KONSTANTINE H. ZOGRAFOS VS. DR. ANTHONY WEHBEÂ (L-1362-14, GLOUCESTER COUNTY AND STATEWIDE), A-1580-15T1

Background

Zografos worked for Soza weight-loss clinics and charged business expenses to his personal card; he later received a 14% membership interest in Soza Clinic, LLC during a 2013 reorganization.
The Operating Agreement and Reorganization Plan (governed by Delaware law) contain broad arbitration clauses requiring arbitration in Philadelphia under AAA or JAMS and state that the agreement is the parties' entire agreement.
In Oct. 2014 Zografos sued in New Jersey Law Division; Judge McDonnell dissolved temporary restraints but dismissed the suit on the ground the parties' disputes were subject to the Operating Agreement’s broad arbitration provision.
In Sept. 2015 Zografos sought to reopen, to file an amended complaint adding parties and claims (including an alleged preexisting oral loan claim), and to compel additional accounting discovery; Judge McMaster denied the relief.
The Appellate Division affirmed, holding that (1) arbitration provisions — which incorporate AAA/JAMS rules — evidence clear intent to delegate arbitrability to arbitrators, and (2) equitable estoppel/related doctrines permit arbitration to bind or include non-signatories when claims are interdependent.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiff’s proposed amended claims fall outside the Operating Agreement’s arbitration clause	Zografos: new claims (e.g., oral loan) are not covered by the Operating Agreement and so are non‑arbitrable	Wehbe: claims arise out of or relate to the Agreement and thus fall within its broad arbitration clause	Court: Claims ‘‘arise out of or relate to’’ the Agreement; they are presumptively arbitrable and not wholly groundless
Who decides arbitrability (court or arbitrator)	Zografos: court should adjudicate arbitrability of new claims	Wehbe: clause incorporates AAA/JAMS rules, so parties clearly and unmistakably delegated arbitrability to arbitrator	Court: incorporation of AAA/JAMS rules shows clear and unmistakable intent to delegate arbitrability to an arbitrator; arbitrator decides scope
Whether non‑signatory defendants can be compelled to arbitrate	Zografos: additional defendants who didn’t sign the Operating Agreement are not bound by its arbitration clause	Wehbe: equitable estoppel and related doctrines permit binding or inclusion of non‑signatories because claims are interdependent	Court: doctrines like equitable estoppel apply where signatory’s claims and non‑signatory conduct are interdependent; arbitration may include non‑signatories to avoid claim‑splitting
Whether the Law Division should be reopened to compel additional discovery/accounting	Zografos: court should reopen to compel documents and ordering further accounting	Wehbe: he produced records in his possession and discovery in arbitration is the appropriate forum	Court: affirmed denial — discovery issues belong in arbitration under AAA/JAMS rules; trial court lacked basis to reopen the case

Key Cases Cited

First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (U.S. 1995) (courts should not presume parties agreed to arbitrate arbitrability absent clear and unmistakable evidence)
James & Jackson, LLC v. Willie Gary, LLC, 906 A.2d 76 (Del. 2006) (Delaware adopts the view that incorporation of arbitration rules can manifest clear intent to delegate arbitrability to an arbitrator)
Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (U.S. 1983) (FAA requires enforcement of arbitration agreements notwithstanding presence of non‑party defendants to related disputes)
Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (U.S. 2009) (traditional state‑law contract principles can bind or permit enforcement by nonparties to arbitration agreements)
GTSI Corp. v. Eyak Tech., LLC, 10 A.3d 1116 (Del. Ch. 2010) (arbitrability delegation where clause incorporates arbitration rules; narrow "wholly groundless" exception)
Douzinas v. American Bureau of Shipping, Inc., 888 A.2d 1146 (Del. Ch. 2006) (equitable estoppel can require signatories to arbitrate claims involving non‑signatories when liabilities are interdependent)
Ashall Homes Ltd. v. ROK Entm’t Group, Inc., 992 A.3d 1239 (Del. Ch. 2010) (Delaware policy disfavors claim‑splitting and supports requiring related disputes to proceed in a single forum)