PEARSON v. VALEANT PHARMACEUTICALS INTERNATIONAL, INC.

Filing 20

OPINION filed. Signed by Judge Brian R. Martinotti on 12/20/2017. (mmh)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
__________________________________________
:
:
:
Plaintiff,
:
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v.
:
:
VALEANT PHARMACEUTICALS
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INTERNATIONAL, INC.,
:
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Defendant.
:
__________________________________________:

J. MICHAEL PEARSON,

Civ. Action No. 17-1995-BRM-DEA

OPINION

MARTINOTTI, DISTRICT JUDGE
Before this Court is Defendant Valeant Pharmaceuticals International, Inc.’s (“Valeant”)
Motion to Compel Arbitration and Dismiss the Proceedings. (ECF No. 7.) Plaintiff J. Michael
Pearson opposes the Motion. (ECF No. 14.) Pursuant to Federal Rule of Civil Procedure 78(b), the
Court did not hear oral argument. For the reasons set forth below, Valeant’s Motion is GRANTED
and the case is CLOSED.
I.

FACTUAL AND PROCEDURAL BACKGROUND
This matter arises from a dispute over whether a Second Amended and Restated

Employment Agreement (“2015 Employment Agreement”) (ECF No. 1-1, Ex. A), containing an
arbitration provision, was superseded by a Separation Agreement (ECF No. 1-1, Ex. B) that does
not contain an arbitration provision. Pearson was the Chief Executive Officer of Valeant between
February 1, 2008, and May 2, 2016. (Compl. (ECF No. 1) ¶ 10.) During his tenure, Pearson and
Valeant entered into a number of employment agreements governing the terms of his employment.
(Id. ¶ 1.)

On January 7, 2015, the parties entered into the 2015 Employment Agreement. (Id. ¶ 11.)
The 2015 Employment Agreement contains terms concerning Pearson’s compensation and
benefits (including the equity awards principally at issue in the complaint), the different
circumstances under which Pearson could be terminated the consequences of termination under
those different circumstances, and various other obligations. (See ECF No. 1-1, Ex. A.) The 2015
Employment Agreement is governed by New Jersey law and contains an arbitration provision
stating, in relevant part:
If any legally actionable dispute arises under this Agreement or
otherwise which cannot be resolved by mutual discussion between
the parties, then [Valeant] and [Pearson] each agree to resolve that
dispute by binding arbitration before an arbitrator experienced in
employment law. Said arbitration will be conducted in accordance
with the rules applicable to employment disputes of the Judicial
Arbitration and Mediation Services (“JAMS”) and the law
applicable to the claim. . . . The parties agree that this agreement to
arbitrate includes any such disputes that [Valeant] may have against
[Pearson], or [Pearson] may have against [Valeant] and/or its related
entities and/or employees, arising out of or relating to this
Agreement, or [Pearson]’s employment or [Pearson]’s termination
including, but not limited to, any claims of discrimination or
harassment in violation of applicable law and any other aspect of
[Pearson]’s compensation, employment, or [Pearson]’s termination.
The parties further agree that arbitration as provided for in this
Section 15(h) is the exclusive and binding remedy for any such
dispute and will be used instead of any court action, which is hereby
expressly waived, except for any request by any party for temporary,
preliminary or permanent injunctive relief pending arbitration in
accordance with applicable law or for breaches by [Pearson] of
[Pearson]’s obligations under Sections 12 or 13 above or an
administrative claim with an administrative agency.
(Id. at 16-17.)
Pearson alleges he did not receive any base salary pursuant to Section 3(a) of the 2015
Employment Agreement. (ECF No. 1 ¶ 12.) “Instead, his compensation was wholly in the form of

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cash bonuses and equity awards.” (Id.) Pearson admits to receiving multiple equity awards, listed
in Section 4(f) of the 2015 Employment Agreement. (Id. ¶ 13.)
The parties’ employment relationship ended in May 2, 2016, and, instead of adhering to
the separation provisions in the 2015 Employment Agreement, they entered into a Separation
Agreement dated May 26, 2016. (ECF No. 1-1, Ex. B at 1.) The Separation Agreement governs
the compensation Pearson was to receive in connection with his termination. (Id.) Specifically,
Valeant agreed to, in part: (1) pay Pearson “[a]n annual bonus in respect of the 2016 fiscal year
pro-rated to reflect the portion of the 2016 fiscal year elapsed prior to the Termination Date payable
within 60 days of the Termination Date”; (2) pay Pearson “[a] severance payment equal to $9
million, payable in lump sum within 60 days of the Termination Date”; (3) “continue[] coverage
for [Pearson] and his dependents under any health, medical, dental or vision program or policy on
the same basis as active employees, at the rates applicable to active employees” for a period of two
years; and (4) “make available to [] Pearson office space in a building” for two years. (Id. at 1-2.)
Pearson admits Valeant “initially satisfied, and is currently satisfying, some of its
obligations under the Separation Agreement.” (ECF No. 1 ¶ 20.) Valeant has paid Pearson the
pro-rated bonus for 2016, paid Pearson the $9 million severance payment, provided and indicated
in writing through counsel that it will continue to provide insurance coverage, and provided and
indicated in writing that it will continue to provide office space and administrative assistant and
IT support to Pearson. (Id.) However, Pearson contends Valeant has not complied with the equity
compensation awards provision in accordance with Section 3(d) of the Separation Agreement. (Id.
¶ 21.) Pursuant to Section 3(d) of the Separation Agreement, Valeant is required to treat the equity
compensation awards in accordance with Section 9(c) of the 2015 Employment Agreement, which
states, in part, Valeant “shall pay to [Pearson] any Accrued Compensation.” (Id. ¶ 23; ECF No. 1-

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1, Ex. A at 10.) The Separation Agreement also governs consulting services Pearson agreed to
provide to Valeant following his termination and the compensation he would receive for providing
those services. (ECF No. 1-1, Ex. B at 2-3.) Pearson argues Valeant failed to deliver Pearson’s
equity compensation awards and failed to pay him for the remainder of the Initial Consulting
Period. (ECF No. 1 ¶ 49.)
Notably, the Separation Agreement does not include an arbitration provision, but contains
a “Governing Law” provision. (ECF No. 1-1, Ex. B at 5.) The Separation Agreement also includes
an “Entire Agreement” provision, stating:
This Agreement sets forth the entire agreement between [] Pearson
and Valeant concerning the termination of [] Pearson’s employment
and his service as a consultant to Valeant, and supersedes any other
written or oral promises concerning the subject matter of this
Agreement, including without limitation, those set forth in the 2015
Agreement (except to the extent the provisions of the 2015
Agreement survive by their terms or the terms of this Agreement).
No waiver or amendment of this Agreement will be effective unless
in writing, refers to this Agreement, and is signed by [] Pearson and
Valeant’s Chief Executive Officer.
(Id.)
On March 27, 2017, Pearson filed a complaint alleging Valeant breached the Separation
Agreement and violated the New Jersey Wage Payment Law. (See ECF No. 1.) On May 26, 2017,
Valeant filed a Motion to Compel Arbitration and Dismiss the Proceedings. (ECF No. 7.) Pearson
opposes the Motion. (ECF No. 14.)
II.

LEGAL STANDARD
Generally, an agreement to arbitrate a dispute “is a matter of contract and a party cannot

be required to submit to arbitration any dispute which he has not agreed so to submit.” E.M.
Diagnostic Sys., Inc. v. Local 169, Int’l Bhd. of Teamsters, Chauffeurs, Warehouseman & Helpers
of Am., 812 F.2d 91, 94 (3d Cir. 1987) (quoting Steelworkers v. Warrior & Gulf Navigation Co.,

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363 U.S. 574, 582 (1960)). The Federal Arbitration Act, 9 U.S.C. §§ 1, et seq. (“FAA”), directs
federal courts to compel arbitration of claims “arising out of” a valid agreement to arbitrate. 9
U.S.C. § 2. The FAA was enacted “to reverse the longstanding judicial hostility to arbitration
agreements that had existed at English common law and had been adopted by American courts,
and to place arbitration agreements upon the same footing as other contracts.” Gilmer v.
Interstate/Johnson Lane Corp., 500 U.S. 20, 24 (1991). Under the FAA, agreements to arbitrate
are “valid, irrevocable, and enforceable,” subject only to traditional contract principles. 9 U.S.C.
§ 2; see also CompuCredit Corp. v. Greenwood, 132 S. Ct. 665, 669 (2012) (citations omitted)
(explaining the FAA favors arbitration agreements and “requires courts to enforce agreements to
arbitrate according to their terms”). The FAA provides that contract provisions manifesting the
intent of the parties to settle disputes in arbitration shall be binding, allows for the stay of federal
court proceedings in any matter referable to arbitration, and permits both federal and state courts
to compel arbitration if one party has failed to comply with an agreement to arbitrate. 9 U.S.C. §§
2-4. Cumulatively, those provisions “manifest a liberal federal policy favoring arbitration
agreements.” Gilmer, 500 U.S. at 24 (quotations omitted). “In the absence of any express provision
excluding a particular grievance from arbitration, . . . only the most forceful evidence of a purpose
to exclude the claim from arbitration can prevail. . . .” AT & T Techs., Inc. v. Commc’ns Workers
of Am., 475 U.S. 643, 654 (1986).
In considering a motion to compel arbitration, a court must engage in a two-step analysis:
it must determine first whether there is a valid agreement to arbitrate and, if so, whether the specific
dispute falls within the scope of said agreement. See Century Indem. Co. v. Certain Underwriters
at Lloyd’s, 584 F.3d 513, 523 (3d Cir. 2009); Salvadori v. Option One Mtg. Corp., 420 F. Supp.
2d 349, 356 (D.N.J. 2006). In considering the first inquiry, the court must “apply the relevant state

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contract law to questions of arbitrability, which may be decided as a matter of law only if there is
no genuine issue of material fact when viewing the facts in the light most favorable to the
nonmoving party.” Aliments Krispy Kernels, Inc. v. Nichols Farms, 851 F.3d 283, 288 (3d Cir.
2017). Per the second inquiry, courts are required to apply a “presumption of arbitrability only
where a validly formed and enforceable arbitration agreement is ambiguous about whether it
covers the dispute at hand.” Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287, 288 (2010).
Granite Rock precludes application of the FAA’s presumption of arbitrability before it is
determined whether there is a “validly formed and enforceable arbitration agreement.” Id. 1
III.

DECISION
Valeant argues it entered into an agreement to arbitrate disputes with Pearson, and as such,

this Court must dismiss Pearson’s complaint in favor of arbitration. (See ECF No. 7-1.)
Specifically, Valeant contends the 2015 Employment Agreement required the parties to arbitrate
the claims Pearson brought against it, and that the arbitration provision remained in effect even
after the parties entered into the subsequent Separation Agreement. (Id. at 11-19 and ECF No. 19
at 4-14.) Valeant further argues the Separation Agreement did not “entirely supersede” the 2015
Employment Agreement through its merger clause. (See ECF No. 19 at 4-14.)
Pearson disagrees. Pearson argues that, at the time the employment relationship terminated,
there was no valid agreement to arbitrate because he signed a new agreement, the Separation
Agreement. (ECF No. 14 at 6-12.) Furthermore, because the Separation Agreement did not include

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As articulated below, this case concerns a dispute about whether a “validly formed . . .
agreement” has been made. Id. at 301. Therefore, the Court’s “determination must in turn be based
on an examination of the validity of the [Separation Agreement] and its effect on the rights and
obligations of [Pearson and Valeant].” Flexi-Van Corp. v. Orzeck, No. 88-5015, 1988 WL 188324,
at *2 (D.N.J. Dec. 29, 1988).

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an arbitration clause and included a merger clause, Pearson argues the arbitration agreement from
the 2015 Employment Agreement was not incorporated into the Separation Agreement, or,
alternatively, that the 2015 Employment Agreement was superseded by the Separation Agreement.
(Id.)
Here, the parties do not dispute the scope of the 2015 Employment Agreement arbitration
provision, if it were held valid. (See ECF No. 14 at 5-6.) Instead, Pearson and Valeant disagree as
to whether and to what extent the 2015 Employment Agreement was superseded by the Separation
Agreement. Accordingly, this Court must only determine whether or not a valid agreement to
arbitrate exists in light of the Separation Agreement, which does not contain an arbitration
provision. If a valid arbitration agreement exists, this matter is dismissed and the parties are
compelled to arbitrate their issues.
In considering the first inquiry, courts must “apply the relevant state contract law to
questions of arbitrability.” Aliments Krispy Kernels, Inc., 851 F.3d at 288. The parties agree New
Jersey law applies to the Separation Agreement. (ECF No. 14 at 6.) Pursuant to New Jersey law,
“[a]n arbitration agreement is a contract and is subject, in general, to the legal rules governing the
construction of contracts.” McKeeby v. Arthur, 81 A.2d 1, 4 (N.J. 1951) (citations omitted). “[T]he
duty to arbitrate . . . [is] dependent solely on the parties’ agreement.” Cohen v. Allstate Ins. Co.,
555 A.2d 21, 23 (N.J. Super. Ct. App. Div.), certif. denied, 536 A.2d 846 (N.J. 1989). The
determination as to whether such a duty exists “rests solely on the parties’ intentions as set forth
in the writing.” Martindale v. Sandvik, Inc., 800 A.2d 872, 881 (N.J. 2002). “[A]n arbitration
clause may be modified or superseded.” Wein v. Morris, 944 A.2d 642, 648 (N.J. 2008). As such,
parties may waive their right to arbitrate in certain circumstances. See id. However, waiver cannot
be presumed. Cole v. Jersey City Med. Ctr., 72 A.3d 224, 230 (N.J. 2013). An agreement to

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arbitrate a dispute “can only be overcome by clear and convincing evidence that the party asserting
it chose to seek relief in a different forum.” Spaeth v. Srinivasan, 959 A.2d 290, 294 (N.J. Super.
Ct. App. Div. 2008).
Under New Jersey law:
The general rule is that a subsequent contract covering the same
subject matter and made by the same parties, but containing terms
inconsistent with the former contract so that the two cannot stand
together, rescinds, supersedes and substitutes for the earlier contract
and becomes the only agreement on the part of the parties on the
subject matter.
Kant v. Seton Hall University, No. 03–6135, 2008 WL 65159, *7 (D.N.J. Jan. 4, 2008) (quoting
Rosenberg v. D. Kaltman & Co., 101 A.2d 94, 96 (N.J. Super. Ct. Ch. Div. 1954)). “[H]owever,
such a finding would only be warranted in the circumstance where the two contracts in question,
read together, deal with the exact same subject matter and are so inconsistent that though not
explicitly expressed, it was obviously the intent of the parties that the latter supersede the former.”
Doyle v. Northrop Corp., 455 F. Supp. 1318, 1332 (D.N.J. 1978); Dieckman v. Walser, 168 A.
582, 583 (N.J. 1933) (“The executed contract supersedes all prior negotiations and agreements,
where the last contract covers the whole subject embraced in the prior one. But where the
stipulation is to do a series of acts at successive periods, or distinct and separable acts to be
performed simultaneously, the executory contract becomes extinct only as to such of its parts as
are covered by the conveyance.”).
Courts have found that an arbitration provision in a prior agreement is superseded by a later
agreement without an arbitration provision only if the subsequent agreement contains an
unambiguous complete integration or merger clause. See Flexi-Van Corp., 1988 WL 188324, at
*3; Rezac v. JMK Auto Sales, Inc., No. A-0931-11T1, 2013 WL 1907739, at *4 (N.J. Super. Ct.
App. Div. May 9, 2013); Alliancebernstein Investments, Inc. v. Eschert, No. A-5420-09T4, 2011

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WL 1345026, at *6 (N.J. Super. Ct. App. Div. Apr. 11, 2011). Naturally, therefore, courts will
enforce pre-existing arbitration agreements when a subsequent agreement neither addresses the
issue of arbitration nor includes a complete merger or integration clause. Local 221-G Bakery v.
Quaker Mfg., LLC, 108 F. App’x 48, 50 (3d Cir. 2004); Ryan v. BuckleySandler, LLP, 69 F. Supp.
3d 140, 146 (D.D.C. 2014); see also Goldman, Sachs & Co. v. Golden Empire Sch. Fin. Auth., No.
13–797, 764 F. Supp. 3d 210, 215, 2014 WL 4099289, at *4 (2d Cir. Aug. 21, 2014) (“In this
Circuit, an agreement to arbitrate is superseded by a later-executed agreement containing a forum
selection clause if the clause ‘specifically precludes’ arbitration . . . .”); Pelletier v. Yellow Transp.,
Inc., 549 F.3d 578, 581 (1st Cir. 2008) (“Thus, the merger clause, which precludes agreements
over the parties’ ‘right to terminate,’ does not nullify the [dispute resolution agreement], which
only deals with the mechanisms for resolving disputes.”); Ramirez–Baker v. Beaser Homes, Inc.,
636 F. Supp. 2d 1008, 1016 (E.D. Cal. 2008) (“Absent any showing that [a party’s] written
Arbitration Agreement [ ] was either expressly or implicitly inconsistent with his arbitration
obligation under [separate agreement], [a party] may not rely on the written employment
agreement’s silence about dispute resolution to establish that such agreement superseded his
[separate agreement] to arbitrate.” (citation omitted)).
In Local 221-G Baker, the Third Circuit held that an arbitration provision is incorporated
by reference where an agreement is not “completely superseded.” Local 221-G Bakery, 108 F.
App’x at 50. In that case, the parties entered into a Collective Bargaining Agreement, which
contained an arbitration clause. Id. at 49. Subsequently, they entered into a Closure Agreement,
which provided:
[T]he November 3, 1997 to October 29, 2000 Collective Bargaining
Agreement (“Current CBA”) between [Quaker] and Union is
superceded [sic] by this Closure Agreement. The current CBA is
amended as shown in Paragraph 28 below. The remaining

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provisions of the current CBA are incorporated by reference herein
and are made a part of this Closure Agreement. To the extent that
any remaining provision in the current Collective Bargaining
Agreement conflicts with the terms of this Closure Agreement, the
terms of the Closure Agreement will prevail.
Id. at 50. The Closure Agreement did not contain an arbitration clause and Paragraph 28 was
unrelated to arbitration or grievance procedures. Id. The court found “the [Closure Agreement], by
its plain terms, incorporates section 3.04 (entitled “Grievance Procedure”) of the [Collective
Bargaining Agreement] to the extent that this section does not contradict any other [Closure
Agreement] provision. Id. The Court rejected Quaker’s argument that no arbitration obligation
existed under the Closure Agreement because the Closure Agreement “contain[ed] clear language
indicating that the [Collective Bargaining Agreement] was not completely superceded [sic] by the
[Closure Agreement]. Interpreting the plain language of the [Closure Agreement], the [Collective
Bargaining Agreement’s] arbitration provision is incorporated by reference, except where it
specifically conflicts with the [Closure Agreement].” Id. As such, the Third Circuit found the
“arbitration provision in the [Collective Bargaining Agreement] survive[d] to the extent that it
[did] not conflict with the provisions of the [Closure Agreement].” Id. In that case, the Closure
Agreement explicitly restricted arbitration in certain instances. Id. Therefore, the court remanded
the case for further proceedings on whether the Closure Agreement limited arbitration of disputes
concerning payment of severance bonuses. Id. at 51.
Ryan further supports Local 221-G Baker and is factually similar to this case. In Ryan,
Ryan worked for Buckley Kolar, LLP as a staff attorney and as a condition of his employment, he
entered into an agreement that required arbitration as the exclusive remedy for all claims and
disputes relating to his employment at the firm. Ryan, 69 F. Supp. 3d at 142. After being passed
over for promotions, Ryan was informed that he was being terminated. Id. at 143. He was presented

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with a separation agreement, which granted him continued medical benefits and severance pay,
provided he signed a release of claims against his current employer, which he signed. Id. The
severance agreement also contained a merger clause stating:
This Agreement sets forth the entire agreement between the parties
with respect to the subject matter hereof and supersedes any and all
prior agreements or understandings between them pertaining to such
subject matter. There are no written or oral understandings,
promises, representations, or agreements directly or indirectly
related to this Agreement. No modification, revision, addition to, or
alteration of this Agreement will be binding unless in writing and
signed by Employee and the Firm.
Id. The severance agreement did not provide any forum to resolve disputes arising out of the
severance. Id. Following his termination, Ryan filed this action alleging his termination was the
result of age discrimination, and Buckely Kolar, LLP moved to dismiss and compel arbitration. Id.
The court determined the merger clause in the severance agreement was “expressly limited to the
‘subject matter of’ the Separation Agreement” and that the Separation Agreement only concerned
the employment law claims waived and released by Ryan, but was silent as to the forum for the
resolution of those claims. Id. at 145. Therefore, it concluded “the Arbitration Agreement (which
mandates the forum for the resolution of claims) concerns a distinct subject matter from the
Separation Agreement (which addressed the employment law claims of the defendant).” Id. at 14546. As a result, the court found the Arbitration Agreement survived the Separation Agreement.
This case is no different than Local 221-G Baker and Ryan. The Separation Agreement, by
its own terms, does not completely supersede the Employment Agreement; it only “supersedes any
other written or oral promises concerning the subject matter of” the Separation Agreement. The
arbitration provision in the 2015 Employment Agreement clearly concerns a distinct subject matter
from the Separation Agreement, which is silent as to dispute resolution. The two contracts, when
read together, do not deal with the exact same subject matter, nor are they “so inconsistent that

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though not explicitly expressed, it was obviously the intent of the parties that the latter supersede
the former.” Doyle, 455 F. Supp. at 1332. Therefore, arbitration is beyond the scope of the “subject
matter” of the Separation Agreement, and the arbitration provision in the 2015 Employment
Agreement must survive.
Pearson’s reliance on Flexi-Van Corp., Rezac and Borough of Atl. Highlands v. Eagle
Enterprises, Inc., 711 A.2d 407, 408 (N.J. Super. Ct. App. Div. 1998) is misplaced, because all of
these cases involve complete merger or integration clauses. In Flexi-Van Corp., the Court
determined the May 12, 1982 Settlement, which contained an arbitration provision, was
superseded by the parties’ October 16, 1987 Release Agreement, which did not contain an
arbitration provision. Flexi-Van Corp., 1988 WL 188324, at *2-3. The October 16, 1987 agreement
stated Flexi-Van agreed to pay Orzeck a lump sum in “full and complete satisfaction of the
obligations owed to him under the terms of Paragraph 3 of the Settlement Agreement” and, most
significantly, that Flexi-Van “will have no further obligations to him under the terms of the
Settlement Agreement.” Id. at 1. The Court found:
When Flexi-Van and Orzeck entered into the October 16, 1987
Release they were free to add a provision which would have directed
that any disputes under the release would be submitted to arbitration.
That they did not suggests that Flexi-Van did not intend or
reasonably believe that it would be forced to arbitrate disputes under
the October 16, 1987 agreement. Furthermore, this Court finds that
the conduct of the parties and the words of the release demonstrate
that the October 16, 1987 release was meant to supersede and
terminate the original May 12, 1982 settlement agreement and its
arbitration provision. Thus, since the parties’ current relationship is
governed by the October 16, 1987 Agreement, Orzeck cannot
harken back to the May 12, 1982 Settlement Agreement for
authority to submit his current dispute with Flexi-Van to arbitration.
Id. at 3 (emphasis added).
In Borough of Atl. Highlands, the court determined

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whether a clause evidencing an agreement to arbitrate all claims
arising out of or related to the parties’ construction contract
remained viable after the parties entered into a subsequent
agreement acknowledging that the construction contract was
complete, that the subsequent agreement “constitute[d] full and final
satisfaction of all claims for compensation,” and that “neither party
ha[d] any further claims for compensation or damages against the
other,” subject only to the retainage being held pending satisfactory
completion of certain repair items.
711 A.2d at 408. It found the original contract, which included the arbitration clause at issue, was
knowingly superseded by the final agreement, which provided that: “[T]he parties agree that [the]
Contract is completed and this Agreement constitutes full and final satisfaction of all claims for
compensation and neither party has any further claims for compensation or damages against the
other.” Id. at 410. The court stated it was “at a loss as to how [it] might interpret this unambiguous
language to mean anything other than that the original construction contract was to be regarded as
history.” Id.
In Rezac, the parties entered into three agreements, but only the first agreement contained
an arbitration clause. Rezac, 2013 WL 1907739, at *4. The court found the first agreement was
“explicitly superseded by the terms of the second agreement,” which stated: “This lease describes
all agreements between us with respect to the Lease of the Vehicle. All prior agreements, whether
oral or in writing, are superseded.” Id. These cases, unlike the case before the Court, found that
the arbitration provisions in the prior agreements were superseded by a later agreement without an
arbitration provision because the subsequent agreements contained unambiguous complete
integration or merger clauses.
Pearson’s arguments regarding the Separation Agreement’s silence as to arbitration, the
2015 Employment Agreement’s exclusion of an express survival clause in the arbitration
provision, and the Separation Agreement’s inclusion of a ”Governing Law” provision even though

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it included one in the 2015 Separation Agreement, are inapposite. (ECF No. 14 at 6-12.) “[P]arties
may waive their right to arbitrate in certain circumstances,” however “[w]aiver is never presumed.”
Cole, 72 A.3d at 230. An agreement to arbitrate a dispute “can only be overcome by clear and
convincing evidence that the party asserting it chose to seek relief in a different forum.” Spaeth,
959 A.2d at 294. There is no clear and convincing evidence that the parties chose to seek relief in
a different forum. A review of the Separation Agreement clearly demonstrates it only intended to
supersede “any other written or oral promises concerning the subject matter of this Agreement.”
(ECF No. 1-1, Ex. B at 5). Although the 2015 Employment Agreement articulates six provisions
that would expressly survive the 2015 Agreement, Sections 2(a), 2(d), 4(d)(6), 12(e) (saving all of
Section 12), 13(d) (saving all of Section 13) and 15(d), and the Separation Agreement includes
references to additional provisions in the 2015 Employment Agreement that also survived, the
parties unambiguously contracted to save the arbitration clause when they decided not to draft a
complete merger clause. (See ECF No. 1-1, Exs. A, B); see also Ryan, 69 F. Supp. 3d at 142; Local
221-G Bakery, 108 F. App’x at 50. The parties chose to include the limiting phrase “concerning
the subject matter of this Agreement,” and the Court cannot and will not ignore it. Travelers Indem.
Co. v. Dammann & Co., 594 F.3d 238, 255 (3d Cir. 2010) (stating courts should “endeavor to
avoid ignoring certain words or reading the contract in such a way as to make any words
‘meaningless.’”). Contrary to Flexi-Van Corp., the words of the merger clause do not demonstrate
that the Separation Agreement was meant to supersede and terminate the 2015 Employment
Agreement in its entirety. Flexi-Van Corp., 1988 WL 188324, at *3. Because the parties do not
dispute the scope of the arbitration clause and the Court finds the 2015 Employment Agreement
arbitration clause valid, Valeant’s Motion to Compel Arbitration and Dismiss the Proceeding is
GRANTED.

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IV.

CONCLUSION
For the reasons set forth above, Valeant’s Motion to Compel Arbitration and Dismiss the

Proceeding is GRANTED and the case is CLOSED. An appropriate Order will follow.

Date: December 20, 2017

/s/ Brian R. Martinotti
HON. BRIAN R. MARTINOTTI
UNITED STATES DISTRICT JUDGE

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