Opinion
NNHCV186080472S
10-23-2018
David E. Silverstone, M.D. v. Connecticut Eye Surgery Center South, LLC et al.
UNPUBLISHED OPINION
Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Pierson, W. Glen, J.
MEMORANDUM OF DECISION RE MOTION TO COMPEL ARBITRATION (NO. 102)
PIERSON, J.
FACTUAL AND PROCEDURAL BACKGROUND
This action involves the termination of the plaintiff’s interest in a limited liability company. According to his operative complaint, the plaintiff, David E. Silverstone, is a doctor of medicine specializing in ophthalmology. He claims that he is an owner and member of the defendant, Connecticut Eye Surgery Center South, LLC (LLC), which is a Tennessee limited liability company having a place of business at 60 Wellington Road, Milford, Connecticut. The plaintiff further claims that the LLC is engaged in the practice of medicine and in particular, the specialty of ophthalmology.
In his complaint dated April 30, 2018, the plaintiff defines Connecticut Eye Surgery Center South, LLC as "CESCS." Compl., Count 1, ¶2. The amended operating agreement submitted by the defendants, which contains the arbitration provision relied upon by the defendants in their motion to compel arbitration, defines Connecticut Eye Surgery Center South, LLC as the "LLC." Defs.’ Exhibit A, Memo. Sup. Mot. Compel Arbitration, § 1.23 (Docket Entry No. 103). As the contract at issue defines the corporate entity as the "LLC," and to avoid confusion, the court refers to Connecticut Eye Surgery Center South, LLC in accordance with the contractual definition.
Further according to the complaint, the defendant, Amsurg Holdings, Inc. (AmSurg), is a Tennessee corporation doing business in Connecticut. The defendant, Connecticut Eye Anesthesia, LLC (CEA), is also a Tennessee corporation, "which may be wholly owned by [the LLC]." The plaintiff goes on to allege that he is a party to certain operating agreements, one with the LLC and AmSurg, and the other with AmSurg (collectively, the operating agreements). The plaintiff claims that AmSurg is a fifty-one percent member in the LLC and that it serves as its managing member. The plaintiff does not attach copies of either alleged operating agreement to his complaint.
While in his complaint the plaintiff spells the defendant’s name as "Amsurg," the amended operating agreement appended to the defendants’ motion reflects that it is spelled "AmSurg," and the court will refer to it as such.
Although not attached to plaintiff’s operative complaint, the defendants append to their memorandum in support of motion to compel arbitration (Docket Entry No. 103) a copy of a document entitled, "Amended and Restated Operating Agreement of Connecticut Eye Surgery Center South, LLC," which reflects that it was "made and entered into as of the 12th day of May 2014." (amended operating agreement). The introductory paragraph of the amended operating agreement defines AmSurg as "AmSurg Holdings, Inc., a Tennessee corporation." The parties to the amended operating agreement are AmSurg, "and each of the other persons listed on the signature page to this Agreement (’Owners’) (each of AmSurg and Owners, together with the other persons who may become members under the terms of this Agreement, a ‘Member’ and collectively, the ‘Members’)."
In an affidavit filed by the plaintiff dated June 28, 2018 (Docket Entry. No. 114), the plaintiff avers that "[h]e was one of the original physicians who signed the Amended Operating Agreement with Amsurg Holdings, Inc." Pl.’s Aff., ¶2. The plaintiff’s signature appears on a certificate, which is numbered page 21 of the amended operating agreement. Exhibit A, Memo. Sup. Mot. Compel Arbitration, 21. The second paragraph of the amended operating agreement provides, in relevant part: "AmSurg and Owners desire to set forth their mutual rights and obligations in this Agreement as the sole operating agreement of the LLC, in full substitution and replacement for any prior operating agreements of the LLC."
Section 1 of the amended operating agreement, entitled, "DEFINITIONS," contains the following definitions of relevance to the defendants’ motion: § 1.1 (" ‘Act’ means the Tennessee Revised Limited Liability Company Act, being Sections 48-249-101 et seq. of the Tennessee Code Annotated, as amended from time to time, and any corresponding provisions of any successor legislation"); § 1.2 (" ‘Affiliate,’ with respect to any individual or Entity, means any individual or other Entity directly or indirectly controlling, controlled by or under common control with such individual or Entity"); § 1.3 (" ‘Affiliated Physician’ means any individual physician who directly or indirectly through another entity has an ownership interest in the LLC, is an immediate family member of any individual who directly or indirectly through another entity has an ownership interest in the LLC, or is a grantor, trustee or beneficiary of any trust that is a Member"); § 1.5 (" ‘Agreement’ means this Amended and Restated Operating Agreement, as amended from time to time"); § 1.6 (" ‘AmSurg’ has the meaning set forth in the introductory paragraph hereof"); § 1.10 (" ‘Board’ means the Board of Directors of the LLC"); § 1.13 (" ‘Center’ means the ambulatory surgery center operated by the LLC and located in Milford, Connecticut ..."); § 1.17 (" ‘Entity’ means any corporation, partnership, trust, limited liability company or other entity"); § 1.23 (" ‘LLC’ means Connecticut Eye Surgery Center South, LLC, a Tennessee limited liability company"). § 1.32 (" ‘Owners’ has the meaning set forth in the introductory paragraph hereof"); § 1.25 (" ‘Market Area’ has the meaning given to such term in Section 8.2 hereof"); § 1.27 (" ‘Members’ has the meaning set forth in the introductory paragraph hereof"); and § 1.28 (" ‘Membership Interest’ means a Member’s interest in the LLC, which when expressed as a percentage of all Membership Interests in the LLC shall be equal to such Member’s Membership Percentage. The Membership Interest shall consist of (a) the Member’s Financial Rights, (b) the Member’s right to assign Financial Rights to the extent permitted under this Agreement, and (c) the Member’s Governance Rights").
Section 3.1 of the amended operating agreement, entitled "Purposes," reads as follows: "The purposes of the LLC shall be to own and operate the Center and to carry on any and all activities necessary, proper, convenient or advisable in connection therewith."
Section 8.2 of the amended operating agreement, entitled, "Ownership and Investment Restrictions," defines "Market Area," as being "within a twenty-five-mile radius of the Center ..."
Section 8.2 of the amended operating agreement also provides, in part, at subsection 8.2.2, as follows: "No Owner or Affiliated Physician, nor any Affiliate of any Owner or Affiliated Physician shall: without the prior written consent of the Board after a review of all pertinent contractual documents, become an employee of a hospital or an Affiliate of a hospital that is located within the Market Area, or enter into any contract or other arrangement (whether as a result of his or employment or otherwise) that requires or incentivizes him or her to perform procedures at any hospital or facility affiliated with a hospital in the Market Area, in each case described in Sections 8.2.1 and 8.2.2 until the later of (i) five (5) years from the date of this Agreement, or (ii) two (2) years after such Owner (or with respect to an Affiliated Physician, the Owner with whom such Affiliated Physician is affiliated) ceases to be a Member of the LLC ..."
Section 12.4 of the amended operating agreement, entitled, "Termination of a Membership Interest," provides that "[n]otwithstanding any provisions to the contrary contained in the Act, a Member’s Membership Interest shall be terminated only on the application of the LLC or another Member as described in Section 48-249-503(a)(6) of the Act."
Section 14.3 of the amended operating agreement, entitled, "Applicable Law," provides that "[t]his Agreement and the rights of the Members shall be governed by and enforced in accordance with the laws of the State of Tennessee."
Section 14.11 of the amended operating agreement, entitled, "Arbitration," reads in relevant part as follows: "All disputes arising under this Agreement shall be resolved by binding arbitration pursuant to the rules of the American Health Lawyers Association Dispute Resolution Service (’AHLA’) then pertaining. The arbitration proceedings shall be held in Boston, Massachusetts. The procedures for conducting discovery in connection with any such arbitration proceeding shall be determined by the mutual agreement of the Members party to the arbitration proceeding or, if the Members cannot agree, by the arbitrators. The arbitrators shall apply the substantive laws of the State of Tennessee and the United States ..."
Section 14.14 of the amended operating agreement, entitled "Integrated Agreement," provides as follows: "This Agreement constitutes the entire understanding and agreement between the Members with respect to the subject matter hereof, and there are no agreements, understandings, restrictions, representations or warranties among the Members other than those set forth herein or herein provided for. The Members acknowledge that they have independently negotiated the provisions of this Agreement, that they have relied on their own counsel as to matters of law and application and that no Member has relied on any other Member with respect to such matters. The Members expressly agree that there shall be no presumption created as a result of any Member having prepared in whole or in part any provision of this Agreement."
In his complaint, the plaintiff alleges that in May 2017, he became employed with the Yale School of Medicine. The plaintiff further alleges that the defendants have since informed him that the plaintiff’s employment with the Yale School of Medicine is a violation of the operating agreements alleged by the plaintiff, as- in the defendants’ view- the Yale School of Medicine is an affiliate of Yale-New Haven Hospital as defined by the operating agreements. The plaintiff disputes the defendants’ position, asserting that the Yale School of Medicine is not an affiliate of Yale-New Haven Hospital as defined by the operating agreements. The plaintiff claims that he has not become an employee of a hospital or hospital affiliate within the Market Area, and has not entered into any contract or other arrangement that requires or incentivizes him to perform procedures at any hospital or facility affiliated with a hospital in the Market Area. As a result, the plaintiff contends that he has never been in violation of Section 8.2.2.
The plaintiff alleges that on November 17, 2017, he was informed by the defendants that his membership interests in the LLC were terminated as of May 1, 2017, that the Owners had the right to repurchase his membership interest in the LLC for one dollar, and that they sent him a check in the amount of one dollar "in an attempt to repurchase his membership interests." The plaintiff claims that he performed his obligations under the operating agreement, is a member in good standing of the LLC, and is not in breach of his contractual obligations.
Based on the foregoing and other allegations, the plaintiff brings this action in four counts, alleging breach of contract (First Count), seeking a declaratory judgment (Second Count), in breach of fiduciary duty (Third Count), and for wrongful intentional conduct (Fourth Count). The action was made returnable to the court on May 29, 2018.
On June 15, 2018, the defendants filed a motion to compel arbitration (Docket Entry No. 102) by which they moved the court "to stay this matter and compel arbitration in accordance with the Federal Arbitration Act ... , Connecticut [General Statutes] § § 52-408 and -409, and the parties’ contractual agreement to arbitrate." In support of their motion, the defendants submitted a supporting memorandum of law, together with a copy of the amended operating agreement. On June 26, 2018, the plaintiff filed an objection to the motion to compel arbitration (Docket Entry No. 104), together with a memorandum (Docket Entry No. 105). In his memorandum, the plaintiff contends, inter alia, that "an order for arbitration at this time would result in delays in the answering of ... discovery ..., including depositions necessary to the plaintiff"; "through the judicial system, the plaintiff has a greater probability of being able to quickly and efficiently obtain his pre-trial information ..."; "defendants’ reliance on the interstate commerce involvement is misplaced as this is a Connecticut business conducted in Connecticut"; "the arbitrator in this action really cannot make the [declaratory] judgment and orders necessary to bring finality to the issues between the parties"; "[s]hould an [arbitrator] rule in favor of the plaintiff, this matter would probably be back in court to turn that decision into the claims made by the plaintiff"; "[t]he Operating Agreement calls for the requested arbitration to be held in Boston under the laws of the State of Tennessee. If that is upheld then that will necessitate the need for multiple depositions and create further unnecessary expenses for the parties"; "[t]his Operating Agreement was prepared by the defendant [AmSurg] and should be invalidated or construed against [AmSurg]." None of the foregoing assertions is supported by legal authority or evidentiary facts. The plaintiff states in the memorandum that "while he did sign the Operating Agreement, this was not the original agreement and should not be enforced. In a previous unsigned copy the laws are under the State of Connecticut and the arbitration place is blank." (Emphasis added.) The defendants filed a reply brief on June 27, 2018. (Docket Entry No. 106.)
9 U.S.C. § 1 et seq.
The plaintiff’s memorandum (Docket Entry No. 105) is devoid of legal analysis concerning the issues raised by the defendants’ motion to compel arbitration. The plaintiff’s memorandum consists of two pages of argument. These two pages do not contain a single citation and the memorandum is lacking in meaningful analysis. A court is "not required to review issues that have been improperly presented to [it] through an inadequate brief ... Analysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly." (Internal quotation marks omitted.) Connecticut Light & Power Co. v. Dept. of Public Utility Control, 266 Conn. 108, 120, 830 A.2d 1121 (2003).
"In deciding motions to compel, courts apply a standard similar to that applicable to a motion for summary judgment." (Citation omitted; internal quotation marks omitted.) Nicosia v. Amazon.com, Inc., 834 F.3d 220, 229 (2d Cir. 2016); see also Conn. Gen. Stat. § 52-409 (the court may stay an action "upon being satisfied that any issue involved in the action or proceeding is referable to arbitration under the agreement, ..." [Emphasis added] ).
On June 28, 2018, two days after filing his opposition brief, the plaintiff submitted an affidavit, in which he states- consistently with his memorandum- that "[h]e was one of the original physicians who signed the Amended Operating Agreement with Amsurg Holdings, Inc ." (Emphasis added.) Pl.’s Aff., ¶2 (Docket Entry No. 114). In his affidavit, the plaintiff also claims that "prior to signing this agreement he had been given a copy in which[,] within the arbitration provision, the location of the arbitration was blank and state law controlling was Connecticut." (Emphasis added.) Pl.’s Aff., ¶3. The plaintiff "assumed that any arbitration location would be in Connecticut"; furthermore, he "did not agree to any Boston arbitration provision." Pl.’s Aff., ¶¶4 and 5.
The plaintiff’s assumption that any arbitration would take place in Connecticut, and the claim that he did not agree to any Boston arbitration agreement, are irrelevant, because these assertions are barred by the parol evidence rule, as they contravene directly certain explicit terms of the amended operating agreement signed by the plaintiff. Our Supreme Court has observed repeatedly that the parol evidence rule is not an exclusionary rule of evidence, but a substantive rule of contract law. Weiss v. Smulders, 313 Conn. 227, 248, 96 A.3d 1175 (2014); Alstom Power, Inc. v. Balcke-Durr, Inc., 269 Conn. 599, 609, 849 A.2d 804 (2004); Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, 231 Conn. 756, 779, 653 A.2d 122 (1995); TIE Communications, Inc. v. Kopp, 218 Conn. 281, 288, 589 A.2d 329 (1991). As stated by the court in Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, supra, 780, "[t]he rule is premised upon the idea that when the parties have deliberately put their engagements into writing, in such terms as import a legal obligation, without any uncertainty as to the object or extent of such engagement, it is conclusively presumed, that the whole engagement of the parties, and the extent and manner of their understanding, was reduced to writing. After this, to permit oral testimony, or prior or contemporaneous conversations, or circumstances, or usages [etc.], in order to learn what was intended, or to contradict what is written, would be dangerous and unjust in the extreme." (Internal quotation marks omitted.) Put another way, "[t]he parol evidence rule ordinarily prohibits a court from considering extrinsic evidence in interpreting an agreement when that evidence tends to alter the explicit terms of the agreement." Battalino v. Van Patten, 100 Conn.App. 155, 167, 917 A.2d 595, cert. denied, 282 Conn . 924, 925 A.2d 1102 (2007). Parol evidence offered solely to vary or contradict the written terms of an integrated contract is not deficient per se, as an evidentiary matter; rather, such evidence is legally irrelevant. TIE Communications, Inc. v. Kopp, supra, 288. As observed by the court in Weiss, "[t]he parol evidence rule does not of itself ... forbid the presentation of parol evidence, that is, evidence outside the four corners of the contract ... but forbids only the use of such evidence to vary or contradict the terms of [an integrated] contract. Parol evidence offered solely to vary or contradict the written terms of an integrated contract is, therefore, legally irrelevant." (Internal quotation marks omitted.) Weiss v. Smulders, supra, 249.
Oral argument on the motion to compel and the objection was heard by the court on July 30, 2018, on which date the matter was submitted for adjudication.
DISCUSSION
I
As a preliminary matter, prior to any application of the relevant law to the facts, the correct source of law must be considered. In this case, there are three possible sources of law: (1) the Federal Arbitration Act, 9 U.S.C. § 1 et seq. (FAA); (2) Tennessee law; and (3) Connecticut law. The defendants urge application of the FAA on the ground that the amended operating agreement "plainly involves interstate commerce." Moreover, Section 14.11 of the amended operating agreement provides that the arbitrators shall apply the substantive law of the United States, in addition to that of the State of Tennessee. Tennessee law is also a possible source because Section 14.3 of the amended operating agreement contains a choice of law provision which reads: "[t]his Agreement and the rights of the Members shall be governed by and construed and enforced in accordance with the laws of the State of Tennessee." Furthermore, termination of a membership interest is only to be "on the application of the LLC or another Member as described in Section 48-249-503(a)(6) of the [Tennessee Revised Limited Liability Company] Act." Amended Operating Agreement, § 12.4. Finally, as this action was brought in Connecticut and both parties have invoked Connecticut law- the defendants’ motion and supporting brief making reference to Conn. Gen. Stat. § § 52-408 and 52-409, and the plaintiff claiming that the unsigned copy of the operating agreement provided to him contained a Connecticut choice of law provision- Connecticut is also a possible source of law. For the reasons that follow, as all three sources of law are in harmony with respect to the issues raised by this motion, no conflicts of law exist. As a result, the court need not engage in a strict or exhaustive analysis to determine which law to apply. See, e.g., Pantelopoulos v. Pantelopoulos, 49 Conn.Supp. 209, 283-84, 869 A.2d 280 (2005) (it is unnecessary to engage in conflict of laws analysis where no conflict exists between the applicable laws of several jurisdictions).
Despite the express choice of law provision in the amended arbitration agreement, by which the parties agreed that the agreement and the rights of the Members would be governed by and enforced in accordance with the laws of the State of Tennessee, the defendants do not rely on or cite to the law of Tennessee in connection with their motion to compel arbitration, other than to state that [b]ecause this case clearly involves interstate commerce, the provisions of the [FAA], rather than Tennessee’s Uniform Arbitration Act, Tenn. Code Ann. § 29-5-301 (2000) et seq., apply." Defs.’ Memo. Sup. Mot. Compel Arbitration, 2 (Docket Entry No. 103) (Quoting
Although an exhaustive conflict of laws analysis is unnecessary here, "Connecticut will give effect to the parties’ contractual choice-of-law provisions ... unless either (a) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties’ choice, or (b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue." (Citations omitted; internal quotation marks omitted.)
II
Over a century ago, the Supreme Court of Connecticut defined arbitration as follows: "Arbitration is an arrangement for taking and abiding by the judgment of selected persons in some disputed matter, instead of carrying it to the established tribunals of justice." In re Curtis Castle Arbitration, 64 Conn. 501, 511, 30 A. 769 (1894). "The origin of arbitration is lost in obscurity." E. Wolaver, "The Historical Background of Commercial Arbitration," 83 U.Pa.L.Rev. 132, 132 (1934). This is the case because "arbitration probably antedates all ... legal systems ..." Id. It can be fairly inferred that arbitration came into being, at least in part, for the, same reason as formal systems of law: to provide a means of resolving disputes peacefully. As observed by one author, "[i]f one [person] takes something from another, the most obvious remedy is for the victim to try to take it back; and when it was the only remedy, no [person] had any rights beyond those which he [or she] was physically able to protect for himself [or herself.] ... One of the first causes of a legal system is the desire to prevent or discourage feuding and private warfare, by offering some peaceful alternative. Here the community could assist, as a body in a public meeting, by encouraging the parties to settle their differences or submit them to honorable arbitration." J. Baker, An Introduction to English Legal History (3d Ed. 1990), p. 4.
Arbitration served as a system of dispute resolution that existed in parallel- and even in rivalry- with formal judicial processes, serving needs that were not met by the courts. Thus, parties resorted to arbitration when the law would not afford them a remedy. See, e.g., P. Phillips, "The Paradox in Arbitration Law: Compulsion as Applied to a Voluntary Proceeding," 46 Harv.L.Rev. 1258, 1258 (1933) ("[b]usiness tribunals were turned to in the Middle Ages because the law would give merchants no redress"). Even when legal redress was available, arbitration was pursued in order "to avoid the formalities, delay, the expense and vexation of ordinary litigation." In re Curtis-Castle Arbitration, supra, 64 Conn. 511. The advantages of arbitration referred to by our Supreme Court over 120 years ago in In re Curtis-Castle Arbitration remain as pertinent today as they were then, perhaps even more so. Thus, the benefits of arbitration continue to be emphasized by many courts, including those of Connecticut and Tennessee. See, e.g., New England Pipe Corporation. v. Northeast Corridor Foundation, 271 Conn. 329, 337, 857 A.2d 348 (2004) ("[a]rbitration is [a] favored [method of dispute resolution] because it is intended to avoid the formalities, delay, expense and vexation of ordinary litigation." [Internal quotation marks omitted] ); Arnold v. Morgan Keegan & Co., Inc., 914 S.W.2d 445, 449 (Tenn. 1996) ("[a]rbitration is attractive because it is a more expeditious and final alternative to litigation").
The resolution of private disputes by way of binding arbitration, as an alternative to using established legal systems, dates at least to ancient Greece. Demosthenes quotes the Athenian law on the subject as follows: "If the parties have a dispute with each other respecting their private obligations, and desire to choose an arbiter, be it lawful to them to select whomsoever they will. But when they have mutually selected an arbiter, let them stand fast by his decision, and by no means carry [an] appeal from him to another tribunal; but let the arbiter’s sentence be supreme." (Citation omitted.) S. Jones, "Historical Development of Commercial Arbitration in the United States," 12 Minn.L.Rev. 240, 243 (1927). Moreover, "[i]t was common among the Romans ‘to put an end to litigation’ by means of arbitration." E. Wolaver, supra, 83 U.Pa.L.Rev. 132; see also P. Sayre, "Development of Commercial Arbitration Law," 37 Yale L. J. 595, 597 (1928) ("[t]here was a partially developed system of arbitration in Roman law, both during the classical period and under Justinian").
Although used in the classical world and late antiquity, arbitration was unknown in Anglo-Saxon law. Id. ("There is apparently no germ of arbitration in Anglo Saxon law ...") When it appeared in England, its origins were most likely continental. See, e.g., W. Howard, "The Evolution of Contractually Mandated Arbitration," 48 Arb.J. 27 (1993) ("Although far from clear, it appears that executory arbitration contracts were used in England by 14th century merchant and craft guilds and in maritime contracts. It has been suggested that these could be traced from the seventh century ecclesiastical courts or even from Roman law, which itself was influenced by Greek law"). As it was in the Middle Ages, and as it developed through the centuries until the present day, commercial actors were the primary driving force behind the growth- and eventual legislative and judicial acceptance- of arbitration as an alternative means of resolving disputes.
Traditionally, the common-law courts viewed arbitration with suspicion, even contempt, for a variety of reasons. To begin, common-law judges were skeptical of the competence of arbitrators to render justice. T. Carbonneau, "Judicial Approbation in Building the Civilization of Arbitration," 113 Penn.St.L.Rev. 1343, 1348 (2009) ("English courts ... long perceived arbitration as an inferior remedy- a murky and shallow reflection of judicial justice. From a historic perspective, they viewed unschooled arbitrators as prone to ineptitude"); W. Howard, supra, 48 Arb.J. 28 ("One explanation of this hostility suggests a fear that arbitration would result in the miscarriage of justice"). Perhaps more importantly, judges were determined to prevent binding arbitration, as a parallel and alternative form of dispute resolution, from depriving the courts of the exclusive right to decide matters within their jurisdiction. Id. Judges, as the appointed guardians of the law, did not want to be displaced by lay arbitrators. Allied-Bruce Terminix Companies, Inc. v. Dobson, 513 U.S. 265, 270, 115 S.Ct. 834, 130 L.Ed.2d 753 (1995). As noted by the United States Supreme Court, the refusal of English courts to enforce arbitration agreements was based, in part, on their determination to fight "for extension of jurisdiction- all of them being opposed to anything that would altogether deprive every one of them of jurisdiction." (Internal quotations omitted.) Id. Or, as observed by the Second Circuit, "[p]erhaps the true explanation" for traditional judicial opposition to arbitration "is the hypnotic power of the phrase, ‘oust the jurisdiction.’ " Kulukundis Shipping Co. v. Amtorg Trading Corporation., 126 F.2d 978, 984 (2d Cir. 1942). Furthermore, the pecuniary advantages of exercising an exclusive jurisdiction over the resolution of legal disputes may also have played a role in the reluctance of courts to view arbitration favorably. "Lord Campbell explained the English attitude as due to the desire of the judges, at a time when their salaries came largely from fees, to avoid loss of income. Indignation has been voiced at this suggestion; perhaps it is justified." (Citations omitted.) Id., 983-84; see also W. Howard, supra, 48 Arb.J. 29 ("an oftrepeated theory was that private arbitration posed an economic threat to judges who received no salary and entirely depended upon fees from disputants." [Citation omitted.] )
Judicial hostility to arbitration made itself manifest in doctrines that thwarted its enforceability. "[In] the early common law, arbitration was entirely a matter of private arrangement for which there was no authority except the personal authority of the parties to the agreement, ..." P. Sayre, supra, 37 Yale L.J. 598. In addition, at common law, agreements to arbitrate were revocable, by any party, at any time prior to the rendering of an award. S. Jones, supra, 12 Minn.L.Rev. 245 ("The courts of law in England held that the parties were at liberty to revoke the authority given to an arbiter, under the submission, at any time before an award was made"); P. Sayre, supra, 37 Yale L.J. 600 ("At common law the authority of the arbitrator was based upon the submission, and since this was purely a private contract in any case, such submission could be revoked like powers generally, unless there was a public policy against it which took it out of the general rule of powers not coupled with an interest") ; see also Buraczynski v. Eyring, 919 S.W.2d 314, 317 (Tenn. 1996) ("Arbitration was not a favored procedure by early common-law courts. The effectiveness of arbitration as a swift and inexpensive alternative to litigation was severely limited ...").
This is consistent with the Athenian law referred to previously, under which "[e]ither party could withdraw from the submission at any time before an award was actually given out." S. Jones,
The principle of revocability was most famously discussed by Lord Coke in a seminal decision, Vynior’s Case, 77 Eng. Rep. 595 (KB 1609). As stated by the court in Vynior’s Case, in dictum, "if I submit myself to an arbitrament; although [this is] made by express words irrevocable, or that I grant or am bound that [this] shall stand irrevocably, yet [it] may be revoked: ..." As noted by the Fourth Circuit in Glass v. Kidder Peabody & Co., 114 F.3d 446, 449 (4th Cir. 1997), "[b]eginning in 1609 with Vynior’s Case, the English courts voiced a firm disapproval of executory arbitration agreements as a vehicle for settling disputes between litigants. The disapproval culminated in England’s highest court denying enforcement of such agreements. In effect, this denial of enforceability nullified the practical value of arbitration agreements."
The benefits of arbitration- particularly in the context of commercial disputes- were sufficiently compelling that early on, solutions were sought to circumvent common-law barriers to enforcement. One tactic was to post a bond in conjunction with a submission to arbitration; if the losing party revoked the arbitration agreement or failed to comply with the arbitration award, the prevailing party could pursue an action on the bond that was enforceable at law. P. Sayre, supra, 37 Yale L.J. 598-99 (observing that "in the early days ... [a] submission to arbitration was accompanied by a bond and the courts allowed full recovery on the bond where there had been revocation"). Another approach was adopted in 1698, when parliament passed a law " ‘for determining differences by arbitration the purpose being promoting trade, and rendering the awards of arbitrators more effectual in all cases, for the final determination of controversies referred to them by merchants and traders, or others, concerning matters of account or trade, or other matters.’ The statute made it lawful for all parties having a dispute of the description there set forth, to agree that their submission thereof to arbitration, should be made a Rule of any of his Majesty’s Courts of Record ... Failure to abide by the award was punishable as for contempt of court." S. Jones, supra, 12 Minn.L.Rev. 245. Thus, by making the agreement to arbitrate a "rule"- that is, an order- of the court in a particular case, the common-law prohibitions against enforcing arbitration agreements were surmounted. Id.
9 and 10 Will. III, chap. 15.
The language of the statute makes clear that parliament’s primary concern was to create a mechanism for the binding arbitration of commercial disputes- hence, the references in the statute to "promoting trade," "merchants and traders," and "matters of account or trade."
In the eighteenth century, Lord Mansfield- whose jurisprudence was instrumental to the development of modern commercial law in the United States and other common-law nations - favored arbitration as a means of dispute resolution. J. Oldham, 2 The Mansfield Manuscripts and the Growth of English Law in the Eighteenth Century, p. 1237 n.69 (1992) ("Whenever Lord Mansfield saw an opportunity, he recommended that a case be solved by a reference [to arbitration]. Often the foreman or a member of the jury would be selected as arbitrator, or sometimes the case went to an officer of the court or to a merchant known to Lord Mansfield"). In accordance with the act of 1698, such references to arbitration would be made enforceable by making the reference an order of the court, punishable by contempt. J. Oldham, 1 The Mansfield Manuscripts and the Growth of English Law in the Eighteenth Century, p. 250 n.3 (1992) (Citing Sidgier v. Robotham, 449 nb 46 (KB 1757), and noting that "[t]he agreement to arbitrate was made a rule of court, thereby placing it under the contempt power"). Despite the innovation of enforcing arbitration by court order, executory agreements to arbitrate disputes remained unenforceable at common law. "It was not until 1855 that English courts recognized and enforced arbitration agreements." W. Howard, supra, 48 Arb.J. 28 (Citing Scott v. Avery, 5 H.C.L. 811, 25 L. J. Ex. 308 [1855] ). "Several decades later, Parliament passed the Arbitration Act of 1889 which made agreements to arbitrate irrevocable." (Citation omitted.) W. Howard, supra, 48 Arb.J. 28. Despite its decidedly inauspicious beginnings as dictum pronounced without extensive analysis, the rule in Vynior’s Case was cited repeatedly and persisted, thereby hindering the evolution of the law of arbitration in common-law jurisdictions, including in the United States. As one exasperated commentator remarked, "[f]ew principles of the modern law have continued without change for three hundred years; yet we are told that Vynior’s Case has such extraordinary vitality that its doctrine alone has limited the development of arbitration in commercial disputes in all common-law countries." P. Sayre, supra, 37 Yale L.J. 601. The rule has been criticized roundly by many modern courts. Thus, the Fourth Circuit observed that "[t]he rule of non-enforceability found its basis only in the antiquity of the rule [rather] than [in] its excellence or reason." (Citation omitted; internal quotation marks omitted.) Glass v. Kidder Peabody & Co., supra, 114 F.3d 450. Or, as also stated by the Second Circuit in connection with the common-law rule against enforcing executory contracts to arbitrate, "[g]ive a bad dogma a good name and its bite may become as bad as its bark." Kulukundis Shipping Co. v. Amtorg Trading Corporation, supra, 126 F.2d 984. "Anyone sensitive to the judicial decision making process must infer that this doctrine arose through hard cases making bad law." Board of Education v. W. Harley Miller, Inc., 159 W.Va. 120, 129, 221 S.E.2d 882 (1975) (Neely, J., concurring).
N. Poser, Lord Mansfield: Justice in the Age of Reason (2013), p. 397 ("[Lord Mansfield’s] commercial-law decisions, in which he assimilated mercantile custom into the common law, were especially influential in New York, the hub of American commerce"); see also
American law long reflected a hostility to arbitration consistent with traditional English common-law rules. Glass v. Kidder Peabody & Co., supra, 114 F.3d 450 ("[l]ike the English courts, the American courts began denying the right to judicial enforcement of arbitration agreements"); Kulukundis Shipping Co. v. Amtorg Trading Corporation, supra, 126 F.2d 984 (the Second Circuit noting that the hostility of English courts to executory arbitration "[w]as largely taken over in the 19th century by most courts in this country"). For example, in 1874, the United States Supreme Court held, in accordance with the longstanding common-law view, that "[a]greements in advance to oust the court of the jurisdiction conferred by law are illegal and void." Home Ins. Co. of New York v. Morse, 87 U.S. 445, 451, 22 L.Ed. 365 (1874). Thus, "[a]n executory agreement to arbitrate would not be given specific performance or furnish the basis of a stay of proceedings on the original cause of action." Kulukundis Shipping Co. v. Amtorg Trading Corporation., supra, 126 F.2d 984.
The English experience shaped early American attitudes and influenced the development of arbitration law in the United States. Initially, it served as a hindrance. See Board of Education. v. W. Harley Miller, Inc., supra, 159 W.Va. 129 n.2 (remarking that the influence of traditional English legal precedents- long since erased by the English themselves- retain an "influence [that] lingers strongly in this [country]." [Citation omitted.] ) Eventually, it served as an inspiration and catalyst for change. One commentator remarked soon after the adoption of the FAA, "[i]n general we have been exhorted to consider how excellent and serviceable is arbitration in England and in other countries ... as compared with arbitration in the United States, where we have for the most part only the inadequate common-law provisions of three hundred years ago ... In England and in the civil law countries commercial arbitration is in fact much better adapted to the needs of business [persons] than in American jurisdictions." P. Sayre, supra, 37 Yale L.J. 595. Discontent with the stagnant state of American arbitration law led to changes. Thus, "[i]n the early part of [the twentieth] century, expressions of dissatisfaction with the rule against enforcement of arbitration agreements emerged, particularly on the part of commercial interests." Glass v. Kidder Peabody & Co., supra, 114 F.3d 450. "Attitudes towards arbitration changed as time passed. This change was reflected in the courts by judicial decisions praising arbitration and in society by the passage of statutes embracing arbitration as an alternative forum for dispute resolution." Buraczynski v. Eyring, supra, 919 S.W.2d 317.
"The clear direction ... has been toward favoring binding arbitration. * * * As early as 1925, statistics showed that arbitration was inexpensive, convenient for the parties, expeditious, simple to administer, tended to preserve good will between the disputants, and assured such privacy as the parties desired. Existing common-law doctrines circumscribing arbitration have outlived any imagined usefulness in the last century. Unfortunately, because the common-law principles have existed for so long, courts are reticent to extinguish them in favor of a more sensible and precisely outlined system." Board of Education v. W. Harley Miller, Inc., supra, 159 W.Va. 132.
New York was the pioneer in developing "a more sensible and precisely outlined system." The reform movement concerning arbitration "received its greatest impetus in New York, which had long been a center of arbitration activity. It culminated in the 1920 enactment of the New York Arbitration Act, which had the effect of validating predispute arbitration agreements, staying court proceedings pending arbitration and prohibiting revocation of agreements to arbitrate ... In 1925, Congress passed the Federal Arbitration Act (FAA) ... [g]enerally patterned after the New York law." W. Howard, supra, 48 Arb.J. 28.
"The FAA was enacted in 1925, 43 Stat. 883, and then reenacted and codified in 1947 as Title 9 of the United States Code." EEOC v. Waffle House, Inc., 534 U.S. 279, 288-89, 122 S.Ct. 754, 151 L.Ed.2d 755 (2002). "The purpose of [the FAA] was deliberately to alter the judicial atmosphere previously existing. The report of the House Committee stated, in part: Arbitration agreements are purely matters of contract, and the effect of the bill is simply to make the contracting party live up to his agreement. He can no longer refuse to perform his contract when it becomes disadvantageous to him. An arbitration agreement is placed upon the same footing as other contracts, where it belongs. * * * The need for the law arises from an anachronism of our American law. Some centuries ago, because of the jealousy of the English courts for their own jurisdiction, they refused to enforce specific agreements to arbitrate upon the ground that the courts were thereby ousted from their jurisdiction. This jealousy survived for so long a period that the principle became firmly embedded in the English common law and was adopted with it by the American courts. The courts have felt that the precedent was too strongly fixed to be overturned without legislative enactment, although they have frequently criticized the rule and recognized its illogical nature and the injustice which results from it. The bill declares simply that such agreements for arbitration shall be enforced ... * * * It is particularly appropriate that the action should be taken at this time when there is so much agitation against the costliness and delays of litigation. These matters can be largely eliminated by agreements for arbitration, if arbitration agreements are made valid and enforceable." (Internal quotation marks omitted.) Kulukundis Shipping Co. v. Amtorg Trading Corporation, supra, 126 F.2d 985. As stated by the United States Supreme Court, "[the] purpose [of the FAA] was 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 agreement upon the same footing as other contracts." (Citation omitted; emphasis added; internal quotation marks omitted.) EEOC v. Waffle House, Inc., supra, 534 U.S. 289; see also Kulukundis Shipping Co. v. Amtorg Trading Corporation, supra, 126 F.2d 985 ("In light of the clear intention of Congress, it is our obligation to shake off the old judicial hostility to arbitration").
Thus, in our common-law tradition, arbitration was for centuries viewed with opprobrium, became grudgingly tolerated, and eventually, was enthusiastically accepted, at least on a national level.
Despite the national policy established by the FAA, certain states continue to view arbitration with skepticism. See, e.g.,
III
A
In enacting the FAA, Congress intended to create a "[l]iberal federal policy favoring arbitration agreements," and to require that courts "[r]igorously enforce agreements to arbitrate ..." Moses H. Cone Hospital. v. Mercury Construction Corporation, 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983); see also Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 221, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985). "Any analysis of a party’s challenge to the enforcement of an arbitration agreement must begin by recognizing the FAA’s strong policy in favor of rigorously enforcing arbitration agreements." Doctor’s Associates, Inc. v. Hamilton, 150 F.3d 157, 162 (2d Cir. 1998).
Individual states have followed the lead of the federal government in espousing public policies in support of arbitration. For example, Tennessee favors enforcing agreements to arbitrate. "Tennessee has adopted a version of the Uniform Arbitration Act." Buraczynski v. Eyring, supra, 919 S.W.2d 318. As observed by the Supreme Court of Tennessee, "the Act embodies legislative policy favoring enforcement of agreements to arbitrate." Id., 318. "In general, arbitration agreements in contracts are favored in Tennessee both by statute and existing case law." Benton v. Vanderbilt University, 137 S.W.3d 614, 617 (Tenn. 2004). Accord Poole v. Union Planters Bank, N.A., 337 S.W.3d 771, 777 n.4 (2010) ("Tennessee litigants are permitted to forego the judicial process altogether if they have entered into a valid, pre-dispute arbitration agreement ... [T]he public policy of this state promotes arbitration as an alternative to the adjudicative process." [Citations omitted.] )
Consistent with the federal view and Tennessee law, Connecticut’s public policy favors strongly the arbitration of private disputes between litigants. Our Supreme Court has acknowledged the "legislature’s well established support of arbitration as a mechanism for the inexpensive and expedient resolution of private disputes." Bloomfield v. United Electrical, Radio & Machine Workers of America, Connecticut Independent Police Union, Local 14, 285 Conn. 278, 290, 939 A.2d 561 (2008). This "well established support" is reflected clearly in the language of General Statutes § 52-408, entitled, "Agreements to arbitrate." That statute provides in part that "[a]n agreement in any written contract ... to settle by arbitration any controversy thereafter arising out of such contract ... shall be valid, irrevocable and enforceable, except when there exists sufficient cause at law or in equity for the avoidance of written contracts generally." General Statutes § 52-408.
Our courts have also long and repeatedly "recognized the public policy favoring arbitration which is intended to avoid the formalities, delay, expense and vexation of ordinary litigation." Board of Education v. East Haven Education Assn., 66 Conn.App. 202, 207, 784 A.2d 958 (2001); see also State v. New England Health Care Employees Union, 271 Conn. 127, 134, 855 A.2d 964 (2004) (our courts "favor arbitration as a means of settling private disputes"); Garrity v. McCaskey, 223 Conn. 1, 4, 612 A.2d 742 (1992). As further explained by the Appellate Court in Asselin & Connolly, Attorneys, LLC v. Heath, 108 Conn.App. 360, 364, 947 A.2d 1051 (2008), "[t]he law in this state takes a strongly affirmative view of consensual arbitration ... Arbitration is a favored method to prevent litigation, promote tranquility and expedite the equitable settlement of disputes ..." (Internal quotation marks omitted); see also Grose v. Didi, LLC, Superior Court, judicial district of Hartford, Docket No. CV-17-6079775 S (April 11, 2018, Peck J.) (66 Conn.L.Rptr. 293) ("Connecticut has adopted a clear public policy in favor of arbitrating disputes." [Citation omitted] ); Peters v. Pillsbury Winthrop Shaw Pitman, LLP, Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-11-6009039 S (Oct. 17, 2011, Adams, J.T.R.) ("The United States Supreme Court has stated repeatedly and unequivocally that the FAA establishes a federal policy in favor of arbitration. Connecticut cases have followed suit." [Citation omitted.] ). Thus, the public policy of all three jurisdictions- the United States, Tennessee, and Connecticut- favor the enforcement of agreements to arbitrate.
B
Although all three potential sources of law are in harmony with respect to public policy, the court finds specifically that the FAA is applicable to this controversy, despite the plaintiff’s contention to the contrary. "The question presented is whether the parties’ ... agreement ... is a contract evidencing a transaction involving commerce within the meaning of the [FAA]." (Citation omitted; internal quotation marks omitted.) Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 53, 123 S.Ct. 2037, 156 L.Ed.2d 46 (2003). The FAA makes valid and enforceable a written arbitration provision in "a contract evidencing a transaction involving commerce ..." 9 U.S.C. § 2; see also Allied-Bruce Terminix Cos. v. Dobson, supra, 513 U.S. 265. Section 1 of Title 9 defines "commerce" as "commerce among the several States ..." "Such commerce is not confined to transportation from one [s]tate to another, but comprehends all commercial intercourse between different [s]tates and all the component parts of that intercourse." Dahnke-Walker Milling Co. v. Bondurant, 257 U.S. 282, 290, 42 S.Ct. 106, 66 L.Ed. 239 (1921). Moreover, it is not necessary that the parties contemplated an interstate commerce transaction for the agreement to be found to "evidence[ ] a transaction involving commerce." (Citation omitted; emphasis omitted.) Allied-Bruce Terminix Cos. v. Dobson, supra, 513 U.S. 273. "We have interpreted the term ‘involving commerce’ in the FAA as the functional equivalent of the more familiar term ‘affecting commerce’- words of art that ordinarily signal the broadest permissible exercise of Congress’ Commerce Clause power ... Because the statute provides for the enforcement of arbitration agreements within the full reach of the Commerce Clause, ... it is perfectly clear that the FAA encompasses a wider range of transactions than those actually ‘in commerce’- that is, ‘within the flow of interstate commerce.’ " (Citations omitted.) Citizens Bank v. Alafabco Inc., 539 U.S. 52, 56, 123 S.Ct. 2037, 156 L.Ed.2d 46 (2003). Furthermore, "Congress’ Commerce Clause power may be exercised in individual cases without showing any specific effect upon interstate commerce if in the aggregate the economic activity in question would represent a general practice ... subject to federal control ... Only that general practice need bear on interstate commerce in a substantial way." (Citations omitted; internal quotation marks omitted.) Id., 56-57.
Turning to the facts of this case, the court concludes that the amended operating agreement evidences a transaction involving interstate commerce. The plaintiff’s argument concerning the applicability of the FAA consists of a single sentence, as follows: "The defendants’ reliance on the interstate commerce involvement is misplaced as this is a Connecticut business conducted in Connecticut." Pl.’s Memo. Supp. Obj. Mot. Compel Arbitration, 2. In fact, the agreement at issue is the governing document for a limited liability company organized and existing under the laws of Tennessee, which operates an ambulatory surgery center in Milford, Connecticut. The operating agreement was entered into by and between AmSurg, a Tennessee corporation, and the Owners, including the plaintiff, who is a resident of Connecticut. AmSurg Corp., also a Tennessee corporation, is the sole shareholder of AmSurg. In the context of this case, the fact that the parties to the amended arbitration agreement are from different states supports a finding that the transaction between the parties involves interstate commerce. A federal court reached this precise conclusion in a case involving AmSurg and a group of Oregon physicians, with an operating agreement containing language substantially similar to the amended operating agreement at issue here. See Wallace v. AmSurg Holdings, Inc., United States District Court, Case. No. CV-01548-MC (D.Or. Nov. 24, 2015). In Wallace, the court held as follows: "The Operating Agreement deals with AmSurg, a Tennessee. LLC, and 50 or so Oregon physicians. As it necessarily involves a contract evidencing a transaction involving commerce, it is governed by the [FAA)." (Citation omitted, internal quotation marks omitted; emphasis added.) Id., 10; see also AmSurg Glendale, Inc. v. Glendale Surgery Partners, United States District Court, Docket No. CV-00862 (M.D.Tenn. March 22, 2017) (confirming arbitration award, submitted pursuant to the FAA, involving a limited partnership "for the purpose of operating an ambulatory surgical center in Glendale, California," with AmSurg Glendale, Inc.- which was wholly owned by AmSurg- serving as the general partner). As a result, the court concludes that the FAA applies to the amended operating agreement.
The stated purpose of the LLC, as set forth in the amended operating agreement, "shall be to own and operate the Center and to carry on any and all activities necessary, proper, convenient or advisable in connection therewith." The Center provides ambulatory ophthalmological surgery services. As noted by the Court of Appeals of Iowa in
C
"The provisions of the FAA are to be applied in both state and federal courts." (Citation omitted.) Warbington Constr., Inc. v. Franklin Landmark, L.L.C., 66 S.W.3d 853, 856 (Tenn.Ct.App. 2001). As observed more recently by the Court of Appeals of Tennessee, "[w]hether the FAA or the [Tennessee Uniform Arbitration Act] governs the specific issues raised ... is of no practical significance because the problems the FAA was intended to cure have been virtually eliminated by the enactment in Tennessee and other states of the Uniform Arbitration Act. The UAA and FAA have similar or identical provisions on the relevant issues." (Citation omitted; internal quotation marks omitted.) Khan v. Regions Bank, 461 S.W.3d 505, 509 (Tenn.Ct.App. 2014).
Connecticut courts routinely enforce the FAA, and Connecticut state law is not in conflict with the FAA with respect to the issues raised by the defendants’ motion to compel arbitration. "[T]he FAA embodies a substantive rule applicable in state as well as federal courts, whereby Congress acting under the Commerce Clause foreclosed state legislatures from undercutting the enforceability of arbitration agreements ... [A]s to the issues before the court, the Connecticut Arbitration Act, General Statutes § § 52-408 et seq., is not inconsistent with the federal act." (Citations omitted; internal quotation marks omitted.) Saltzman v. The Travelers, Inc., Superior Court, judicial district of Hartford, Docket No. CV-95-0549057 S (Jan. 5, 1996, Hennessey, J.) (15 Conn.L.Rptr. 596); see also Discover Bank v. Bryant, Superior Court, judicial district of New Haven at New Haven, Docket No. CV-13-6036145 S (Dec. 5, 2014, Burke, J.) (59 Conn.L.Rptr. 437) ("As federal substantive law, the [FAA] is to be applied by state courts as well as federal courts ... It [is] well-settled that state courts have jurisdiction to hear cases arising under the [FAA]"). (Citations omitted; internal quotation marks omitted.)
IV
A threshold issue presented by the defendants’ motion to compel arbitration is "the question of whether [the plaintiff] entered into an agreement which obliges [him] to consent to arbitration." (Citation omitted; internal quotation marks omitted.) Morales v. Rent-A-Center, Inc., 306 F.Supp.2d 175, 180 (D.Conn. 2003). "The FAA requires that questions of arbitrability ... be addressed with a healthy regard for the federal policy favoring arbitration and that any doubts concerning the scope of arbitrable issues ... be resolved in favor of arbitration." (Citation omitted; internal quotation marks omitted.) Security Ins. Co. v. TIG Ins. Co., 360 F.3d 322, 325 (2d Cir. 2004). Despite the foregoing, "[t]he federal policy favoring arbitration ... does not change the long established principle that [a]rbitration 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." (Citations omitted; internal quotation marks omitted; brackets omitted.) Id. This is consistent with Connecticut law. "Arbitration is a creature of contract ... It is designed to avoid litigation and secure prompt settlement of disputes and is favored by the law ..." (Citations omitted; internal quotation marks omitted.) Stack v. Hartford Distributors, Inc., 179 Conn.App. 22, 28, 177 A.3d 1201 (2017). However, "[a party] can be compelled to arbitrate a dispute only if, to the extent that, and in the manner which, [it] has agreed to do so ... Because arbitration is based on a contractual relationship, a party who has not consented cannot be forced to arbitrate a dispute." (Citation omitted; alterations in original.) New Britain v. AFSCME, Council 4, Local 1186, 304 Conn. 639, 646, 43 A.3d 143 (2012).
"The threshold question of whether the parties ... agreed to arbitrate is determined by state contract law principles." (Citation omitted.) Nicosia v. Amazon.com, Inc., 834 F.3d 229, 229 (2d Cir. 2016); see also Cap Gemini Ernst & Young, __ U.S. __, L.L.C. v. Nackel, 346 F.3d 360, 364 (2d Cir. 2003) ("[In] evaluating whether the parties have entered into a valid arbitration agreement, the court must look to state law principles"); Morales. v. Rent-A-Center, Inc., supra, 306 F.Supp.2d 180 ("[i]n deciding whether parties agreed to arbitrate in accordance with the FAA, courts should generally apply ordinary state-law principles that govern the formation of contracts." [Citations omitted] ). "As a result, prior to compelling arbitration, the [trial court] must first determine two threshold issues that are governed by state rather than federal law: (1) Did the parties enter into a contractually valid arbitration agreement? and (2) If so, does the parties’ dispute fall within the scope of the arbitration agreement?" Cap Gemini Ernst & Young, __ U.S. __, L.L.C. v. Nackel, supra, 365; accord Hottle v. BDO Seidman, LLP, 268 Conn. 694, 704-05, 846 A.2d 862 (2004). The court considers each of these questions in turn.
In this case, it is undisputed that the plaintiff signed the amended operating agreement, which was intended to supplant all prior written agreements between the parties. This constitutes presumptive if not conclusive evidence that an agreement was formed. Morales v. Rent-A-Center, Inc., supra, 306 F.Supp.2d 181 ("[i]n this case, Plaintiff actually signed the arbitration agreement at issue, which serves as presumptive evidence that an agreement was formed"); see also Credit Acceptance Corporation v. Hinton, Superior Court, judicial district of Ansonia-Milford at Milford, Docket No. CV-16-6021002 S (January 16, 2018, Hiller, J.T.R.) ("[t]hat a party signed a written agreement is usually conclusive evidence of contract formation." [Emphasis added] ); D’Antuono v. Service Road Corp., supra, 789 F.Supp.2d 323 (D.Conn.) ("In Connecticut, the fact that a party signed a written agreement is usually conclusive evidence of contract formation"). Furthermore, it has long been the law in Connecticut that "where a person of mature years, who can read and write, signs or accepts a formal written contract affecting his pecuniary interest, it is his duty to read it, and notice of its contents will be imputed to him if he negligently fails to do so ..." Ursini v. Goldman, 118 Conn. 554, 562, 173 A. 789 (1934). This view is consistent with the law of Tennessee, which holds that "a party who signs a contract is presumed to know its contents ... The law imparts a duty on parties to a contract to learn the contents and stipulations of a contract before signing it, and signing it without learning such information is at the party’s own peril." (Citation omitted; internal quotation marks omitted.) Poole v. Union Planters Bank, N.A., 337 S.W.3d 771, 784-85 (Tenn.Ct.App. 2010). As a result, the plaintiff is bound by the arbitration provisions of the amended operating agreement, "[u]nless he can show special circumstances, such as duress or coercion, which would justify non-enforcement of the contract." Morales v. Rent-A-Center, Inc., supra, 306 F.Supp.2d 181; see also D’Antuono v. Service Road Corp., supra, 789 F.Supp.2d 326 ("[t]he FAA permits ... courts to invalidate arbitration agreements based on generally applicable contract defenses, such as fraud, duress, or unconscionability ... Typically, those defenses are state law defenses") (Citation omitted; internal quotation marks omitted.)
In this case, the plaintiff has failed to introduce any evidence of fraud, duress, or unconscionability. In fact, in his opposition to the motion to compel, the defendant does not even advance an argument that the arbitration provisions of the amended operating agreement should not be enforced against him based on fraud, duress, or unconscionability. Instead, the plaintiff claims that the provisions of the amended operating agreement, which he admittedly signed, should not be enforced against him because they allegedly differ in certain discrete respects from the copy of a document that was provided previously to him. The plaintiff fails to cite legal grounds for this position. Moreover, this allegation, in and of itself, is insufficient to demonstrate the existence of fraud, duress, or unconscionability necessary to invalidate the arbitration provisions of the amended operating agreement.
The plaintiff also asserts that the amended operating agreement should be "construed against" AmSurg, presumably on the grounds that it was drafted by AmSurg. First, the foregoing argument contradicts the express terms of the amended operating agreement by which the Members, including the plaintiff, "acknowledge that they have independently negotiated the provisions of this Agreement ... The Members expressly agree that there shall be no presumption created as a result of any Member having prepared in whole or in part any provision of this Agreement." Amended Operating Agreement, § 14.14. Second, the plaintiff appears to invoke the well-known rule that "[w]hen the language in a contract is ambiguous, courts construe the ambiguity against the drafter." (Citations omitted.)
With respect to a possible defense based on fraud, "[t]he four essential elements of fraud are (1) that a false representation of fact was made; (2) that the party making the representation knew it to be false; (3) that the representation was made to induce action by the other party; and (4) that the other party did to act [to his or] her detriment ..." Bank of America, N.A. v. Aubut, 167 Conn.App. 347, 378-79, 143 A.3d 638 (2016); see also Dog House Investments, LLC v. Teal Properties, Inc., 448 S.W.3d 905, 916 (Tenn.Ct.App. 2014) ("Actions for fraud contain four primary elements: (1) intentional misrepresentation of a material fact; (2) knowledge that the representation was false- that the misrepresentation was made knowingly or recklessly or without belief or regard for its truth; (3) reasonable reliance on the misrepresentation by the plaintiff and resulting damages; (4) that the misrepresentation relates to an existing or past fact" [citation omitted; internal quotation marks omitted; alterations omitted] ). No evidence of any of the foregoing elements has been presented.
As for duress, "[t]he classical or common-law definition of duress is any wrongful act of one person that compels a manifestation of apparent assent by another to a transaction without his volition ... The defendant must prove: [1] a wrongful act or threat [2] that left the victim with no reasonable alternative, and [3] to which the victim in fact acceded, and that [4] the resulting transaction was unfair to the victim ... The wrongful conduct at issue could take virtually any form, but must induce a fearful state of mind in the other party, which makes it impossible for that party to exercise his own free will." Tedesco v. Agolli, 182 Conn.App. 291, 305, 189 A.3d 672 (2018); see also McClellan v. McClellan, 873 S.W.2d 350, 352 (Tenn.Ct.App. 1993) (defining duress as "an unlawful restraint, intimidation, or compulsion of another to such an extent and degree as to induce such other person to perform some act which he is not legally bound to do, contrary to his will and inclination. The alleged coercive event must be of such severity, either threatened, impending or actually inflicted, so as to overcome the mind and will of a person of ordinary firmness." [Citation omitted.] ) The record is devoid of evidentiary facts that would satisfy any of the necessary elements of duress.
Finally, the plaintiff has not shown that the amended operating agreement, or any of the arbitration provisions of that agreement, is unconscionable. "The classic definition of unconscionable contract is one which no [person] in his senses, not under delusion, would make, on the one hand, and which no fair or honest [person] would accept, on the other ... In practice, we have come to divide this definition into two aspects of unconscionability, one procedural and the other substantive, the first intended to prevent unfair surprise and the other intended to prevent oppression ... A determination of unconscionability generally requires a showing that the contract was both procedurally and substantively unconscionable when made- i.e., some showing of an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party ..." (Citation omitted internal quotation marks omitted.) Emeritus Senior Living v. Lepore, 183 Conn.App. 23, 29, 191 A.3d 212 (2018); see also Philpot v. Tennessee Health Management, 279 S.W.3d 573, 579 (Tenn.Ct.App. 2007) (unconscionability of contract has two components: "(1) procedural unconscionability, which is an absence of meaningful choice on the part of one of the parties, and (2) substantive unconscionability, which refers to contract terms which are unreasonably favorable to the other party"). The plaintiff has not demonstrated procedural or substantive unconscionability. The only colorable basis for a claim of unconscionability is that, prior to signing the amended arbitration agreement, the plaintiff was provided with a copy of an agreement containing language different from that set forth in the amended operating agreement- not with respect to the mandatory arbitrability of disputes, but pertaining to choice of law and the venue for arbitration. Again, the plaintiff cites no legal authority for the proposition that the foregoing is either procedurally or substantively unconscionable, particularly in the context of a contract entered into by sophisticated business actors who participated mutually in drafting an agreement in consultation with counsel. See Amended Operating Agreement, § 14.14. "Courts do not generally find contracts unconscionable where the parties are businesspersons." (Citations omitted.) Emlee Equipment Leasing Corporation. v. Waterbury Transmission, Inc., 31 Conn.App. 455, 464, 626 A.2d 307 (1993). In fact, our Supreme Court has determined that "[p]rocedural unconscionability cannot be predicated solely on the failure by a commercial party proffering a form contract to an individual party to direct the individual’s attention to specific terms of a contractual agreement." (Emphasis added.) Smith v. Mitsubishi Motors Credit of America, Inc., 247 Conn, 342, 352, 721 A.2d 1187 (1987); see also Forshaw v. S.C.I. Connecticut Funeral Services, Inc., Superior Court, judicial district of New London at New London, Docket No. 555164 (July 29, 2002, Hurley, J.T.R.) (granting motion to stay pending arbitration and rejecting the plaintiff’s argument "[t]hat because she did not have an opportunity to read the contract, it is substantively unconscionable"). Unlike in Smith and Forshaw, this case does not involve a form contract entered into by an individual consumer with unequal bargaining power. The amended operating agreement is not procedurally or substantively unconscionable.
For these reasons, the court concludes that the parties entered into a contractually valid written agreement to arbitrate, in accordance with the terms of the amended operating agreement.
V
Having concluded that the amended operating agreement contains valid arbitration provisions that are enforceable against the plaintiff, the court turns to the scope of those provisions to determine whether they encompass the underlying dispute between the parties. The scope of the obligation to arbitrate is defined by the language of the parties’ agreement. "Arbitration is a creature of contract. It is the province of the parties to set the limits of the authority of the arbitrators, and the parties will be bound by the limits they have fixed." (Citation omitted; internal quotation marks omitted.) Success Centers, Inc. v. Huntington Learning Centers, Inc., 223 Conn. 761, 772, 613 A.2d 1320 (1992).
With respect to the interpretation of contracts, it is axiomatic that in Connecticut, "[a] contract must be construed to effectuate the intent of the parties, which is determined from the language used interpreted in the light of the situation of the parties and circumstances connected with the transaction ... The intent of the parties is to be ascertained by a fair and reasonable construction of the written words and ... the language used must be accorded its common, natural, and ordinary meaning and usage where it can be sensibly applied to the subject matter of the contract ... Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms. A court will not torture words to import ambiguity where the ordinary meaning leaves no room for ambiguity ..." (Citations omitted; internal quotation marks omitted.) Lawson v. Whitey’s Frame Shop, 241 Conn. 678, 686, 697 A.2d 1137 (1997) "Although the intention of the parties typically is a question of fact, if their intention is set forth clearly and unambiguously, it is a question of law." Stack v. Hartford Distributors, Inc., 179 Conn.App. 22, 29, 177 A.3d 1201 (2017) (Citations omitted; internal quotations marks omitted).
In light of the strong legislative and judicial policies in support of arbitration, it is not surprising that courts have adopted interpretive rules favoring the enforcement of arbitration agreements. Thus, in the context of agreements to arbitrate, federal and Connecticut state courts apply the "positive assurance test" to the language at issue. See Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960); White v. Kampner, 229 Conn. 465, 472-73, 641 A.2d 1381 (1994); see also A.P. Savino, LLC v. Csak, Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-16-6029156 S (August 3, 2017, Povodator, J.) ("The positive assurance test is well-established in Connecticut"). Under this test, "[a]n order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage ." State v. Philip Morris, Inc., 279 Conn. 785, 797 n. 10, 905 A.2d 42 (2006) [Citation omitted; emphasis added] ); see also Hottle v. BDO Seidman, LLP, 74 Conn.App. 271, 277, 811 A.2d 745, aff’d, 268 Conn. 694, 846 A.2d 862 (2004) (citing federal policy favoring arbitration and holding that "[a]ny doubt concerning the scope of arbitrable issues is to be resolved in favor of arbitration"). (Citation omitted.) "Generally, arbitration is mandated as long as the claim implicates issues of contract construction or the parties’ rights or obligations under it. Furthermore, if the allegations underlying the claims ‘touch matters’ covered by the parties’ ... agreements, then those claims must be arbitrated, whatever the legal labels attached to them." (Citations omitted; internal quotation marks omitted.) Credit Acceptance Corporation. v. Hinton, supra, Superior Court, judicial district of Ansonia-Milford at Milford, Docket No. CV-16-6021002 S, *20.
Tennessee courts also use this test when applying the FAA. See,
In construing arbitration clauses, "[c]ourts have at times distinguished between broad clauses that purport to refer all disputes arising out of a contract to arbitration and narrow clauses that limit arbitration to specific types of disputes. If a court concludes that a clause is a broad one, then it will order arbitration and any subsequent construction of the contract and of the parties’ rights and obligations under it are within the jurisdiction of the arbitrator." (Internal quotation marks omitted.) McDonnell Douglas Finance Corporation v. Pennsylvania Power & Light Co., 858 F.2d 825, 832 (2d Cir. 1988). According to the Second Circuit, broad clauses commonly use the words, "arising out of" or "relating to." Collins & Aikman Products Co. v. Building Systems, supra, 58 F.3d 20 (a clause submitting to arbitration "[a]ny claim or controversy arising out of or relating to th[e] agreement, is the paradigm of a broad clause" [Internal quotation marks omitted] ). In light of the harmony between the federal and state law of arbitration, it is not surprising that Connecticut courts have cited favorably the Second Circuit’s view in this regard. See, e.g., Cafarelli v. Colon-Collazo, Superior Court, judicial district of Danbury, Docket No. CV-05-5000279 S (June 20, 2006, Schuman, J.) (41 Conn.L.Rptr. 539) (applying federal analysis to arbitration provision and noting that federal courts addressing "arising out of or "relating to" clauses have interpreted them expansively); Saltzman v. The Travelers, Inc., supra, Superior Court, judicial district of Hartford, Docket No. CV-95-0549057 S, *4 ("Where the arbitration clause is broad we have directed courts to compel arbitration whenever a party has asserted a claim, however frivolous, that on its face is governed by the contract ... Broad clauses typically use language such as ‘arising out of’ or ‘related to.’ " [Citations omitted; internal quotation marks omitted] ).
This action involves the allegedly wrongful termination of the plaintiff’s membership in the LLC. The amended operating agreement is the operating agreement of the LLC, and it contains provisions governing, inter alia, the widest possible range of matters pertaining to the LLC, including the following: its organization; purposes and powers; capital contributions and membership interests; expenses; allocation of income, loss and distributions; board of directors; members; officers; fiscal matters; assignment and termination of membership interests and admission of new members; as well as dissolution, winding up and termination of the LLC’s existence. Defs.’ Exhibit A, Memo. Supp. Mot. Compel Arbitration. In his complaint, the plaintiff alleges that he did not violate Section 8.2.2 of the amended operating agreement, which imposes ownership and investment restrictions upon the Owners and Affiliated Physicians, and that his termination from the LLC was wrongful. Termination is governed by Section 12 of the amended operating agreement.
Indisputably, the amended operating agreement at issue contains a "broad" arbitration clause. That clause provides that "[a]ll disputes arising under this Agreement shall be resolved by binding arbitration pursuant to the rules of the American Health Lawyers Association Dispute Resolution Service (’AHLA’) then pertaining." (Emphasis added.) Amended Operating Agreement, § 14.11. In this case, it cannot be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute- to the contrary, the arbitration clause clearly covers the dispute in question. Furthermore, the underlying claims at issue here do more than merely "touch upon" matters covered by the amended operating agreement; they go to the very heart of matters governed by that document. Thus, the underlying dispute is well within the scope of the arbitration provisions of the amended operating agreement and is subject to binding arbitration.
VI
Finally, and given that the plaintiff’s claims are subject to binding arbitration, the court considers the remedies prayed for by the defendants, in their motion. In this case, the defendants have moved to compel arbitration and for a stay of this action. "The FAA provides for stays of proceedings in [the trial courts] when an issue in the proceeding is referable to arbitration, and for orders compelling arbitration when one party has failed or refused to comply with an arbitration. See 9 U.S.C. § § 3 and 4." EEOC v. Waffle House, Inc., supra, 534 U.S. 289. Under the FAA, the defendants are entitled to both remedies. As discussed above, all issues in this proceeding are referable to arbitration pursuant to the terms of the amended operating agreement. By his objection to the defendants’ motion to compel arbitration, the plaintiff has demonstrated a failure and refusal to comply with arbitration.
See also
Connecticut law does not conflict with the FAA’s procedural remedies and is consistent with the federal remedy allowing for a stay of proceedings. General Statutes § 52-409 "provides relief when a party to a contract that contains an arbitration clause desires arbitration of a dispute, and the other party, instead of proceeding with arbitration, institutes a civil action to resolve the dispute. The party desiring arbitration can then seek a stay of the civil action." (Citations omitted; internal quotation marks omitted.) MSO, LLC v. DeSimone, 313 Conn. 54, 62-63, 94 A.3d 1189 (2014). As observed by the court in a case involving a motion to stay proceedings under the FAA and Connecticut law, "the language of the two statutes [9 U.S.C. § 3 and General Statutes § 52-409] relevant to the motion to stay proceedings is virtually identical and federal and Connecticut state law on arbitration are similarly in concert." Peters v. Pillsbury Winthrop Shaw Pitman, LLC, supra, Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-11-6009039 S, *1; see also D’Antuono v. Service Road, Corp., supra, 789 F.Supp.2d 330 ("Connecticut’s preference for arbitration is even embodied in a statute that tracks the language of the FAA. See Conn. Gen. Stat. § 52-409").
It has been noted that while Connecticut’s arbitration statutes provide for a stay of proceedings, unlike the FAA, they do not allow a court to compel the arbitration of a dispute that is the subject of a pending action. See, e.g.,
Although virtually identical, there is one difference between the statutes that is worthy of note. In order to obtain a stay of proceedings under Connecticut law, "the person making application for the stay shall be ready and willing to proceed with the arbitration." General Statutes § 52-409. No "ready and willing" requirement appears in 9 U.S.C. § 3. The difference is of significance here because the court has emphasized the harmony between federal and Connecticut law with respect to arbitration and, in this case, the defendants have not stated explicitly- either in their briefs or at oral argument- that they are "ready and willing" to proceed with an arbitration in accordance with the amended arbitration agreement. This raises the possibility that, while they are entitled to a stay of proceedings under the FAA, the defendants have not satisfied Connecticut’s statutory requirements for a stay of proceedings and, therefore, are not entitled to a stay under § 52-409.
"A split of authority exists in Superior Court cases regarding what a party seeking a stay must establish to fulfill the ready and willing requirement." (Citations omitted; internal quotations omitted.) Brubaker v. Ranciato, Superior Court, judicial district of New Haven at New Haven, Docket No. CV-17-6068768 S (Oct. 5, 2017, Wilson, J.) (65 Conn.L.Rptr. 400); see also Twin Lake Indoor Tennis, Ltd. v. Twin Lakes, Inc., Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-07-4011311 S (Oct. 30, 2007, Adams, J.) ("Connecticut appellate courts have not specifically addressed this requirement, and a split of authority exists in Superior Court cases as to what a party seeking a stay must establish to fulfill the ‘ready and willing’ requirement" [Citations omitted] ). One line of cases requires the movant to state specifically, by way of affidavit or motion, that they are "ready and willing" to proceed with the arbitration. See, e.g., Bridgeport v. C.R. Klewin Northeast, LLC, Superior Court, judicial district of Waterbury, Complex Litigation Docket, Docket No. X06-CV-04-4000308 S (March 3, 2005, Alander, J.) (denying motion for stay of proceedings where the moving party "has not represented either by affidavit or within its motion ... that it is ready and willing to proceed with arbitration. For that reason, the motion for a stay is denied"). Another line of cases holds that a party otherwise demonstrating adequately a readiness and willingness to proceed with arbitration- for example, by demanding arbitration and moving to compel arbitration- is sufficient to satisfy the "ready and willing" requirement of § 52-409. See, e.g., Watson Enterprises, Inc. v. Greenwich Cadillac-Oldsmobile, Inc., Superior Court, judicial district of Stamford-Norwalk, Docket No. 30243 (July 2, 2004, Hickey, J.T.R.) ("the defendants have filed a demand for arbitration and moved this court to compel the plaintiff’s participation in those proceedings, thus demonstrating their willingness to proceed with arbitration").
This court joins the latter line of cases, and holds that a party does not need to state explicitly that it is "ready and willing" to proceed to arbitration to satisfy the requirements of § 52-409, so long as the moving party has demonstrated to the court that it is, in fact, "ready and willing" to proceed to arbitration in some meaningful way. The words "ready and willing" are not talismanic. Moreover, the application of a more flexible standard to the "ready and willing" requirement of § 52-409 is consistent with Connecticut’s strong public policy favoring arbitration. While it may be prudent for a moving party to make use of the statutory language in connection with a motion to stay proceedings, requiring a moving party to use the exact words, "ready and willing to proceed with arbitration," elevates form over substance in a manner that is inconsistent with our state’s firmly established policy supporting arbitration. In this case, by their motion, the defendants have demanded arbitration and asked this court to compel arbitration in accordance with the amended operating agreement. This constitutes a sufficient expression of readiness and willingness to proceed with arbitration in satisfaction of the requirements of § 52-409. As a result, the defendants are entitled to a stay of proceedings under both federal and Connecticut law.
CONCLUSION
For the foregoing reasons, the defendants’ motion to compel arbitration is granted. All proceedings in this matter are stayed pending a final determination of the plaintiff’s claims in binding arbitration, in accordance with the terms and provisions of the amended arbitration agreement.
"In order for the bar against the introduction of extrinsic evidence to apply, the writing at issue must be integrated, that is, it must have been intended by the parties to contain the whole agreement ... and to be a final expression of one or more terms of [the] agreement." (Citation omitted; internal quotations marks omitted.) "The intent of the parties determines whether the written agreement was the final repository of any oral agreements. If the court determines that the parties intended the writing to be an integrated agreement, the oral agreements are not considered when determining the contractual obligations of the parties." Conn. Acoustics, Inc. v. Xhema Construction, Inc., 88 Conn.App. 741, 748, 870 A.2d 1178 (2006).
An examination of the amended operating agreement reflects a clear and unequivocal intention by the parties to enter into an integrated contract. See Amended Operating Agreement, § 14.14. The plaintiff’s assumption and claim regarding the venue for the arbitration are offered to vary or alter the explicit terms of the amended operating agreement. As such, the assumption and claim are irrelevant to the court’s analysis.
Warbington Construction, Inc. v. Franklin Landmark, L.L.C., 66 S.W.3d 853, 856 [Tenn.Ct.App. 2001]). Thus, the defendants rely principally on federal and Connecticut law; the plaintiff claims that the controlling state law is that of Connecticut. Pl. Aff., ¶3 and 4.
Avionics Technologies, Inc. v. Ulti-Mate Connector, Inc., Superior Court, judicial district of New Haven at New Haven, Docket No. CV-10-6015858 S (April 21, 2011, Silbert, J.) (51 Conn.L.Rptr. 806).
supra, 12 Minn.L.Rev. 243.
Id., p. 218 (describing Lord Mansfield’s most important contribution to English law as "the creation of a comprehensive system of commercial law ...").
D’Antuono v. Service Road Corp., 789 F.Supp.2d 308, 329 (D.Conn. 2011) (observing that "California courts have tended to look upon arbitration agreements with disfavor ...").
Sutcliffe, D.O. v. Mercy Clinics, Inc., numerous cases "support [the] proposition that health-related services affect interstate commerce with regard to application of the FAA. These cases primarily involve agreements with hospitals, medical groups, and nursing homes." 856 N.W.2d 382 (Table) (Citations omitted.) The Sutcliffe court goes on to observe that "[i]n finding the requisite interstate commerce nexus was satisfied, all the courts relied on evidence from different types of information such as: acceptance of out-of-state and multi-state insurer reimbursements; purchase and receipt of goods, equipment, medication, and services from out-of-state vendors; out-of-state corporate offices; recruitment of physicians from out-of-state; service to out-of-state patients; and receipt of federal funds, such as Medicare reimbursements." Id. (Citations omitted.) As is the case here, the defendant in Sutcliffe did not provide evidence of these factors. Id. ("Evidence of these factors ... would have been helpful in determining the applicability of the FAA to this contract, but no such evidence was made part of [the] record"). Nevertheless, based on the fact that the amended operating agreement is one between parties from different states, and reflects a transaction involving interstate commerce as discussed above, the court finds that the arbitration provisions of the amended operating agreement are governed by the FAA.
DiNardo Seaside Tower, Ltd. v. Sikorsky Aircraft Corporation, 153 Conn.App. 10, 34, 100 A.3d 413 (2014). As the language of the amended operating agreement at issue is not ambiguous, the rule is inapplicable here.
e.g., Taylor v. Butler, 142 S.W.3d 277, 281 (2004).
Warbington Constr. v. Landmark, L.L.C., supra, 66 S.W.3d 856 ("Because this case clearly involves interstate commerce, the provisions of the Federal Arbitration Act, ... rather than Tennessee’s Uniform Arbitration Act ... apply to this appeal").
Mandell & Blau, M.D.’s, P.C. v. Hartford Healthcare Corporation, Superior Court, judicial district of Hartford, Complex Litigation Docket, Docket No. X03-CV-17-6074602 S, n.6 (June 19, 2017, Moll, J.) ("The court notes that "[a] § 52-409 order does not compel arbitration; rather, it merely stays the pending civil action until arbitration has been completed." [Emphasis in original] ).