Highlands Wellmont Health Network, Inc. v. John Deere Health Plan, Inc.

350 F.3d 568 | 6th Cir. | 2003

Before: GUY, and GILMAN, Circuit Judges; REEVES,

District Judge. [*] UNITED STATES COURT OF APPEALS _________________ FOR THE SIXTH CIRCUIT _________________ COUNSEL ON BRIEF: James S. Chase, HUNTON & WILLIAMS, H IGHLANDS W ELLMONT (cid:88) Knoxville, Tennessee, for Appellant. William C. Bovender, (cid:45) H EALTH N ETWORK , I NC .; Jimmie C. Miller, HUNTER, SMITH & DAVIS, Kingsport, (cid:45) W ELLMONT H EALTH Tennessee, for Appellees. (cid:45) No. 02-6078 S YSTEMS , I NC ., doing (cid:45) > business as Wellmont Bristol _________________ (cid:44) Regional Medical Center, (cid:45) OPINION doing business as Wellmont (cid:45) _________________ Holston Valley Medical (cid:45) (cid:45) Center, RALPH B. GUY, JR., Circuit Judge. Defendant, John

(cid:45) Deere Health Plan, Inc. (JDHP), appeals from the denial of its Plaintiffs-Appellees, (cid:45) motion under the Federal Arbitration Act (FAA), 9 U.S.C. (cid:45) § 4, to compel arbitration of the claims asserted by plaintiffs, v. (cid:45) Highlands Wellmont Health Network, Inc. and Wellmont (cid:45) Health System (collectively “Wellmont”). JDHP argues that (cid:45) J OHN D EERE H EALTH P LAN , the district court erred in finding that JDHP had waived its (cid:45) I NC ., rights under the arbitration clause in the parties’ medical (cid:45) services agreement. After review of the record, the applicable Defendant-Appellant. (cid:78) law, and the arguments presented on appeal, we reverse. Appeal from the United States District Court I. for the Eastern District of Tennessee at Greeneville. No. 02-00032—Thomas G. Hull, District Court. JDHP is a qualified health maintenance organization. Wellmont Health Systems owns and operates the Bristol Submitted: September 17, 2003 Regional Medical Center and Wellmont Holston Valley Medical Center in East Tennessee. Each of these hospitals is

Decided and Filed: November 25, 2003 a member of the Highland Wellmont Health Network, Inc. Contract did not contain an arbitration clause. It had an initial Each party will bear its own costs and attorney fees. The term of two years and automatically renewed annually expenses associated with the arbitration will be shared thereafter.

equally by both parties. Arbitration shall be final and In early 2001, the parties entered into a second contract binding on all parties. (2001 Contract) that contained the following arbitration The arbitrator shall have no authority to award exemplary clause:

or punitive damages, and the parties waive their right to 29. DISPUTE RESOLUTION such damages. Contracting Hospital agrees that any dispute arising out Judgment upon the decision of the arbitrator may be of this Agreement shall be resolved in accordance with entered in any court having jurisdiction, and the court JDHP’s written policies and procedures for dispute may enforce the decision of the arbitrator. resolution, which include mandatory, binding arbitration.

The 2001 Contract “superceded” the 1997 Contract “to the The parties waive their right to seek remedies in court, extent [it applied] to inpatient and outpatient hospital including their right to jury trial. If policies and services.” All other terms and conditions of the 1997 procedures are inconsistent with this provision, then this Contract remained in full force and effect. The 2001 Contract provision shall prevail.

was signed by Wellmont on January 24, 2001, and by JDHP Arbitration in regard to benefit determination, utilization, on February 27, 2001. The term of the 2001 Contract for and quality of care matters shall be conducted in Medicare + Choice Product (which includes the services accordance with the Employee Benefit Plans Claims subject to the billing dispute in this case) was made Arbitration Rules of the American Arbitration retroactive to October 23, 2000 through December 31, 2003. Association. Arbitration in regard to all other matters

In November 2000, prior to the signing of the 2001 arising out of this Agreement including, but not limited Contract, JDHP conducted an audit of Wellmont’s billings to, credentialing/recredentialing, participation, and under the 1997 Contract. JDHP determined that Wellmont termination, including termination for quality of care had billed rehabilitation services under the rate code called concerns, shall be conducted in accordance with the DRG 462, which JDHP believed was inappropriate because, Commercial Arbitration Rules of the American among other things, the rehabilitation services were provided Arbitration Association.

in a hospital skilled nursing unit rather than in a licensed With respect to benefit determination, which includes but is not limited to authorization of coverage for medical services and the determination of availability and extent of coverage for services provided to a particular Member,

No. 02-6078 Highlands Wellmont Health Network 5 6 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan rehabilitation facility as required under the Medicare Several months later, on July 13, 2001, JDHP sent a letter regulations. [1]

to Wellmont referencing both the disputed overpayments and the intervening disputed underpayments. [2] With respect to

Wellmont did not learn that JDHP objected to the Wellmont’s proposed resolution methods, JDHP stated: rehabilitation services billings until Wellmont was contacted by the FBI on March 9, 2001—after the 2001 Contract was For the reasons stated above, we cannot agree with the signed. The FBI was investigating allegations made by JDHP assertions made in your May 23 letter that to the Office of the Inspector General of the Department of underpayments have occurred. On the contrary, John Health and Human Services regarding Wellmont’s billing Deere Health maintains its position that the services were practices. Also on March 9, 2001, JDHP informed Wellmont billed inappropriately, resulting in overpayment on John that it was seeking in excess of $1 million for the alleged Deere Health’s part. overpayments for rehabilitation services, and that after March

While we appreciate Wellmont’s interest in resolving 2001 JDHP would prospectively reimburse Wellmont at a what Wellmont wishes to portray as a contract dispute lower rate applicable to a skilled nursing facility (SNF) for quietly and expeditiously, we do not at this point agree to the rehabilitation services performed in Wellmont’s skilled arbitration or other alternative dispute resolution. Rather, nursing units.

John Deere Health reiterates its demand for full payment On April 13, 2001, Wellmont sent a letter to JDHP of all amounts overpaid, totaling in excess of $1.3 regarding the alleged overpayments for rehabilitation million before upward adjustment for interest and services. The letter cited section 12.b of the 1997 Contract in previously returned withhold. outlining Wellmont’s position on the billing dispute. The We also expect that Wellmont [sic] take immediate steps letter concluded with the following:

to correct its billing practice to avoid future Finally, we would like to set a date to discuss overpayments. alternatives for dispute resolution. As I mentioned, On February 8, 2002, Wellmont filed a complaint in this Wellmont would be open to discussion of a range of action asking for a declaration that it was entitled to options, including mediation, possible arbitration, or a reimbursement under the higher DRG 462 rate and asking for possible declaratory judgment action before the Federal damages equal to the difference between the DRG 462 and court. After we have received your analysis and you the SNF rates for rehabilitation services provided after March have had a chance to review our enclosed documentation, 2001. The complaint referenced and attached only the 1997 we will be in a better position to have that discussion.

Contract. failure to comply therewith is not in issue, the court shall Wellmont argues that JDHP waived its right to invoke make an order directing the parties to proceed to arbitration because the July 2001 letter (1) made no arbitration in accordance with the terms of the distinction between disputed overpayments under the 1997 agreement. . . . If the making of the arbitration agreement Contract and disputed underpayments under the 2001 or the failure, neglect, or refusal to perform the same be

No. 02-6078 Highlands Wellmont Health Network 9 10 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan Contract; and (2) categorically denied arbitration without More importantly, JDHP was responding to a suggestion referring to either contract. for alternative dispute resolution made by Wellmont in its

April 2001 letter. [3] That letter did not reference the 2001 The July 2001 letter clearly declined alternative dispute Contract even though at that point the 2001 Contract was in resolution of JDHP’s claim for the overpayments made under effect, and Wellmont had been informed that beginning in the 1997 Contract. It also, however, referenced Wellmont’s March JDHP would pay for rehabilitation services at the claim for underpayments. JDHP did not start reimbursing at lower SNF rate. Instead, Wellmont’s letter referenced only the lower SNF rate until March 2001, after the 2001 Contract the 1997 Contract, which did not contain arbitration language, was signed and became effective. Thus, in the July 2001 and suggested different means of alternative dispute letter, JDHP was declining to engage in alternative dispute resolution, only one of which was arbitration. Wellmont resolution of claims made under both the 1997 and the 2001

offered no evidence that it ever attempted to invoke, let alone Contracts. suggest, arbitration under the 2001 Contract. Thus, there is no evidence that JDHP expressly waived arbitration under the

When JDHP sent the letter in July 2001, the parties were in 2001 Contract. Given the strong preference in favor of a discussion stage about their respective claims and their arbitration and against waiver, we cannot infer a waiver of positions on the proper billing code for rehabilitation services. arbitration under the 2001 Contract based solely on the JDHP made the decision to stand firm on its position. It parties’conduct at this stage of their dispute. declined “at [that] point” to agree to arbitration or other alternative dispute resolution. When faced with the growing B. Applicability of Arbitration Clause underpayments under the 2001 Contract and JDHP’s decision to stand firm on its position, Wellmont had the choice of Wellmont argues that we should affirm the denial of the either initiating a lawsuit or commencing arbitration motion to compel arbitration because the arbitration provision proceedings. If JDHP had not immediately invoked the in the 2001 Contract is “repugnant” and should be arbitration clause upon the commencement of litigation, or if disregarded. Wellmont points to that portion of paragraph 1 JDHP had frustrated the arbitration process upon of the 2001 Contract stating that all other terms and commencement by Wellmont, Wellmont may have had a provisions of the 1997 Contract continue in full force and better argument for waiver. Indeed, most arbitration waiver effect. It argues that because the 1997 Contract did not cases involve these types of scenarios. See, e.g., Gen. Star contain an arbitration clause, while the 2001 Contract did, Nat’l Ins. Co. , 289 F.3d at 438. But that is not what happened there is a conflict over dispute resolution mechanisms, and in this case. JDHP’s July 2001 letter was sent during pre- under Tennessee law, the first method, i.e. , no alternative commencement negotiations. It really amounts to nothing dispute resolution, should prevail. See Bartlett v. Philip- more than the typical posturing that may occur where one Carey Mfg. Co. , 392 S.W.2d 325, 327 (Tenn. 1965) (if two party is attempting to “stare down” the other party in the hope clauses of a contract are so repugnant to each other that they that the other party will simply give up. See Enviro Petroleum Inc. v. Kondur Petroleum , 91 F. Supp.2d 1031, 1033-34 (S.D. Tex. 2000). [3] W e focus o n the April letter, because Wellmont itself argues that

JDHP was responding to its suggestion for alternative dispute resolution contained in its April 2001 letter.

No. 02-6078 Highlands Wellmont Health Network 11 12 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan cannot stand together, the first shall be received and the latter Co. , 388 U.S. 395, 402-04 (1967). However, if there was a rejected). fraud that “goes to the ‘making’ of the agreement to

arbitrate,” then a federal court may adjudicate: The fatal flaw in Wellmont’s reasoning is that the 1997 Contract did not remain in full force and effect with respect Under § 4, with respect to a matter within the jurisdiction to hospital services. Paragraph 1 of the 2001 Contract states of the federal courts save for the existence of an in pertinent part: arbitration clause, the federal court is instructed to order

arbitration to proceed once it is satisfied that “the making This Agreement supersedes the contracts, HNHPHO of the agreement for arbitration or the failure to comply 98/12 KPMP98 961, and HNH POA/PHO 12/96 (with the arbitration agreement) is not in issue.” COPYRIGHT 1996 KPMP96 446, to the extent these Accordingly, if the claim is fraud in the inducement of contracts apply to inpatient and outpatient hospital the arbitration clause itself—an issue which goes to the services. All other terms and conditions of those

“making” of the agreement to arbitrate—the federal court contracts and any amendments remain in full force and may proceed to adjudicate it. . . . We hold, therefore, that effect. in passing upon a [section] 3 application for a stay while the parties arbitrate, a federal court may consider only Contract KPMP96 446 is the 1997 Contract. The issues relating to the making and performance of the rehabilitation services are hospital services. They are agreement to arbitrate. provided in the skilled nursing units of the Wellmont hospitals. Thus, the 2001 Contract, including the section Id. at 403-04 (footnotes omitted). See also Ferro Corp. v. requiring arbitration, completely supercedes the 1997 Garrison Indus., Inc. , 142 F.3d 926, 933 (6th Cir.1998) (once Contract for those services. There can, therefore, be no a court determines that the agreement to arbitrate has not been repugnancy and the arbitration clause is part of the contract

fraudulently induced, all other issues falling within that applying to hospital services. [4] agreement are to be sent to arbitration). C. Fraudulent Inducement Wellmont claims that, when read as a whole, the allegations in the amended complaint show that not only was Wellmont Wellmont argues that if we remand this case, the district fraudulently induced to enter into the 2001 Contract, but also court should be allowed to adjudicate whether the arbitration that the arbitration provision itself was the product of clause was fraudulently induced. The Supreme Court has fraudulent inducement. It argues that the allegations support held that a “claim of fraud in the inducement of the entire a finding that JDHP inserted the arbitration clause knowing contract” is a matter to be resolved by the arbitrators, not the that a major controversy was about to surface of which federal courts. Prima Paint Corp. v. Flood & Conklin Mfg. Wellmont had no knowledge when it executed the 2001 Contract. inducement claim “relates to” but does not “arise out of” the

of the arbitration agreement itself. Fazio , 340 F.3d at 394. 2001 Contract. The amended complaint in this case alleges that JDHP District courts have the authority to decide whether an issue “fraudulently induced Wellmont to enter into the 2001 is within the scope of an arbitration agreement. Fazio , 340 contract by fraudulently concealing that [JDHP] disagreed F.3d at 395. “A proper method of analysis here is to ask if an with the manner in which Wellmont was billing for action could be maintained without reference to the contract rehabilitation services and for failing to disclose that [JDHP] or relationship at issue.” Id. If it could, then it may fall had reported Wellmont to the federal investigative agencies outside the scope of the arbitration agreement. for allegedly fraudulent billing practices.” Wellmont further alleges that “[b]ut for said fraudulent concealment, Wellmont

When a contract contains an arbitration clause, there is a would not have been induced to execute the 2001 contract and general presumption of arbitrability, and any doubts are to be continue its contractual relationship” with JDHP. The resolved in favor of arbitration “unless it may be said with amended complaint states that the 2001 Contract was entered positive assurance that the arbitration clause is not susceptible into as a result of fraud because JDHP signed the contract of an interpretation that covers the asserted dispute.” AT&T after it had identified the dispute and wrongfully reported it Techs., Inc. v. Communications Workers of Am. , 475 U.S. to the FBI. Wellmont alleges that JDHP fraudulently induced 643, 650 (1986). Where the arbitration clause is broad, only Wellmont to sign the 2001 Contract by not disclosing that an express provision excluding a specific dispute, or “the JDHP would not continue to pay the higher rate for most forceful evidence of a purpose to exclude the claim from rehabilitation services. For relief, Wellmont asks that the arbitration,” will remove the dispute from consideration by district court declare the 2001 Contract void. the arbitrators. Id. There are no separate allegations in the amended complaint In an early case, the Second Circuit stated that the phrase that JDHP fraudulently induced Wellmont to agree to an “‘any dispute or difference [arising] under this Charter’” was arbitration clause. The alleged fraudulent scheme in this case not broad enough to reach a claim of fraudulent inducement. relates to the contract as a whole. Such a claim must be brought before the arbitrator and not the district court in deciding a motion to arbitrate. Fazio , 340 F.3d at 395. No. 02-6078 Highlands Wellmont Health Network 15 16 Highlands Wellmont Health Network No. 02-6078

v. John Deere Health Plan v. John Deere Health Plan In re Kinoshita & Co. , 287 F.2d 951, 952 (2d Cir. 1961). [5] 383-85 (11th Cir. 1996) (fraudulent inducement of contract The court held that this phrase applied only to claims relating within scope of arbitration clause covering “any dispute . . . to the interpretation or performance of the contract. While which may arise hereunder”); Peoples Sec. Life Ins. Co. v. Kinoshita has not been formally overruled, the Second Circuit Monumental Life Ins. Co , 867 F.2d 809, 813 (4th Cir. 1989) has severely limited its application to its precise facts, i.e. , to (claim of fraudulent inducement fell within scope of the phrase “arising under.” See ACE Capital Re Overseas arbitration clause covering any issue “believed to constitute Ltd. v. Cent. United Life , 307 F.3d 24, 33-34 (2d Cir. 2002) a breach or violation” of the contract). (“any right of action hereunder” is broad enough to include In Sweet Dreams Unlimited, Inc. v. Dial-A-Mattress claim of fraudulent inducement of contract); Louis Dreyfus International, Ltd. , 1 F.3d 639, 641 (7th Cir. 1993), the Negoce S.A. v. Blystad Shipping & Trading Inc ., 252 F.3d

plaintiff alleged that the contract should be rescinded because 218, 225 -26 (2d Cir. 2001) (the distinction between “arising it violated Illinois law. The Seventh Circuit considered the from” and Kinoshita ’s language of “arising under” is more same language used in this case. The arbitration provision than just a semantic one, and only the latter phrase limits covered disputes “arising out of” the contract. The Seventh arbitration to a literal interpretation or performance of the Circuit noted the narrow application of Kinoshita to its contract); Genesco, Inc. v. T. Kakiuchi & Co. , 815 F.2d 840, precise facts and concluded that “arising out of” covers all 854 (2d Cir. 1987) (“all claims . . . of whatever nature arising disputes “having their origin or genesis in the contract, under this contract” was broad enough to reach claim of fraud whether or not they implicate interpretation or performance of in the inducement); S.A. Mineracao Da Trindade-Samitri v.

the contract per se.” Id. at 642. The court held that: Utah Int’l, Inc. , 745 F.2d 190, 194 (2d Cir. 1984) (“any question or dispute aris[ing] or occur[ring] under” the

Although Count I seeks to cancel the Agreement, it is agreement was sufficiently broad to reach fraudulent nonetheless a result of the Agreement and has its origins inducement claim). The Second Circuit itself has recognized in it. In that sense it “arises out of” the Agreement and that the authority of Kinoshita , therefore, is highly is subject to arbitration. In fact, any dispute between questionable even in the Second Circuit. ACE Capital , 307 contracting parties that is in any way connected with F.3d at 33. their contract could be said to “arise out of” their agreement and thus be subject to arbitration under a Other circuits have declined to follow Kinoshita because of provision employing this language. At the very least, an the strong federal policy in favor of arbitration. See Battaglia “arising out of” arbitration clause would “arguably v. McKendry , 233 F.3d 720, 725 (3d Cir. 2000) (“arising

cover[]” such disputes, and, under our cases, this is all under” and “arising out of” are given broad construction and that is needed to trigger arbitration. encompass claims going to the formation of the underlying agreement); Gregory v. Electro-Mech. Corp. , 83 F.3d 382,

Id . [5] The Ninth Circuit reached a similar result in Mediterranean

Enterp rises, Inc. v. Ssangyong Corp. , 708 F.2d 1458, 1464 (9th Cir. 1983) (phrase “arising hereunder” covers a much narrower range of disputes than the phrase “arising out of or relating to”). No. 02-6078 Highlands Wellmont Health Network 17

v. John Deere Health Plan This circuit has not yet decided whether a fraudulent inducement of the contract claim “arises out of” the contract. [6] We have previously held, however, that an arbitration clause requiring arbitration of any dispute arising out of an agreement is “extremely broad.” Cincinnati Gas & Elec. Co. v. Benjamin F. Shaw Co. , 706 F.2d 155, 160 (6th Cir.1983). We agree with the reasoning of the Seventh Circuit in that a claim that a contract is voidable because it was fraudulently induced arises out of the contract. Resolution of Wellmont’s claim will require reference to the 2001 Contract. In addition, because all doubts are to be resolved in favor of arbitration, consistent with every circuit that has addressed this issue, we hold that “arising out of” is broad enough to include a claim of fraudulent inducement of a contract.

III.

The decision of the district court is REVERSED, and this case is REMANDED with instructions that the district court enter an order to arbitrate. not an issue in Arnold .

NOTES

[*] The Honorable Danny C. Reeves, United States District Judge for the Eastern District of Kentucky, sitting by designation. 1 No. 02-6078 Highlands Wellmont Health Network 3 4 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan In 1997, Wellmont and JDHP entered into a medical the question for the arbitrator will be whether the services agreement (1997 Contract) under which Wellmont decision being arbitrated should be set aside because the provided medical services to JDHP members. The 1997 decision was arbitrary and capricious.

[1] The reimbursement schedules under both the 1997 Contract and the

[2] 2001 Contract reference DRG code which is a standardized coding system The July 13 JD HP letter references a May 23 letter from W ellmont, used for billing a nd reimbursement within the health care industry. which is not part of the record. No. 02-6078 Highlands Wellmont Health Network 7 8 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan After JDHP informed Wellmont that its claims were in issue, the court shall proceed summarily to the trial governed by the 2001 contract, Wellmont filed an amended thereof. complaint. The amended complaint alleged that JDHP 9 U.S.C. § 4. fraudulently induced Wellmont to enter into the 2001 Contract. Wellmont also asked for damages for JDHP’s It is well established that any doubts regarding arbitrability alleged breach of the implied duty of good faith and fair must be resolved in favor of arbitration. Fazio v. Lehman dealing in negotiating the 2001 Contract and for JDHP’s Bros., Inc. , 340 F.3d 386, 392 (6th Cir. 2003). We review a alleged breach of the 2001 Contract in paying the lower SNF district court’s ruling on a motion to compel arbitration de rate for the rehabilitation services. novo . Great Earth Cos. v. Simons , 288 F.3d 878, 888 (6th Cir. 2002). JDHP immediately filed a motion to compel arbitration and stay proceedings. On August 7, 2002, the district court A. Waiver denied the motion. It found that the 2001 Contract contained a binding arbitration clause but concluded that JDHP had An agreement to arbitration may be “waived by the actions waived its right to compel arbitration in the July 13, 2001 of a party which are completely inconsistent with any reliance letter. This appeal followed. thereon.” Gen. Star Nat’l Ins. Co. v. Administratia Asigurarilor de Stat , 289 F.3d 434, 438 (6th Cir. 2002) II. (quoting Germany v. River Terminal Ry. Co. , 477 F.2d 546, 547 (6th Cir. 1973)). There is a strong presumption in favor The FAA provides that arbitration clauses in commercial of arbitration under the FAA. O.J. Distrib., Inc. v. Hornell contracts are “valid, irrevocable, and enforceable, save upon Brewing Co. , 340 F.3d 345, 355 (6th Cir. 2003). Because of such grounds as exist at law or in equity for the revocation of the strong presumption in favor of arbitration, waiver of the any contract.” 9 U.S.C. § 2. If a court determines that a right to arbitration is not to be lightly inferred. Id . claim is covered by an arbitration clause, it must stay the proceedings until the arbitration process is complete. JDHP argues that it could not have waived its right to 9 U.S.C. § 3. invoke arbitration in the July 2001 letter because Wellmont did not raise the fraudulent inducement or bad faith claims, or When faced with a motion to compel arbitration, a district assert other claims under the 2001 Contract, until it filed its court must follow the procedure set forth in section 4 of the amended complaint in 2002. JDHP also argues that the July FAA: 2001 letter applied only to claims under the 1997 Contract; The court shall hear the parties, and upon being satisfied and thus, there could be no waiver of arbitration under the that the making of the agreement for arbitration or the 2001 Contract.

[4] We have, however, held that in order to void an arbitration Mo reover, complete silence regarding alternative dispute resolution does not conflict with a clause requiring arbitration. T herefo re, even if clause, the complaint must contain a “‘well-founded claim of portions of the 1997 Contract were applicable to hospital services, we fraud in the inducement of the arbitration clause itself, would not find that there was a repugnancy. No. 02-6078 Highlands Wellmont Health Network 13 14 Highlands Wellmont Health Network No. 02-6078 v. John Deere Health Plan v. John Deere Health Plan standing apart from the whole agreement , that would provide D. Scope of the Arbitration Agreement grounds for the revocation of the agreement to arbitrate.’” Wellmont finally maintains that its fraudulent inducement Fazio , 340 F.3d at 394 (quoting Arnold v. Arnold claim does not fall within the scope of the arbitration clause Corp.—Printed Communications For Bus. , 920 F.2d 1269, in the 2001 Contract, which requires arbitration of matters 1278 (6th Cir. 1990)). Allegations of fraudulent schemes are “arising out of this Agreement.” Wellmont argues that this not sufficient to overcome the strong federal policy in favor clause is narrower than a clause requiring arbitration of of arbitration. The central question is whether the plaintiff’s matters “relating to” the contract, and that its fraudulent claim of fraud as stated in the complaint relates to the making

[6] JDHP argues that Arnold , 920 F.2d at 1271, interprets “arising under” to require arbitration of fraudulent inducement claims. The scope or application of the arbitration clause to that type of claim, however, was

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