Lead Opinion
OPINION
Sunоco, Inc. appeals from the District Court’s denial of its motion to compel arbitration, arguing that Donald "White, who brought this lawsuit against Sunoco alleging fraud on behalf of a putative class, must arbitrate his claims pursuant to a credit card agreement that White signed with a third party who is not named in the lawsuit. At issue in this appeal is whether Sunoco, a non-signatory to the credit card agreement and who is not mentioned in the agreement, can compel "White to arbitrate. After examining" the relevant state law and applying it to the facts here, we will affirm the District Court’s judgment.
Appellant Sunoco is a Pennsylvania corporation that markets' and sells gasoline through approximately 4,900 retail operations in 26 states. This lawsuit involves the “Sunoco Rewards Program,” which Sunoco advertised through various promotional materials. The Sunoco Rewards Program offered customers who buy gas at Sunoco locations using a Citibank-issued credit card (the “Sunoco Rewards Card”) a 5-cent per gallon discount either at the pump or on their monthly billing statements. The promotional materials included a “Terms and Conditions of Offer” sheet, indicating that Citibank, N.A. is the issuer of the Sunoco Rewards Card. Joint Appendix (“J.A.”) 45, 52. They also stated-that approval for the card was dependent on meeting Citibank’s creditworthiness criteria and that by applying for the card, the applicant authorized Citibank to “share with Sunoco® and its affiliates experiential and transactional information regarding your activity with us.” J.A. 52. Finally, the promotion explained, “When you become a cardmember, you will receive the full Su-noco Rewards Card Program Terms and Conditions, which may change at any time for any reason upon thirty (30) days prior written notice.” Id Although Sunoco and White disagree as to whether Sunoco and Citibank jointly marketed the credit card, it is undisputed that Sunoco was not a corporаte affiliate of and had no ownership interest in Citibank and vice versa.
Appellant White is a Florida resident who applied for and obtained a Sunoco Rewards Card from Citibank in 2013. He made fuel purchases with the card at various Sunoco-branded gas station locations. White alleges that “[cjontrary to its clear and express representations, Sunoco does not apply a 5<f/gallon discount on all fuel purchases made by cardholders at every Sunoco location. Sunoco omits this material information to induce customers to sign-up for the Sunoco Rewards Credit Card so they frequent Sunoco locations.” J.A. 31. White avers that but for the representations regarding the 5-cent per gallon discount, he “would not have become [a] Su-noco Credit Card cardholder[ ] and/or would have purchased gasoline at cheaper prices and/or elsewhere.” J.A. 37. He brings claims of fraud and' fraudulent inducement, negligent misrepresentation, unjust enrichment, and violation of the Florida Deceptive and Unfair Trade Practices Act. White’s claims are against Suno-co only, and he alleges no misconduct by Citibank.
White’s Sunoco Rewards Card is governed by a Card Agreement, which he received when he first obtained the card from Citibank and again when he requested additional copies of the agreement from Citibank on April 30, 2014 and June 1, 2015. The ‘ Card Agreement ’ explicitly states that “we, us, and our mean Citibank, N.A., the issuer of your account” and that “y°u, your, and yours mean the person who applied to open this account.” J.A. 88.
It is undisputed that Sunoco is not a signatory to the Card Agreement, to which White and Citibank are the only parties. The Card Agreement does not mention the word “Sunoco”; it also makes no mention of the 5-cent per gallon discount. However, the account statements mailed to White bear the Sunoco logo and include e-mail
Sunoco filed a motion to-compel arbitration based on the arbitration clause contained in the Card Agreement. The arbitration clause provides in relevant part,
PLEASE READ THIS PROVISION OF THE AGREEMENT CAREFULLY. IT PROVIDES THAT ANY DISPUTE MAY BE RESOLVED BY BINDING ARBITRATION. ARBITRATION REPLACES THE RIGHT TO GO TO COURT, INCLUDING THE RIGHT TO A JURY AND THE RIGHT TO INITIATE OR PARTICIPATE IN A CLASS ACTION OR SIMILAR PROCEfeDING. IN ARBITRATION, A DISPUTE IS RESOLVED BY AN ARBITRATOR INSTEAD OF A JUDGE OR JURY. ARBITRATION PROCEDURES ÁRE SIMPLER AND MORE LIMITED THAN COURT PROCEDURES.
Agreement to Arbitrate: Either you or we may, without the other’s consent, elect mandatory, binding arbitration for any claim, dispute, or controversy between you and us (called “Claims”).
J.A. 91. The arbitration clause also defined the claims that are subject to' arbitration as those “relating to your account, a prior related account, or our relationship ... including Claims regarding the application, enforceability, or interpretation of this Agreement and this arbitration provision.” Id. The provision adds that relevant claims are subject to arbitration “no matter what legal theory they are based on or what remedy ... they seek.” Id. Finally, a paragraph titled “Whose Claims are subject to arbitration?” states, “[n]ot only ours and yours, but also claims made by or against anyone connected with us or you or claiming through us or you, such as a co-applicant or authorized user of your account, an employee, agent, representative, affiliated company, predecessor or successor, heir, assignee, or trustee in bankruptcy” are subject to arbitration. Id. The arbitration provision also sets forth the steps for invoking arbitration: “At any time you or we may ask an appropriate court to compel arbitration of Claims, or to stay the litigation of Claims pending arbitration, even if such Claims are part of a lawsuit, unless a trial has begun or a final judgment has been entered.”
The District Court denied Sunoco’s motion to compel arbitration. The court began its analysis by noting that “traditional principles of state law allow a contract to be enforced by or against nonparties to the contract” and that such principles apply to arbitration agreements. J.A. 11 (quoting Griswold v. Coventry First LLC,
Examining the arbitration provision itself, the District Court observed that there was no dispute as to the validity of the provision and that the provision could only be enforced by signatories ■ to it unless contract, agency, or estoppel principles dictated otherwise. The District Court examined all three and determined that none applied. It concluded that as to contract
Sunoco timely appealed.
II.
The District Court had jurisdiction- pursuant to 28 U.S.C. § 1332(d). Our appellate jurisdiction over the District Court’s denial of Sunoco’s motion to compel arbitration derives from 28 U.S.C. § 1291 and the Federal Arbitration Act (“FAA”), 9 U.S.C. § 16(a)(1)(B). See Griswold,
III.
The key issue in this case is whether Sunoco, as a nonsignatory to the Card Agreement and its arbitration clause, can compel White to arbitrate. The Supreme Court explained in Arthur Andersen LLP v. Carlisle that “ ‘traditional principles’ of state law allow a contract to be enforced by or against nonparties through ‘assumption, piercing the corporate veil, alter ego, incorporation by reference, third-party beneficiary theories, waiver and estoppel.’”
Sunoco argues that equitable estoppel prevents White from refusing arbitration
To choose which state law will apply, “a federal court sitting in diversity must apply the choice-of-law rules of the forum state.” LeJeune v. Bliss-Salem, Inc.,
Under South Dakota law, a signatory can be forced to arbitrate against a non-signatory under principles of equitable estoppel in either of two circumstances. The first is when “all the claims against the nonsignatory defendants are based on alleged substantially interdependent and concerted misconduct by both the nonsig-natories and one or more оf the signatories to the contract.” Rossi Fine Jewelers, Inc. v. Gunderson,
Although the Florida Supreme Court has not opined on equitable еstoppel in the arbitration enforcement context, we “predict how it would rule if faced with the issue.” Spence v. ESAB Grp., Inc.,
A non-signаtory may enforce an arbitration clause against a signatory under Florida law in either, of two circumstances. First, “[e]quitable estoppel is warranted when the signatory to the contract containing the arbitration' clause raises allegations of concerted conduct by both the nonsignatory and one or more, of the signatories to the contract.” Armas,
To summarize: both South Dakota and Florida courts would apply the doctrine of equitable estoppel to prevent a signatory from avoiding arbitration against a non-signatory in two circumstances. First, if a plaintiff-signatory alleges concerted conduct on the part of both the non-signatory and another signatory, that plaintiff may be equitably estopped from avoiding arbitration with the non-signatory. Second, if a plaintiff-signatory asserts a claim against a defendant based on an agreement, that plaintiff may be equitably estopped from avoiding arbitration on the basis that the defendant was not a signatory-to that same agreement. Neither circumstance is applicable in this case.
We hold that White cannot be forced to arbitrate under principles of equitable estoppel under either South Dakota or Florida law. First, there is no alleged “concerted conduct” or misconduct on the part of Sunoco and Citibank. See Armas,
■ We also disagree with Sunoco’s characterization of this case as akin to one alleging that the entire Card Agreement, including the arbitration agreement, is the product of fraud. See Sunoco Br. 34 (citing Merrit-Chapman & Scott Corp. v. Pa. Turnpike Comm’n,
Second, the claims that White asserts against Sunoco do not rely on any terms in the Card Agreement; White is therefore not estopped from avoiding arbitration under the arbitration clause within the Card' Agreement. We know this to be true because even if the Card Agreement contained entirely different terms—for example, about the interest rate, credit limit, billing address, annual membership fee, foreign transaction fees, payment schedules, credit reporting rules, or even the arbitration agreement—that would not have any bearing on the validity of White’s claims against Sunoco regarding its allegedly fraudulent promise to discount 5 cents per gallon" of fuel at Sunoco locations. Accordingly, White cannot be required to arbitrate based on the Card Agreement under South Dakota or Florida law.
We also address two alternative arguments Sunoco advances which do not relate to estoppel. First, Sunoco argues that its promotional materials and the Card Agreement must be read together as one “integrated whole,” and that this is a basis for compelling arbitration. Second, Sunoco argues that the arbitration clause in the Card Agreement requires that White аrbitrate against “connected” entities, of which Sunoco claims it is one.
A.
Sunoco asserts that the District Court erroneously concluded that Sunoco’s promotional materials constituted a separate contract from the Card Agreement. Sunoco argues that the “the promotional materials and the Sunoco Rewards Card Agreement ... together ... explain and supply all of the key terms of the Sunoco Rewards Card Program,” J.A. 24, and therefore form an “integrated whole” contract between White and Citibank and Su-noco. Because of this purported “integrated” contract consisting of both the Card Agreement and the promotional materials, Sunoco asserts it is entitled to invoke the arbitration clause in the Card Agreement despite not being a signatory or being mentioned at all. While we are unconvinced that Sunoco’s argument could ever yield a conclusion that all agreed to include Sunoco as a party to the arbitration clause, see infra, we begin by concluding that the “integrated whole” assertion itself is unfounded.
First, Sunoco’s own representations contradict this position and the position taken by our dissenting colleague. Su-noco argues that the promotions were “simply an offer to receive offers, or more precisely, an invitation for Plaintiff to submit an application,” Sunoco Br. 20, and acknowledges that a consumer who has been offered a promotional deal has no obligations at all.
B.
Sunoco’s final argument is that the Card Agreement’s arbitration clause compels White to arbitrate claims against “connected” entities, of which Sunoco claims it is one. Sunoco points to the portion of the arbitration clause in the Card Agreement which defines the claims covered as inclusive of those “made by or against anyone connected with us or you or claiming through us or you.” J.A. 91. Sunoco argues that it is “connected with” Citibank as it jointly marketed the Sunoco Rewards Card with Citibank.
First, Sunoco’s argument fails because it confuses the nature of the claims covered by the arbitration clause with the question of who can compel arbitration. Even if Sunoco is “connected” with Citibank and the claims against Sunoco are covered claims, that does not give Sunoco the right to elect to arbitrate against White. The arbitration clause of the Cardholder Agreement establishes unequivocally that “[e]ither you or we may, without the other’s consent, elect mandatory, binding arbitration for any claim, dispute, or controversy between you and us (called ‘Claims’).” J.A. 91. Moreover, the clause also provides, “At any time you or we may ask an appropriate court to compel arbitration of Claims.” Id The Cardholder Agreement defines “you” as the card holder and “we” and “us” as Citibank. J.A. 88. Nowhere does the agreement provide for a
Second, we are skeptical of whether the joint marketing campaign between Sunoco and Citibank could make Sunoco a “connected” entity under the arbitration clause.
⅜ ‡ ⅜ ⅜ ‡ ⅜
The FAA “simply requires courts to enforce privately negotiated agreements to arbitrate, like other contracts, in accordance with their terms.” Volt Info. Scis., Inc. v. Bd. of Tr. of Leland Stanford Junior Univ.,
V.
For the reasons stated above, we will affirm the District Court’s order denying Sunoco’s motion to compel arbitration.
Notes
. Before bringing this action, White communicated with the Citibank customer service department several times regarding the status of fuel discount credits that he claims he was entitled to but did not receive. White alleges that on several occasions, Citibank told him that "[u]nfortunately, not all stations honor the discount as they are independently owned and operated.” J.A. 252; see also J.A, 31. White acknowledges that Citibank did credit his account to some extent after he complained.
. Citibank registered the arbitration clause of this agreement with the American Arbitration Association as the “Citibank Cards Standard Arbitration Agreement-." J.A. 338-41. -
. Sunoco does not challenge the District Court’s conclusion that third-party beneficiary theory and agency theory were invalid bases for Sunoco to compel White to arbitrate.
. The parties appear to rely on DuPont,
. The equitable estoppel rule in Pennsylvania is essentially the same as the test described in DuPont: “ 'non-signatories to an arbitration agreement can enforce such an agreement when there is an obvious and close nexus between the nonsignatories and the contract or the contracting parties' ... [and if] claims against [the non-signatory] are inextricably entwined with the Contract.” Elwyn v. DeLuca,
. While the Card Agreement’s choice-of-law clause requires that the terms of the agreement itself be governed by South Dakota law, it is not immediately obvious whether the issue of equitable estoppel would be determined by that clause, especially since Citibank—which drafted the choice-of-law clause and is located in South Dakota—is not party to this dispute.
. Sunoco’s argument appears to be solely to refute the District Court’s passing mention of a "separate agreement” between White and Sunoco in concluding that White should not be held to the cardholder agreement when he did not invoke any of its terms against Suno-co. J.A. 18-19. The District Court’s analysis of this issue relied upon caselaw regarding es-topping non-signatories from avoiding arbitration. We have already determined that under the relevant state law regarding estopping signatories, Sunoco has failed to meet the standard for invoking equitable estoppel regardless of whether there is a "separate agreement” between White and Sunoco.
. In order for multiple writings to constitute a single agreement between parties, the writings "must show, either on its face or by reference to some other writing, the contract between the parties so that it can be understood without having recourse to parol proof.” Meek v. Briggs,
. There is no conflict between Florida and South Dakota law regarding the parol evidence rule or other applicable principles, so we need not determine which state’s laws apply. See Berg Chilling,
. Per the choice-of-law clause in the Cardholder Agreement, we use South Dakota law to interpret the express terms of the contract, See Kruzits v. Okuma Mach. Tool, Inc.,
. We also reject Sunoco's argument that the District Court should have conducted a summary trial on the issue of whether Sunoco and Citibank jointly marketed the Sunoco Rewards Card. The District Court acknowledged this issue as a disputed fact and correctly concluded that disposition does not turn on its resolution.
Dissenting Opinion
dissenting:
This case involves a single contract about a hybrid product: the Sunoco Re
I.
As a threshold issue, the promotional materials
Basic contract law dictates that this process cannot create two separate contracts. Promotional materials are generally not considered offers that can be accepted through application, especially when the application is explicitly subject to approval.
Insofar as the majority holds that there is only one valid contract—the Card Agreement between White and Citibank— with terms independent from those specified in the promotional materials,
Florida and South Dakota have each articulated standards for construing multiple documents together as one contract. The Florida Supreme Court will read multiple instruments as one contract where “[t]he instruments in writing which allegedly constitute a valid contract .., specify the terms and conditions definitely and certainly.”
Here, the promotional materials and Card Agreement together state the definite terms of the contract and are clearly part of a single transaction; accordingly, both should be considered together as one contract. The documents evince the parties’ intent for the documents to be read together as one contract. First, only when read together do the promotional materials and the Card Agreement state the definite
Second, the fact that the promotional materials and Card Agreement are part of a single transaction is shown through the internal references to, and dependence between, the documents. The promotional materials clearly refer to the Card Agreement in setting out the entire process which would create the Sunoco Rewards Card Contract.
II.
Following then from the conclusion that there is but one contract here—the contract between White, Sunoco and Citibank made up of the promotional materials and the Card Agreement—Sunoco, as a party to the contract, is in a position to exercise the provisions of the contract. The plain language of the contract allows Sunoco to compel arbitration of White’s claims.
The majority, however, relies on the clause stating that “[ejither you or we may, without the other’s consent, elect mandatory, binding arbitration[,]”
The majority next holds that Sunoco is not sufficiently “connected with” Citibank to render its claims arbitrable. Based on the examples listed in the clause, the majority opines that sufficient relationships are those “where rights and obligations are intertwined and where liability may be sharedt;]” relative to such relationships, Sunoeo’s “merely ... marketing relationship” with Citibank is insufficient.
While brief excerpts of the Card Agreement can be narrowly read to suрport the majority’s interpretation, when read as-a whole the contract clearly evince an intent to allow Sunoco to compel arbitration.,
III.
Finally, even if the plain language of .the contract did not allow Sunoco to compel arbitration, Sunoco may do so if “ ‘traditional principles’ of state law allow a contract to be enforced by or against nonparties to the contract.”
While the majority holds that White’s claims do not rely on any terms in the Card Agreement, since the underlying contract encompasses both the promotional materials and the Card Agreement, White’s claims clearly do. White’s claims arise out of the terms 'of the fuel, discount, which are outlined in the promotional materials. Since the promotional materials are part of the same contract as the arbitration clause, White’s claims “arise out of’ the underlying agreement, and Sunoco can compel arbitration based on. equitable es-toppel.
ÍV.
At issue is an attempt to bypass, through artful pleading, a valid agreement to arbitrate. Clever framing, however, cannot obfuscate the intent оf the parties upon creation of the contract. Given that there is an integrated agreement between White, Sunoco, and Citibank, I would hold that, either under the plain terms of the contract or through equitable estoppel, Su-noco can compel arbitration of the claims brought against it. I respectfully dissent.
. I agree with the majority’s choice of law analysis and will accordingly apply Florida and South Dakota law.
. The majority’s characterization of the promotional materials as parol evidence misses the point. Maj. at 266. The promotional materials are not used to interpret an ambiguous term in an otherwise complete contract; rather, the promotional materials are themselves part of the complete Sunoco Rewards Card contract.
. Whether this is so is a question of law for the courts. Baker v. Wilburn,
. Certainly, Sunoco would not have engaged in such a promotion of a Citibank credit card without Citibank’s full knowledge and agreement. .
. JA 44-46, 51-52.'
. JA 44, 52 ("When you become a cardmem-ber, you will receive the full Sunoco Rewards Card Program Terms and Conditions, which may change at any time for any reason upon thirty (30) days prior written notice.”).
. Maj. at 260, fn. 1.
. . JA 44, 52.
. Restatement (Second) of Contracts § 26 (1981) ("A manifestation of willingness to enter into a bargain is not an offer if the person to whom it is addressed knows or has reason to know that the person making it does not
. Maj. at 266 ("Sunoco has also conceded that there are no terms to ‘integrate’ with the actual contract at issue: the Card Agreement.”).
. Webster Lumber Co. v. Lincoln,
. Citibank (S.D.), N.A. v. Hauff,
. While most such cases involve multiple contracts, the South Dakota Supreme Court has construed non-contract writings as part of a contract in at least one case. In Citibank (S.D.), N.A. v. Hauff, thе South Dakota Supreme Court held that the expiration language on credit cards were part of Citibank’s credit card agreement.
. Id. at 837.
. Baker,
. First Trust & Sav. Bank v. McVeigh,
. Kramer v. William F. Murphy Self-Declaration of Trust,
. JA44, 52.
. JA 91.
. JA 88.
. JA 91.
. JA 91.
. Maj. at 268.
. Griswold v. Coventry First LLC,
. Rolls-Royce PLC v. Royal Caribbean Cruises LTD.,
. Rossi,