# MYSTIC RETREAT MED SPA & WEIGHT LOSS CENTER v. ZELTIQ AESTHETICS LLC

> District Court, M.D. North Carolina · August 3, 2022

URL: https://www.frixlaw.com/law-library/cases/10254092

## Case

- **Court:** District Court, M.D. North Carolina
- **Decided:** August 3, 2022
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10254092

## How later opinions describe it (automated extraction)

- holding that “[l]eave to amend, however, should only be denied on the ground of futility when the proposed amendment is clearly insufficient or frivolous on its face”
- noting that “as under general principles of contract law, our task is to ‘give ordinary words their ordinary meanings.’” (quoting Internet East, Inc. v. Duro Communications, Inc., 553 S.E.2d 84, 87 (N.C. Ct. App. 2001)

## Opinion text

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA

MYSTIC RETREAT MED SPA & )
WEIGHT LOSS CENTER, and MISTY )
SINCLAIR, M.D., )
)
Plaintiffs, )
)
v. ) 1:21-cv-00515
)
ASCENTIUM CAPITAL LLC, ZELTIQ )
AESTHETICS LLC, and ALLERGAN )
USA, INC., )
)
Defendants. )

MEMORANDUM OPINION AND ORDER

THOMAS D. SCHROEDER, Chief District Judge.
This is an action involving a contract for weight loss
equipment. Defendants Zeltiq Aesthetics, Inc. (“Zeltiq”) and
Allergan USA, Inc. (“Allergan”) (collectively the “Allergan
Defendants”) move for leave to file an amended answer (Doc. 28)
and to stay proceedings and compel arbitration (Doc. 29).
Defendant Ascentium Capital, LLC (“Ascentium”) consents to the
Allergan Defendants’ motion for leave to file an amended answer.
(Doc. 28-3.) Plaintiffs Mystic Retreat Med Spa & Weight Loss
Center, PLLC, (“Mystic”) and Misty Sinclair, M.D., oppose both
motions.1 (Docs. 34, 35.) The Allergan Defendants filed a reply.

1 Ascentium also filed a response, clarifying that it did not agree to
arbitration with Plaintiffs. (Doc. 36.) Ascentium requests, should the
court grant the Allergan Defendants’ motion to stay proceedings and
compel arbitration, that the “Ascentium/Plaintiffs Claims should not be
stayed, should be severed from the claims between Plaintiffs and the
(Doc. 37.) For the reasons set forth below, the Allergan
Defendants’ motion to stay proceedings and compel arbitration
(Doc. 29) will be denied without prejudice, and the motion for

leave to file an amended answer (Doc. 28) will be granted.
I. BACKGROUND
The basic facts, as relevant to the motions before the court,
are as follows:
Zeltiq and Ascentium worked together to sell and finance the
purchase of medical devices designed to assist with weight loss.
(Doc. 7 ¶ 8.) On June 22, 2016, Sinclair and her business partner,
Marcia Ballard, met with Wes Lev, Zeltiq’s sales manager, to
execute a Master Sales Agreement (“MSA”) with Zeltiq2 for Mystic’s
purchase of CoolSculpting System equipment and services. (Doc.
29-3.) Lev presented Sinclair and Ballard with a single-page MSA
Sales Order. (Doc. 34-1 ¶ 13, Doc. 34-2 ¶ 12.) The bottom of the

Sales Order states:
The agreement between Customer and ZELTIQ Aesthetics
regarding the products described above (the ‘Master
Sales Agreement’) includes this Sales Order and the
attachments (A-C) hereto which are incorporated herein
in their entirety by this reference.

(Doc. 29-3.) However, Lev did not present Sinclair and Ballard
with any of these MSA attachments on June 22. (See Doc. 34-1

Allergan Defendants, and should be allowed to proceed forward in this
Court without delay.” (Id. at 5.)

2 Allergan USA, Inc. acquired Zeltiq in 2017. (Doc. 16 ¶ 5.)
¶¶ 13-16; Doc. 34-2 ¶¶ 12-13.) At the in-person meeting,
Plaintiffs made two handwritten changes to the Sales Order; first
to change the address to the new Mystic facility in Carthage, North

Carolina; and the second to note $1,000 in marketing development
funds that Zeltiq was providing. (Doc. 34-1 ¶ 14, Doc. 29-3.)
Lev and Sinclair both initialed and dated the two changes, and
Sinclair signed the MSA Sales Order on behalf of Mystic. (Doc.
29-3.) The next day, on June 23, Lev sent Sinclair an email with
a copy of the executed single-page MSA Sales Order attached. (Doc.
34-1 ¶ 18; Doc. 34-2 ¶ 16.)
In support of their motion to compel arbitration, the Allergan
Defendants have filed a copy of an email they contend Lev sent to
Sinclair and Ballard at 8:14 p.m. on June 19, 2016, three days
before their in-person meeting, which attached a blank copy of the
MSA Sales Order with Attachments A through C. (Doc. 29-2.)

However, these Defendants have not filed an affidavit to
authenticate this email. Plaintiffs also claim they did not see
Lev’s June 23, 2016 email attaching the signed MSA Sales Order
until the pendency of this litigation. (Doc. 34-1 ¶ 18; Doc. 34-
2 ¶ 16.) Plaintiffs state under oath that the first time they saw
the MSA attachments was during the pendency of this litigation.
(See Doc. 34-1 ¶ 16; Doc. 34-2 ¶¶ 14-15.)
Attachment A purports to contain, among other terms, the
following:
APPLICABLE LAW; DISPUTE RESOLUTION. The laws of the
State of California govern this agreement without regard
to conflict of laws principles or any other principles
that would result in the application of a different body
of law. . . . Any controversy or claim arising out of
or relating to this Agreement, or its breach, shall be
subject to non-binding mediation prior to binding
arbitration in Alameda County, California under the
then-current Commercial Arbitration Rules of the
American Arbitration Association by one arbitrator
appointed in accordance with such Rules. . . .

(Doc. 29-1 at 5.)
As demand for the CoolSculpting System declined, Plaintiffs
refused to make additional payments to Defendants and sought to
return the device and terminate the business relationship.
(Doc. 7 ¶¶ 25-26.) Plaintiffs allege Ascentium took possession of
the device but wrongfully demanded the balance due under the
equipment financing agreements. (Id. ¶¶ 27, 31.)
On May 10, 2021, Plaintiffs filed their complaint against
Defendants in The General Court of Justice, Superior Court
Division, in Moore County, North Carolina. (Doc. 7.) Ascentium’s
counsel accepted service of the complaint on June 7, 2021 (Doc. 1-
1 at 15), and on June 23 the Allergan Defendants, with Ascentium’s
consent, timely filed a notice of removal in this court. (Doc. 1
¶ 8.) On January 3, 2022, the Allergan Defendants moved for leave
to file an amended answer to add an arbitration defense and to
change the name of “Zeltiq Aesthetics, LLC” to “Zeltiq Aesthetics,
Inc.” (Doc. 28), and they moved to stay proceedings and to compel
arbitration (Doc. 29).
II. ANALYSIS
A. Legal Standard
When presented with a question as to whether parties are

required to arbitrate a dispute, the trial court is limited to
resolving the “gateway dispute” of whether the claims are
“arbitrable.” Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79,
84 (2002); Peabody Holding Co., LLC v. United Mine Workers of
America, International Union, 665 F.3d 96, 104 (4th Cir. 2012).
Here, the parties do not dispute that the court is the proper forum
to determine whether the dispute is arbitrable, nor do the relevant
agreements contain “clear and unmistakable” language requiring
that an arbiter make this determination. Peabody, 665 F.3d at
102-03. Thus, the court must determine whether the dispute is
arbitrable.
The Federal Arbitration Act (“FAA”), 9 U.S.C. §§ 1–16,

establishes “a liberal federal policy favoring arbitration”
agreements. Moses H. Cone Memorial Hospital v. Mercury
Construction Corp., 460 U.S. 1, 24 (1983).3 “When parties have
entered into a valid and enforceable agreement to arbitrate their
disputes and the dispute at issue falls within the scope of that
agreement, the FAA requires federal courts to stay judicial

3 Though Attachment A provides that disputes under the MSA are governed
by the laws of California (Doc. 29-1 at 5), the FAA preempts conflicting
state law. See Volt Info. Scis., Inc. v. Bd. of Tr. of Leland Stanford
Jr. Univ., 489 U.S. 468, 477 (1989).
proceedings, and compel arbitration . . . .” Murray v. United
Food & Commercial Workers International Union, 289 F.3d 297, 301
(4th Cir. 2002) (citations omitted); 9 U.S.C. §§ 3-4. However, “a

party cannot be required to submit to arbitration any dispute which
he has not agreed so to submit.” American Bankers Insurance Group
v. Long, 453 F.3d 623, 626–27 (4th Cir. 2006) (citation omitted).
As such, the court must determine whether parties have a valid and
enforceable agreement to arbitrate. Berkeley County School
District v. Hub International Limited, 944 F.3d 225, 234 (4th Cir.
2019).
The party seeking to compel arbitration must establish an
agreement to arbitrate. See In re Mercury Construction Corp.,
656 F.2d 933, 939 (4th Cir. 1981), aff’d sub nom. Moses, 460 U.S.
1; see Adkins v. Labor Ready, Inc., 303 F.3d 496, 500–01 (4th Cir.
2002) (requiring litigant seeking to compel arbitration to

demonstrate “a written agreement that includes an arbitration
provision which purports to cover the dispute”). A court may order
arbitration of a dispute only where it is satisfied that the
parties entered into an agreement to arbitrate it. Granite Rock
Co. v. International Brotherhood of Teamsters, 130 S. Ct. 2847,
2855-56 (2010) (citing First Options of Chicago, Inc. v. Kaplan,
514 U.S. 938, 943 (1995)). The party seeking to compel arbitration
must demonstrate: “(1) the existence of a dispute between the
parties, (2) a written agreement that includes an arbitration
provision which purports to cover the dispute, (3) the relationship
of the transaction, which is evidenced by the agreement, to
interstate or foreign commerce, and (4) the failure, neglect or

refusal of the defendant to arbitrate the dispute.” American
General Life & Accident Insurance Co. v. Wood, 429 F.3d 83, 87
(4th Cir. 2005) (quoting Adkins, 303 F.3d at 500-01). In this
case, Plaintiffs challenge only the presence of the second element,
arguing that the parties never entered into a written agreement to
arbitrate any dispute over the MSA. (Doc. 34.)
“Arbitration is ‘a matter of consent, not coercion,’ and
federal arbitration policy does not alter that maxim.” Raymond
James Financial Services, Inc. v. Cary, 709 F.3d 382, 385 (4th
Cir. 2013) (quoting Volt Information Sciences, Inc. v. Board of
Trustees of Leland Stanford Junior University, 489 U.S. 468, 479
(1989)). The Fourth Circuit has recognized that “the ‘touchstones

of arbitrability analysis’ are the ‘twin pillars’ of the parties’
‘consent and intent’ to arbitrate.” Id. at 385-86 (quoting
Peabody, 665 F.3d at 103). While the court must resolve any
ambiguity regarding the scope of the arbitral issues in favor of
arbitration, Moses, 460 U.S. at 24-25; Wachovia Bank National Ass’n
v. Schmidt, 445 F.3d 762, 767 (4th Cir. 2006), the question of the
parties’ intent does not enjoy any presumption favoring
arbitration, First Options of Chicago, Inc. v. Kaplan, 514 U.S 938,
944 (1995).
To determine whether the parties agreed to arbitrate a
particular dispute, the court must consider relevant state law
principles governing contract formation. Hill v. Peoplesoft USA,

Inc., 412 F.3d 540, 543 (4th Cir. 2005); see Perry v. Thomas,
482 U.S. 483, 492 n.9 (1987). This inquiry is not confined to
defects in contract formation, but also includes “such grounds as
exist at law or in equity for the revocation of any contract.”
Hooters of America, Inc. v. Phillips, 173 F.3d 933, 938 (4th Cir.
1999) (citation omitted). In a case premised upon diversity
jurisdiction, a federal court applies the law of the forum state.
Arthur Anderson LLP v. Carlisle, 556 U.S. 624, 630–31 (2009); see
also Cara’s Notions v. Hallmark Cards, Inc., 140 F.3d 566, 569
(4th Cir. 1998). Here, the parties agree that North Carolina law
applies to the question of contract formation. (See Doc. 30 at 5;
Doc. 34 at 6.)

In determining if an agreement to arbitrate exists, North
Carolina law instructs “the court to examine the language of the
contract itself for indications of the parties’ intent . . . .”
State v. Philip Morris, USA, Inc., 618 S.E.2d 219, 225 (N.C. 2005).
The parties’ intent is determined in light of the “contract as a
whole.” Id. “Whenever a court is called upon to interpret a
contract its primary purpose is to ascertain the intention of the
parties at the moment of its execution.” Lane v. Scarborough,
200 S.E.2d 622, 624 (N.C. 1973). When construing contractual
terms, a contract’s plain language controls. See DeLoach v.
Lorillard Tobacco Co., 391 F.3d 551, 558 (4th Cir. 2004) (noting
that “as under general principles of contract law, our task is to

‘give ordinary words their ordinary meanings.’” (quoting Internet
East, Inc. v. Duro Communications, Inc., 553 S.E.2d 84, 87 (N.C.
Ct. App. 2001)); Walton v. City of Raleigh, 467 S.E.2d 410, 411
(N.C. 1996) (“If the plain language of a contract is clear, the
intention of the parties is inferred from the words of the
contract.”).
The standard for deciding a motion to compel arbitration is
similar to that applied to a motion for summary judgment.
Berkeley, 944 F.3d at 234; Adams v. Citicorp Credit Services, Inc.,
93 F. Supp. 3d 441, 445 (M.D.N.C. 2015). A party seeking to compel
arbitration bears the initial burden of demonstrating the absence
of any genuine dispute of material fact as to the parties’

agreement to arbitrate. See Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986); see also Dillon v. BMO Harris Bank, N.A., 787
F.3d 707, 713 (4th Cir. 2015). Once the moving party has met its
burden, the nonmoving party must affirmatively demonstrate with
specific evidence that there is a genuine dispute of material fact
requiring trial. Matsushita Electric Industry Co. v. Zenith Radio
Corp., 475 U.S. 574, 585–87 (1986); see Drews Distributing, Inc.
v. Silicon Gaming, Inc., 245 F.3d 347, 352 n.3 (4th Cir. 2001).
In determining whether arbitration should be compelled, the court
is entitled to consider materials beyond the complaint and its
supporting documents. Berkeley, 944 F.3d at 234. If there are
unresolved questions of material fact that prevent the court from

deciding the arbitrability issue, the court shall hold “an
expeditious and summary hearing.” Moses H. Cone, 460 U.S. at 22;
9 U.S.C. § 4.
B. Motion to Compel Arbitration
The Allergan Defendants argue that Plaintiffs’ dispute
arising under the MSA must be arbitrated and that the court should
therefore stay this lawsuit pursuant to the FAA, pending the
resolution of arbitration. (Doc. 30.) In response, Plaintiffs
contend the Allergan Defendants “have failed to submit competent,
admissible evidence in support of the agreement to arbitrate”
(Doc. 34 at 5) and that, as an electronic document, the attachments
to the MSA do not satisfy North Carolina’s statute of frauds (id.

at 5-11 (citing the North Carolina Uniform Electronic Transactions
Act, N.C. Gen. Stat. Article § 66-311 et. seq.)). Plaintiffs
further contend that their claims against the Allergan Defendants
must proceed because the arbitration clause is not incorporated
into the signed MSA Sales Order, as there is a lack of mutual
assent. (Id. at 11-14.) The question, therefore, is whether there
is an absence of any genuine dispute that the parties agreed to
the arbitration clause contained in the MSA attachments.
In support of its position that there is a written arbitration
agreement, the Allergan Defendants proffer three pieces of
evidence: an unsigned copy of the MSA with attachments (Doc. 29-
1); the June 19, 2016 email from Lev to Sinclair and Ballard, with

the MSA attachments that include the arbitration provision (Doc.
29-2); and the June 22, 2016 signed single-page MSA Sales Order,
which includes the statement that “the attachments (A-C) hereto
which are incorporated herein in their entirety by this reference”
(Doc. 29-3).
In response, Plaintiffs argue that they did not enter into
the terms and conditions contained in the MSA attachments, and
thus the arbitration provision, because “Lev never presented
Plaintiffs with a paper copy of [the MSA attachments] in the
document he presented for signature, nor did he ever mention it.”
(Doc. 34 at 12–13 (referring to the full MSA contained in the June
19, 2016 email as “the MSA.pdf file”).) Plaintiffs also contend

that the record “is bereft of evidence that Plaintiffs knew about
and intended to agree to the terms in the [MSA attachments]” as
the Allergan Defendants have failed to lay a foundation for their
proffered evidence. (Id.) Consequently, Plaintiffs argue, the
Allergan Defendants have failed to present evidence that the
parties entered into the MSA beyond the single-page MSA Sales
Order, and thus did not enter into the agreement to arbitrate
contained within Attachment A of the MSA attachments. (Id. at 13-
14.)
Additionally, Plaintiffs maintain that, particularly in light
of the declarations of Sinclair and Ballard, the Allergan
Defendants have failed to meet their burden to demonstrate

Plaintiffs’ consent to the arbitration clause. (See Docs. 34-1,
34-2.) In her declaration, Sinclair states that Lev only presented
her with the single-page MSA Sales Order at the in-person meeting
on June 22, 2016. (Doc. 34-1 ¶¶ 12-15.) She states that she did
not see the MSA attachments until the pendency of this litigation
and that she did not intend to agree to them. (Id. ¶¶ 16-17.)
Further, in Ballard’s declaration, she also states that Lev only
presented her with the single-page MSA Sales Order at the in-
person meeting on June 22, 2016. (Doc. 34-2 ¶¶ 11-13.) She states
that she was unaware of, and thus did not intend to agree to, the
terms of the MSA attachments, and that she has “never seen” them.
(Id. ¶¶ 14-15.)

In reply, the Allergan Defendants argue that because their
emails and attachments are “relevant, credible, and highly
probative, they are admissible for purposes of deciding this
motion.” (Doc. 37 at 3-5 (citing Fed. R. Evid. 402).) They
contend that the terms of the MSA attachments, including the
arbitration clause, “were explicitly incorporated by reference
into the MSA Sales Order.” (Id. at 8.) They further argue that
Plaintiffs’ “failure to read the full terms of the MSA before
signing does not negate Plaintiffs’ assent to the arbitration
provision.” (Id. at 9-10; see also id. at 10 n.5 (arguing that
Plaintiffs’ declarations “do not establish lack of mutual assent
simply because Plaintiffs failed to read their emails”)).

On the present record, Plaintiffs are correct that the
Allergan Defendants have failed to produce admissible evidence
that there was an arbitration agreement. “The initial burden on
a proponent of an arbitration agreement is not high. But [Federal]
Rule [of Evidence] 901 does require that the proponent submit ‘a
satisfactory foundation’ from which a jury could ‘reasonably find
that the evidence is authentic.’” Dillon v. BMO Harris Bank, N.A.,
173 F. Supp. 3d 258, 269 (M.D.N.C. 2016) (quoting United States v.
Hassan, 742 F.3d 104, 133 (4th Cir. 2014)). Defendants have not
submitted a declaration, or other proper basis, to authenticate
their proffered documents. See Fed. R. Evid. 901 (“To satisfy the
requirement of authenticating or identifying an item of evidence,

the proponent must produce evidence sufficient to support a finding
that the item is what the proponent claims it is.”). Rather, they
simply rely on their statements in their briefing. Accordingly,
the court cannot determine whether the items on which the Allergan
Defendants rely are “what the proponent claims [they] [are].” Id.
Thus, the Allergan Defendants have not met their burden to proffer
credible, admissible evidence of an arbitration agreement.
Even were the court to consider the Allergan Defendants’
evidence, Plaintiffs have “unequivocally den[ied] that there was
an arbitration agreement and produce[d] evidence to substantiate
the denial.” Dillon, 173 F. Supp. 3d at 269 (citing Drews
Distributing, 245 F.3d at 352 n.3). Indeed, Sinclair and Ballard

both state under oath that Lev presented them with only the single-
page MSA Sales Order at their in-person meeting on June 22, 2016,
and that they were unaware of, and thus did not intend to agree
to, the terms of the MSA attachments. (Doc. 34-1 ¶¶ 12-17; Doc.
34-2 ¶¶ 11-15.) While the Allergan Defendants present a copy of
Lev’s June 19, 2016 email (with the MSA attachments) to Sinclair
and Ballard (Doc. 29-2), there is no evidence that Sinclair or
Ballard received, read, or were even aware of this email or its
contents. Under North Carolina law, the MSA Sales Order’s
incorporation by reference of the MSA attachments is insufficient
to establish that Plaintiffs agreed to arbitrate — especially where
there is doubt that the Plaintiffs ever saw or were aware of the

MSA attachments. See Sciolino v. TD Waterhouse Investor Services,
Inc., 562 S.E.2d 64, 65-67 (N.C. Ct. App. 2002) (finding no
evidence of mutual assent to arbitrate where plaintiffs signed an
application in which they indicated that they “read, understand,
and agree to be bound by the terms of the attached Customer
Agreement” enclosed, but there was no customer agreement attached
to the application, plaintiffs denied a customer agreement was
provided, and the customer agreements presented by defendants at
trial did not bear any indication that plaintiffs had ever seen
the document); Evangelistic Outreach Center v. General Steel
Corp., 640 S.E.2d 840, 843-45 (N.C. Ct. App. 2007) (affirming
trial court’s denial of a motion to compel arbitration and finding

that defendant had not carried its burden of showing that an
agreement’s second page, which contained an arbitration provision,
had been faxed to or received by the plaintiff, who claimed he
received and signed only the first page, despite the inclusion of
a notation on the first page that the agreement was subject to
“terms and conditions on the face and reverse hereof”); Kennedy v.
Branch Banking & Trust Co., 600 S.E.2d 520 (N.C. Ct. App. 2004)
(same, where plaintiff executed a “signature card” incorporating
by reference an agreement to arbitrate but denied receiving a copy
of the agreement to arbitrate until after the commencement of his
lawsuit); see also Dillon, 173 F. Supp. 3d at 266-67, 267 n.6
(collecting cases).

For these reasons, the Allergan Defendants have failed to
establish the absence of a genuine dispute that Sinclair and Mystic
agreed to be bound by the arbitration provision. Their motion to
stay proceedings and compel arbitration will accordingly be denied
without prejudice.
C. Motion to Amend Answer
The Allergan Defendants also move for leave to file an amended
answer. (Doc. 28.) The amendment merely seeks to correct the
corporate status of Defendant Zeltiq from an LLC to a corporation
and to amend the third affirmative defense to clarify that reliance
on the terms of the MSA “includ[es] the arbitration provision.”
(Doc. 28-1 at 8.)

Federal Rule of Civil Procedure 15(a)(2) provides that “a
party may amend its pleading only with the opposing party’s written
consent or the court’s leave. The court should freely give leave
when justice so requires.” While district courts have discretion
to grant or deny a motion to amend, the Fourth Circuit has
“interpreted Rule 15(a) to provide that leave to amend a pleading
should be denied only when the amendment would be prejudicial to
the opposing party, there has been bad faith on the part of the
moving party, or the amendment would have been futile.” Laber v.
Harvey, 438 F.3d 404, 426 (4th Cir. 2006); see also Foman v. Davis,
371 U.S. 178, 182 (1962) (holding leave should be “freely given”
absent “any apparent or declared reason – such as undue delay, bad

faith or dilatory motive on the part of the movant, repeated
failure to cure deficiencies by amendments previously allowed,
undue prejudice to the opposing party by virtue of allowance of
the amendment, futility of amendment, etc.”).
The Allergan Defendants filed their motion for leave to file
an amended answer on January 3, 2022. (Doc. 28.) Plaintiffs do
not claim, nor is there evidence in the record, that the Allergan
Defendants seek leave to amend their answer in bad faith.
Therefore, the motion should be granted unless it presents unfair
prejudice to Plaintiffs or if amendment would be futile. “Whether
an amendment is prejudicial will often be determined by the nature
of the amendment and its timing.” Laber, 438 F.3d at 427. An

amendment is not prejudicial if “it merely adds an additional
theory of recovery to the facts already pled.” Id.; see
also Hatteras/Cabo Yachts, LLC v. M/Y EPIC, 2020 WL 1668045, at *3
(E.D.N.C. 2020) (holding that undue prejudice justifies denying a
motion to amend “if the amendment would require the non-moving
party to expend significant additional resources to conduct
discovery and prepare for trial, or would significantly delay the
resolution of the dispute” (citation omitted)). “It is settled
that ‘if the proposed change . . . advances a claim or defense
that is legally insufficient on its face, the court may deny leave
to amend.’” Williams v. Little Rock Municipal Water Works,
21 F.3d 218, 225 (8th Cir. 1994) (citing Charles A. Wright & Arthur

Miller, Federal Practice & Procedure: Civil, § 1487, at 637
(1991)); see Joyner v. Abbott Labs, 674 F. Supp. 185, 190 (E.D.N.C.
1987) (“When a proposed amendment is frivolous or advances a claim
or defense that is legally insufficient on its face, the motion to
amend should be denied.”).
Neither party claims any additional discovery is needed to
address the Allergan Defendants’ proposed amended answer including
an arbitration defense. Cf. Laber 438 F.3d at 427. In short,
there is no indication that granting the Allergan Defendants’
motion for leave to file an amended answer would cause delay, and,
even if it would, “[d]elay alone, however, is an insufficient
reason to deny . . . a motion to amend.” Id. Additionally, even

though the court has found that the Allergan Defendants have failed
to establish that Plaintiffs agreed to arbitration when they signed
the single-page MSA Sales Order, their amendment pleading an
arbitration defense would not be futile as Defendants may “cure
the evidentiary deficiencies” presently before the court and move
to compel arbitration again after having done so unsuccessfully.
See BMO Harris Bank, 787 F.3d at 715-16 (explaining that “no
authority — not the FAA, the Federal Rules of Civil Procedure, or
any other source of law of which we are aware — limits a party to
only one motion under §§ 3 or 4 of the FAA”); see also Johnson v.
Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir. 1986) (holding that
“[l]eave to amend, however, should only be denied on the ground of

futility when the proposed amendment is clearly insufficient or
frivolous on its face”). Thus, the Allergan Defendants’ motion to
file an amended answer will be granted.
III. CONCLUSION
For the reasons stated,
IT IS THEREFORE ORDERED that the Allergan Defendants’ motion
stay proceedings and compel arbitration (Doc. 29) is DENIED without
prejudice.
IT IS FURTHER ORDERED that the Allergan Defendants’ motion
for leave to file an amended answer (Doc. 28) is GRANTED, and
Defendants are DIRECTED to file their amended answer forthwith.

/s/ Thomas D. Schroeder
United States District Judge

August 3, 2022

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10254092. Public record. Not legal advice.