PowerHour v. Brain Swell Media
Filing
45
MEMORANDUM DECISION granting 32 Motion to Stay. The parties are directed to take the necessary steps to arbitrate as per the parties' agreement, and report to the court within 30 days of any disposition resulting from arbitration proceedings. Signed by Judge David Sam on 2/23/12. (jmr)
THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
CENTRAL DIVISION
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)
POWERHOUR, L.L.C., a Utah
Limited Liability Company,
)
Case No. 2:11CV356
Plaintiff,
vs.
)
)
MEMORANDUM DECISION
BRAIN SWELL MEDIA, L.L.C, a
South Carolina Limited
Liability Company,
Defendant.
)
)
)
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PowerHour (“Plaintiff”), a Utah limited liability corporation, filed this diversity suit on April
18, 2011 alleging breach of contract against Brain Swell Media (“Defendant”), a South Carolina
limited liability company. Brain Swell Media filed a motion to stay litigation (Doc. #’s 32, 33) which
is fully briefed. Pursuant to court instruction, Defendant filed a supplemental memorandum in
support (Doc. #42) on January 17, 2012 . Plaintiff filed its supplemental response in opposition on
January 26, 2012 (Doc. # 43) and Defendant filed its response on January 30, 2012 (Doc. #44). The
court conducted two telephone conferences with counsel–the firsts on January 5, 2012 and the
second on February 21, 2012. The court has considered the parties’ briefs and comments during the
telephone conferences and is prepared to issue the following ruling:
As previously indicated by the court to counsel during the January 5, 2012 telephone
conference, the court finds the Defendant has not waived its right to compel arbitration. Plaintiff
arguments that Defendant’s actions in appearing, moving to dismiss and waiting several months
before raising the arbitration issue have little support in law and are not compelling given the strong
presumption in favor of enforcing agreements to arbitrate. The only remaining issue involves the
scope of the arbitration clause. In the telephone conference of January 5, 2012 the court requested
supplemental briefing on this limited issue.
The court finds the case of Central Florida Investments, Inc. V. Parkwest Associates, 2002
UT 3, 40 P.3d 599 (Utah 2002) highly relevant and helpful in interpreting the arbitration clause in
the parties’ agreement before the court. As the Utah Supreme Court stated in that case:
In this instance, to distinguish between the terms themselves and enforcement of the
terms would be meaningless-a distinction without a difference.
To interpret the agreement in this way would in effect nullify the agreement to
arbitrate. Put otherwise, an agreement to arbitrate only terms of an agreement is of
no effect if the parties can simply bring suit to enforce their interpretation of the
terms of the agreement. . . .If the exception advocated by CFI, litigation to enforce
the agreement, were permitted, it would swallow the bargain that “any disagreement
over the terms of this agreement shall be arbitrated.” Moreover, CFI’s proposed
interpretation would be contrary to the parties’ intent, apparent from the four corners
of the agreement, to avoid litigation and resolve any disputes through arbitration.
Id. at ¶¶ 17-18.
Accordingly, the court grants the motion to stay for the reasons contained in the Defendant’s
briefs and for the reasons advanced by the court in the telephone conference. This order
memorializes that discussion. The parties are directed to take the necessary steps to arbitrate as per
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the parties’ agreement, and report to the court within 30 days of any disposition resulting from
arbitration proceedings.
SO ORDERED.
DATED this 23rd day of February, 2012.
BY THE COURT:
David Sam
Senior Judge
United States District Court
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