Richmont Holdings, Inc. v. Superior Recharge Systems, L.L.C.
392 S.W.3d 633
| Tex. | 2013Background
- Richmont Holdings owns imaging supply businesses and acquired Superior Recharge via an asset purchase agreement that requires arbitration of disputes arising from the agreement.
- Jon Blake, owner/manager of Superior Recharge, was hired as Superior Acquisition’s general manager under an employment agreement that lacked an arbitration clause.
- Blake’s employment ended six months after the August 14, 2007 signing of both agreements.
- Blake sued Richmont and related entities for fraud and other relief, including cancellation of his covenants not to compete.
- Richmont moved to compel arbitration after an 18-month delay; the trial court denied the motion
- The court of appeals affirmed the denial on a different rationale, and Richmont petitioned for review arguing the asset purchase arbitration clause covers the dispute and that waiver defenses should be considered.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the asset purchase arbitration clause cover Blake’s suit? | Blake argues the dispute arises from employment, outside the asset purchase scope. | Richmont contends the asset purchase clause governs all disputes relating to the agreement, including this suit. | Yes; arbitration clause applies to the dispute. |
| Did Richmont waive its right to arbitrate by delay and litigation conduct? | Blake contends Richmont waived by substantial invocation of judicial process. | Richmont argues waiver defenses were raised; the status of waiver is for remand/analysis. | Waiver issue to be resolved on remand; Supreme Court reversed lower court on scope and permitted waiver consideration. |
| Should the court apply severability of arbitration clauses when multiple agreements are involved? | Blake emphasizes employment agreement lacks arbitration clause, possibly outside scope. | Richmont relies on asset purchase arbitration term to bind related disputes. | Arbitration clause in asset purchase governs the dispute; employment agreement’s lack of clause does not defeat it. |
Key Cases Cited
- Forest Oil Corp. v. McAllen, 268 S.W.3d 51 (Tex. 2008) (court must compel arbitration when a valid agreement governs and defenses fail)
- In re FirstMerit Bank, N.A., 52 S.W.3d 749 (Tex. 2001) (no discretion to deny arbitration when within scope and defenses lacking)
- In re J.D. Edwards World Solutions Co., 87 S.W.3d 546 (Tex. 2002) (per curiam; enforce arbitration agreements when applicable)
- Cantella & Co., Inc. v. Goodwin, 924 S.W.2d 943 (Tex. 1996) (enforcement of arbitration agreements absent defenses)
- Certain Underwriters at Lloyd's of London v. Celebrity, Inc., 988 S.W.2d 731 (Tex. 1998) (interlocutory appeal when decision conflicts with precedent)
