Harley Blanton v. Domino's Pizza Franchising LLC
962 F.3d 842
| 6th Cir. | 2020Background
- Domino’s franchises are independently owned but contractually constrained; Domino’s allegedly required franchises not to hire from other franchises without consent.
- Derek Piersing worked at one Domino’s franchise, then was hired at another and signed an arbitration agreement requiring arbitration under the AAA Rules.
- Piersing alleges the first franchise fired him to comply with Domino’s franchise agreement; he and a co‑plaintiff filed a class action alleging antitrust and state‑law claims.
- Domino’s (a non‑signatory to Piersing’s arbitration agreement) moved to compel arbitration; the district court ordered arbitration and held the arbitrator should decide gateway arbitrability questions.
- Piersing appealed, arguing Domino’s cannot enforce the arbitration agreement because it did not sign it and that incorporation of the AAA Rules does not clearly delegate arbitrability.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether incorporation of AAA Rules provides "clear and unmistakable" evidence that parties delegated arbitrability to the arbitrator | Incorporation applies only after a court first finds the claim falls within the agreement; does not clearly delegate arbitrability | Incorporation of AAA Rules (which empower arbitrators to decide jurisdiction) is clear evidence of delegation | Court: Incorporation of AAA Rules is clear and unmistakable evidence delegating arbitrability to the arbitrator |
| Choice of law for evaluating "clear and unmistakable" standard | State contract law should govern delegation analysis | The clear‑and‑unmistakable standard is a federal interpretive rule; result same under Washington law | Court: Standard is federal but Washington law reaches same result; choice of law doesn’t change outcome |
| Whether Domino’s (a non‑signatory) can enforce the agreement (gateway issue) | Domino’s lacks signature so cannot compel arbitration; court should resolve non‑signatory challenge | The question of whether Domino’s can enforce the agreement is a question of arbitrability delegated to the arbitrator | Court: The arbitrator should decide whether Domino’s can enforce the agreement; arbitration compelled |
| Procedural/ancillary issues (leave to amend; vacatur of district opinion) | District court erred by denying leave to amend and should vacate portions deciding equitable estoppel | No motion for leave to amend was properly filed; vacatur unnecessary because judgment is limited to order compelling arbitration | Court: No abuse of discretion on amendment (no proper request); will not vacate district court opinion language but clarifies arbitrator decides enforcement issues |
Key Cases Cited
- Rent‑A‑Center, W., Inc. v. Jackson, 561 U.S. 63 (2010) (arbitration is contractual and parties may agree to arbitrate gateway questions)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (requires "clear and unmistakable" evidence to delegate arbitrability)
- Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019) (arbitrator may decide arbitrability even if the argument for arbitration is wholly groundless)
- Preston v. Ferrer, 552 U.S. 346 (2008) (courts may look to incorporated arbitral rules to determine parties' intent)
- C & L Enters., Inc. v. Citizen Band Potawatomi Indian Tribe of Okla., 532 U.S. 411 (2001) (use of institutional rules can inform scope and allocation of arbitrability)
- McGee v. Armstrong, 941 F.3d 859 (6th Cir. 2019) (6th Cir. treated incorporation of AAA Rules as clear and unmistakable delegation)
- In re Automotive Parts Antitrust Litig., 951 F.3d 377 (6th Cir. 2020) (distinguishes challenges by non‑signatories to arbitration existence versus delegated arbitrability)
- Awuah v. Coverall N. Am., Inc., 554 F.3d 7 (1st Cir. 2009) (one of multiple circuits holding incorporation of AAA Rules delegates arbitrability)