherman Division, 21 May 2020, Civil Action No. 4:19-CV-00648-ALM
(Bayco Products Inc. v. ProTorch Company Inc. et al.)
UNITED STATES 1008
The Court granted the defendants' motion to compel arbitration, finding that the defendants, which were not signatories to the contract containing the arbitration clause, could rely on that clause because the arbitration clause itself was readily susceptible of an interpretation that covered both the parties and the disputes at issue. Further, the defendants could rely on the arbitration clause under either a direct-benefits estoppel or an intertwined-claim estoppel theory.
The court discusses whether the dispute falls within the wording of the arbitration agreement; and whether claims in tort fall within the scope of the agreement.
Multi-party disputes: The court discusses under which conditions non-signatories are covered by an arbitration agreement entered into by another party.