# HEALTHPLANCRM, LLC v. AVMED, INC.

> District Court, W.D. Pennsylvania · April 28, 2020

URL: https://www.frixlaw.com/law-library/cases/10415554

## Case

- **Court:** District Court, W.D. Pennsylvania
- **Decided:** April 28, 2020
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
HEALTHPLANCRM, LLC d/b/a )
)
CAVULUS, ) 2:19-cv-1357-NR
)

Plaintiff, )
)
v. )
)

)
AVMED, INC. d/b/a AVMED )
HEALTH PLANS and NTT DATA )
)
SERVICES, LLC,
)
)
Defendants. )
)
OPINION
J. Nicholas Ranjan, United States District Judge
Plaintiff Cavulus is in the business of licensing cloud-based “customer
relation management” software to insurance companies managing Medicare
Advantage plans. In this lawsuit, Cavulus seeks to compel a licensee
(Defendant AvMed) and sub-licensee (Defendant NTT) to arbitrate trade-
secret claims arising from their use of Cavulus’s software. Cavulus argues that
AvMed and NTT are bound by its License and End-User Agreements, which
each include an identical arbitration clause. Both Defendants oppose
Cavulus’s motion, but for different reasons. AvMed admits that it is bound by
the Agreements but argues that this Court lacks personal jurisdiction over it
and that the parties delegated questions of arbitrability to the arbitrator. NTT,
on the other hand, argues that it never contracted with Cavulus, and thus
never agreed to arbitrate anything at all.
After carefully considering the parties’ arguments, the Court largely
agrees with Cavulus. First, the Court can exercise personal jurisdiction over
AvMed. By agreeing to arbitrate disputes in Allegheny County, AvMed has
waived any jurisdictional objection to litigating disputes related to the parties’
arbitration agreement in this District. Second, both AvMed and NTT are
bound by the arbitration clause in the Agreements. AvMed is bound because
it negotiated and entered into the Agreements and does not dispute their
validity. NTT, on the other hand, is bound by equitable estoppel and also
because it independently accepted the End-User Agreement by accessing and
using Cavulus’s software in the face of conspicuous browsewrap language.
On one issue, however, AvMed makes a good point—the parties’
incorporation of AAA arbitration rules in their contract is, based on the precise
contractual language here, a “clear and unmistakable” delegation of
arbitrability issues to the arbitrator. While the Court rejects the notion that
incorporation of AAA rules always operates as a “clear and unmistakable”
delegation of that authority, the explicit language of the parties’ contract
leaves no room for ambiguity here. AvMed must raise any objections to the
arbitrability of Cavulus’s claims in arbitration.
Thus, the Court holds that a valid arbitration agreement exists between
the parties and will, therefore, grant Cavulus’s motion; except that the
arbitrator, not the Court, must decide any objections to the arbitrability of
specific claims.
BACKGROUND
In September 2008, Cavulus and AvMed entered into a License
Agreement. [ECF 21 at ¶¶ 18-19 & Ex. 1 § 3]. NTT was not a party to the
Agreement and had no relationship with AvMed when the License Agreement
was executed. Cavulus and AvMed extended and amended the License
Agreement several times, until the last extended term expired on September
30, 2019. [ at ¶ 23 & Exs. 3, 4, 5].
Under the License Agreement, Cavulus granted AvMed a license to use
its “MedicareCRM” software platform for AvMed’s Medicare Advantage
business. [ at ¶¶ 13, 18-19]. Cavulus describes its software as a cloud-based
“customer relation management platform.” The License Agreement came with
a related “End-User Agreement,” attached to the License Agreement as Exhibit
A and incorporated-by-reference into that Agreement. [ at ¶ 18 & Ex. 1 §
1(a)]. Both the License and End-User Agreements included a section entitled
“Controlling Law; Arbitration,” which provided that Pennsylvania law would
govern the Agreements, and that any “dispute, claim or controversy of any kind
… shall be resolved exclusively by binding arbitration in Allegheny County,
Pennsylvania in accordance with the Commercial Arbitration Rules of the
American Arbitration Association.” [ at ¶¶ 22, 36, Ex. 1 § 11(e), Ex. 2 § 8].
This arbitration clause reads in full:
Controlling Law; Arbitration. This Agreement shall be governed
by and construed in accordance with the laws of the
Commonwealth of Pennsylvania without regard to its choice of law
provisions. Any dispute, claim or controversy of any kind arising
in connection with or relating to this Agreement or performance
hereunder shall be resolved exclusively by binding arbitration in
Allegheny County, Pennsylvania in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association then in effect, by one (1) arbitrator appointed in
accordance with said rules. Judgment on the award rendered by
the arbitrator may be entered into any court of competent
jurisdiction. Notwithstanding the foregoing, it is understood and
agreed that any breach of Section 7 of this Agreement by either
party will cause irreparable harm and damage to the non-
breaching party which may not adequately be compensated by
money damages and, therefore, the non-breaching party shall be
entitled to injunctive relief in addition to any other remedies
provided by law or in equity for any such breach.
[ at Exs. 1 § 11(e) & 2 § 8].
The arbitration clause contained in the End-User Agreement differs only
in that the last sentence refers to “any breach of Section 4 of this Agreement
by End-User,” [ at Ex. 2 § 8], rather than “Section 7 of this Agreement by
either party.” [ . at Ex. 1 § 11(e)].1
At some point in 2018, AvMed decided to replace Cavulus as its CRM
platform provider and contracted with another company, Salesforce, to provide
a replacement CRM product. [ at ¶ 25]. As part of this transition, AvMed
needed to transfer customer information stored on Cavulus’s platform to the
new Salesforce platform. [ at ¶ 27].
Typically, in such situations, Cavulus provides its customers with the
stored information in an electronic format requested by the customer. [ ].
Cavulus does not allow customers to discover, transfer, or export the “unique
characteristics of the Cavulus MedicareCRM platform.” [ ]. This time,
however, AvMed insisted on engaging NTT to transition its historical data. [
at ¶ 28]
To do so, it granted NTT a sublicense to access Cavulus’s software. [ ].
This sublicensing was contemplated by Section 1(a) of the License Agreement,
which authorized AvMed to “sub-license” use of Cavulus’s software to “its
employees, independent contractors or agents,” who the Agreement defines as
“End-Users.” [ at Ex. 1 § 1(a)]. The same provision specifies that such “End-
Users shall be bound for the benefit of [Cavulus] to the terms of the End-User

1 Notably, the reference to “Section 4” in the End-User Agreement is almost
certainly a typo, as the License Agreement makes clear that the final sentence
of this provision is intended to refer to the “Confidentiality” provision of the
Agreement, and Section 4 is a provision purporting to limit Cavulus’s liability
to its end-user. The analogous “Confidentiality” provision of the End-User
Agreement is Section 3. To the extent that this typo has any significance at
all, it would be only to arbitrability objections that, as discussed below, the
Court determines that the arbitrator must decide.
Agreement … by executing a ‘click-on’ version of the same agreement.” [ at
¶¶ 19-20].
On November 26, 2018, AvMed sent Cavulus a “Limited Letter of
Agency,” providing notice that it intended to authorize NTT to access Cavulus’s
software. [ at ¶ 29 & Ex. 6]. Specifically, the letter advised Cavulus that
NTT was “authorized to act on behalf of AvMed with regard to the products
and/or services that are owned, leased, or licensed by AvMed,” including
“supporting and operating the products and/or services provided to AvMed
from [Cavulus] … under the current agreement(s) … between [Cavulus] and
[AvMed].” [ at ¶ 29 & Ex. 6]. AvMed copied NTT’s “Senior IT Executive,”
Fouad Bensellam, and “Senior Business Development Executive,” Viji
Shankar, on its letter. [ at ¶ 31 & Ex. 6].
On March 11, 2019, NTT began accessing Cavulus’s software platform to
identify AvMed’s historical customer data and transfer it to Salesforce. [ at
¶ 32]. Between March 11, 2019 and June 12, 2019, NTT employees accessed
the Cavulus platform over 75 times. [ at ¶¶ 32, 35, Ex. 8]. Each time NTT
employees accessed the Cavulus software platform they were directed to a
secure log-in page, which required them to enter their individual user ID and
password to access the software. [ ].
The secure log-in page states: “Use of Cavulus constitutes acceptance of
the End User License Agreement.” [ at ¶ 34 & Ex. 7] (emphasis original).
Clicking on the “End User License Agreement” hyperlink takes the user to the
same End-User Agreement referenced in the AvMed License Agreement. [
at ¶ 35]. This language was displayed on the log-in page each time it was
visited and accessed by an NTT employee (or any other user). [ at ¶ 33].
And Cavulus’s software cannot be accessed without first visiting the log-in
page. [ at ¶ 34].
At some point, Cavulus “uncovered” NTT employees “reviewing the
platform to copy its customized and proprietary workflows and functionalities
and recreate them on a generalized CRM platform, such as Salesforce, for
AvMed or other clients.” [ECF 27 at p. 7; ECF 21 at ¶¶ 39-52]. After making
this discovery, Cavulus initiated AAA arbitration by filing a Demand for
Arbitration against AvMed and NTT on July 19, 2019. [ECF 21 at ¶ 55 & Ex.
9]. In its Demand, Cavulus sought relief for: (1) AvMed’s alleged breach of the
License Agreement and End-User Agreement; (2) NTT’s alleged breach of the
End-User Agreement; (3) AvMed and NTT’s alleged theft of Cavulus’s trade
secrets, and; (4) violations of the Pennsylvania Uniform Trade Secrets Act.
After NTT refused to participate in arbitration and AvMed raised an
objection to the arbitrability of Cavulus’s claims, Cavulus filed this suit to
compel arbitration in the Allegheny County Court of Common Pleas. [ at ¶¶
57-59]. AvMed and NTT jointly removed the case to this Court on October 21,
2019. [ECF 1]. Cavulus then filed an amended complaint on October 30, 2019
and, per this Court’s scheduling order, a motion to compel arbitration on
November 6, 2019. [ECF 21; ECF 23; ECF 25]. At the request of all parties,
the Court issued an order staying the arbitral proceedings, pending its decision
on Cavulus’s motion, on October 31, 2019. [ECF 24].
STANDARD OF REVIEW
This dispute concerns an arbitration agreement in an interstate
commercial contract, and so is governed by the Federal Arbitration Act.
, 401 F.3d 529, 532 (3d Cir. 2005). The
standard of review that applies to a motion to compel arbitration under the
FAA can differ depending on the circumstances.
In some cases, the arbitrability of claims is “apparent on the face of a
complaint or . . . documents relied upon in the complaint.”
, 618 F. App’x 114, 117 (3d Cir. 2015) (cleaned up). When it is,
“a motion to compel arbitration should be considered under a Rule 12(b)(6)
standard without discovery’s delay.”
, 716 F.3d 764, 776 (3d Cir. 2013) (quotations and citations
omitted).
But if, instead, a motion to compel arbitration “is not based on a
complaint with the requisite clarity to establish arbitrability,” or “the opposing
party has come forth with reliable evidence that is more than a naked assertion
. . . that it did not intend to be bound by the arbitration agreement, even though
on the face of the pleadings it appears that it did,” then “resort to discovery
and Rule 56 is proper.” , 618 F. App’x at 117 (cleaned up);
, 716 F.3d at 776.
Here, the parties disagree about what standard should apply. Cavulus
argues that the Court should apply a Rule 12(b)(6) standard because it “does
not need to consider facts outside of Cavulus’s First Amended Complaint, and
the documents relied upon therein, to determine that AvMed and NTT entered
into valid arbitration agreements with Cavulus, and that the relevant
agreements cover the scope of this dispute.” [ECF 27 at p. 11]. NTT suggests
that a Rule 56 standard should apply, because the complaint “do[es] not
provide a sufficient factual basis for determining whether the parties entered
into an agreement to arbitrate.” [ECF 28 at pp. 4-5]. And AvMed takes no
position either way. [ECF 29].
Further complicating things is the “reversed” posture of the parties in
this case. Unlike most cases, the plaintiff here is the one seeking to compel
arbitration. The Third Circuit’s cases discussing the appropriate standard of
review envision a scenario where a plaintiff files its claims in court and the
defendant responds with a motion to compel arbitration. Under that more
familiar scenario, applying a Rule 12(b)(6) standard of review to test the
plausibility of the allegations in the complaint is more natural.
But in this case, Cavulus is the plaintiff and also the one affirmatively
moving to compel; it filed this action in order to compel the case to arbitration.
Under this scenario, it seems odd to apply a Rule 12(b)(6) standard to accept
as true the allegations in the complaint of the party that is also moving to
effectively dismiss this action.
Nevertheless, the Court ultimately agrees with Cavulus—Rule 12(b)(6)
provides the correct standard, even in light of the somewhat unusual posture
of the parties. Cavulus’s arguments depend only on the allegations in its
complaint and the documents attached.
, 696 F. App’x 576, 579 (3d Cir. 2017) (“Those legal questions—
based entirely on documents attached to the complaint—do not require
additional discovery.”) (citation omitted).2 In response to Cavulus’s arguments,
NTT has not presented evidence or otherwise identified any relevant category
of information outside the record requiring the Court to pierce the pleadings in
order to determine whether a valid arbitration agreement exists. Nor has NTT
requested that the Court permit any discovery before deciding Cavulus’s
motion.
At most, NTT attaches a declaration from its in-house counsel,
Christopher Stidvent. [ECF 28 at Ex. 1]. In it, Mr. Stidvent asserts that NTT
“understands” that Cavulus alleges NTT employees “logged onto a software

2 Cavulus does attach a declaration from one of its counsel, Kevin J. English,
to its motion. [ECF 26]. But Cavulus asserts that the declaration “substantially
follows” the complaint, and is intended only to “add[] clarification.” [ECF 27
at p. 11 n. 1]. Upon review, the Court sees no need to consider or rely on that
declaration, as opposed to the complaint itself and the documents referenced
in and attached to the complaint, and so will disregard the declaration.
system provided by Cavulus.” [ ]. He then claims, based on his “familiar[ity]
with the rules concerning which [NTT] employees have the authority to sign
contracts,” that the employees identified by Cavulus as accessing its software
lack authority “to bind [NTT] to a software sub-license agreement or to an
arbitration agreement.” [ .].
True or not, this assertion does not raise any real fact issue that would
compel application of a summary-judgment standard—it is merely legal
argument repackaged in the form of a declaration. Indeed, the question of
whether NTT is bound to a contract by the actions of its employees turns on
agency law, rather than NTT’s assertion that it did not subjectively consider
those employees to have the legal authority to bind it. ,
840 F. Supp. 2d 287, 291 (D.D.C. 2012) (“[T]he court gives very little weight to
the defendant’s self-serving characterization of the parties’ legal relationship.”)
(citation omitted). Even so, the Court will err on the side of caution and assume
for purposes of this motion that the NTT employees who used Cavulus’s
software were ordinary, non-managerial employees with no special authority
to bind NTT beyond that which any ordinary employee or agent might have
under applicable law.
With that precaution, the Court will decide the motion “under a Rule
12(b)(6) standard without discovery’s delay.” , 716 F.3d at 776
(quotations and citations omitted). When applying a Rule 12(b)(6) standard to
a motion to compel arbitration, the Court considers “only the allegations in the
complaint, exhibits attached to the complaint, matters of public record, and
documents that form the basis of a claim.”
, 832 F. Supp. 2d 474, 482 (E.D. Pa. 2011) (quotations
and citations omitted). The Court will then “accept as true the factual
allegations set forth in the [c]omplaint” and “consider the substance of the
contracts that ostensibly compel arbitration.”
, 751 F.3d 165, 168 n.2 (3d Cir. 2014). If the existence of an agreement
to arbitrate is “apparent on the face of [the] complaint [or the] . . . documents
relied upon in the complaint,” the Court will grant Cavulus’s motion. ,
716 F.3d at 773-74 (quotations and citations omitted).
Finally, that the parties are basically “reversed” from the more common
posture does not change what standard applies. That is, Calvulus is the
plaintiff, but the Court can and will still apply a Rule 12(b)(6) standard. In a
certain sense, this is no different than deciding the present motion as if it were
a motion for judgment on the pleadings under Rule 12(c). The Court can accept
as true all allegations in all parties’ submissions, and, like a MJOP, apply a
Rule 12(b)(6) standard. , 598 F.3d 128,
134 (3d Cir. 2010) (“A motion for judgment on the pleadings based on the
defense that the plaintiff has failed to state a claim is analyzed under the same
standards that apply to a Rule 12(b)(6) motion.”) (citation omitted).3
DISCUSSION & ANALYSIS
Both AvMed and NTT oppose Cavulus’s motion, but for different reasons.
AvMed does not dispute that it “formed an agreement to arbitrate certain
disputes” with Cavulus. Instead, it argues that this Court lacks personal
jurisdiction and, alternatively, that the parties agreed that the arbitrator, not
the Court, would decide whether Cavulus’s claims fall within the scope of the

3 No matter if a Rule 56 or Rule 12(b)(6) standard applies, the substantive
analysis below would remain the same and the outcome would not change.
That is because: (1) the Court’s decision relies only on undisputed facts; (2)
NTT has not requested discovery or expressed any desire to present evidence,
other than the employee declaration attached to its briefing; and (3) despite
their disagreement on the appropriate standard to be applied, neither Cavulus
nor NTT argues that, or identifies any way in which, changing the applicable
standard of review would make a difference to their other arguments.
arbitration clause. NTT, for its part, raises the more fundamental objection
that it never contracted with Cavulus and, thus, did not agree to arbitrate
anything at all. The Court will address each Defendant’s arguments in turn,
starting with AvMed.
I. AvMed is bound to the arbitration agreement, but the
arbitrability of Cavulus’s claims is for the arbitrator to decide.
AvMed’s arguments implicate the Court’s power to AvMed’s
arbitration agreement with Cavulus; not the existence of the arbitration
agreement itself. For the following reasons, the Court finds that it can properly
exercise personal jurisdiction over AvMed, and thus enforce the arbitration
agreement, but that the parties agreed in their contract that the arbitrator
should decide if the specific claims asserted by Cavulus are arbitrable ( , fall
within the scope of the arbitration agreement).
A. AvMed consented to personal jurisdiction by agreeing to
arbitrate disputes in Allegheny County.
AvMed first argues that it is not subject to personal jurisdiction in
Pennsylvania because it has “no affiliation with Pennsylvania,” and personal
jurisdiction cannot rest “solely on the forum selection clause in the parties’
contract.” [ECF 29 at pp. 4, 6]. If AvMed were correct, the lack of personal
jurisdiction would require the Court to dismiss the case.
, 324 F. Supp. 3d 541, 549 (E.D. Pa. 2018) (“[A] court
must grant a defendant’s motion to dismiss if the court lacks personal
jurisdiction over the defendant.”). But AvMed is wrong.
“It is well established that personal jurisdiction is a waivable right.”
, 26 F. Supp. 3d 482,
485 (W.D. Pa. 2014) (Gibson, J.) (citation omitted). Relatedly, “a party may
consent to personal jurisdiction where such jurisdiction might otherwise not
exist in a number of ways.” , 96 F. Supp. 3d
428, 436 (D.N.J. 2015). These “ways” include “[a] variety of legal
arrangements” that “have been taken to represent express or implied consent
to the personal jurisdiction of the court.”
, 456 U.S. 694, 703 (1982). Of relevance here, “federal
courts have found such consent implicit in agreements to arbitrate.”
(citation omitted). And to that end, Cavulus argues that “by agreeing to
arbitrate in [Allegheny County],” AvMed “consented to the jurisdiction of
courts in that location for litigation of matters arising out of the arbitration.”
The Court agrees.
It is true that the Third Circuit has not “directly resolved the issue of
whether personal jurisdiction may be exercised over a defendant based on its
agreement to arbitrate all disputes in a specific venue.”
, No. 12-01392, 2012 WL 5906535, at *11 (W.D. Pa. Nov. 26,
2012) (Fischer, J.). It has, however, suggested in dicta that it would find
consent to personal jurisdiction inherent in an arbitration agreement; stating
that an agreement to arbitrate in a specific location “would probably—and
properly—be regarded as a waiver of objections to judicial jurisdiction [in that
location] as well.” , 229
F.3d 254, 261–62 (3d Cir. 2000).
The Courts of Appeals for at least the First, Second, Fifth, Sixth, and
Eighth Circuits have agreed; each holding that, by agreeing to arbitrate in a
particular forum, parties “impliedly consen[t] to the jurisdiction of courts in
that location for litigation of matters arising out of the arbitration given that
those courts have jurisdiction under the FAA … to compel arbitration.”
, 2012 WL 5906535, at *11 (citation omitted);
, 42 F. App’x 770, 771 (6th Cir. 2002);
, 270 F.3d 621, 624 (8th
Cir. 2001); ,
260 F.3d 453, 461 (5th Cir. 2001); , 85 F.3d 975,
979 (2d Cir. 1996);
, 774 F.2d 524, 527 (1st Cir. 1985).
The Court finds this authority persuasive, as has at least one other judge
in this District , 2012 WL 5906535, at *11;
, No. 13-1590, 2014 WL 1452322, at *6 n. 8 (W.D.
Pa. Apr. 14, 2014) (Fischer, J.) (interpreting as standing for the
“principle that a party to . . . an arbitration agreement necessarily consents to
the personal jurisdiction of the District Court nearest to the stated location of
the arbitration for cases arising out of the parties’ arbitration, such as a motion
to compel arbitration and/or to enforce an arbitration award.”). Indeed, as the
Eighth Circuit observed in , “if the court in the selected
forum did not have personal jurisdiction to compel arbitration, the agreement
to arbitrate would be effectively unenforceable, contrary to the strong national
policy in favor of arbitration.” 270 F.3d at 624.
That is because Section 4 of the FAA provides that, when a petition to
compel arbitration is granted, the arbitration “hearing and proceedings . . .
shall be within the district in which the petition for an order directing such
arbitration is filed.” 9 U.S.C. § 4. Most courts interpreting this language have
inferred from it that “where the parties have agreed to arbitrate in a particular
forum only a district court in that forum has jurisdiction to compel arbitration
under [Section] 4.” , 414 F.3d 1214, 1219–20
(10th Cir. 2005) (collecting cases);
, 173 F. App’x 123, 128 (3d Cir. 2006) (“[T]he majority of district
courts … have held that they lacked authority to compel arbitration at all, even
in their own districts, when [an] agreement specifies that arbitration is to take
place in a different venue.”). In other words, where contracting parties have
agreed to arbitrate in a particular location, jurisdiction to enforce that
agreement is likely to either exist in the district encompassing that location or
not at all.
Given these considerations, this Court sees no reason to diverge from the
broad, judicial consensus that an agreement to arbitrate in a particular forum
implies consent to the jurisdiction of the corresponding district court—though
only for all “cases arising out of the parties’ arbitration, such as a motion to
compel arbitration and/or to enforce an arbitration award.” , 2014
WL 1452322, at *6 n.8.
AvMed’s main argument against enforcement of a forum-selection clause
is that such a clause, standing alone, isn’t enough to confer personal
jurisdiction. [ECF 29 at pp. 5-7]. AvMed, citing the Supreme Court’s decisions
in and , argues that “other relevant factors”
must also be considered, such as the burden to AvMed of litigating away from
home. [ at p. 6]. But that’s not quite right.
and stand for the proposition, in
part, that a contractual relationship alone is insufficient to create minimum
contacts.
, 137 S. Ct. 1773, 1783 (2017) (“The bare fact that BMS
contracted with a California distributor is not enough to establish personal
jurisdiction in the State.”); , 471 U.S. 462, 478
(1985) (“If the question is whether an individual’s contract with an out-of-state
party alone can automatically establish sufficient minimum contacts in the
other party’s home forum, we believe the answer clearly is that it cannot.”).
So, as applied here, those decisions hold that just because AvMed entered into
the License Agreement with Cavulus (a Pennsylvania-based company), that
alone doesn’t confer personal jurisdiction. But that’s materially different than
the current situation where the contract has a forum-selection clause, and in
that contractual clause, a party (AvMed) specifically consents to or waives
objections to personal jurisdiction.
The Supreme Court long ago recognized that such a forum-selection
clause, standing alone, satisfies due process and creates personal jurisdiction.
, 471 U.S. at 473 n.14 (“We have noted that, because the
personal jurisdiction requirement is a waivable right, there are a variety of
legal arrangements by which a litigant may give express or implied consent to
the personal jurisdiction of the court. For example, particularly in the
commercial context, parties frequently stipulate in advance to submit their
controversies for resolution within a particular jurisdiction. Where such
forum-selection provisions have been obtained through freely negotiated
agreements and are not unreasonable and unjust, their enforcement does not
offend due process.”) (cleaned up). The burden to AvMed and the traditional
personal-jurisdiction considerations are irrelevant when a party has consented
to jurisdiction in a forum based on a forum-selection clause. And that consent
is what “federal courts have found … implicit in agreements to arbitrate.”
, 456 U.S. at 703.
But even if this Court were to consider the burden to AvMed, it is unclear
what burden it really faces, beyond what it has already faced ( ., resisting a
motion to compel arbitration, which is now water under the bridge). Cavulus
does not assert any substantive claims against AvMed; it seeks only to compel
AvMed to arbitrate claims in Allegheny County (as AvMed admits it agreed to
do). There will be no additional litigation in this case after today. As a result,
even considering the burden to AvMed, the Court finds that AvMed faces no
such ongoing burden and that it has necessarily consented to personal
jurisdiction in the Western District of Pennsylvania for all cases “arising out
of the parties’ arbitration,” including this one. , 2014 WL 1452322,
at *6 n.8.
B. The parties “clearly and unmistakably” delegated
questions of arbitrability to the arbitrator.
AvMed’s second argument is that the Court may not determine whether
Cavulus’s claims fall within the scope of the arbitration clause, because the
parties delegated questions of whether particular claims are arbitrable to their
chosen arbitrator. [ECF 29 at pp. 7-11]. AvMed says they did so by agreeing,
in Section 8 of the License Agreement and Section 8(b) of the End-User
Agreement, that their arbitration will take place “in accordance with” the
AAA’s “Commercial Arbitration Rules.” [ at p. 9]. According to AvMed, the
incorporation of AAA rules constitutes implicit agreement to delegate
arbitrability questions to the arbitrator, because those rules provide that the
arbitrator “shall have the power to rule on his or her own jurisdiction, including
any objections with respect to the existence, scope, or validity of the arbitration
agreement or to the arbitrability of any claim or counterclaim.” [ .] (citing
AAA Commercial Arbitration Rule R-7(a) (2013),
www.adr.org/commercial).
AvMed has made clear that it wishes to argue, to the arbitrator, that
Cavulus’s claims are not arbitrable, including that Cavulus’s request for
injunctive relief falls outside the scope of the arbitration clause. Though
AvMed does not preview its arguments in any detail, those details don’t matter.
For this motion, the Court is concerned only with the threshold question of who
must decide whether Cavulus’s claims are arbitrable—the arbitrator or the
Court? Based on the precise language of the contract here, the Court agrees
with AvMed that the arbitrator must decide.
Generally, there is a presumption that courts decide questions related to
arbitrability— , whether a certain dispute falls within the scope of an
arbitration clause. , 605 F.3d 172, 187 (3d
Cir. 2010) (“[T]he general rule is that questions of arbitrability are for the court
to resolve . . .”). Parties can agree to delegate this decision to an arbitrator
instead, but because of the presumption, the delegation must be “clear and
unmistakable.” , 761 F.3d 326, 335 (3d
Cir. 2014) (“It is presumed that courts must decide questions of arbitrability
unless the parties clearly and unmistakably provide otherwise.”) (cleaned up).
In other words, if the contract leaves any doubt about the parties’ intent, the
Court decides the arbitrability issue.
The Third Circuit has described this “clear and unmistakable” standard
as “onerous,” and required an “express” and “unambiguous” expression of
intent to arbitrate arbitrability in order to satisfy it.
, 809 F.3d 746, 753 (3d Cir. 2016).
Indeed, the word “onerous” appears 14 times throughout the Third Circuit’s
opinion in . So, the question here is whether the
incorporation by reference of AAA arbitration rules is a sufficiently “clear and
unmistakable” delegation to meet that “onerous” test.
Most courts have found that it is. , 941
F.3d 859, 866 (6th Cir. 2019);
, 921 F.3d 522, 538 (5th Cir. 2019).4 In general, these courts

4 , No. 19-273, 2019 WL 2563738, at *4
(E.D. Pa. June 20, 2019); , No. 18-1776,
2019 WL 1454953, at *2 (D. Del. Apr. 2, 2019);
have reasoned that incorporation of AAA commercial rules by reference reflects
a “clear and unmistakable” delegation of arbitrability questions to the
arbitrator, because AAA Commercial Rule 7 purports to give the arbitrator the
“power” to decide his or her own jurisdiction. , 921 F.3d
at 537 (“One such rule is Rule 7(a) of the American Arbitration Association’s
(‘AAA’) Commercial Arbitration Rules. Rule 7(a) provides that ‘[t]he arbitrator
shall have the power to rule on his or her own jurisdiction, including any
objections with respect to the existence, scope, or validity of the arbitration
agreement or to the arbitrability of any claim or counterclaim.’”).
What’s troubling to the Court, however, is that many of these decisions
simply state, without much analysis, that incorporation of AAA rules is a
sufficiently “clear” delegation because that is the majority view.
, 2011 WL 3423081, at *3 (“The prevailing rule across
jurisdictions is that incorporation by reference of rules granting the arbitrator
the authority to decide questions of arbitrability—especially the American
Arbitration Association ‘AAA’ rules—is clear and unmistakable evidence that
the parties agreed to submit arbitrability questions to the arbitrators.”)
(cleaned up); , 2007 WL 1775393, at *4 (same); , 2019
WL 1454953, at *2 (“Courts regularly find that agreements that incorporate
arbitration rules that give the arbitrator the power to decide issues of
arbitrability constitute clear and unmistakable evidence that the parties

., No. 18-12091, 2019 WL 2613265, at *6 (D.N.J. June 24, 2019);
, No. 18-794, 2019 WL 4717477, at *10 (S.D.
Ohio Sept. 26, 2019), , No. 18-794, 2019
WL 5455111 (S.D. Ohio Oct. 24, 2019);
, No. 18-3364, 2019 WL 6324523, at *3 (D. Md. Nov. 26, 2019);
, No. 11-cv-286, 2011 WL 3423081, *3
(M.D. Pa. Aug. 4, 2011); . , No. 06-cv-
2109, 2007 WL 1775393, *4 (E.D. Pa. June 18, 2007).
intended the arbitrator to decide those issues.”) (citation omitted);
, 2019 WL 4717477, at *11 (“The overwhelming majority of federal
courts to have addressed the issue have also held that an agreement by parties
that their disputes shall be resolved by arbitration in accordance with the
Rules of the AAA is ‘clear and unmistakable’ evidence that the parties intended
to submit the question of arbitrability to the arbitrator.”).
But is it so simple? In the Court’s view, the blanket rule emerging from
these cases is inconsistent with the more nuanced approach directed by the
Third Circuit—an approach that requires the Court to do more than scour the
relevant contract for the magic letters “AAA.” , 809 F.3d at
758 (“Having considered the language of the Leases, the nature and contents
of the various AAA Rules, and the prior case law, we conclude that the Leases
do not satisfy the onerous burden of overcoming the presumption in favoring
of judicial resolution of the question of class arbitrability.”).
Instead, to comply with , district courts must scrutinize the
precise language of the arbitration clause at issue and ensure that it truly
manifests a clear intent to delegate arbitrability to the arbitrator. at 762-
63 (“Given the actual contractual language at issue here as well as the
language and nature of the other AAA rules, the Supplementary Rules are not
enough for us to conclude that the Leases clearly and unmistakably delegate
the question of class arbitrability to the arbitrators.”);
, No. CIV.A. 14-4966, 2015 WL 4480829, at *6 (E.D. Pa. July
22, 2015) (“[W]e cannot find the three-word reference to AAA ‘rules and
regulations’ incorporates a panoply of collective and class action rules applied
by AAA once the matter is properly before the arbitrators by consent or
waiver.”), , 666 F. App’x 124 (3d Cir. 2016). Thus, if a particular contract
gives good reason to doubt that delegation was the parties’ intent, questions of
arbitrability should remain with the Court, even if the contract incorporates
the AAA rules as part of any arbitration.
Giving closer scrutiny to such provisions makes good sense. As a
practical matter, when parties—even sophisticated ones—decide what arbitral
forum they will insert into their contract, the somewhat esoteric issue of
arbitrability is often the last thing they are considering.
, 514 U.S. 938, 945 (1995) (“[T]he former question—the ‘who
(primarily) should decide arbitrability’ question—is rather arcane. A party
often might not focus upon that question or upon the significance of having
arbitrators decide the scope of their own powers.”). Instead, factors such as
fees, the roster of neutrals, availability of discovery, speed of decision, and the
like are usually what drive them to pick one arbitral forum over another.
Threshold jurisdictional considerations, relevant in only a subset of cases,
simply aren’t as important to most contracting parties.
As a result, there are good, practical reasons to doubt that every
“incorporation” of AAA or other arbitration rules is “clearly and
unmistakably” intended to delegate arbitrability questions to an arbitrator. To
assume that a reference to the AAA rules is always enough would “too often
force unwilling parties to arbitrate a matter they reasonably would have
thought a judge, not an arbitrator, would decide.” (citation omitted).
Therefore, when examining this issue here, the Court will take the more
cautious, textual approach that demands. , 809
F.3d at 758. That requires the Court to start with the presumption that
arbitrability is for the Court to decide, examine the relevant contractual
language for potential ambiguities, and ultimately satisfy itself that the
language of the parties’ contract is an “unmistakable” delegation of
arbitrability to the arbitrator. Here, the Court finds that AvMed has satisfied
this “onerous” standard for five reasons.
, the language of the arbitration clause in the License Agreement
is broad. Not only does it cover any dispute under the Agreement, but it
extends to any dispute of “any kind” that arises “in connection with” or
“relating to” the Agreement. [ECF 21 at Ex. 1 § 11(e)]. A dispute over
arbitrability could fall within, and is certainly a dispute “in connection with,”
the Agreement. Of course, the presence of “a broadly worded arbitration clause
is not enough, standing alone, to amount to clear and unmistakable evidence
that the parties intended to arbitrate arbitrability.”
, 171 F. Supp. 3d 417, 426 n.8 (E.D. Pa. 2016) (citation omitted).
But it is a starting point, because it at least does not foreclose the possibility
that the parties intended to vest the arbitrator with the broadest possible
jurisdiction.
In contrast, a narrower or qualified provision might suggest that parties
intended the arbitrator’s jurisdiction to be constrained in a way that would
preclude the arbitration of arbitrability issues.
, 935 F.3d 274, 281–82 (5th Cir. 2019) (“The plain
language incorporates the AAA rules—and therefore delegates arbitrability—
for all disputes those under the carve-out. Given that carve-out, we
cannot say that the Dealer Agreement evinces a ‘clear and unmistakable’
intent to delegate arbitrability.”); ,
770 F.3d 1010, 1031 (2d Cir. 2014) (“We have found the ‘clear and
unmistakable’ provision satisfied where a broad arbitration clause expressly
commits all disputes to arbitration, concluding that all disputes necessarily
includes disputes as to arbitrability.”) (citation omitted).
Thus, as a rule of thumb, a broad arbitration clause is more suggestive
of an intent to arbitrate arbitrability than a narrow clause. And the clause at
issue here is as broad as they come.
, the arbitration clause incorporates the AAA rules in a
particularly clear and exhaustive manner. To begin with, it provides that the
AAA “Commercial Arbitration Rules” shall apply, as opposed to merely
referencing the AAA rules more generally. The AAA Commercial Arbitration
Rules are a readily-identifiable set of 58 rules, distinguishing this clause from
vague, general references to AAA rules that courts have found lacking.
, 809 F.3d at 762–63 (“[B]efore we can even consider these
Supplementary Rules, the ‘daisy-chain’ takes us from the Leases to the
otherwise unspecified ‘rules of the American Arbitration Association’ to the
Commercial Rules. The Commercial Rules do not even refer to the
Supplementary Rules and are phrased in terms of basic procedural issues
arising out of bilateral arbitration proceedings.”).
The contracts here also specify that the version of the rules “then in
effect” shall apply. This, too, is significant, because it removes any ambiguity
about what version of the AAA rules applies.
, 218 F. Supp. 3d 465, 474 (W.D. Pa. 2016) (Hornak, J.)
(“[B]ecause it is … ambiguous which version of the Rules the parties intended
to reference and what those particular Rules reveal, the parties cannot be said
to have clearly and unmistakably provided for an arbitrator, rather than a
court, to decide the question of arbitrability.”).
On this point, Cavulus argues that there ambiguity because it entered
into the License Agreement with AvMed in 2008, while the AAA amended its
rule governing the arbitrator’s power to decide arbitrability, to include more
explicit delegation language, in 2013. But this argument is unconvincing. To
begin with, even assuming there is an ambiguity about which version of the
rules should apply, the 2013 amendments to the AAA rules did not
meaningfully affect the arbitrator’s power to decide his or her own jurisdiction.
Indeed, “[s]ince at least 1998, the AAA Commercial Arbitration Rules have
explicitly provided that that the arbitrator shall have the power to rule on his
or her own jurisdiction.” , 2019 WL 2613265, at *7 (citation
omitted).5
Furthermore, there is no ambiguity. It is clear that the 2013 version of
the AAA rules apply. After executing their contract in 2008, the parties
amended their agreements several times, including most recently in 2017.
Thus, they executed the operative version of their agreement at a time when
the 2013 version of the AAA rules was “then in effect,” and so those are the
rules that apply.
, the parties’ contract avoids a common ambiguity that, in the
Court’s view, can make the mere incorporation of AAA Commercial Rule 7
insufficiently “clear” for delegation purposes. That is, AAA Rule 7 is, by itself,
permissive. It provides that the arbitrator has the “power” to decide his or her
jurisdiction, but it doesn’t say (as some other arbitration rules do) that the
arbitrator “shall” do so or that the arbitrator’s power is “exclusive.” Some
courts have found this to be a problem, and the Court agrees.
, No. 2:18MD2836, 2018 WL 4677830, at *6
(E.D. Va. Sept. 6, 2018) (“Rule 7 of the AAA Commercial Rules incorporated in

5 ., , 398 F.3d 205, 208 (2d Cir.
2005); , 687 F.3d
671, 675 (5th Cir. 2012); , 559 F.3d 874, 878 (8th Cir.
2009); , 466 F.3d 1366, 1372–73 (Fed. Cir. 2006)
, 432 F.3d 1327, 1332–33
(11th Cir. 2005).
the MAD Agreements is permissive, not mandatory, … conferring jurisdiction
on the arbitrator, but not requiring submission of such disputes by the
parties.”), , 2018 WL 6795836 (E.D. Va.
Dec. 6, 2018); , 137 Cal. Rptr. 3d 773, 789 (Cal.
Ct. App. 2012) (“This tells the reader almost nothing, since a court also has
power to decide such issues, and nothing in the AAA rules states that the AAA
arbitrator, as opposed to the court, determine those threshold issues, or
has authority to do so, particularly if litigation has already been
commenced.”); , No. 2D19-1383, 2020 WL 1486926, at *7 (Fla. Dist.
Ct. App. Mar. 25, 2020) (“This rule confers an adjudicative power upon the
arbitrator, but it does not purport to make that power exclusive. Nor does it
purport to contractually remove that adjudicative power from a court of
competent jurisdiction.”) (citation omitted).6
Thus, simply incorporating by reference a rule that permits an arbitrator
concurrent authority with the Court, without clarifying that the arbitrator’s
authority is exclusive, may be insufficient to show the required “clear and
unmistakable” intent. But that is not a problem here because the parties’
arbitration agreement separately makes clear that any dispute must be
resolved “exclusively” through an arbitration governed by AAA rules. The use
of the word “exclusively” is powerful evidence in demonstrating unmistakable
clarity regarding delegation. , 561 U.S. 63,
68 (2010) (finding “clear and unmistakable” delegation of arbitrability

6 , 464 U.S. 417, 456 (1984)
(describing the phrase “Congress shall have the power” as “permissive.”);
, 847 F.2d 553, 555 (9th Cir. 1988) (“The
language of § 608a(7) is unambiguously permissive. Congress easily could have
mandated a hearing, but instead stated that the Secretary ‘shall have the
power’ to conduct such investigations.”).
questions where clause provided that arbitrator “shall have exclusive authority
to resolve any dispute relating to the . . . enforceability . . . of this Agreement
including, but not limited to any claim that all or any part of this Agreement
is void or voidable.”);
, 410 F. Supp. 3d 882, 888 (N.D. Ill. 2019) (“[A] robust
delegation clause conferring power to the arbitrator suffices[.]”)
, the License Agreement’s references to the availability of
equitable remedies and “judicial proceedings” do not create ambiguity. There
is a provision in the arbitration clause that, for any breaches of the
confidentiality provision (Section 7 of the License Agreement), the parties can
also seek injunctive relief as a remedy. And the confidentiality provision in
the license itself refers to judicial proceedings. Some courts have viewed
references to judicial proceedings in the contract, such as a carve-out for
injunctive relief, as creating ambiguity regarding delegation. ,
935 F.3d at 281–82 (“Given that carve-out, we cannot say that
the Dealer Agreement evinces a ‘clear and unmistakable’ intent to delegate
arbitrability.”). But the way the provision is framed here, it creates no
ambiguity. Rather, it authorizes the parties to obtain injunctive
relief in court for violations of the confidentiality provision—it does not “carve
out” arbitrability. [ECF 21 at Exs. 1 § 11(e) & 2 § 8] (“…therefore, the non-
breaching party will be entitled to injunctive relief any other
remedies provided by law or in equity for any such breach.”) (emphasis added).
, Cavulus is a sophisticated commercial entity and, presumably,
the drafter of the arbitration clause in its own contracts. Some courts have
found that the incorporation of AAA rules is not a “clear and unmistakable”
delegation of arbitrability issues when one of the contracting parties is
unsophisticated. , 171 F. Supp. 3d at 428 (“[I]ncorporating
forty pages of arbitration rules into an arbitration clause is tantamount to
inserting boilerplate inside of boilerplate, and to conclude that a single
provision contained in those rules amounts to clear and unmistakable evidence
of an unsophisticated party’s intent would be to take ‘a good joke too far.’”)
(citation omitted); , No. CV 18-1542, 2019 WL 1003135,
at *10 (E.D. Pa. Feb. 28, 2019).7 Here, however, Cavulus cannot argue that it
lacked sufficient sophistication when it incorporated the AAA commercial rules
into its arbitration clause. As a result, this concern is simply not present here.
Based on these considerations, the Court is persuaded that the
incorporation of AAA rules is, in contract, a sufficiently “clear and
unmistakable” delegation of arbitrability to satisfy AvMed’s “onerous” burden
of showing that the parties agreed to arbitrate those issues.
In sum, then, the Court holds as follows with respect to AvMed: (1)
AvMed is subject to personal jurisdiction in this Court; (2) AvMed, by its own
admission, entered into a valid and enforceable arbitration agreement with
Cavulus; and (3) the parties’ arbitration agreement “clearly and unmistakably”
delegated questions of arbitrability to the arbitrator. The Court will therefore
compel AvMed to participate in arbitration, but leave any objections to the
arbitrability of specific claims for the arbitrator to resolve.8

7 , No. 18-532, 2018 WL 4639225,
at *4 (D.N.J. Sept. 27, 2018); , No. 1:19-CV-
00172, 2019 WL 2339783, at *4 (E.D. Cal. June 3, 2019);
, 144 F. Supp. 3d 1069, 1078 (N.D. Cal. 2015).
8 Cavulus complains that AvMed pulled a fast one in this case, by getting
Cavulus to agree to stay the pending arbitration while this Court decided the
present motion. Cavulus argues that implicit in that agreement was that
AvMed was consenting to this Court deciding all arbitrability disputes.
Cavulus, though, cites nothing in the record to support this alleged
II. NTT is bound to the arbitration agreement by equitable estoppel
and its acceptance of the browsewrap End-User Agreement.
Unlike AvMed, NTT disputes the very existence of an agreement to
arbitrate. It argues that it did not agree to arbitrate anything at all, because
it was not a signatory to the License or End-User Agreements. This is a
challenge to the of an arbitration agreement, and so is for the Court
to decide. , 139 S. Ct. 524,
530 (2019) (“To be sure, before referring a dispute to an arbitrator, the court
determines whether a valid arbitration agreement exists.”) (citation omitted);
, 220 F.3d 99, 112 (3d Cir. 2000) (“[W]hen the
very existence of such an agreement is disputed, a district court is correct to
refuse to compel arbitration until it resolves the threshold question of whether
the arbitration agreement exists.”).
Broadly speaking, NTT is correct that “[a]rbitration is strictly a matter
of contract,” and that “[i]f a party has not agreed to arbitrate, the courts have
no authority to mandate that [it] do so.” ,
181 F.3d 435, 444 (3d Cir. 1999) (citation omitted). But there’s a bit more to it
than that. A party can also be “compelled to arbitrate under an agreement,
even if he or she did not sign that agreement, if common law principles of
agency and contract support such an obligation on his or her part.”
, 359 F.3d 292, 294 (3d Cir. 2004) (citation omitted).
Thus, an arbitration clause can be “enforced by or against nonparties through
assumption, piercing the corporate veil, alter ego, incorporation by reference,
third-party beneficiary theories, waiver and estoppel.” ,
870 F.3d 257, 262 (3d Cir. 2017).

. In any event, to the extent that Cavulus wants to press such an argument,
it should do so before the arbitrator.
Cavulus identifies at least three potential reasons why it believes NTT
should be bound to the arbitration clause here: (1) NTT was AvMed’s agent
under the Agreements; (2) equitable estoppel applies; and (3) NTT accepted
the End-User Agreement by accessing and using Cavulus’s software in the face
of an enforceable browsewrap contract. The Court will compel NTT to arbitrate
based on the second and third reasons.9

9 Because NTT is bound to the arbitration agreement based on equitable
estoppel and its actual acceptance of the End-User Agreement, the Court will
decline to decide whether NTT might also be bound based on Cavulus’s
“agency” theory.
The Court notes that existing Third Circuit law is seemingly inconsistent
with respect to whether and when a non-signatory agent may be bound to its
principal’s arbitration agreement. , 7 F.3d
1110, 1121 (3d Cir. 1993) (“Because a principal is bound under the terms of a
valid arbitration clause, its agents, employees, and representatives are also
covered under the terms of such agreements.”) (citation omitted) ,
181 F.3d at 444 (suggesting that is limited to circumstances where a
non-signatory agent of a signatory seeks to compel the other signatory of an
arbitration agreement to arbitrate its claims against the non-signatory)
, 269 F.3d at 198-199 (suggesting that “[t]raditional principles of
agency law may a non-signatory to an arbitration agreement” and
describing as “b[inding] an agent to the principal’s arbitration
agreement.”) (emphasis added).
This ambiguity has led to inconsistent application of in the
district courts. No. 13-6981, 2016 WL
3566960, at *18 (D.N.J. June 30, 2016) (“The rule set forth in ” applies
“only … when a non-signatory seeks to invoke the arbitration agreement
entered into by its principal, rather than the other way around when a non-
signatory seeks to avoid the arbitration agreement.”)
No. CIV.A. 14-1516, 2014 WL 5285634, at *8 (E.D. Pa. Oct. 14,
2014) (“Under the agency theory in the arbitration context … a non-signatory
person to an arbitration agreement can be compelled to arbitrate.”).
These decisions cannot be easily reconciled, because any case where an
agent is “bound” by a court to its “principal’s arbitration agreement” (approved
of by ) is, by definition, a case where an arbitration agreement is being
enforced against a non-signatory agent (disapproved of by ). In the
A. NTT is bound to the arbitration agreement by equitable
estoppel.
Equitable estoppel bars NTT from refusing to arbitrate because NTT
accepted a “direct benefit” from Cavulus’s agreements with AvMed, namely, a
license to access Cavulus’s proprietary software, which NTT needed to perform
its work for AvMed.
Equitable estoppel “bind[s] a non-signatory to an arbitration clause
when that non-signatory has reaped the benefits of a contract containing an
arbitration clause.” , 625 F.3d at 84 (citation omitted). This “prevents
a non-signatory from ‘cherry-picking’ the provisions of a contract that it will
benefit from and ignoring other provisions that don’t benefit it or that it would
prefer not to be governed by (such as an arbitration clause).” (citation
omitted).
To determine whether equitable estoppel applies here, the Court looks
to state contract law. , 618 F. App’x at 118 (“Arbitration provisions
may be enforced against non-signatories under the doctrine of equitable
estoppel if the relevant state contract law recognizes that principle as a ground
for enforcing contracts against third parties.”) (cleaned up). The Third Circuit
has held that “Pennsylvania law allow[s] non-signatories to be bound to an
arbitration agreement” by equitable estoppel “when the non-signatory
knowingly exploits the agreement containing the arbitration clause despite
having never signed the agreement.” , 762 F.3d
264, 271-72 (3d Cir. 2014) (quotations and citations omitted). A non-signatory
“knowingly exploits” an agreement “(1) by knowingly seeking and obtaining
direct benefits from that contract; or (2) by seeking to enforce terms of that

absence of further guidance from the Third Circuit, the Court sees no need to
wade into this issue here, since there are two other independent and sufficient
bases for compelling NTT to arbitrate.
contract or asserting claims based on the contract’s other provisions.” at
272 (quotations and citations omitted).
NTT argues that equitable estoppel does not apply because NTT has
“never asserted in any forum that it was a party to the [License and End-User
Agreements] or sought to enforce the terms of either contract against Cavulus.”
[ECF 28 at p. 11]. But it is the first category of estoppel—seeking and
obtaining “direct benefits” from a contract—that is relevant here; not estoppel
based on any attempt by NTT to “enforce terms of that contract or asser[t]
claims based on the contract’s other provisions.” , 762 F.3d at 272.
The first category encompasses cases “involv[ing] non-signatories who,
during the life of the contract, have embraced the contract despite their non-
signatory status but then, during litigation, attempt to repudiate the
arbitration clause in the contract.”
, 269 F.3d 187, 200 (3d Cir.
2001) (citation omitted);
, No. 17-6322, 2018 WL 2215517, at *4 n.5 (D.N.J. May 15,
2018) (“A person may be bound to an arbitration agreement where he or she
has accepted benefits under the contract.”) (citations omitted).
Courts have applied this theory of estoppel where non-signatories to a
contract seek to avoid arbitration clauses after accepting all manner of benefits
flowing directly from signatories’ performance of that contract. For example,
non-signatories have been compelled to arbitrate where they have accepted
benefits such as: (1) “significantly lower insurance rates,”
, 170 F.3d 349, 353 (2d Cir. 1999); (2) “the
ability to sail under the French flag,” ; (3) “having custom-made Amkor chips
made available,” , 278 F. Supp. 2d 519,
523 (E.D. Pa. 2003); (4) “continuing use of the name ‘Deloitte’,”
, 9 F.3d 1060, 1064 (2d Cir.
1993); (5) the subsequent “license of … relevant trademarks” contemplated by
an asset purchase agreement with an arbitration clause,
, 803 F. Supp. 2d 270, 277 (S.D.N.Y. 2011); and (6)
“promissory notes” issued pursuant to a Distribution Agreement.
, No. CIV.A. 06-4786, 2008 WL 2502139, at
*10 (E.D. Pa. June 20, 2008).
Here, NTT received a “direct benefit” from AvMed’s License and End-
User Agreements, in the form of a license to access Cavulus’s software to
perform its work for AvMed. Cavulus conditioned AvMed’s access to its
software on acceptance of the License Agreement. That Agreement
contemplated that AvMed might grant sublicenses to agents or contractors,
such as NTT, but permitted it to do so only if sublicensees were also “bound for
the benefit of [Cavulus] to the terms of the End-User Agreement … by
executing a ‘click-on’ version of the same agreement.” [ECF 21-1 at § 1(a)].
The License Agreement expressly did not permit any other “sublicense,
distribution or disclosure” of Cavulus’s software by AvMed. [ at § 1(b)].
Thus, when AvMed sublicensed access to NTT, it was conferring on NTT
a benefit that had been specifically contemplated by the License Agreement,
and which AvMed only had a right to confer because the Agreement granted it
that right. The sublicense was therefore a “direct” benefit flowing to NTT from
the contract itself. 803 F. Supp. 2d at 274 (“The benefits must
be direct—which is to say, flowing directly from the agreement.”).
And NTT knowingly accepted that benefit without objection. AvMed
copied two NTT executives on the “Limited Letter of Agency” it sent to Cavulus,
which represented that NTT was “authorized to act on behalf of AvMed with
regard to the products and/or services that are owned, leased, or licensed by
AvMed,” including “supporting and operating the products and/or services
provided to AvMed from [Cavulus] … under the current agreement(s) …
between [Cavulus] and [AvMed].” [ECF 21-6]. NTT never disputed or objected
to this purported delegation of authority to act on AvMed’s behalf “under the
current agreement(s) … between [Cavulus] and [AvMed].” [ ]. Far from it.
NTT acted fully in accordance with this letter, accessing Cavulus’s platform to
perform work on AvMed’s behalf. [ECF 21 at ¶ 32]. And each time NTT’s
employees accessed Cavulus’s log-in page, they clicked past a warning that
their use of the software constituted “acceptance” of the End-User Agreement.
[ . at ¶¶ 33-36].
In short then: (1) Cavulus conditioned AvMed’s license to use its software
on AvMed’s acceptance of the Agreements and their arbitration clauses; (2) as
contemplated by the License Agreement, AvMed sublicensed its access rights
to NTT; and (3) NTT directly reaped the benefits of that sublicense by using
Cavulus’s software to perform paid work for AvMed. Moreover, accepting
Cavulus’s allegations as true (which the Court must at this stage), NTT also
exploited that access to copy and steal Cavulus’s “customized and proprietary
workflows and functionalities.” [ . at ¶ 43].
Principles of equity do not permit NTT to enjoy and exploit the benefits
of the License and End-User Agreements’ access provisions, while ignoring
their arbitration clause when legal claims arise from that access. The Court
will thus estop NTT from denying that it is bound by the arbitration clause.
B. NTT accepted the browsewrap End-User Agreement by
accessing and using Cavulus’s software.
Separately, NTT is also bound to arbitrate Cavulus’s claims because it
independently accepted the End-User Agreement by using Cavulus’s software
in the face of a conspicuous browsewrap agreement.
Of course, actual acceptance of a written contract containing an
arbitration clause would create an enforceable arbitration agreement.

, 119 F. Supp. 3d 307,
313 (E.D. Pa. 2015) (“[T]he court must assess an arbitration clause like any
other contract term.”) (citation omitted). Relatedly, “non-signatories may
assume the obligations contained in an arbitration clause” where “subsequent
conduct indicates that [the non-signatory] is assuming the obligation to
arbitrate.” , 625 F.3d at 85 (quotations and citations omitted);
, 64 F.3d 773, 777 (2d Cir. 1995)
(“In the absence of a signature, a party may be bound by an arbitration clause
if its subsequent conduct indicates that it is assuming the obligation to
arbitrate.”) (citation omitted).
Here, Cavulus argues that NTT accepted the End-User Agreement,
including the arbitration provision, each time its employees accessed and used
Cavulus’s software to perform their work for AvMed. This is because the
secure log-in page of Cavulus’s software “states that ‘[u]se of Cavulus
constitutes acceptance of the End User License Agreement,’ and contains a
hyperlink to the terms” of that Agreement, including its arbitration provision.
[ECF 27 at p. 5]. Cavulus contends that this language is a so-called
“browsewrap” agreement and that it is enforceable against NTT. [ . at p. 15].
NTT responds that (1) the browsewrap agreement is unenforceable; and (2) in
any event, the NTT employees who accessed the Cavulus software lacked the
authority to bind NTT to the End-User Agreement. [ECF 28 at pp. 13-19].
Upon consideration, the Court agrees with Cavulus that the browsewrap
agreement is enforceable, and that NTT accepted it.
i. The browsewrap agreement is enforceable.
The link to the End-User Agreement on Cavulus’s log-in page creates an
enforceable browsewrap agreement.10 “In browsewrap agreements, a
company’s terms and conditions are generally posted on a website via
hyperlink at the bottom of the screen.” , 852 F.3d
262, 267 (3d Cir. 2017). However, “[u]nlike online agreements where users
must click on an acceptance after being presented with terms and conditions
(known as ‘clickwrap’ agreements), browsewrap agreements do not require
users to expressly manifest assent.” (citation omitted). Instead, “in a pure-
form browsewrap agreement, the website will contain a notice that—by merely
using the services of, obtaining information from, or initiating applications
within the website—the user is agreeing to and is bound by the site’s terms of
service.” , 841 F. Supp. 2d 829, 837 (S.D.N.Y. 2012)
(cleaned up).
The Third Circuit has suggested that browsewrap agreements are
enforceable if “the terms are reasonably conspicuous on the webpage” so that

10 NTT’s attack on the entire browsewrap agreement does not, in this
circumstance, sidestep the usual rule that a challenge to an otherwise
controlling arbitration agreement “must focus exclusively on the arbitration
provision, rather [than on] the contract as a whole.”
, 840 F.3d 138,
143 (3d Cir. 2016). That is because “a challenge to a contract on the grounds
that the signatory was unauthorized to sign it must be decided by a court, even
if the contract contains an arbitration clause, because it is a challenge to a
contract’s formation rather than its validity.”
, 707 F.3d 267, 271 (3d Cir. 2013); , 220 F.3d at
107 (“[W]e draw a distinction between contracts that are asserted to be ‘void’
or non-existent, as is contended here, and those that are merely ‘voidable’ …
for purposes of evaluating whether the making of an arbitration agreement is
in dispute.”); , 256 F.3d 587, 591 (7th
Cir. 2001) (“. . . [A]n argument that the contract does not exist can’t logically
be resolved by the arbitrator[.]”).
the user can be fairly charged with “constructive notice” that continued use
will constitute acceptance of the agreement. , 852 F.3d at 267;
, 834 F.3d 220, 233 (2d Cir. 2016) (“In determining
the validity of browsewrap agreements, courts often consider whether a
website user has actual or constructive notice of the conditions.”) (citation
omitted); , 763 F.3d 1171, 1177 (9th Cir. 2014)
(“[T]he validity of the browsewrap agreement turns on whether the website
puts a reasonably prudent user on inquiry notice of the terms of the contract.”)
(citation omitted).
Although the enforceability of web-based agreements will often depend
on a “fact-intensive inquiry,” the Court may determine that a web-based
agreement to arbitrate exists where notice of the agreement was “reasonably
conspicuous and manifestation of assent unambiguous as a matter of law.”
, 868 F.3d 66, 76 (2d Cir. 2017) (citation omitted).
Importantly, in assessing whether a party manifested an intent to enter a
contract, the Court looks not to inward, subjective intent but, rather, to the
“intent a reasonable person would apprehend in considering the parties’
behavior.” , 584 F.3d 575, 582 (3d
Cir. 2009) (citation omitted). In other words, “a true and actual meeting of the
minds is not necessary to form a contract.” (quotations and citations
omitted). As a result, “an internet user need not actually read the terms and
conditions or click on a hyperlink that makes them available as long as she has
notice of their existence.” , 834 F.3d at 232 (citation omitted).
In the context of browsewrap agreements, courts have typically found
that continued use of a website is a sufficient manifestation of intent where
the website “contains an explicit textual notice that continued use will act as a
manifestation of the user’s intent to be bound.” , 852 F.3d at 267. On
the other hand, “when terms are linked in obscure sections of a webpage that
users are unlikely to see, courts have refused to find constructive notice.” Jd.
Here, the relevant browsewrap language is found on the log-in page of
Cavulus’s software platform. Cavulus attaches a screenshot of the log-in page
to its complaint as an exhibit, and NTT does not dispute the screenshot’s
authenticity. [ECF 21 at Ex. 7]. The log-in page consists of a box to type in a
user ID and password and then, about one inch below that box, a sentence
reading: “Use of Cavulus constitutes acceptance of the End User License
Agreement,” containing a hyperlink to the Agreement itself. [Jd]. This
language was displayed every time an NTT employee (or other user) logged on
to the software. Cavulus alleges that nine NTT employees logged on more than
75 times, and NTT does not dispute that it performed work for AvMed that
required it to access Cavulus’s platform. A screenshot is pasted below:

User ID

Forgat Password? | Request Access

Use of Cavulus constitutes acceptance of the End ger License Agreement
The information contained within this application is confidential and
proprietary infermation of HealihPianORM, LLC di/bfa Cavulus.
Unauthorized aceess to or use & strictly prohibited. Any violation of
HealthPianCRM policies pertaining to System access or confidentiality
ay PeSut in criminal and cil penalties. This application gives
Bote bh iidrdually idenifiabe health infoyreian which is
candied private, privieged and confidential. Such infermation &
desrmed to be covered information far purposes of the Health
Insurance Portabilty and Accountability Act of 1996 (HIPAA), Po
14-191. Bnd users are reduired te maintain the private, privileged
and confidential status af the covered information. Any decloaure of
towered information to & BUSINESS Partner pursuant to @ written
COntract, the written contract shall meet the Pegureneits of HIPAA
Copyright © HealthPianGRM, LLC. All nights reserved
Page Served on: 08/08/2079 3:40053 PM EDT in 0.021 seconds.

- 36 -

NTT argues that the browsewrap End-User Agreement is not sufficiently
“conspicuous” to be enforced, because the link to the End-User Agreement is
“in small font, positioned close to a large paragraph of text in the same small
font, and is far enough below the log-in boxes and button so as not to command
the viewer’s attention.” [ECF 28 at p. 15]. The Court cannot agree with this
characterization. The link to the End-User Agreement appears no more than
an inch below the log-in boxes, and it is both above and set apart from the
“large paragraph” of text NTT references (which is itself only six sentences
long). The link is not concealed at the bottom of a webpage or hidden in fine
print. What’s more, the blue hyperlink to access the full End-User Agreement
stands out against the white background of the log-in page and appears in a
sentence which straightforwardly advises the user that “[u]se of Cavulus
constitutes acceptance” of the linked agreement.
Indeed, other courts have found similar browsewrap agreements to be
reasonably conspicuous and thus enforceable. ,
, 708 F. Supp. 2d 669, 683 (N.D. Ohio 2010) (enforcing
browsewrap agreement where “[e]ach website contains a single page access
screen where users must input a user name and password and then click an
‘Enter’ button to proceed … [and] [b]elow the ‘Enter’ button, the page states:
‘The use of and access to the information on this site is subject to the terms
and conditions set out in our legal statement.’”);
, No. 3:17-CV-42, 2019 WL 4647305, at *11 (S.D.
Ohio Sept. 24, 2019) (“…FPM’s home page displayed a visible link that read:
‘[t]o learn how you can use Freeplay music click on Terms of Use, Licensing,
Rate Card.’ … FPM website users did not have to scroll to find the link for the
terms of use. The link is easily visible in the upper left-hand corner of the home
page.”); , 507 F.Supp.2d 1096, 1107
(C.D. Cal. 2007) (plaintiff was “highly likely to succeed in showing that
Defendant received notice of the Terms of Use and assented to them by actually
using the website,” where site displayed a warning that “Use of this website is
subject to express Terms of Use ” and “[t]he underlined phrase ‘Terms of Use’
is a hyperlink to the full Terms of Use”);
, No. CV997654, 2003 WL 21406289, at *2 (C.D. Cal. Mar. 7, 2003) (finding
browsewrap agreement enforceable where Ticketmaster “placed in a
prominent place on the home page the warning that proceeding further binds
the user to the conditions of use.”); , No.
C 04-04825, 2005 WL 756610, at *2 (N.D. Cal. Apr. 1, 2005) (enforcing forum-
selection clause of browsewrap agreement displayed near defendant’s logo on
web-page which stated: “By continuing past this page and/or using this site,
you agree to abide by the Terms of Use for this site, which prohibit commercial
use of any information on this site.”).
Moreover, because the explicit warning that “use” of the software
“constitutes acceptance” appears directly below the log-in button, the language
arguably functions more like a “clickwrap” agreement than a traditional
browsewrap agreement—perhaps falling somewhere between the two. That is,
while Cavulus does not ask its users to check an “I Accept” box, as is the case
with a typical clickwrap agreement, the placement of an explicit warning
directly below a log-in button has a similar psychological effect. And clickwrap
agreements are routinely enforced by the courts. 868 F.3d at 75
(“Courts routinely uphold clickwrap agreements[.]”) (citation omitted).11 Thus,

11 , 817 F.3d 1029, 1033 (7th Cir. 2016)
(“Courts around the country have recognized that this type of electronic ‘click’
can suffice to signify the acceptance of a contract.”) (citation omitted);
513 F. Supp. 2d 229, 236 (E.D. Pa. 2007) (“Absent a showing of
fraud, failure to read an enforceable clickwrap agreement, as with any binding
while not strictly “clickwrap,” the agreement here similarly avoids the
concerns regarding lack of notice and manifested assent that often lead courts
to decline to enforce pure browsewrap agreements buried “in obscure sections
of a webpage that users are unlikely to see[.]” , 852 F.3d at 267.
For these reasons, the Court finds that the browsewrap version of
Cavulus’s End-User Agreement is enforceable, and thus would be accepted by
anyone proceeding past Cavulus’s log-in screen and using its software in the
face of that language.
ii. NTT is bound by its employees’ notice and acceptance
of the browsewrap End-User Agreement.
The Court rejects NTT’s argument that it cannot be bound by its
employees’ notice and acceptance of the browsewrap End-User Agreement
because those employees “were not authorized to bind [NTT].” [ECF 28 at p.
14]. NTT suggests that the browsewrap agreement, if it is enforceable, binds
only “the person logging into the program, not any entity” they might be
affiliated with. NTT says that the agreement unambiguously applies to the
user (“you”), not to the user’s company. [ . at pp. 12-13]. NTT further argues
that under its own corporate policies, its employees were not given
authorization to bind the company. [ at p. 13]. The Court credits all of
NTT’s assertions as true, as well as NTT’s interpretation of the End-User
Agreement. In the end, though, all of this is immaterial. Under settled
principles of agency law, because NTT’s employees were acting within the
scope of their employment, their conduct bound their employer, NTT.
It is well-established that “principals generally are responsible for the
acts of agents committed within the scope of their authority.”

contract, will not excuse compliance with its terms.”) (citation omitted);
, 2019 WL 2563738, at *3 (same).
, 708 F.3d 470, 494 (3d Cir. 2013) (quotations and citations
omitted). Relatedly, “[k]nowledge of an agent, acting with [sic] the scope of his
authority, real or apparent, may be imputed to the principal, and thus,
knowledge of the agent is knowledge of the principal.”
, 72 A.3d 270, 279 (Pa. Super. Ct. 2013) (citation omitted);
Restatement (Third) Of Agency § 5.03 (“For purposes of determining a
principal’s legal relations with a third party, notice of a fact that an agent
knows or has reason to know is imputed to the principal if knowledge of the
fact is material to the agent’s duties to the principal[.]”). The question here is
whether these bedrock principles of agency law bind NTT to the browsewrap
agreement that its employees assented to by using Cavulus’s software to
perform work for NTT.
The Eleventh Circuit’s recent decision in ,
908 F.3d 675 (11th Cir. 2018) provides persuasive guidance consistent with
Pennsylvania law. In , a group of plaintiff-homeowners, who had hired
roofers to purchase and install shingles on their home, brought a putative class
action against a manufacturer of roofing shingles. at 679. The shingles at
issue in the case had been purchased for the homeowners by their hired roofers.
at 684.
After the lawsuit was filed, the manufacturer moved to compel the
homeowners to arbitrate, relying on a product-purchase agreement
“display[ed] on the exterior wrapping of every package of shingles” bought by
the roofers. at 678. The Eleventh Circuit analogized this agreement to the
sort of web-based “wrap” contracts at issue here, deeming it, “for lack of a
better label,” a “shinglewrap” agreement. . To avoid arbitration, the
homeowners in made an argument that closely mirrors NTT’s argument
here. Like NTT, the homeowners claimed that it was their agents (the roofers),
and not them, who “ordered, opened, and installed the shingles” wrapped in
the alleged arbitration agreement. . Thus, the homeowners argued that
“[e]ven if this was a valid means of making an offer, they didn’t accept it—their
roofers did.” at 684.
The Eleventh Circuit rejected this argument. It held that “[i]mputing
the roofers’ notice and acceptance of [the manufacturer’s] purchase terms to
the homeowners . . . fits squarely within established agency-law principles and
precedent.” . More specifically, the court explained that any grant of agency
authority “necessarily implies the authority to do acts that are incidental to it,
usually accompany it, or are reasonably necessary to accomplish it,” and that
“knowledge or notice that an agent acquires while acting within the course and
scope of his authority is generally imputed to his principal.” . (cleaned up).
Applying these principles, the court held that, because the homeowners
“expressly delegated to their roofers the task of purchasing shingles,” the law
would not permit them to “contest terms—in particular, those requiring
mandatory arbitration—that are part and parcel of that purchase.” .
Relatedly, knowledge of the “shinglewrap” agreement was “properly imputed
to [the homeowners]” because the roofers received notice “while acting within
the scope of their authority to purchase and install the shingles” on behalf of
the homeowners. . at 686.
Pennsylvania agency law compels the same conclusion here. Under
Pennsylvania law, “[t]he basic elements of agency are the manifestation by the
principal that the agent shall act for him, the agent’s acceptance of the
undertaking[,] and the understanding of the parties that the principal is to be
in control of the undertaking.” , 72 A.3d at 278. Like Florida law,
Pennsylvania law recognizes that agents have “implied authority” to take
actions that are “proper, usual and necessary to carry out express agency.”
, 155 A.3d 641, 645 (Pa. Super. Ct. 2017)
(cleaned up). And like Florida law, Pennsylvania law holds that “knowledge of
the agent is knowledge of the principal” when such knowledge is acquired by
the agent, “acting with [sic] the scope of his authority, real or apparent[.]”
, 72 A.3d at 279 (citation omitted); Rest. (Third) Of Agency § 5.03.
Applying these principles here, both the reasoning of and
corresponding Pennsylvania law support holding NTT to the End-User
Agreement, based on its employees’ access to and use of Cavulus’s software in
the face of a conspicuous browsewrap agreement. NTT does not suggest that
its employees accessed the software for any reason other than to perform NTT’s
work for AvMed, and each time they did so they clicked past the browsewrap
agreement—which, as discussed, is enforceable. So just as the homeowners in
could not direct their roofer-agents to purchase shingles, but then disavow
the standard terms attached to that purchase, NTT cannot direct its employees
to access Cavulus’s software to perform its contract with AvMed, but then
disavow the terms on which Cavulus conditions that access.
Simply put, (1) Cavulus was free to impose lawful terms-of-use on its
own software; (2) those terms were made reasonably conspicuous to NTT
employees by browsewrap language on the secure log-in page; and (3) the
employees’ acceptance of those terms was “incidental to” or “reasonably
necessary to accomplish” their assigned task of accessing Cavulus’s software
and transferring AvMed’s customer data. , 908 F.3d at 685;
, 155 A.3d at 645.
To be clear, this is not to say that NTT would be bound by every
nominally enforceable browsewrap agreement its employees might encounter
when they access a website from their work computers. The agreement here
binds NTT because NTT, as reflected by AvMed’s Limited Letter of Agency,
directed its employees to access Cavulus’s software in order to perform the
work required by NTT’s contract with AvMed. By directing and permitting its
employees to access Cavulus’s software, NTT, as a matter of agency law,
authorized them to take any incidental actions “proper, usual and necessary”
to complete that assignment. , 155 A.3d at 645. Surely, if anything
is incidental to the use of a software program, it is accepting the corresponding
terms and conditions of using that software. Such terms are ubiquitous in the
internet age.
Additionally, as in , the notice of the browsewrap agreement
received by NTT’s employees while performing their work is fairly imputed to
NTT. , 908 F.3d at 685; , 72 A.3d at 279. And “[b]ecause the
notice that [NTT’s employees] acquired while acting within the scope of their
authority to [access the Cavulus platform and transfer AvMed’s data] is
properly imputed to [NTT], [NTT] cannot now plead ignorance of the [End-
User Agreement’s] existence.” , 908 F.3d at 686.
These conclusions seem necessary. After all, “a corporation is an
artificial legal entity which can act only through its employees.”
, 937 F. Supp. 413, 423 (E.D. Pa. 1996);
, 47 A.3d 1190, 1196 (Pa. 2012) (“[A]
corporation can only act through its officers, agents, and employees.”) (citation
omitted). Thus, “acts of … employees within the scope of their employment”
are generally considered “a lesser included subset within the set of the
company’s actions.” , 937 F. Supp. at 423.
If it were otherwise, companies would never be bound by browsewrap or
other web-based agreements accepted by ordinary employees, even when those
employees are acting squarely within the scope of their employment. Instead,
companies would be bound only when a CEO or other high-ranking executive
with unilateral authority to make contracts on behalf of the company assented
to a browsewrap agreement. Yet that is clearly not how the law surrounding
such agreements has developed. , ,
No. 4:17-CV-00815, 2018 WL 2848985, at *7 n. 4 (E.D. Tex. June 11, 2018)
(“BareWeb was bound by the browsewrap TOU Agreement since its employees
allegedly visited HerRoom’s website, BareWeb uses a similar browsewrap
agreement on its own website, and Andra’s claims are covered by the TOU
Agreement.”); , No.
3:17-CV-42, 2019 WL 4647305, at *1, *10-11 (S.D. Ohio Sept. 24, 2019)
(enforcing browsewrap agreement against Arbogast where “[a]n Arbogast
employee, David Novotny, who was responsible for developing the
advertisements, accessed the website and downloaded music to a folder by
right-clicking his selections.”); , No. 3:06-
CV-0891-B, 2007 WL 4823761, at *1 (N.D. Tex. Sept. 12, 2007) (enforcing
browsewrap agreement against BoardFirst where “BoardFirst employees log
on to the ‘Check In and Print Boarding Pass’ page of the Southwest site and
check the customer in using his personal information.”);
, No. 15 CIV. 2836, 2016 WL 5390896, at *13 (S.D.N.Y. Sept. 26, 2016)
(“Whether Spring11 is contractually bound by the Terms of Service depends
whether Spring11’s employees had actual or constructive knowledge of the
site’s terms and conditions, and manifested assent to them.”) (cleaned up).
For all these reasons, the Court holds that NTT accepted the End-User
Agreement, including its arbitration clause, through its employees’ access and
use of Cavulus’s software platform in the scope of their duties and in the face
of a conspicuous browsewrap agreement. Along with equitable estoppel, this
provides a basis for compelling NTT to arbitrate.
III. The Court will dismiss, rather than stay, the remainder of this
case pending arbitration.
Finally, having decided that a valid arbitration agreement exists
between Cavulus and each Defendant, and that any objections to the
arbitrability of specific claims must be resolved by the arbitrator, the Court
must decide whether to stay or dismiss what remains of the case ( , the
claims Cavulus has pled “in the alternative”) after referring the parties to
arbitration.
Under 9 U.S.C. § 3, the Court always has the power to stay court
proceedings for any claim referable to arbitration until arbitration is complete.
And the FAA “affords a district court no discretion to dismiss a case where one
of the parties applies for a stay pending arbitration.”
, 369 F.3d 263, 269 (3d Cir. 2004). That said, if neither party requests a
stay, the Court may dismiss the case after compelling arbitration. ,
, 832 F. Supp. 2d at 490 (“[N]either plaintiffs nor defendants have
requested that we stay the action pending arbitration. We will accordingly
dismiss plaintiffs’ amended complaint and close this case.”).
Here, after entering judgment in favor of Cavulus on Count 1 of the
amended complaint (seeking to compel arbitration), the Court will dismiss the
remaining claims because neither party has requested a stay and, in any event,
Cavulus has asserted no claims that would warrant imposition of a stay.
Indeed, the only substantive claims in Cavulus’s complaint are pled “in the
alternative” if “arbitration is not compelled against NTT.” [ECF 21 at ¶¶ 72-
84]. The Court has compelled arbitration against NTT, and thus concludes
that its work here is done. Dismissal is therefore the appropriate course.
CONCLUSION
For all these reasons, Cavulus’s motion is granted insofar as it seeks an
order compelling both NTT and AvMed “to participate in the arbitration
proceeding commenced by Cavulus.” [ECF 21 at ¶ 71]. But any objections to
the arbitrability of Cavulus’s specific claims must be resolved by the arbitrator.
A corresponding order follows.
DATED: April 28, 2020 BY THE COURT:
/s/
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10415554. Public record. Not legal advice.