Carr v. MAIN CARR DEVELOPMENT, LLC, 337 S.W.3d 489

MCD is a Delaware series LLC formed to develop real estate projects; Operating Agreement designates 'the Company' as MCD and lists Carr as director and trustee for two entities he controls.
The Operating Agreement contains no arbitration clause and does not bind MCD personally to any arbitration provision.
On December 18, 2008, Carr, CBAC, and MCBD signed the Development Agreement; MCD was not a signatory.
The Development Agreement provides for three development pathways and contains a broad arbitration clause for disputes arising from or relating to the Agreement.
In 2010, MCD sued Carr for fiduciary-duty breaches under Delaware law; Carr and CBAC initiated arbitration under the Development Agreement, naming MCD and MCBD as respondents.
The trial court denied Carr’s motions to compel arbitration of MCD and to abate the suit; this interlocutory appeal followed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether MCD is a third-party beneficiary of the Development Agreement.	Carr asserts MCD benefits from the Development Agreement and should arbitrate.	MCD is not expressly or implicitly intended to benefit under Section 3 or 7(c); no direct third-party beneficiary intent.	MCD is not a third-party beneficiary; no arbitration compelled.
Whether MCD is estopped from avoiding arbitration due to direct benefits from the Development Agreement.	MCD derives benefits from the Development Agreement and should be bound by arbitration under direct benefits estoppel.	Any benefits are insubstantial, indirect, or not tied to the contract terms; claims arise from Delaware law, not the Development Agreement.	Estoppel does not apply; the breach-of-fiduciary-duty claim is tortious and not dependent on the Development Agreement.
Whether the case should be abated or stayed pending arbitration.	Arbitration should determine issues that would resolve this lawsuit; stay is proper.	Arbitrable issues are not controlling the fiduciary-duty claim; stay not required where not resolution of the suit.	No stay required; arbitration will not resolve the fiduciary-duty claim; abatement denied.

In re Kellogg Brown & Root, Inc., 166 S.W.3d 732 (Tex. 2005) (direct benefits estoppel governs when nonsignatory seeks to derive contract benefits)
Weekley Homes, L.P. v. Wynn, 180 S.W.3d 127 (Tex. 2005) (analyzes when contract-based benefits create estoppel; substance over form)
In re Olshan Foundation Repair, Co. LLC, 328 S.W.3d 883 (Tex. 2010) (treats arbitration agreements as contracts; look to contracting parties' intent)
J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223 (Tex. 2003) (requirements to compel arbitration under FAA; scope and validity analysis)
In re Merrill Lynch & Co., Inc., 315 S.W.3d 888 (Tex. 2010) (abstention/abeyance framework for FAA interlocutory review; abuse of discretion standard)