Ventive, LLC v. Caring People, LLC et al

Filing 31

MEMORANDUM DECISION AND ORDER. The Court HEREBY ORDERS: Plaintiff's Motion to Appoint an Arbitrator 18 is GRANTED. Within two weeks of entry of this Order, the parties must submit a joint list of no more than three potential arbitrators, with information regarding each potential arbitrators' qualifications. Signed by Judge David C. Nye. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (st)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
VENTIVE, LLC,

Case No. 1:18-cv-00120-DCN

Plaintiff,

MEMORANDUM DECISION AND
ORDER

v.
CARING PEOPLE, LLC, a limited
liability company organized under the
laws of Florida, (now d/b/a
HannaKaylie, LLC),
CARINGONDEMAND, LLC, a limited
liability company organized under the
laws of Delaware, and AVIOR
SCIENCES, LLC, a limited liability
company organized under the laws of
Delaware,
Defendants.

I. INTRODUCTION
Pending before the Court is Plaintiff Ventive, LLC’s Motion to Appoint an
Arbitrator. Dkt. 18. Having reviewed the record and briefs, the Court finds that the facts
and legal arguments are adequately presented. Accordingly, in the interest of avoiding
further delay, and because the Court finds that the decisional process would not be
significantly aided by oral argument, the Court will address this motion without oral
argument. Dist. Idaho Loc. Civ. R. 7.1(d)(2)(ii). For the reasons outlined below, the
Court finds good cause to GRANT Plaintiff’s Motion to Appoint an Arbitrator.

ORDER - 1

II. BACKGROUND
This Court recounted the background of this dispute in its previous order staying
the case. Dkt. 16, at 1-3. The Court now incorporates that background in full by
reference. Since then, the United States District Court for the Southern District of Florida
(“Florida court”) issued an order in the Florida action compelling arbitration, but
“decline[d] to decide the question of the appropriate forum for arbitration,” and closed
the case. CaringOnDemand, LLC v. Ventive LLC, No. 18-cv-80211-BLOOM/Reinhart,
2018 WL 3093543, at *3-5 (S.D. Florida June 22, 2018).
On June 27, 2018, Plaintiff filed a Motion to Lift the Stay imposed in the Idaho
action, and to Appoint an Arbitrator. Dkt. 18. This Court lifted the stay on June 28, 2018,
but did not rule on the Motion to Appoint an Arbitrator. See Dkt. 19. On July 6, 2018,
Defendants Caring People, LLC, and CaringOnDemand, LLC filed their Second Motion
to Dismiss the Idaho action, arguing that the collateral attack doctrine bars any relief
Plaintiff seeks, including the appointment of an arbitrator, and therefore this Court lacks
jurisdiction over the dispute. However, in subsequent filings, Defendants reversed their
position and joined Plaintiff’s request for this Court to appoint an arbitrator. Dkt. 24, at 4
(“Notwithstanding the Collateral Attack Rule, Defendants Join in the Pending Request
for Appointment of an Arbitrator . . . Because of the practical realities arising from the
Florida court's refusal to act, Defendants will join with Ventive in this request.”).
(capitalization in original). The Court ultimately denied Defendants’ Second Motion to
Dismiss, and joined Avior Sciences, LLC as a party defendant in this case. Dkt. 29, at 89.
ORDER - 2

III. ANALYSIS
Defendants raised only one argument in opposition to Ventive’s Motion to
Appoint an Arbitrator—that it was an impermissible collateral attack. The Court has
already rejected this argument and explained that the collateral attack doctrine does not
apply. Dkt. 29, at 7. Additionally, Defendants have since joined Plaintiff’s request for this
Court to appoint an arbitrator. Accordingly, the Court GRANTS Plaintiff’s Motion to
Appoint an Arbitrator.
Such an appointment is governed by Section 9 of the Federal Arbitration Act, 9
U.S.C. § 5, which states:
If in the agreement provision be made for a method of naming or
appointing an arbitrator or arbitrators or an umpire, such method shall be
followed; but if no method be provided therein, or if a method be provided
and any party thereto shall fail to avail himself of such method, or if for any
other reason there shall be a lapse in the naming of an arbitrator or
arbitrators or umpire, or in filling a vacancy, then upon the application of
either party to the controversy the court shall designate and appoint an
arbitrator or arbitrators or umpire, as the case may require, who shall act
under the said agreement with the same force and effect as if he or they had
been specifically named therein; and unless otherwise provided in the
agreement the arbitration shall be by a single arbitrator.
The arbitration clause at issue in this case states:
This Agreement will be construed in accordance with the laws of Florida as
applied to a contract to be fully performed therein and without reference to
laws pertaining to conflict of laws. THE PARTIES agree to waive all rights
to a trial by jury and hereby agree to submit all disputes to binding
arbitration, which shall be submitted and conducted by one arbitrator, the
costs of which shall be equally shared among THE PARTIES. The parties
agree that the arbitrator shall have authority to grant injunctive or other
forms of equitable relief to any party. Any arbitration relating to a dispute
under Section 5 of this Agreement shall be conducted in Boise, Idaho or
within 10 miles of CONSULTANT'S principal place of business, Any
arbitration relating to Section 2 shall be conducted in Delray Beach, Florida
ORDER - 3

or within 10 miles of COMPANIES SCIENCE's principal place of
business. Any arbitration relating to Sections 2 and 5 shall take place in
Boise or Delray Beach, or within 10 miles of the principal place of business
of whichever party first demands arbitration in writing pursuant to this
Agreement. The prevailing party of any such arbitration or dispute shall be
awarded all costs of arbitration including attorney's fees and travel costs. It
is specifically understood and agreed that any party may enforce any award
rendered pursuant to the arbitration provisions of this Section by bringing
suit in any court of competent jurisdiction.
Dkt. 1-1, at 5-6.
The arbitration agreement provision does not provide a method of naming an
arbitrator. It simply requires that one arbitrator conduct the proceedings. The parties have
been unable to agree on an arbitrator, and now ask the Court to make an appointment
instead. Rather than doing so immediately, the Court deems it appropriate to receive
input from the parties, as set forth in the order below.

IV. ORDER
The Court HEREBY ORDERS:
1. Plaintiff’s Motion to Appoint an Arbitrator (Dkt. 18) is GRANTED.
2. Within two weeks of entry of this Order, the parties must submit a joint list of no
more than three potential arbitrators, with information regarding each potential
arbitrators’ qualifications. If the parties are unable to reach mutual agreement,
Plaintiff must submit a list of two proposed arbitrators, and Defendants
(collectively) must submit a list of two proposed arbitrators. When choosing
potential arbitrators, the parties must take into consideration the arbitrators’

ORDER - 4

availability to initiate and complete the arbitration within a reasonable time.

DATED: October 12, 2018
_________________________
David C. Nye
U.S. District Court Judge

ORDER - 5