Hoopes et al v. Gulf Stream Coach Inc et al

Filing 35

OPINION AND ORDER GRANTING IN PART and DENYING IN PART 29 MOTION for Summary Judgment to Enforce Arbitration Clause filed by General RV Center. Defendant General RV Center Inc's request to compel arbitration is DENIED. The motion is GRA NTED to the extent that dft General RV Center, Inc seeks dismissal of the claims against it as set forth in the Amended Complaint. Defendant General RV Center is DISMISSED from this lawsuit. The Claims against dft Gulf Stream Coach Inc remain pending. Signed by Judge Rudy Lozano on 3/26/12. (jcp)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
NATHAN HOOPES and
DEVON HOOPES,
Plaintiffs,
vs.
GULF STREAM COACH, INC., and
GENERAL RV CENTER, INC.,
Defendants.

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NO. 1:10-CV-365

OPINION AND ORDER
This matter is before the Court on the Motion for Summary
Judgment to Enforce Arbitration Clause, filed by Defendant General
RV Center, Inc. on May 16, 2011.

(DE #29.)

For the reasons set

forth below, the motion is GRANTED in part and DENIED in part.

To

the extent that Defendant General RV Center, Inc. asks this Court
to compel arbitration, that request is DENIED. However, the motion
is GRANTED to the extent that Defendant General RV Center, Inc.
seeks dismissal of the claims against it as set forth in the
Amended Complaint.

Accordingly, Defendant General RV Center, Inc.

is DISMISSED from this lawsuit.

The claims against Defendant Gulf

Stream Coach, Inc. remain pending before this Court.

PROCEDURAL HISTORY
Prior to filing the instant Motion for Summary Judgment,
Defendant General RV Center, Inc. (“GRV”) filed an earlier Motion
for Summary Judgment to Enforce Arbitration Clause on January 20,
2011.

(DE #14.)

However, because the parties stipulated on the

record that certain claims against GRV were to be excluded and
resolved by way of arbitration (see DE #’s 17 & 25-1), an Amended
Complaint was filed on April 25, 2011 (DE #25), which rendered the
earlier Motion for Summary Judgment to Enforce Arbitration Clause
moot.

(DE #26.)

GRV then filed the instant Motion for Summary

Judgment to Enforce Arbitration Clause on May 16, 2011.

(DE #29.)

Plaintiffs Nathan and Devon Hoopes (the “Hoopes’”) filed a Response
on June 3, 2011.
(DE #34.)

(DE #32.)

GRV filed its Reply on June 13, 2011.

Thus, the instant Motion is now fully briefed and ripe

for adjudication.

DISCUSSION
Although GRV requests dismissal from this lawsuit, it has
titled

its

Arbitration

Motion
Clause”

for

Summary

and

Judgment

references

the

as

one

to

“Enforce

appropriateness

of

submitting all of the claims to arbitration throughout its brief.
This motion was filed by GRV in lieu of an answer to the Amended
Complaint, and no discovery has yet been conducted in this case.

-2-

The parties have presented their briefs pursuant to the summary
judgment

standard;

however,

Arbitration Act (the “FAA”).

both

acknowledge

the

See 9 U.S.C. §§ 1 et seq.

Federal
Section 3

of the FAA allows a district court to stay proceedings where an
issue is referable to arbitration pursuant to a valid arbitration
clause, and section 4 allows a court to compel arbitration when one
party has failed, neglected, or refused to arbitrate under a
written agreement.

9 U.S.C. §§ 3, 4.

Although the FAA does not

dictate a particular standard to be used when evaluating issues of
arbitration, the Seventh Circuit has approved the use of Rule 56(e)
of the Federal Rules of Civil Procedure in that the party opposing
compelled arbitration “must demonstrate that a genuine issue of
material fact warranting a trial exists.”

Tinder v. Pinkerton

Security, 305 F.3d 728, 735 (7th Cir. 2002).

“[A] party cannot

avoid compelled arbitration by generally denying the facts upon
which the right to arbitration rests; the party must identify
specific evidence in the record demonstrating a material factual
dispute for trial.” Id. When viewing the evidence presented, that
“of the non-movant is to be believed and all justifiable inferences
are to be drawn in his favor.”

Id. (quoting Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 255 (1986)).
context

below,

the

Seventh

Circuit

As will be discussed in

has

also

indicated

that

dismissal for improper venue based on an arbitration agreement’s
forum selection clause is appropriate under Federal Rule of Civil

-3-

Procedure Rule 12(b)(3). See Faulkenberg v. CB Tax Fran. Sys., LP,
637 F.3d 801, 808 (7th Cir. 2011). In this context, “[w]hen ruling
on a motion to dismiss for improper venue, the district court is
not obligated to limit its consideration to the pleadings . . . if
the parties submit evidence outside the pleadings.”
(internal quotation marks and citation omitted).
construed

and

plaintiffs.

reasonable
Id. at 806.

inferences

drawn

in

Id. at 809-10

Facts should be
favor

of

the

Therefore, based on the particular

circumstances of this case, whether GRV is seeking dismissal
pursuant to the traditional summary judgment rubric, compelled
arbitration pursuant to the FAA, or dismissal for improper venue
based on a forum selection clause related to arbitration, the
standard of review is primarily the same.

Facts
For purposes of this motion, the material facts are largely
undisputed.
Stream

Super

On January 23, 2010, the Hoopes’ purchased a Gulf
Nova

recreational

vehicle

(“RV”).

The

RV

was

assembled by Gulf Stream Coach, Inc. (“Gulf Stream”) and sold to
the Hoopes’ by GRV, an independent, authorized dealer of Gulf
Stream vehicles.1

At the time of purchase, the Hoopes’ and GRV

1

The Hoopes’ are citizens of Ohio. Gulf Stream, whose principal place
of business is located in Nappanee, Indiana, is an Indiana citizen for
jurisdiction purposes. General RV is a Michigan corporation and is a Michigan
citizen for jurisdiction purposes. According to the Amended Complaint,
jurisdiction is premised both on diversity and on federal question pursuant to
the Hoopes’ claim under the Magnuson Moss Warranty Act, 15 U.S.C. § 2301, et

-4-

entered into a Purchase Agreement (the “Agreement”), which was
signed by the Hoopes’ and a representative from GRV.

(DE #32-2.)

The Agreement is a two-sided document and contains the following
provision, which is located directly above the Hoopes’ signatures:
THIS PURCHASE AGREEMENT CONTAINS THE ENTIRE
UNDERSTANDING
BETWEEN
GENERAL
RV
AND
PURCHASER. NO ONE HAS AUTHORITY TO MAKE ANY
REPRESENTATION BEYOND THIS AGREEMENT AND NO
OTHER REPRESENTATIONS OR INDUCEMENTS, VERBAL
OR WRITTEN HAVE BEEN MADE, WHICH ARE NOT
CONTAINED ON THIS DOCUMENT. BY SIGNING BELOW
PURCHASER ACKNOWLEDGES THAT PURCHASER HAS
RECEIVED A COPY OF THIS AGREEMENT AND THAT
PURCHASER HAS READ AND UNDERSTANDS THE TERMS
OF THIS AGREEMENT, INCLUDING THOSE PRINTED ON
THE REVERSE SIDE, WHICH INCLUDE AN ARBITRATION
AGREEMENT, AN “AS IS” CLAUSE, AND A CHOICE OF
LAW PROVISION INDICATING THAT MICHIGAN LAW
WILL APPLY TO ANY POTENTIAL DISPUTES.
(Id.) On the reverse side of the Agreement, a clause (“Arbitration
Clause”), printed in bold type, provides the following:
ANY CONTROVERSY OR CLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT, THE BREACH OF THIS
AGREEMENT, THE SUBJECT OF THIS AGREEMENT,
AND/OR THE RECREATIONAL VEHICLE SOLD PURSUANT
TO THIS AGREEMENT, SHALL BE RESOLVED BY
ARBITRATION ADMINISTERED BY THE OFFICE OF THE
AMERICAN ARBITRATION ASSOCIATION LOCATED IN
OAKLAND,
COUNTY,
MICHIGAN,
USING
THE
SUBSTANTIVE LAWS OF THE STATE OF MICHIGAN, IN
ACCORDANCE WITH ITS THEN CURRENT ARBITRATION
RULES.
ARBITRATION SHALL BE THE EXCLUSIVE
REMEDY OF THE PARTIES.
JUDGMENT UPON THE
AWARD RENDERED BY THE ARBITRATION MAY BE
ENTERED IN ANY COURT HAVING JURISDICTION.
(Id.)

The Hoopes’ also received a copy of a “Limited Warranty”

seq.

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applicable only to Gulf Stream; this warranty does not contain an
arbitration clause.

(DE #32-3.)

The Hoopes’ did not sign or

receive any warranty specifically applicable to GRV.
Between January 2010 and July 2010, the Hoopes’ experienced
trouble with the slide-out room of their new RV and brought it to
GRV numerous times to be repaired. Because the repairs by GRV were
ultimately

unsuccessful,

the

Hoopes’

brought

the

RV

to

a

representative from Gulf Stream in August of 2010, for inspection.
The Hoopes’ assert, by way of an affidavit of Nathan Hooopes, that
a representative from Gulf Stream informed him that “the problem
with the slide-out mechanism was a failure by [GRV] to tighten a
lock nut in the slide-out mechanism.”

(DE #32-1.)

Still not

satisfied as to the condition of their RV, the Hoopes’ filed a
multi-count Complaint with this Court against both Gulf Stream and
GRV on October 19, 2010.
2011.

The Complaint was amended on April 25,

The Hoopes’ allege causes of action against GRV and/or Gulf

Stream under the Magnuson-Moss Warranty Act, theories of breach of
express and implied warranties, violations of lemon laws of Ohio,
Indiana, and/or Michigan, breach of contract, promissory estoppel,
violations of the consumer protection laws of Indiana, Michigan,
and

Ohio,

and

a

general

unsuccessful repairs.

negligence

theory

related

to

the

On May 16, 2011, Gulf Stream filed an

Answer, and GRV filed the instant Motion for Summary Judgment to
Enforce Arbitration Clause.

The issue presently before this Court

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is whether the post-sale causes of action against GRV fall within
the scope of the parties’ Arbitration Clause.

Applicable Law
Congress enacted the FAA, 9 U.S.C. §§ 1 et seq., to reverse
the

pervasive

institute

a

judicial

national

hostility

policy

both

towards
favoring

arbitration
it

and

and

to

“plac[ing]

arbitration agreements on equal footing with all other contracts.”
Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443 (2006).
If contracts to arbitrate involve “commerce,” the FAA deems those
agreements “valid, irrevocable, and enforceable, save upon such
grounds as exist at law or in equity for the revocation of any
contract.”

9 U.S.C. § 2.

While section 2 reflects a “liberal

federal policy favoring arbitration,” it also provides recognition
that agreements to arbitrate are ultimately matters of contract.
AT&T Mobility LLC v. Concepcion, --- U.S. ----, 131 S.Ct. 1740,
1745 (2011) (citations omitted).

As such, the Supreme Court has

stated that arbitration agreements are to be enforced pursuant to
their written terms and that “parties may agree to limit the issues
subject to arbitration, to arbitrate according to specific rules,
and to limit with whom a party will arbitrate its disputes.”

Id.

at 1748-49 (citations and emphasis omitted). See also Rosenblum v.
Travelbyus.com

Ltd.,

299

F.3d

657,

662

(7th

Cir.

2002)

(“arbitration is a matter of contract between the relevant parties;
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no party can be required to arbitrate absent an agreement to do
so.”)

As

the

Supreme

Court

has

recently

reemphasized,

“[a]rbitration is strictly a matter of consent, and thus is a way
to resolve those disputes— but only those disputes—that the parties
have agreed to submit to arbitration.”

Granite Rock Co. v. Int’l

Bhd. of Teamsters, --- U.S. ----, 130 S.Ct. 2847, 2857 (2010)
(emphasis in original) (citations and internal quotation marks
omitted).
Under the FAA, “arbitration may be compelled if the following
three elements are shown: a written agreement to arbitrate, a
dispute within the scope of the arbitration agreement, and a
refusal to arbitrate.”

Zurich American Ins. Co. v. Watts Indus.,

Inc., 417 F.3d 682, 687 (7th Cir. 2005).

It is a matter for the

court to determine “whether parties have agreed to submit a
particular dispute to arbitration.”

Granite Rock, 130 S.Ct. at

2855 (citation and internal quotation marks omitted).
regarding

the

applicability

of

an

arbitration

Questions

clause

to

a

particular dispute are governed by “ordinary state-law principles
that govern the formation of contracts.” First Options of Chicago,
Inc. v. Kaplan, 514 U.S. 938, 944 (1995).

However, as courts

analyze these issues, “‘due regard must be given to the federal
policy favoring arbitration, and ambiguities as to the scope of the
arbitration clause itself resolved in favor of arbitration.’”
Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 62 (1995)

-8-

(quoting Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford
Junior Univ., 489 U.S. 468, 476 (1989)).2

Only when a court has

determined that “the parties’ arbitration agreement [i]s validly
formed and that it cover[s] the dispute in question and [i]s
legally enforceable,” should arbitration be compelled.
Rock, 130 S.Ct. at 2858.

Granite

In addition, the Seventh Circuit has

recently stated:
To determine whether a contract's arbitration
clause applies to a given dispute, federal
courts apply state-law principles of contract
formation.
Once it is clear, however, that
the parties have a contract that provides for
arbitration of some issues between them, any
doubt concerning the scope of the arbitration
clause is resolved in favor of arbitration as
a matter of federal law. To this end, a court
may not deny a party's request to arbitrate an
issue unless it may be said with positive
assurance that the arbitration clause is not
susceptible of an interpretation that covers
the asserted dispute.
Gore v. Alltel Commc’ns, LLC, 666 F.3d 1027, 1033 (7th Cir. 2012)
(internal quotation marks and citations omitted).
Here, while it is undisputed that the FAA applies because the
contracts involve commerce, both the underlying Agreement and the
Arbitration Clause itself contain choice of law provisions, which

2

The Granite Rock Court noted that a presumption of arbitrability only
applies when (1) an ambiguity exists in a validly formed arbitration agreement
as to the coverage of a particular dispute; and (2)the presumption is not
rebutted by the opposing party. Granite Rock, 130 S.Ct. at 2858-59. In
reversing the court of appeals’ judgment, the Supreme Court ultimately
concluded that a question regarding the formation date of a contract was one
for judicial determination and that the “parties’ ratification-date dispute”
was outside of the scope of the rather narrow arbitration agreement. Id. at
2860-62.

-9-

provide that Michigan law shall apply to any disputes arising
between the parties.3

Thus, the Court will apply Michigan law to

construe the scope of the Arbitration Clause.4

See e.g. Ross Bros.

Constr. Co., Inc. v. Int’l Steel Servs., Inc., 283 F.3d 867, 874
(7th Cir. 2002) (when determining whether a claim is covered by the
arbitration clause, that clause “must be interpreted pursuant to
the purchase order agreement’s choice of law provision.”); Shriner
v. Signal Fin. Co., No. 02-1846, 92 Fed.Appx. 322, 325, 2003 WL
22977474, *3 (7th Cir. Dec. 11, 2003) (acknowledging that contract
formation principles apply to determine whether a particular claim
is covered by an arbitration clause and noting that the contract at
issue contained a choice of law clause dictating the body of law to
3

Specifically, the Arbitration Clause states that such disputes "shall
be resolved by arbitration administered by the office of the American
Arbitration Association located in Oakland, County, Michigan, using the
substantive laws of the state of Michigan, in accordance with its then current
arbitration rules." (DE #32-2.)
4

Neither party discusses in any depth which body of law will apply to
the arbitrability issues presented in this case. GRV cites to federal and
Indiana law, while the Hoopes' cite to federal and Michigan law. The
Agreement, which was signed in the state of Ohio, contains a Michigan choice
of law provision as does the Arbitration Clause. Notwithstanding the
references to various state laws (Indiana, Michigan, and Ohio), the Court
notes that there is little difference among those laws as they pertain to this
motion. See Janiga v. Questar Capital Corp., 615 F.3d 735, 742 (7th Cir.
2010) (in recognizing that there was some dispute as to which state law
applied when construing an arbitration clause, the Seventh Circuit noted that
“[w]e need not dwell on that problem, however, because we see no difference
among the laws of those three states that would be dispositive.”). Here, all
three states’ laws acknowledge a strong policy favoring the enforcement of
arbitration agreements and use ordinary principles of contract interpretation
to resolve issues over the scope of those agreements. See e.g. Geneva–Roth
Capital, Inc. v. Edwards, 956 N.E.2d 1195, 1198-99 (Ind. Ct.App. 2011),
petition for reh'g denied; Fromm v. MEEMIC Ins. Co., 690 N.W.2d 528, 530-31
(Mich. Ct.App. 2004); Covington v. Lucia, 784 N.E.2d 186, 189-90 (Ohio Ct.App.
2003). In any event, to the extent that the laws do conflict, the Court notes
that the law of the forum state would be applied and “Indiana choice of law
doctrine favors contractual stipulations as to governing law.” Allen v. Great
Am. Reserve Ins. Co., 766 N.E.2d 1157, 1162 (Ind. 2002).

-10-

be utilized for such analysis).
Under Michigan law, arbitration is favored as a matter of
public policy.

Rooyakker & Sitz, P.L.L.C. v. Plante & Moran,

P.L.L.C., 742 N.W.2d 409, 416 (Mich. Ct.App. 2007).

When deciding

a dispute related to the scope of the arbitration agreement, a
court must look to the parties’ agreement itself.

See Fromm v.

MEEMIC Ins. Co., 690 N.W.2d 528, 530-31 (Mich. Ct.App. 2004).

In

doing so, a court must consider the following: (1) whether the
agreement contains an arbitration clause; (2) whether the issue in
dispute can “arguably” fall within that clause; and (3) whether the
terms of the contract “expressly exempt” that particular dispute
from being decided by an arbitrator.

Id.

When examining the

contractual language, a court must “giv[e] it its ordinary and
plain meaning if such would be apparent to a reader of the
instrument,” and when this meaning is not ambiguous, the contract
should be enforced according to its terms.

Wilkie v. Auto-Owners

Ins. Co., 664 N.W.2d 776, 780-82 (Mich. 2003) (also noting that
when

contractual

language

is

unambiguous,

a

court

necessarily construe the contract against its drafter).

need

not

“Thus, an

unambiguous contractual provision is reflective of the parties'
intent as a matter of law.”

Quality Prod. and Concepts Co. v.

Nagel Precision, Inc., 666 N.W.2d 251, 259 (Mich. 2003).

Finally,

any doubt as to the scope of an arbitration clause is to be
resolved in favor of arbitration, and courts should take care to

-11-

prevent dissection of a party’s claims (i.e. segregating them “into
categories of ‘arbitrable sheep and judicially-triable goats’”)
whenever possible.

Detroit Auto. Inter-Ins. Exch. v. Reck, 282

N.W.2d 292, 294 (Mich. Ct.App. 1979) (citation omitted).
In this case, it is undisputed that the Agreement contains an
Arbitration Clause.

There is no argument over contract formation,

there are no claims of fraud, duress, or unconscionability, and the
Hoopes’ do not assert that they were unaware of the Arbitration
Clause when they signed the Agreement. In fact, as noted above, it
is clear from the record that the Hoopes’ acknowledge that at least
some of their claims against GRV must be submitted to an arbitrator
pursuant to the Arbitration Clause; however, they argue that their
post-sale claims, which, according to their Response, include
“claims of negligent repair and breach of agreements unrelated to
the purchase agreement,” simply do not fall within the scope of the
Arbitration Clause.
To determine whether these claims can “arguably” fall within
the scope of the Arbitration Clause, the Court must look to the
written language itself.

The Arbitration Clause provides that any

of the following controversies or claims shall be resolved by way
of arbitration: (1) those arising out of or relating to the
Agreement; (2) those arising out of or related to a breach of the
Agreement; (3) those arising out of or related to the subject of
the Agreement; and/or (4) those arising out of or related to the RV

-12-

sold pursuant to the Agreement.

The ordinary and plain meaning of

this language establishes that, in addition to those claims arising
out of or related to the Purchase Agreement itself, “any” (in other
words all)5 controversies or claims “arising out of or related to”
(emphasis added) the RV sold to the Hoopes’ by GRV are also subject
to arbitration.

The use of the phrase “and/or” underscores this

point--the Arbitration Clause takes care to distinguish claims
related to the Agreement (including its potential breach and/or its
subject) from claims related to the RV sold pursuant to it.

It is

clear that the text of the Arbitration Clause is very broad and
includes all claims that are substantially related to the RV in
question.

The alleged negligent repairs performed by GRV, whether

conducted pursuant to the Purchase Agreement, an “independent
agreement,” or “manufacturer warranties,” are certainly “related
to” the RV itself.

Indeed, the Arbitration Clause encompasses all

claims brought forth by the Hoopes’ against GRV because each and
every one of these issues “arises out of” or “relates to” either
the Agreement or the RV sold pursuant to it.
The Hoopes’ attempts to distinguish these claims as somehow
unrelated to the RV sold to them by GRV fall short; although they
state that the Arbitration Clause “should be construed as not

5

See Dep’t of Agric. v. Appletree Mktg., L.L.C., 779 N.W.2d 237, 242
(Mich. 2010) (“Any” is defined as “every; all.”) (citing Random House
Webster’s College Dictionary (1997)).

-13-

applying to the services, which are the subject of the various
claims in this case,” they do not adequately explain why these
specific claims should be parsed out of such a broad clause.

As

explained above, services performed on the RV by GRV’s technicians
are substantially related to the RV itself.

As such, although the

Hoopes’ argue that the Arbitration Clause is ambiguous on its face,
the

Court

disagrees;

the

clear

language

of

the

contract

demonstrates the parties’ intent to submit any claim between them
arising out of or related to the Agreement and/or the RV itself to
arbitration.

Because the language of the Arbitration Clause is

unambiguous, the Court need not look further.

Thus, all of the

claims against GRV in the Amended Complaint “arguably” fall within
the scope of this broad Arbitration Clause.

See e.g. Rooyakker &

Sitz, P.L.L.C. v. Plante & Moran, P.L.L.C., 742 N.W.2d 409, 421
(Mich. Ct.App. 2007) (“In this case, the broad language of the
arbitration clause–-‘any dispute or controversy arising out of or
relating to’ the agreement–-vests the arbitrator with the authority
to hear plaintiffs’ tortious interference and defamation claims,
even if they involve nonparties to the agreement.”). See also Gore
v. Alltel Communications, LLC, 666 F.3d 1027, 1033 (7th Cir. 2012)
(noting that the phrase “‘arising out of’ reaches all disputes
having their origin or genesis in the contract, whether or not they
implicate interpretation or performance of the contract per se”
(citation omitted)); Kiefer Specialty Flooring, Inc. v. Tarkett,

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Inc., 174 F.3d 907, 909-10 (7th Cir. 1999) (describing broad
arbitration

clauses

containing

“relating

to”

as

having

an

“expansive reach” and noting that “a party may not avoid . . .
arbitration . . . by ‘casting its complaint in tort.’” (citation
omitted)).
This becomes even more clear when viewed in light of the fact
that the Arbitration Clause here does not “expressly exempt” these
types of claims from its reach.

The parties could easily have

provided that “post-sale” claims, service issues, or those related
to

“negligent

arbitration.

repairs”

of

the

They did not.

RV

are

not

to

be

subject

to

Furthermore, Michigan courts have

expressed a strong preference in favor of keeping all issues
between parties in a single forum.

See e.g. In re Nestorovski

Estate, 769 N.W.2d 720, 735-36 (Mich. Ct.App. 2009).

As the

Hoopes’ have already indicated that some of their claims against
GRV will likely be submitted to arbitration, it logically follows
that those “post-sale” claims, which are significantly related to
both the Agreement and the RV itself, should also be submitted to
the same arbitral forum.

And, finally, to the extent that any

doubts remain as to the scope of the Arbitration Clause, those
doubts are resolved in favor of arbitration.

See e.g.

Watts v.

Polaczyk, 619 N.W.2d 714, 719 (Mich. Ct.App. 2000) (“Any doubts
about the arbitrability of an issue should be resolved in favor of

-15-

arbitration.”)6
In sum, the Court has determined that all of the Hoopes’
claims against GRV described in the Amended Complaint fall within
the scope of the parties’ Arbitration Clause.

As such, the Court

is satisfied that the Arbitration Clause was validly formed, that
it

covers

the

disputes

in

question,

and

that

it

is

legally

enforceable; thus, the Hoopes’ claims against GRV as set forth in
the Amended Complaint are subject to arbitration.

See Granite

Rock, 130 S.Ct. at 2858.
Nonetheless,
Arbitration

a

Clause’s

procedural

wrinkle

stipulation

that

arises

based

arbitration

on

shall

the
be

“administered by the office of the American Arbitration Association
located in Oakland, County, Michigan.”

Normally, when a party

seeks to “invoke an arbitration clause,” the Seventh Circuit’s
preferred method is to stay the litigation pending arbitration
rather than to dismiss it completely.

Halim v. Great Gatsby's

Auction Gallery, Inc., 516 F.3d 557, 561 (7th Cir. 2008).

When an

arbitration agreement itself contains a forum selection clause,
however, and the suit has been brought in a district other than
that referenced by the parties in their agreement, dismissal is
more appropriate.

See Faulkenberg v. CB Tax Franchise Sys., LP,

6

The parties present arguments as to the validity of negligent repair
claims under Michigan law. However, as the Court has determined that the
Arbitration Clause is broad enough in scope to include such post-sale claims
(i.e. those that are substantially related to the RV sold to the Hoopes’ by
GRV), the Court need not address those arguments; this task is left to the
arbitrator.

-16-

637 F.3d 801, 808 (7th Cir. 2011).

This is so because “a district

court

outside

cannot

compel

arbitration

district.”

Id. (citation omitted).

motion

one

as

to

“Enforce

the

confines

of

its

Here, although GRV titles its

Arbitration

Clause,”

it

does

not

substantively seek compelled arbitration from this Court but rather
seeks dismissal outright.

It does so pursuant to a motion for

summary judgment filed in lieu of an answer, and little activity
has been docketed in the case to date.

Understanding that this

Court does not have authority to compel arbitration in Michigan and
noting the principles and facts outlined above, the Court finds it
appropriate in this instance for the claims against GRV to be
dismissed without prejudice.

In the event that GRV refuses to

arbitrate these claims at some point in the future, the Hoopes’
have the option of filing their own motion to compel arbitration in
the appropriate forum.

The claims against Gulf Stream remain

pending before this Court.

CONCLUSION
For the reasons set forth above, the motion is GRANTED in part
and DENIED in part.

To the extent that Defendant General RV

Center, Inc. asks this Court to compel arbitration, that request is
DENIED.

However,

the

motion

is

GRANTED

to

the

extent

that

Defendant General RV Center, Inc. seeks dismissal of the claims
against it as set forth in the Amended Complaint.
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Accordingly,

Defendant General RV Center, Inc. is DISMISSED from this lawsuit.
The claims against Defendant Gulf Stream Coach, Inc. remain pending
before this Court.

DATED: March 26, 2012

/s/RUDY LOZANO, Judge
United State District Court

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