Intellivest Securities, Inc. v. Wave Equity Partners LLC et al

Filing 26

OPINION AND ORDER DENYING 1 Petition to Compel Arbitration. Signed by Judge Steven D. Grimberg on 3/10/2025. (tas)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
INTELLIVEST SECURITIES, INC.,
Plaintiff,
v.
WAVE EQUITY PARTNERS LLC, et al.,
Defendants.

Civil Action No.
1:24-cv-01644-SDG

OPINION AND ORDER
This case is before the Court on the petition by Plaintiff Intellivest Securities,
Inc. to compel arbitration of its dispute with Defendants Wave Equity Partners
LLC; Wave Equity Fund II, L.P.; Wave Equity II, GP, LLC; and Wave Equity Fund
II (NQP), L.P. regarding allegedly unpaid securities commissions [ECF 1]. For the
reasons stated below, the petition is DENIED.
I.

Factual Background
Intellivest is a broker-dealer and registered investment advisor that

specializes in helping raise capital from investors “desiring to receive a fair rate of
return while making a positive social impact,” often referred to as “impact
investing” or “environmental, social, governance investing.” 1 Wave Equity
Partners, LLC (Wave) is a registered investment advisor which serves as the

1

ECF 4-2, at 4; ECF 1, ¶¶ 1, 14 n.2. Intellivest filed an affidavit of its chief
executive officer (and attorney of record) Daniel Kolber attesting that the
allegations in the complaint are true and correct. ECF 4-3.
1

investment advisor for Wave Equity Fund II, L.P. 2 Wave Equity Fund II, GP, LLC
is the general partner of Wave Equity Fund II, L.P. 3 Wave Equity Fund II (NQP),
L.P. is a “parallel fund” to Wave Equity Fund II, L.P. 4
The dispute also involves several non-parties. Intellivest attests that Michael
Whelchel and Shawn Lesser were registered representatives of Intellivest and
simultaneously owned a company named Big Path Capital, LLC, “a consulting
group that specializes in familiarizing fund managers, companies, and people
around the world with the emerging impact and sustainable sectors.” 5 According
to Intellivest, Whelchel, Lesser, and several others resigned from Intellivest on
March 27, 2018, and joined another broker-dealer, non-party Growth Capital
Services, Inc. 6
As relevant to Intellivest’s petition to compel arbitration, Intellivest states
that it negotiated an agreement with Defendants pursuant to which Defendants
would make a presentation at an Intellivest-sponsored event called the “22nd Five

2

ECF 18, ¶ 17.

3

Id. ¶ 19.

4

Id. ¶ 20.

5

ECF 1, ¶¶ 2, 10 n.1; ECF 4, at 7. Defendants dispute this characterization. See
ECF 18, ¶ 10.

6

ECF 1, ¶ 3.
2

Fund Forum,” to take place in March 2018. 7 In exchange, Defendants agreed to
pay Intellivest 2% of the capital that Defendants raised from investors introduced
to them by Intellivest. 8 The purported agreement, titled the “Event Engagement
Letter,” also included a clause requiring the parties to arbitrate any disputes under
the rules of FINRA. 9 The Event Engagement Letter was structured to be an
agreement between a “presenter” (presumably Defendants), Intellivest, and Big
Path. 10
The Event Engagement Letter submitted by Intellivest is a blank form and
does not identify Wave—or anyone else—as the presenter. 11 Intellivest also admits
that the Event Engagement Letter was not signed by any party. 12 However,
Intellivest presents several arguments as to why Defendants should be compelled
to arbitrate the instant dispute with FINRA: (1) Defendants expressly agreed to the
terms of the unsigned Event Engagement Letter by email; (2) Defendants
manifested their assent to the terms of the unsigned Event Engagement Letter by
presenting at the Five Fund Forum; and (3) Defendants subsequently entered into

7

Id. ¶¶ 57–58.

8

Id.

9

Id. ¶ 24; see also ECF 4, at 7, 16.

10

ECF 4, at 7, 17.

11

Id.

12

ECF 1, ¶ 71; see also ECF 4, at 17.
3

a different agreement with Big Path and Growth Capital which included a clause
requiring those entities to arbitrate any disputes under the rules of FINRA. 13
The parties generally agree that the email conversations submitted by
Intellivest—dated between February 6 and 22, 2018—form the heart of the
arbitration dispute. 14 While Defendants dispute Intellivest’s characterization of
the events, they do not necessarily dispute the events themselves. According to
Defendants, Wave—but not the remaining Defendants—negotiated with
representatives of Big Path for Wave to present at the Five Fund Forum in March
2018. 15 Defendants assert that Intellivest was not a party to their discussions with
Big Path. 16 Wave’s discussions with Big Path culminated in a signed “Speaker
Engagement Letter” between Wave and Big Path for Wave to present at the Five
Fund Forum in exchange for a $25,000 fee paid to Big Path. 17 The terms of the
Speaker Engagement Letter vary considerably from the unsigned Event
Engagement Letter. 18

13

ECF 4-2.

14

ECF 17-1, ¶ 2.

15

Id.

16

Id. ¶ 5.

17

Id. ¶ 4, Ex. 1.

18

Compare id. at Ex. 1, with ECF 4, at 7–17.
4

Lastly, in May 2018, Wave, Big Path, and Growth Capital entered into a
“Broker Dealer Services Agreement,” pursuant to which Wave engaged Big Path
and Growth Capital to provide certain services in connection with a proposed
private placement of securities by Wave. 19 The Broker Dealer Services Agreement
included a FINRA arbitration provision. 20
II.

Procedural Background
Initially, Intellivest pursued arbitration against Defendants before FINRA in

December 2020. 21 Defendants did not consent to the arbitration, so FINRA
withdrew Intellivest’s claim without prejudice. 22 Intellivest attempted once again
to pursue FINRA arbitration against Defendants in December 2023, but
Defendants once again declined to participate, and FINRA withdrew the claim
against them. 23
Intellivest filed its “Petition to Compel Arbitration / Complaint” in this
Court on April 17, 2024. 24 The petition seeks to compel arbitration of Intellivest’s
claims against Defendants, but in the alternative Intellivest asks the Court to

19

See generally ECF 4-1.

20

Id. at 9–10.

21

ECF 1, ¶ 25.

22

Id.

23

Id. ¶ 26.

24

ECF 1.
5

consider the case on the merits. 25 The Court granted Defendants’ motion for an
extension of time to respond to the complaint, and Defendants filed their response
to Intellivest’s petition to compel arbitration and an answer to Intellivest’s
complaint on June 28. 26
III.

Applicable Legal Standard
The Federal Arbitration Act reflects the strong federal policy in favor of

arbitration. Howsam v Dean Witter Reynolds, Inc., 537 U.S. 79, 83 (2002) (quoting
Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24–25 (1983) (noting
that the Supreme Court has “long recognized and enforced a ‘liberal federal policy
favoring arbitration agreements’”)); see also Parnell v. CashCall, Inc., 804 F.3d 1142,
1146 (11th Cir. 2015) (citations omitted) (“The FAA places arbitration agreements
on equal footing with all other contracts and sets forth a clear presumption—’a
national policy’—in favor of arbitration.”). That said, parties cannot be required to
submit a dispute to arbitration unless they have agreed to do so. “[A] court may
order arbitration of a particular dispute only where the court is satisfied that the
parties agreed to arbitrate that dispute.” Granite Rock Co. v. Int’l Bhd. of Teamsters,
561 U.S. 287, 297 (2010) (citations omitted); see also Howsam, 537 U.S. at 83; AT&T
Techs. Inc. v. Commc’ns Workers of Am., 475 U.S. 643, 649 (1986).

25

Id.

26

ECFs 16, 17, 18.
6

“The threshold question of whether an arbitration agreement exists at all is
‘simply a matter of contract.’ Absent such an agreement, ‘a court cannot compel
the parties to settle their dispute in an arbitral forum.’” Bazemore v. Jefferson Cap.
Sys., LLC, 827 F.3d 1325, 1329 (11th Cir. 2016) (quoting First Options of Chicago, Inc.
v. Kaplan, 514 U.S. 938, 943 (1995); Klay v. All Defendants, 389 F.3d 1191, 1200
(11th Cir. 2004)).
State law governs whether the parties formed a contract. Bazemore, 827 F.3d
at 1329 (citing First Options, 514 U.S. at 944); see also Cogas Consulting, LLC v. Aeterna
Zentaris Inc., 2018 WL 7253597, at *3 (N.D. Ga. Aug. 27, 2018) (“[T]his Circuit
repeatedly has emphasized that state law generally governs whether an
enforceable contract or agreement to arbitrate exists.”) (internal citations and
quotation marks omitted). Accordingly, “[t]he Court simply looks to whether
contract formation is in dispute—either because Plaintiff or Defendant denies its
existence—and then looks to governing state-law principles to resolve the
formation dispute.” Cogas Consulting, 2018 WL 7253597, at *3.
Under the Federal Arbitration Act, “[i]f the making of the arbitration
agreement or the failure, neglect, or refusal to perform the same be in issue, the
court shall proceed summarily to the trial thereof.” 9 U.S.C. § 4. A summary
judgment-like standard should be applied when assessing whether such a trial is
necessary. Bazemore, 827 F.3d at 1333 (citing Fed. R. Civ. P. 56(a)). If there is no

7

genuine dispute of material fact, then the Court may “conclude as a matter of law”
that the parties did (or did not) enter into an arbitration agreement. Id.
IV.

Discussion
Intellivest’s petition to compel arbitration hinges on whether the parties

formed an agreement to arbitrate their disputes. On the facts as presented, the
Court concludes as a matter of law that there is no arbitration agreement between
the parties because (1) there was no mutual agreement to the terms of the Event
Engagement Letter, and (2) Intellivest has no basis to enforce an arbitration
agreement in the Broker Dealer Services Agreement between Defendants and nonparties Big Path and Growth Capital.
A.

The parties did not mutually agree to the terms of the Event
Engagement Letter.

Intellivest argues that Defendants agreed to the terms of the Event
Engagement Letter in two ways: (1) by Wave representative Mark Robinson’s
email on February 20, 2018 at 11:58 AM stating “[w]e have a deal,” and (2) by
Wave’s subsequent presentation at the Five Fund Forum. However, application of
state law contract principles requires the opposite conclusion—that the parties did
not agree to the arbitration provision.

8

Under Georgia law, 27 “[a]cceptance of an offer must be unconditional,
unequivocal, and without variance of any sort; otherwise, there can be no meeting
of the minds and mutual assent necessary to contract formation.” Nugent v. Myles,
350 Ga. App. 442, 447 (2019) (quoting Durham v. McLaughlin, 286 Ga. App. 166,
166–67 (2007)). When a party to the alleged contract “varies even one term of the
original offer,” it is considered a counteroffer. Costello Indus., Inc. v. Eagle Grooving,
Inc., 308 Ga. App. 254, 257 (2011) (quoting Lamb v. Decatur Fed. Sav. & Loan Ass’n,
201 Ga. App. 583, 585 (1991)). “A counteroffer acts to reject and nullify the original
offer.” Id. If the original offeror does not renew its offer, there is no offer left for
the other party to accept. Id.
At the outset, the Court notes that there is no obvious indication that even
Intellivest assented to the terms of the Event Engagement Letter. The individuals
included in the email conversation were, at various points: Robinson, Praveen
Sahay, Charles Bridge, and Haskell Crocker of Wave; Whelchel, Lesser, Jyoti
Aggarwala, and Christie Lange of Big Path; and Ian Mackenzie of Mira. 28
However, Intellivest attests that Whelchel and Lesser were “registered

27

Intellivest argues the issue of contract formation under Georgia law.
Defendants do not dispute that Georgia law applies but generally rely on the
11th Circuit’s pre-Bazemore case law.

28

See generally ECF 4, at 20–41. Mackenzie’s role in the conversation appears to
have been to introduce Big Path and Wave. See id. at 26–27.
9

representatives” of Intellivest, 29 so the Court will assume arguendo that Whelchel
and Lesser had the authority to bind Intellivest to the contract. The Court will also
assume for purposes of this Order only that Robinson was negotiating on behalf
of all Defendants as parties to the purported contract, and not just Wave.
1.

The parties’ email communications

The parties’ email communications do not evidence a mutual agreement to
the terms of the Event Engagement Letter. On February 13, 2018, Whelchel sent
Robinson the blank Event Engagement Letter. 30 On February 19, Robinson sent an
email to Lesser stating that “the Additional Fee of 2% is not appropriate” and
proposing, among other things, a different fee structure. 31 Because Robinson
varied the terms of the original offer, in particular the fee provided by the blank
Event Engagement Letter, Robinson’s February 19 email was a counteroffer and
consequently a rejection of the terms of the Event Engagement Letter.
Lesser’s response to Robinson’s February 19 email was a flat rejection of
Robinson’s counteroffer. Lesser stated that the 2% fee was not negotiable, and
further there was “[n]o need to go thr[ough] the other points [if] that is a show

29

ECF 1, ¶ 2.

30

ECF 4, at 20.

31

Id. at 40.
10

stopper.” 32 Robinson and Lesser continued to negotiate the contours of the fee, and
on the same day Lesser offered Robinson a 50% credit for an event fee towards the
2% additional fee. 33 Robinson agreed to Lesser’s proposal, responding “[w]e have
a deal! We’ll mark up the contract.” 34
At this point, the terms of the Event Engagement Letter had been rejected
by Robinson’s original counteroffer, and Lesser expressly limited the negotiation
to the 2% additional fee. The only offer outstanding was Lesser’s proposal for the
structure of the 2% fee, and Robinson’s acceptance was necessarily limited to
Lesser’s proposal. 35 See White v. Cheek, 360 Ga. App. 557, 562 (2021) (citation
omitted) (“[A]n answer to an offer will not amount to an acceptance, so as to result
in a contract, unless it is unconditional and identical with the terms of the offer.”).
Therefore, the arbitration agreement in Paragraph 11 of the Event Engagement
Letter was not part of the parties’ agreement at this stage of the negotiation.
Because the parties did not form an agreement to arbitrate their disputes before
FINRA through the email conversation, Intellivest cannot compel Defendants to
arbitrate their disputes on this basis.

32

Id. at 39.

33

Id. at 38–39.

34

Id. at 37.

35

The Court does not decide whether these actions constitute a valid contract as
to the fee.
11

2.

Wave’s presentation at the Five Fund Forum

Wave’s presentation at the Five Fund Forum does not alter the conclusion
that the parties did not mutually agree to the terms of the Event Engagement
Letter, because there is no evidence that Whelchel or Lesser renewed their offer
for the remaining terms of the Event Engagement Letter, including the FINRA
arbitration provision.
As previously noted, Robinson’s counteroffer on February 19, 2018 served
as a rejection of the terms of the Event Engagement Letter, and the parties’
subsequent negotiations were expressly limited to the structure of the 2% fee.
There is no evidence that Whelchel or Lesser renewed their offer of the remaining
terms of the Event Engagement Letter, including the provision for FINRA
arbitration. Because Robinson rejected the terms of the Event Engagement Letter,
and the subsequent negotiations were limited to the structure of the 2% fee, there
was no offer including the FINRA arbitration provision for Defendants to accept.
“A counteroffer operates to reject an offer and to terminate the power of
acceptance,” and “as the counteroffer acted to reject immediately and nullify the
original offer, any subsequent performance on the part of [the counter-offeror]
could not unilaterally breathe life into the then non-existing original offer.” Lamb,
201 Ga. App. at 585–56. Wave’s presentation at the Five Fund Forum could not by
itself reanimate the Event Engagement Letter, or the FINRA arbitration provision

12

therein. Therefore, there was no offer of FINRA arbitration for Wave to accept by
presenting at the Five Fund Forum.
Intellivest’s case law in support of its position on this point does not address
the issue of a counteroffer serving as a rejection of the original offer. See Del Lago
Ventures, Inc. v. QuikTrip Corp., 330 Ga. App. 138 (2014); Engineered Floors, LLC v.
Lakeshore Equip. Co., 2021 WL 857741 (N.D. Ga. Mar. 8, 2021); Athon v. Direct
Merchants Bank, 2007 WL 1100477 (M.D. Ga. Apr. 11, 2007); Leslie v. Barclays Bank
Del., 2017 WL 8220505 (N.D. Ga. Oct. 13, 2017), report and recommendation adopted,
2018 WL 1320082 (N.D. Ga. Jan. 3, 2018); Honig v. Comcast of Ga. I, LLC, 537 F. Supp.
2d 1277 (N.D. Ga. 2008); Comvest, L.L.C. v. Corp. Sec. Grp., Inc., 234 Ga. App. 277
(1998). While it is generally true that “[i]f one of the parties has not signed, his
acceptance is inferred from a performance under the contract, in part or in full,
and he becomes bound,” Del Lago, 330 Ga. App. at 144, Intellivest’s cases do not
address the effect of Robinson’s counteroffer and the parties’ subsequent
negotiations. As noted above, “[a] counteroffer acts to reject and nullify the
original offer,” and “[i]f the original offer was nullified and not renewed by [the
offeror], there was no offer left . . . to accept.” Costello Indus., Inc. v. Eagle Grooving,
Inc., 308 Ga. App. 254, 257 (2011).
Accordingly, Wave’s presentation at the forum is not a basis for Intellivest
to compel Defendants to arbitrate their dispute with FINRA.

13

B.

Intellivest has no basis to enforce an arbitration agreement in the
Broker Dealer Services Agreement between Defendants and nonparties Big Path and Growth Capital.

Intellivest also argues that because Wave entered into the Broker Dealer
Services Agreement with Big Path and Growth Capital, which also contained a
provision for FINRA arbitration, Defendants should be compelled to arbitrate the
instant dispute. However, Intellivest is not a party to the Broker Dealer Services
Agreement, 36 and Intellivest does not identify any other basis to compel
arbitration based on an agreement to which it was not a party.
The arbitration provision in the Broker Dealer Services Agreement provides
that “[a]ny dispute that may arise between [Wave] and [Big Path] shall be subject
to arbitration under the rules of FINRA.” 37 Thus, by its plain terms the arbitration
provision covers only disputes between Wave and Big Path. The Broker Dealer
Services Agreement also shows that it was executed by Wave (signed by Robinson)
and Big Path (signed by Whelchel) on May 8, 2018. 38 Intellivest attests that
Whelchel resigned from Intellivest on March 27, 2018, 39 and absent any other

36

See generally ECF 4-1.

37

Id. at 9–10.

38

Id. at 11.

39

ECF 1, ¶ 3.
14

evidence on this point there is no basis for Whelchel and Big Path’s actions to be
attributed to Intellivest.
While it is true that “a nonparty to an arbitration agreement may force
arbitration ‘if the relevant state contract law allows him to enforce the agreement,’”
Nat’l Freight, Inc. v. Consol. Container Co., LP, 166 F. Supp. 3d 1320, 1325 (N.D. Ga.
2015) (quoting Lawson v. Life of the S. Ins. Co., 648 F.3d 1166, 1170 (11th Cir. 2011)),
Intellivest has not identified any basis in Georgia or Delaware 40 law to allow it to
compel arbitration of its disputes with Defendants based upon the Broker Dealer
Services Agreement to which it was not a party. Intellivest cites 17 C.F.R. § 230.152
(Rule 152) for the proposition that the Broker Dealer Services Agreement and the
Event Engagement Letter involved the same securities offering by Wave, and
therefore Wave must submit this dispute to arbitration. Of course, Wave is not the
entity bringing this dispute in the first instance.
More importantly, Rule 152 does not affect the application of the Broker
Dealer Services Agreement’s arbitration provision under state law contract

40

The Broker Dealer Services Agreement contains a Delaware choice of law
clause. ECF 4-1, at 9–10. However, there is no apparent conflict between
Georgia and Delaware law on this point. Kuroda v. SPJS Holdings, L.L.C., 2010
WL 4880659, at *3 (Del. Ch. Nov. 30, 2010) (holding that “[g]enerally, only
parties to a contract and intended third-party beneficiaries may enforce or be
bound by that agreement’s provisions, whereas a nonparty to a contract has
no legal right to enforce it,” but recognizing potential exceptions “under
principles of contract and agency common law.”).
15

principles. Rather, Rule 152 involves “determining whether two or more offerings
are to be treated as one for the purpose of registration or qualifying for an
exemption from registration under [the Securities Act of 1933].” 17 C.F.R.
§ 230.152(a); see also In re Bd. of Dirs. of Multicanal S.A., 340 B.R. 154, 174 (Bankr.
S.D.N.Y. 2006) (“Rule 152 has been described as an exception to the SEC’s
‘integration doctrine,’ which provides that an issuer cannot use two or more
exemptions to avoid registration of what is in reality a single transaction and
determines what constitutes a single offering for purposes of registration.”)
(applying an earlier version of Rule 152). In short, Rule 152 is simply inapplicable
to the Court’s analysis of the scope of the arbitration provision in the Broker Dealer
Services Agreement. Intellivest has no basis to compel arbitration of its dispute
with Defendants based upon the arbitration provision in the Broker Dealer
Services Agreement.
V.

Conclusion
Intellivest’s petition to compel arbitration [ECF 1] is DENIED.
SO ORDERED this 10th day of March, 2025.

Steven D. Grimberg
United States District Judge

16