     Case: 17-60631      Document: 00514597623         Page: 1    Date Filed: 08/13/2018




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT       United States Court of Appeals
                                                         Fifth Circuit

                                                                                      FILED
                                                                                  August 13, 2018
                                      No. 17-60631
                                                                                   Lyle W. Cayce
                                                                                        Clerk
RICHLAND EQUIPMENT COMPANY, INCORPORATED, a Mississippi
Corporation,

              Plaintiff - Appellant

v.

DEERE & COMPANY, a Delaware Corporation,

              Defendant - Appellee




                   Appeal from the United States District Court
                     for the Southern District of Mississippi
                              USDC No. 5:17-CV-88


Before DENNIS, CLEMENT, and ENGELHARDT, Circuit Judges.
PER CURIAM:*
       The issue on appeal is whether arbitration must be compelled when one
contract providing for arbitration of “any dispute” between the parties and
containing a valid delegation clause is terminated and claims thereunder are
subsequently removed from a complaint but claims under related contracts are
preserved. The district court held that it must and we AFFIRM.



       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                   No. 17-60631
                         FACTS AND PROCEEDINGS
        Richland Equipment Company, Inc. (“Richland”) and Deere & Company
(“Deere”) began their business relationship when the parties entered into two
agreements in 1986: the John Deere Agricultural Dealer Agreement (“Ag DA”)
and the John Deere Consumer Products Dealer Agreement (“CP DA”). In 2001,
the parties entered into a third agreement, the Commercial Worksite Products
Dealer Agreement (“CWP DA”). The CWP DA includes the following
arbitration clause:
         Although Dealer and John Deere are entering into this
         Agreement in a spirit of cooperation and mutual respect, it is
         possible that disputes may arise. Dealer, Affiliates . . . , Deere &
         Company and its affiliates agree that any dispute shall be
         finally resolved by binding arbitration pursuant to the terms set
         forth in Schedule 4.


Schedule 4 supplements the arbitration clause, providing that if the parties “to
a dispute” disagree, “the dispute shall be finally resolved by binding arbitration
in accordance with the arbitration rules of JAMS/Endispute.” JAMS provides
that:
         Jurisdictional and arbitrability disputes, including disputes
         over the formation, existence, validity, interpretation[,] or scope
         of the agreement under which Arbitration is sought, and who
         are proper Parties to the Arbitration, shall be submitted to and
         ruled on by the Arbitrator. The Arbitrator has the authority to
         determine jurisdiction and arbitrability issues as a preliminary
         matter.


JAMS        Rule      11(b),     https://www.jamsadr.com/rules-comprehensive-
arbitration/#Rule-11.
        The CWP DA cancellation provision states, in relevant part, that: “The
Company may cancel the Dealer’s appointment at any time after the
happening of . . . [a] [t]ermination (or notice of termination) of any John Deere

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                                   No. 17-60631
Dealer Agreement that the dealer . . . has with the Company.” As discussed,
the only other contracts are the AG DA and the CP DA. Neither of those
agreements contains an arbitration clause.
      The parties have had ongoing disputes since the late 1990s. Deere sent
a termination notice to Richland in 2011 because Richland allegedly stopped
promoting Deere products. Richland filed suit, but the parties settled. As part
of the settlement, Richland agreed to reach certain market share percentages
for the following three years. Because Richland apparently never met any of
these goals Deere sent a six-month notice that it had “elected to terminate
[Richland’s] John Deere Agricultural Dealer Agreement, as well as any other
agreements that may exist between Richland Equipment Co., Inc. and Deere &
Company.” In response to the termination notice, Richland claimed that “John
Deere has elected to provide ‘certain dealers’ with better pricing . . . in violation
of the Robinson-Patman Act.”
      Richland filed the underlying lawsuit to enjoin Deere from terminating
all three dealer agreements. Deere moved to compel arbitration based on the
CWP DA’s arbitration clause. In response, Richland contended that it had
“consented to the termination” of the CWP DA. Richland filed an amended
complaint removing claims related to the CWP DA, and it asserted that the
motion to compel should be denied because the contract containing the
arbitration clause was no longer at issue.
      The district court rejected Richland’s attempt to avoid arbitration. It
found that the arbitration clause survived the termination of the underlying
agreement. Accordingly, the district court granted the motion to compel
arbitration and dismissed the lawsuit without prejudice.
      Richland timely appealed.




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                                     No. 17-60631
                             STANDARD OF REVIEW
      This court reviews the grant or denial of a motion to compel arbitration
de novo. Primerica Life Ins. Co. v. Brown, 304 F.3d 469, 471 (5th Cir. 2002).
                                    DISCUSSION
      Richland contends that it cannot be compelled to arbitrate its claims
because it did not agree to arbitration under the AG DA and the CP DA. 1 It
relies on Torrence v. Murphy for the proposition that “a party cannot be
required to submit to arbitration any dispute which he has not agreed to so
submit.” 815 F. Supp. 965, 971 (S.D. Miss. 1993). True enough. But, under the
CWP DA, Richland did agree to arbitration of the present dispute.
      The two-step framework for analyzing enforcement of arbitration
agreements is well established: (1) “whether the parties entered into any
arbitration agreement at all,” and (2) “whether this claim is covered by the
arbitration agreement.” Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199,
201 (5th Cir. 2016) (emphasis in original). And where an arbitration agreement
includes a delegation clause, the inquiry in step two is “limited.” Id. at 203.
      The “first step is a question of contract formation only—did the parties
form a valid agreement to arbitrate some set of claims.” IQ Prods. Co. v. WD-
40 Co., 871 F.3d 344, 348 (5th Cir. 2017), cert. denied, 138 S. Ct. 2620 (2018).
It is undisputed that the CWP DA contained a valid arbitration agreement
between the parties, binding them to arbitrate some set of claims.
      Further, the termination of an agreement containing an arbitration
clause does not automatically extinguish the parties’ duty to arbitrate



      1   Richland also raises a new argument based on Douglas v. Regions Bank, 757 F.3d
460 (5th Cir. 2014). This argument was raised in the district court only after that court’s
ruling on Deere’s motion to compel arbitration. Thus it is waived on appeal. Rosedale
Missionary Baptist Church v. New Orleans City, 641 F.3d 86, 89 (5th Cir. 2011) (Preserving
an argument on appeal requires that the argument “be raised to such a degree that the
district court has an opportunity to rule on it.” (internal quotation marks omitted)).
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                                  No. 17-60631
disputes. Nolde Bros., Inc. v. Local No. 358, Bakery & Confectionery Workers
Union, AFL-CIO, 430 U.S. 243, 251 (1977); see also Rive v. Briggs of Cancun,
Inc., 82 F. App’x 359, 363 (5th Cir. 2003). To hold otherwise, the Supreme Court
explained, would create disorder and unpredictability. See Nolde, 430 U.S. at
250–51. The converse “would preclude the entry of a post-contract arbitration
order even when the dispute arose during the life of the contract but
arbitration proceedings had not begun before termination.” Id. at 251.
Similarly, an arbitration clause would be unenforceable “if arbitration
processes began[,] but were not completed, during the contract’s term.” Id. The
Supreme Court contemplated this precise situation—where a contract
requiring arbitration terminates after a dispute arises. As in Nolde, there is no
evidence that the parties here intended for disputes to be resolved in
arbitration before termination of the CWP DA and in court afterward. Thus
the court finds the parties are subject to a valid and enforceable arbitration
agreement.
      Next the court must address whether the parties’ intended to arbitrate
arbitrability. In order to do this, “the court must determine whether the
agreement contains a valid delegation clause.” IQ Prods. Co., 871 F.3d at 348.
“[A] valid delegation clause requires the court to refer a claim to arbitration to
allow the arbitrator to decide gateway arbitrability issues.” Kubala, 830 F.3d
at 202. The court “will not assume that the parties agreed to arbitrate
arbitrability unless the parties clearly and unmistakably provide otherwise.”
Petrofac, Inc. v. DynMcDermott Petroleum Operations Co., 687 F.3d 671, 675
(5th Cir. 2012) (internal quotations and alterations omitted). Parties’ express
incorporation of rules from specific arbitration services in their arbitration
agreement delegates arbitrability. See, e.g., id. (incorporating the American
Arbitration Association rules); Brittania-U Nigeria, Ltd. v. Chevron USA, Inc.,


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                                 No. 17-60631
866 F.3d 709, 714 (5th Cir. 2017) (incorporating the United Nations
Commission on International Trade Law rules).
      The arbitration clause includes such a delegation. The CWP DA provided
that the parties’ dispute “shall be finally resolved by binding arbitration in
accordance with the arbitration rules of JAMS/Endispute.” If the court
determines that “there is a delegation clause, the motion to compel should be
granted in almost all cases.” Kubala, 830 F.3d at 202.
      Kubala explains that where there is a delegation clause, the court must
only consider whether the parties intended for “the arbitrator [to] decide
whether a given claim must be arbitrated.” Id. Unlike some language which
courts have characterized as narrow, the “any dispute” language in the CWP
DA is not qualified or limited. Cf. Pennzoil Expl. & Prod. Co. v. Ramco Energy
Ltd., 139 F.3d 1061, 1064 (5th Cir. 1998) (suggesting a narrow construction of
a clause providing for arbitration of “disputes arising out of [a particular]
contract” (emphasis added) (quotation omitted)); Coffman v. Provost *
Umphrey Law Firm, L.L.P., 161 F. Supp. 2d 720, 725 (E.D. Tex. 2001)
(narrowly construing a clause providing for arbitration of “any dispute arising
under” a particular agreement (emphasis added)), aff’d, 33 F. App’x 705 (5th
Cir. 2002). The unqualified “any dispute” language in the CWP DA confirms
that the delegation of arbitrability was intended to apply to all disputes
between the parties. The district court aptly reasoned that “the phrase ‘any
dispute’ should be interpreted broadly because ‘disputes’ arising under the
CWP DA could involve disputes under any previous dealer agreements because
the contract contains a ‘cross-termination’ provision.”
      In sum, the parties’ express intent to enter into an arbitration clause,
the terms of the arbitration clause, including its delegation and “any dispute”
provisions, and the cross-termination clause all support the conclusion that the
district court did not err in granting Deere’s motion to compel arbitration.
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                             No. 17-60631
                            CONCLUSION
    For the foregoing reasons the judgment of the district court is
AFFIRMED.




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