In a three paragraph memorandum decision, the Ninth Circuit has reversed an order of a district court granting a motion to compel arbitration. The Court held that the district court erred in holding that the non-movant, GIB, had waived its right to a trial to determine the enforceability of a written arbitration agreement. The Court stated that once GIB challenged the validity of the agreement the district court was obligated under the Federal Arbitration Act to hold a trial on the issue of the validity of the agreement. Second, the Court held that the district court erred in holding GIB, which was not a signatory to the written arbitration agreement, bound by the agreement by the doctrine of estoppel, finding the factual record insufficient to support the district court’s ruling. Finally, the Court held that the submission by GIB of a sworn declaration denying that the parties had entered into a written agreement, accompanied by e-mails which suggested a different, more informal, agreement, precluded the district court from deciding, as a matter of law, that the parties had entered into an agreement to arbitrate. GIB, LLC v. Salon Ware, Inc., No. 14-55399 (9th Cir. Feb. 5, 2016) (unpublished).
This post written by Rollie Goss.
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