EA Independent Franchisee Association LLC v. Edible Arrangements International Inc.
To prevail on a motion to arbitrate, a movant must prove that the parties agreed to arbitrate and that the scope of the arbitration clause covers the parties' dispute. The plaintiff franchisee association requested a declaratory judgment that the defendant, Edible Arrangements, breached its franchise agreement and violated the implied covenant of good faith and fair dealing and CUTPA, the Connecticut Unfair Trade Practices Act. Defendant Edible Arrangements moved to compel arbitration pursuant to an arbitration clause. The Federal Arbitration Act codifies a policy that favors arbitration. The act provides that arbitration contracts "shall be valid, irrevocable, and enforceable save upon such grounds as exist at law or in equity for the revocation of any contract," pursuant to 9 United States Code §2. "[A]ny doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration," pursuant to the U.S. Supreme Court's 1983 decision, Moses H. Cone Memorial Hospital v. Mercury Construction Corp. Here, the parties agreed to arbitrate "all controversies, disputes or claims between [Edible] and its affiliates, and their respective shareholders, officers, directors, agents and/or employees, and Franchisee . . . arising out of or related to: 1.) this [Franchise] Agreement . . .; 2.) [Edible's] relationship with Franchisee; 3.) the validity of this [Franchise] Agreement . . .; or 4.) any System Standard. The District Court found that the arbitration contract covered the plaintiff's allegations that Edible Arrangements unfairly required extended hours of operation and use of certain vendors and failed to disclose its relationships with affiliates. The District Court rejected the plaintiff's arguments that Edible Arrangements waived its right to arbitrate and that Edible Arrangements' motion to compel arbitration was not ripe. The court granted the motion to compel and stayed litigation of the complaint.