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Quality Plus Services, Inc. v. AGY Aiken LLC

United States District Court, E.D. Virginia, Richmond Division

June 7, 2017

QUALITY PLUS SERVICES, INC., Plaintiff,
v.
AGY AIKEN LLC, Defendant.

          MEMORANDUM OPINION

          M. Hannah Lauck United States District Judge

         This matter comes before the Court on two motions filed by Defendant AGY AIKEN LLC ("AGY"): (1) the Motion to Dismiss for Lack of Personal Jurisdiction and/or Improper Venue, or in the Alternative, Motion to Transfer Venue (the "Motion to Dismiss or Transfer"), (ECF No. 3); and, (2) the Motion to Dismiss, or in the Alternative, to Stay the Proceedings and Compel Arbitration (the "Motion to Compel Arbitration"), (ECF No. 5). Plaintiff Quality Plus Services, Inc. ("QPS") has responded to AGY's motions, (ECF Nos. 7, 8), and AGY has replied, (ECF Nos. 10, 11). Accordingly, the motions are ripe for adjudication. The Court dispenses with oral argument because the materials before it adequately present the facts and legal contentions necessary to resolve the motions. For the reasons that follow, the Court will grant the Motion to Compel Arbitration and deny the Motion to Dismiss or Transfer as moot. The Court will dismiss the action without prejudice.

         I. Procedural and Factual Background

         A. Procedural History

         QPS initially filed suit in Virginia state court, alleging two causes of action: (1) breach of contract; and, (2) unjust enrichment. AGY removed the case to this Court on the basis of diversity jurisdiction[1] and filed two motions seeking dismissal: (1) the Motion to Dismiss or Transfer, which challenges personal jurisdiction and venue; and, (2) the Motion to Compel Arbitration, which argues that a valid and enforceable arbitration clause requires that the Court compel arbitration. QPS responded to both of AGY's motions, and AGY replied.

         B. Factual Background and the Agreement to Arbitrate[2]

         AGY operates a plant in Aiken, South Carolina. In 2014 or 2015, AGY decided to modify the plant's "E-Wing." That project required, among other things, "demolishing three existing furnaces, extensive steel repairs to a large hallway/'tunner area[J and new construction of three internal floors." (Compl. ¶ 7, ECF No. 1-1.) AGY did not issue a single contract for the entire project and instead contracted with QPS to perform substantial portions of it, for which the parties contracted through individual purchase orders. In all, AGY issued at least nineteen separate purchase orders to QPS. After QPS received a purchase order from AGY, QPS would issue an invoice. Three invoices allegedly remain outstanding and unpaid. QPS's suit arises from those three invoices.

         AGY offers a declaration from its Purchasing Leader, Tom Kessing, which states that certain "Terms and Conditions" accompanied each purchase order. (Kessing Decl. ¶ 6, ECF No. 6-1.) QPS presents nothing to rebut this sworn statement. (See Starratt Decl. 9, ECF No. 8- 1 ("The 'AGY Terms and Conditions of Purchase' were a separate attachment to the emails.").) The scope of the Terms and Conditions is as follows:

1. Acceptance. By accepting or filling this order or rendering services under this order, the Seller agrees to these terms and conditions, which shall prevail over an inconsistent provisions in any form or other paper submitted by Seller except as expressly set forth herein. These terms and conditions of purchase are applicable to all purchase orders and are the only terms and conditions applying to a sale of seller's goods and services except those which additionally relate to (i) price, (ii) quantity, (iii) delivery schedule, (iv) separate warranties, (v) payment terms and (vi) description and specifications of the goods and services, and Buyer hereby expressly rejects any terms and conditions proposed by Seller which are different from or in addition to the terms contained herein, unless expressly assented to in writing by Buyer. Agreements for sales created by Seller's acceptance on these terms shall be deemed to have been formed in the state of South Carolina, regardless of the location of Seller.

(AGY Terms and Conditions of Purchase ¶ 1, ECF No. 6-2.) The Terms and Conditions provide the following arbitration clause (the "Arbitration Clause"):

13. Disputes. Any dispute or cause of action the Buyer and Seller may have with one another arising out of this agreement shall be finally settled by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association and in accordance with the substantive laws of the state of South Carolina, excluding the conflicts of law provisions of such laws. Judgment upon the award rendered by the arbitrators may be enforced in any court having jurisdiction thereof. The arbitration tribunal shall consist of three arbitrators, of whom one shall be nominated by Buyer, one by Seller, and a third, who shall serve as chairman, shall be chosen by the two party-nominated arbitrators. The place of arbitration shall be Atlanta, Georgia. The award of the arbitrators shall be final and binding. The parties waive any right to appeal the arbitrage award, to the extent a right of appeal may be lawfully waived. Each party retains the right to seek judicial assistance to compel arbitration, to obtain interim relief pending arbitration, and to enforce the award of the arbitrators, including the final award.

(Id. ¶ 13.)

         The record does not explicitly indicate whether QPS objected to the Terms and Conditions or the inclusive Arbitration Clause. QPS, however, acknowledges that it did not discuss any of the Terms and Conditions with AGY. Nonetheless, the parties disagree about whether the Terms and Conditions apply to the purchase orders at issue.

         II. Analysis

         The Court finds that QPS's claims are subject to binding arbitration pursuant to the Federal Arbitration Act ("FAA")[3] because: (1) the parties agreed to the Terms and Conditions; and, (2) the scope of the Arbitration Clause covers the disputes between QPS and AGY. Accordingly, the Court will grant the Motion to Compel Arbitration and dismiss the action without prejudice. Because the Court will dismiss this action for improper venue based on the binding Arbitration Clause, the Court will deny the Motion to Dismiss or Transfer as moot.

         A. The Federal ...


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