OPINION
This is an arbitration dispute in which the parties are currently litigating the question of where they should be litigating—in court or in arbitration. The parties agreed in writing to arbitrate certain disputes. DCK now takes the position that the parties’ arbitration provision does not apply to the claims in this case. For the following reasons, Burns and Roe’s Motion to Dismiss or Stay Pending Arbitration or Mediation (ECF No. 5) will be granted, this case will be stayed pending arbitration, and the parties will be ordered to arbitration in the manner they have agreed.
I. BACKGROUND
Plaintiff DCK North America, LLC (“DCK”) filed this action alleging, among other things, that Defendant Burns and Roe Services Corporation (“Burns and Roe”) breached its contractual obligation to compensate DCK for over eight million dollars ($8,000,000) of unpaid costs incurred during joint construction projects in Guantanamo Bay, Cuba. ECF No. 1-2. Burns and Roe timely removed the case to this Court from the Court of Common Pleas of Allegheny County, Pennsylvania on the basis of diversity jurisdiction. ECF No. 1. Before the Court is Burns and Roe’s Motion to Dismiss or Stay Pending Arbitration or Mediation. ECF No. 5. The parties fully briefed the issues and the Court heard oral argument on September 6, 2016. ECF Nos. 6, 6, 12, 13, 14, 20, 21, 22, 23.
The basic facts are undisputed. Eight years ago, DCK and Burns and Roe entered into a Joint Venture Agreement (“Agreement”) to bid on construction project contracts for the United States Navy at Guantanamo Bay, Cuba, and to perform such contracts should they be awarded the bids.
DCK now alleges Burns and Roe shorted it over eight million dollars. Id. The shortfall, according to DCK, is based upon the parties’ respective monetary contributions for labor, manpower, and equipment. Id. DCK filed suit, and Burns and Roe subsequently filed its Motion to Compel Arbitration (ECF No. 5).
The parties’ Agreement contains the following arbitration provision:
Any controversy or claim arising out of or relating to this Agreement or the breach thereof which cannot be resolved in accordance with the foregoing processes while in the course of performance of the Contract(s) shall be settled by arbitration in accordance with the Construction Industry Arbitration Rulesof the American Arbitration Association and any award tendered shall be final and binding upon the parties hereto, and judgment on the award rendered by the Arbitrator or Arbitrators may be entered in any Court having jurisdiction thereof. Any controversy or claim arising after the completion of the Construction Contract has been performed shall be resolved in a court of law.
ECF No. 1-2 at 23-24. Neither party disputes the validity or the binding nature, generally speaking, of the arbitration provision.
The plain language of the Agreement appears to draw a line between disputes referable to arbitration and disputes that should be settled in court: Those disputes arising during performance of the Contracts) shall be settled by arbitration and those arising after completion of performance of the Construction Contract shall be settled in court. But at oral argument on Burns and Roe’s motion, it became quite clear that the parties have logical and reasonable positions in support of their differing views as to whether performance on the Contraet(s) or the Construction Contract is complete. The parties agree that physical construction of the projects—the labor—is complete. The parties also agree, though, that they have not submitted a certificate of completion to the Navy, nor has the Navy approved all of their construction work. Thus, it would appear that the arbitrability of the parties’ dispute thus turns on a mixed question of fact and contractual interpretation: whether performance of the Contract(s) and/or the Construction Contract was ‘complete’ when this dispute arose.
Upon closer scrutiny of the parties’ Agreement, the line of demarcation as to contract completion is anything but sharp. The Agreement defines the term “Contract(s)” to include several of the Navy contracts the parties bid on as part of their joint venture. ECF No. 1-2 at 10. It does not, however, provide a definition for what the parties refer to as “the Construction Contract.” Nor does it make clear what goalpost the parties contemplated for completion of performance on the Construction Contract such that arbitration would no longer be appropriate. The parties might, for example, have contemplated Contract completion as having occurred once the physical labor had been performed. They might have contemplated completion when the Navy approved the final buildouts. They might have contemplated completion when all outstanding payments had been received. Or the parties might not have contemplated this question at all, at least in terms of providing any definitional language in the Contract documents.
At the Court’s request, the parties submitted supplemental briefing addressing who must decide the question of when “after completion of the Construction Contract has been performed” occurs. ECF Nos. 22, 23. The parties also addressed whether a reference in the parties’ arbitration provision to the Construction Industry Arbitration Rules of the American Arbitration Association (hereinafter “AAA Rules” or “Rules”) incorporates those Rules into the provision, and, if so, whether such incorporation requires that the dispute be arbitrated in and of itself. Id. DCK contends this Court must decide the question presented here and argues (seemingly as a matter of law) that the parties’ dispute is not arbitrable under the Agreement. ECF No. 23. Burns and Roe contends an arbitrator must determine the issue of Contract completion and, beyond that, the dispute in any event falls within the arbitration provision. ECF No. 22.
II. LEGAL STANDARD
The United States Court of Appeals for the Third Circuit recently clarified the standards to be applied to motions to compel arbitration, identifying the circum
Where the affirmative defense of arbi-trability of claims is apparent on the face of a complaint (or documents relied upon in the complaint), the FAA would favor resolving a motion to compel arbitration under a motion to dismiss standard without the inherent delay of discovery. That approach appropriately fosters the [Federal Arbitration Actj’s interest in speedy dispute resolution. In those circumstances, the question to be answered becomes whether the assertions of the complaint, given the required broad sweep, would permit ad-duction of proofs that would provide a recognized legal basis for rejecting the affirmative defense.
Id. at 773-74 (internal citations and quotations omitted). With respect to the Rule 56 standard, the court held:
[A] Rule 12(b)(6) standard is inappropriate when either the motion to compel arbitration does not have as its predicate a complaint with the requisite clarity to establish on its face that the parties agreed to arbitrate, or the opposing party has come forth with reliable evidence that is more than a naked assertion that it did not intend to be bound by the arbitration agreement, even though on the face of the pleadings it appears that it did. Under the first scenario, arbitra-bility not being apparent on the face of the complaint, the motion to compel arbitration must be denied pending further development of the factual record. The second scenario will come into play when the complaint and incorporated documents facially establish arbitrability but the non-movant has come forward with enough evidence in response to the motion to compel arbitration to place the question in issue. At that point, the Rule 12(b)(6) standard is no longer appropriate, and the issue should be judged under the Rule 56 standard. Under either of those scenarios, a restricted inquiry into factual issues will be necessary to properly evaluate whether there was a meeting of the minds on the agreement to arbitrate, and the non-movant must be given the opportunity to conduct limited discovery on the narrow issue concerning the validity of the arbitration agreement. In such circumstances, Rule 56 furnishes the correct standard for ensuring that arbitration is awarded only if there is an express, unequivocal agreement to that effect.
Id. at 774-75 (internal citations and quotations omitted).
The Guidotti court went on to explain that where the complaint and attached documents “establish on their face that [a plaintiff] agreed to be bound by the terms of ... [a] provision for arbitration,” that would “trigger[ ] a Rule 12(b)(6) standard.” Id. at 776.
Here, DCK attached a copy of the parties’ Agreement to its Complaint, and it critically relied upon that Agreement— which contains the arbitration provision— to state its claim. EOF No. 1-2 at 4-5, 23-24. Neither party—in pleadings, motions, responses, replies, supplemental briefings, or at oral argument—has disputed the validity or enforceability, generally speaking, of the Agreement’s arbitration provision. The Court therefore concludes that under Guidotti, a motion to dismiss standard is appropriate.
III. ANALYSIS
The Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., governs written agreements to arbitrate in contracts involving interstate commerce.
Under the FAA framework, “arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.” Howsam v. Dean Witter Reynolds, Inc.,
The parties’ Agreement is, on its face, silent about who should decide questions of arbitrability. ECF No. 1-2 at 23-24. The question whether the parties have submitted a particular dispute to arbitration is presumptively for judicial determination unless the parties agreed to arbitrate it. Gay v. CreditInform,
In support of its motion to compel, Burns and Roe asserts that an arbitrator should decide the question of arbitrability for two reasons. ECF No. 22 at 2. First, Burns and Roe argues the underlying factual question—whether the parties’ dispute arose during contract performance— amounts to a procedural precondition to arbitration. ECF No. 22 at 4-5. Burns and Roe asserts the question here is of the time-limit variety, and thus, under BG Group, the arbitrator should resolve it. ECF No. 22 at 4-5. The cases dealing with time limit preconditions to arbitration, however, are distinguishable. In BG Group, for example, the provision at issue was a time limitation on the parties’ ability to request arbitration: it stated that a dispute “shall be submitted to international arbitration” on request of a party as long as “a period of eighteen months ha[d] elapsed” since the dispute was submitted to a local tribunal.
Likewise, in Howsam, the Supreme Court considered another time-limit provision which dealt with when, but not whether, arbitration may occur. The provision stated that no dispute “shall be eligible for submission to arbitration ... where six (6) years have elapsed from the occurrence or event giving rise to the ... dispute.”
Here, the question underling the parties’ dispute—whether DCK’s claim arose during performance of the contracts or after performance—is not an issue governing when arbitration may begin, as in EG Group, nor is it an arbitrator’s rule or mechanism for raising a procedural question, as in Howsam. The question is also not one of waiver or delay, questions typically decided by the arbitrator.
Burns and Roe next contends an arbitrator should decide the question of arbi-trability because the parties’ made reference in their arbitration provision to the AAA Rules. Under the parties’ arbitration provision, disputes which arise during performance of the contracts shall be settled by arbitration in accordance with the Rules, while those that arise after performance shall be settled in a court of law. ECF No. 1-2 at 23.
The Third Circuit has not explicitly decided the issue whether incorporation of the AAA Rules is sufficient to establish a clear and unmistakable intent of parties in a bilateral dispute to delegate to the arbitrator the question of arbitrability. Virtually every other circuit to have considered that issue, however, has concluded that incorporation of the Rules is sufficient to establish clear and unmistakable evidence that the parties agreed to arbitrate arbitrability. See Chesapeake Appalachia, L.L.C. v. Scout Petroleum, L.L.C.,
Here, however—even assuming the parties successfully incorporated the AAA Rules into their arbitration provision
In addition and in the alternative, even if incorporation of the AAA Rules were sufficient to subject all the parties’ disputes to those Rules, the Court would then have to intuit, absent any clear contractual provision, whether the parties intended to incorporate the version of the Rules in circulation at the time of the Agreement or at some other time—such as at the time of the dispute or of a court’s ruling on the issue. The Court notes that what appears to be the current version of the AAA Rules provides “[t]he arbitrator shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope, or validity of the arbitration agreement.” AAA Rule R-9, available at http://www.adr.org. But the parties have provided no guidance on past versions of the Rules or their dates of adoption.
Because the parties’ reference to the AAA Rules in their arbitration provision does not necessarily bring those Rules into play in this dispute, and because it is further ambiguous which version of the Rules the parties intended to reference and what those particular Rules reveal, the parties cannot be said to have clearly and unmistakably provided for an arbitrator, rather than a court, to decide the question of arbitrability. The Court must therefore decide the question. See First Options,
When interpreting and applying contractual arbitration provisions, federal substantive law reflects a strong presumption in favor of arbitration. Medtronic,
In determining when the presumption in favor of arbitration applies, the Third Circuit has added an additional layer of analysis. Where “the arbitration provision is narrowly crafted, we cannot presume, as we might if it were drafted broadly, that the parties [ ] agreed to submit all disputes to arbitration.” Local 827, Intern. Broth. Of Elec. Workers, AFL-CIO v. Verizon New Jersey, Inc.,
Here, the parties’ arbitration clause is broad rather than narrow. It provides that “[a]ny controversy or claim arising out of or relating to this Agreement or the breach thereof which cannot be resolved in accordance with the foregoing processes while in the course of performance of the Contract(s) shall be settled by arbitration.” ECF No. 1-2 at 23; EM. Diagnostic Systems, Inc. v. Local 169,
Because the. parties’ arbitration provision is facially unclear regarding what goalpost the parties’ contemplated for completion of performance—whether it be
Applying the presumption, the parties’ arbitration provision meets the standard for referral to arbitration: it is, without question, “susceptible of an interpretation that covers the asserted dispute.” AT&T Tech.,
IV. CONCLUSION
For the reasons set forth above, Burns and Roe’s Motion to Dismiss or Stay Pending Arbitration or Mediation (ECF No. 5) will be granted. This case will be stayed and administratively closed pending arbitration, and the parties will be ordered to proceed forthwith to arbitration in the manner they have agreed. The stay may be lifted by this Court on its own Motion or for good cause shown. An appropriate Order will issue.
Notes
. DCK Worldwide, LLC originally entered the Agreement before assigning it to the Plaintiff in this suit, DCK. ECF No. 1-2 at 25-26. Neither party disputes the validity of the assignment.
. In addition or in the alternative, for the reasons set forth in this Opinion, the Court
.The Court applies the FAA based on the fact that the parties' Agreement involves funding from business in diverse states for construction contracts to be completed in Cuba. Neither party disputes the FAA's applicability, nor do the parties urge the Court to apply the law of any particular state. See Harris v. Green Tree Financial Corp.,
. See also Moses H. Cone Mem. Hasp. v. Mercury Constr. Corp.,
. Bums and Roe does not contend, for exam-pie, that DCK brought its claim too late.
. The Court assumes for the purposes of argument—but does not decide—that the parties’ reference to the AAA Rules was sufficient to incorporate those Rules into the agreement under any applicable state law.
