IMPLANT DENTISTRY ASSOCIATES OF MOUNT LAUREL, P.C. v. CLEARCHOICE MANAGEMENT SERVICES, LLCIMPLANT DENTISTRY ASSOCIATES OF MOUNT LAUREL, P.C. v. CLEARCHOICE MANAGEMENT SERVICES, LLC
APPEARANCES:
Carl Louis Peer
LAW OFFICE OF CARL LOUIS PEER
P.O. Box 10
Westfield, NJ 07091
Brenna Dee Kelly
DLA PIPER LLP
1605 Market St.
Suite 4900
Philadelphia, PA 19103
On behalf of Plaintiffs
Brad D. Feldman
DUANE MORRIS LLP
40 Lake Center Drive
401 Route 73 North
Suite 200
Marlton, NJ 08053
John C. Sokatch
Sarah R. Douglas
DYKEMA GOSSETT PLLC
Comerica Bank Tower
1717 Main Street
Suite 4200
Dallas, TX 75201
On behalf of Defendants
O’HEARN, District Judge
INTRODUCTION
This matter comes before the Court on Defendants ClearChoice Management Services, LLC (“CCMS”) and ClearChoice Holdings, LLC’s (“CCH” and collectively with CCMS, “Defendants”) Motion to Dismiss the Second Amended Complaint and Compel Arbitration Pursuant to
Defendants are a “network of dental treatment centers” with “[e]ach ClearChoice Center[] owned and operated by licensed and experienced dental experts.” (Second Am. Compl., ECF No. 57, ¶ 2) (internal quotations omitted). Plaintiff Felicia D. Wilson, DDS, MS (“Dr. Wilson”) is the sole owner of Implant Dentistry Associates of Mount Laurel, P.C. d/b/a/ ClearChoice Dental Implant Center (“IDA” and collectively with Dr. Wilson, “Plaintiffs”), the company through which a ClearChoice dental practice in Mount Laurel, New Jersey was operated. (ECF No. 45 at 1 n.1).
In 2017, Dr. Wilson entered into a series of agreements to open the ClearChoice dental practice in Mount Laurel, New Jersey. (Second Am. Compl., ECF No. 57, ¶ 13). These agreements included an Administrative Services Agreement between CC Philadelphia, LLC (“CC Philadelphia”) and IDA, dated September 15, 2017, amended on July 2, 2020 (“ASA”); an Assignment and Assumption of Lease and Security Deposit, between CCMS and IDA, dated November 1, 2017; a Consulting Agreement, between CCMS and IDA, dated September 15, 2017; a Succession Agreement, between CCH and IDA, dated September 15, 2017; an Intellectual Property Sublicense and Proprietary Software License Agreement, between CCMS and IDA, dated September 15, 2017 (“IP Sublicense Agreement”); a Set Up Fee Agreement, between CCMS and IDA, dated September 15, 2017; a Chattel Mortgage, between CCMS and IDA, dated September 15, 2017; and the Bylaws for IDA, dated September 15, 2017. (Id.)
Plaintiffs allege that the aforementioned agreements and the parties’ course of business under such agreements created a franchise relationship protected by the New Jersey Franchise Practices Act,
Defendants seek in the present motion an order dismissing this case and compelling Plaintiffs to arbitrate their claim by virtue of the dispute resolution provisions contained in the ASA and the IP Sublicense Agreement. Each of these contracts requires “any dispute or controversy arising out of, or in any way relating to this Agreement” to be submitted first to mediation and then, if not resolved, to arbitration. (Defs.’ Mot., ECF No. 60-1 at 6). Plaintiffs, however, contend that Defendants cannot compel arbitration pursuant to the arbitration provision of the ASA because neither defendant is a party to that contract and therefore does not have standing to compel arbitration. (Pls.’ Opp., ECF No. 63 at 2). Plaintiffs further assert that Defendants cannot compel arbitration pursuant to the IP Sublicense Agreement because that contract was terminated effective October 17, 2025, and the dispute resolution provision of the contract did not survive termination. (Id. at 2-3). Finally, Plaintiffs argue that if the Court compels arbitration, the Court should strike an attorneys’ fee shifting clause and a “Limitation of Liability” provision contained in the ASA and IP Sublicense Agreement, compel the parties to first participate in mediation, and compel Defendants to produce the books and records of non-party CC Philadelphia. (Id. at 4-6).
Plaintiffs filed the Complaint on September 26, 2025. On October 1, 2025, Plaintiffs filed an ex parte motion seeking a Temporary Restraining Order and Order to Show Cause Why a Preliminary Injunction Should Not Issue. (ECF No. 13). On October 6, 2025, after this Court issued an Order to Show Cause regarding the Court’s subject matter jurisdiction over the action, Plaintiffs filed an Amended Complaint. (ECF No. 20). The Court thereafter denied without prejudice Plaintiffs’ motion for injunctive relief to the extent Plaintiffs sought ex parte relief, directed Plaintiffs to serve all previously filed documents on Defendants, and scheduled a hearing on the motion. (ECF No. 22).
The Court conducted a hearing on October 17, 2025, at which time the Court denied Plaintiffs’ motion for a temporary restraining order and preliminary injunctive relief. (ECF No. 45). The Court concluded that Plaintiffs are not likely to succeed on the merits of proving that the Mount Laurel ClearChoice dental practice is a “franchise” under the NJFPA and also failed to establish irreparable harm sufficient to warrant injunctive relief. (Id.) During the hearing, the Court rejected Plaintiffs’ efforts to rely on the obligations imposed by the ASA in arguing that a franchise existed, because the complaint that was operative at that time relied only on the obligations created by the IP Sublicense Agreement and did not refer to the ASA. (ECF No. 52 at 62-63). Following the hearing, Plaintiffs filed the Second Amended Complaint, which is now the operative pleading in this case, citing the rights and obligations created by the ASA, as well as other agreements, in support of Plaintiffs’ contention that a franchisor/franchisee relationship existed between Defendants and Plaintiffs. (ECF No. 57).
Defendants filed the instant Motion to Dismiss and Compel Arbitration on December 8, 2025. (ECF No. 60). Plaintiffs filed opposition to the motion on December 23, 2025. (ECF No.
III. JURISDICTION
This Court has original subject matter jurisdiction over this action under
IV. LEGAL STANDARD
A. Motion to Compel Arbitration
An arbitration provision involves the waiver of a party’s right to have its claims and defenses litigated in court. See, e.g., Atalese v. U.S. Legal Servs. Grp., L.P., 99 A.3d 306, 309 (N.J. 2014). The Federal Arbitration Act (“FAA”),
The Third Circuit has adopted a two-step test for assessing motions to compel arbitration. See Kirleis v. Dickie, McCarney & Chilcote, P.C., 560 F.3d 156, 160 (3d Cir. 2009). Under this framework, a court must determine whether (1) a valid agreement to arbitrate exists, and (2) the
[W]hen it is apparent, based on the face of a complaint, and documents relied upon in the complaint, that certain of a party’s claims are subject to an enforceable arbitration clause, a motion to compel arbitration should be considered under a Rule 12(b)(6) standard without discovery’s delay. But if the complaint and its supporting documents are unclear regarding the agreement to arbitrate, or if the plaintiff has responded to a motion to compel arbitration with additional facts sufficient to place the agreement to arbitrate in issue, then the parties should be entitled to discovery on the question of arbitrability before a court entertains further briefing on [the] question. After limited discovery, the court may entertain a renewed motion to compel arbitration, this time judging the motion under a summary judgment standard.
Guidotti v. Legal Helpers Debt Resol., LLC, 716 F.3d 764, 776 (3d Cir. 2013) (citations and quotations omitted). This bifurcated standard is the result of an intent to balance the competing purposes of the FAA, which aims to foster “efficient and speedy dispute resolution” while upholding the “significant role courts play in interpreting the validity and scope of contract provisions.” Id. at 773 (citations omitted). Ultimately, “[t]he centerpiece of that framework is whether the existence of a valid agreement to arbitrate is apparent from the face of the complaint or incorporated documents.” Singh v. Uber Techs., Inc., 939 F.3d 210, 218 (3d Cir. 2019) (citing Guidotti, 716 F.3d at 774–76).
Here, neither party cites nor even addresses the applicable standard or framework for analyzing the present motion. Applying the Guidotti standard, the appropriate legal framework is
B. Motion to Dismiss
When considering a motion to dismiss under the
On such a motion, the court may only consider the facts alleged in the pleadings, any attached exhibits, and any matters of judicial notice. S. Cross Overseas Agencies, Inc. v. Kwong Shipping Grp. Ltd., 181 F.3d 410, 426 (3d Cir. 1999). If any other matters outside the pleadings
V. DISCUSSION
“Because ‘[a]rbitration is a matter of contract between the parties,’ a judicial mandate to arbitrate must be predicated upon the parties’ consent.” Guidotti, 716 F.3d at 771 (quoting Par-Knit Mills, Inc. v. Stockbridge Fabrics Co., Ltd., 636 F.2d 51, 54 (3d Cir. 1980)). “[T]he party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for arbitration.” Green Tree Fin. Corp. Ala. v. Randolph, 531 U.S. 79, 91 (2000).
Here, the parties do not dispute that there are valid contracts containing arbitration clauses or that the sole claim asserted by Plaintiffs in this case under the NJFPA falls within the scope of such agreements. Rather, the instant motion presents two issues: (1) whether Defendants can compel arbitration under the ASA when they are not parties to that contract, and (2) whether Defendants can compel arbitration under the IP Sublicense Agreement when Plaintiffs contend that the dispute resolution provision contained therein did not survive termination of the Agreement. For the reasons set forth below, the Court finds that Defendant CCH can compel arbitration under the ASA, Defendant CCMS can compel arbitration under the IP Sublicense Agreement, and the dispute resolution provision contained in the IP Sublicense Agreement survived termination of that contract.
A. The ASA
The parties to the ASA are Plaintiff IDA and non-party CC Philadelphia. (ECF No. 32-1). Plaintiffs contend that Defendants cannot compel arbitration pursuant to the ASA because neither defendant is a signatory to the agreement, and both Defendants therefore lack standing to enforce the ASA’s dispute resolution provision. (Pls.’ Opp., ECF No. 63 at 2). Defendants assert that they
With respect to Defendant CCH, the Court need not look to state law theories to determine whether CCH can enforce the ASA, because the allegations of the Second Amended Complaint are sufficient for purposes of the instant motion to establish that CCH is a party to that agreement. Plaintiffs expressly allege in the Second Amended Complaint that “[t]he ASA is between CCH and IDA” and that “[w]hile, technically, CC Philadelphia and IDA signed the ASA, in reality, the agreement is between CCH and IDA.” (Second Am. Compl., ECF No. 57, ¶ 35). Accepting these allegations as true, as the Court must for purposes of this motion, the Court concludes that CCH is a party to the ASA and can therefore seek to enforce the arbitration provision contained therein. Moreover, Plaintiffs do not assert that the ASA is invalid or that their claim under the NJFPA falls outside the scope of the arbitration provision. Thus, the Court concludes that Plaintiffs’ claim against Defendant CCH is subject to ASA’s arbitration provision.
With respect to Defendant CCMS, by contrast, the Second Amended Complaint does not allege that CCMS is a party to the ASA or that the agreement is effectively between IDA and
B. The IP Sublicense Agreement
The IP Sublicense Agreement is a contract between Plaintiff IDA and Defendant CCMS, and Plaintiffs therefore do not assert that CCMS lacks standing to seek to compel arbitration pursuant to this Agreement. (ECF No. 20-2). Rather, Plaintiffs contend that the Court cannot compel arbitration under the IP Sublicense Agreement because the arbitration clause contained therein did not survive termination of the contract. (Pls.’ Opp., ECF No. 63 at 3). Specifically, Plaintiffs note that one section of the IP Sublicense Agreement – Section 6.1 entitled “Limitation of Liability” – expressly states that “[t]his Section 6.1 shall survive termination of this Agreement.” (Id.) Plaintiffs argue that because the remaining sections of the Agreement, including the dispute resolution provision, do not contain similar express language, by implication such sections did not survive termination. (Id.) Plaintiffs contrast the language of the IP Sublicense Agreement with the language of the ASA, which explicitly states that the dispute resolution provision will survive termination of the agreement. (Id.) Plaintiffs argue that Defendants knew how to include survival language if they intended the dispute resolution provision in the IP Sublicense Agreement to
Initially, the Court notes that at the time Plaintiffs filed the original complaint in this matter, the IP Sublicense Agreement was not yet terminated, and the dispute resolution provision was still in effect. Indeed, Plaintiffs allege in the Second Amended Complaint that the IP Sublicense Agreement did not terminate until thirty days after receipt of the September 12, 2025 Termination Letter, which they received on September 15, 2025. (Second Am. Compl., ECF No. 57, ¶¶ 103, 105). The IP Sublicense Agreement therefore did not terminate until October 15, 2025.3 Plaintiffs instituted this litigation on September 26, 2025 instead of following the dispute resolution mechanism set forth in the IP Sublicense Agreement.
Plaintiffs contend that they could not have followed the dispute resolution protocol at the time they filed the original complaint because their claim under the NJFPA did not accrue until the effective date of termination of the IP Sublicense Agreement in October 2025, at which time the dispute resolution clause also terminated. Even assuming that the NJFPA applies for purposes of this motion, Plaintiffs cite no authority for their assertion that a claim under the NJFPA accrues only upon the effective date of termination of an alleged franchise and not at the time notice of termination is provided. Moreover, Plaintiffs’ argument is contrary to the allegations in the complaint they filed on September 26, 2025, wherein Plaintiffs did not allege an anticipatory violation of the NJFPA but instead alleged that Defendants had already “repeatedly and willfully” violated the NJFPA. (Compl., ECF No. 1, ¶¶ 53, 62) (defendants “have repeatedly and willfully
Regardless, the Court finds that even if the IP Sublicense Agreement was terminated at the time Plaintiffs’ claim under the NJFPA accrued, the arbitration provision survived termination of the contract. The expiration of a contract does not automatically extinguish the parties’ duty to arbitrate a dispute arising under the contract, as courts must presume that the parties intended to arbitrate disputes arising under the contract unless the parties expressly or clearly imply an intention to disavow arbitrability upon the expiration of the contract. Litton Fin. Printing Div., a Div. of Litton Bus. Sys., Inc. v. N.L.R.B., 501 U.S. 190, 204 (1991) (recognizing “presumption in favor of post-expiration arbitration of matters unless negated expressly or by clear implication . . . [for] matters and disputes arising out of the relation governed by contract”) (internal quotation marks and brackets omitted).4 “Where there is no express language or clear indication to the contrary, an arbitration clause will be enforceable as to contractual disputes after termination.” New Jersey Psychological Ass’n v. MCC Behav. Care, Inc., No. 96-3080, 1997 WL 33446538, at *2 (D.N.J. Sept. 17, 1997) (citing Nolde Bros. v. Bakery and Confectionery Workers Union, 430 U.S. 243, 250 (1977)). In determining whether the parties intended an arbitration provision to survive termination of an agreement, courts should consider the contract in its entirety. Shivkov v.
In this case, the IP Sublicense Agreement does not expressly state that the right to arbitrate terminates once the IP Sublicense Agreement is terminated, and the Court must therefore determine whether the contract implies that the parties did not intend for their arbitration obligations to survive termination. Plaintiffs rely on the survival language in the “Limitation of Liability” provision, and the absence of a similar carve-out in the dispute resolution provision, to support their argument that the dispute resolution clause did not survive termination. Several courts have considered and rejected a similar argument and concluded that the omission of an express provision regarding survival of an arbitration clause, despite survival language in other provisions of a contract, will not negate the presumption of arbitrability.
In Huffman v. Hilltop Companies, LLC, 747 F.3d 391, 393-94 (6th Cir. 2014), for example, the defendant sought to compel arbitration pursuant to a contract with a survival clause that expressly delineated twelve contract provisions that would survive contract termination, but the arbitration section was not one of the twelve surviving provisions. The Sixth Circuit found that the “omission of the arbitration clause from the survival clause . . . did not clearly imply that the parties did not intend for the arbitration clause to have post-expiration effect[.]” Id. at 399. In so finding, the Sixth Circuit considered “the contract as a whole – the survival clause and its relationship to the other clauses in the agreement” and noted that other provisions of the contract which would typically survive termination, including a severability clause and an integration clause, also were not included in the survival clause. Id. at 397. Thus, it would be “illogical to conclude” that such provisions would be “in effect only prior to the agreement’s expiration,” and the Sixth Circuit therefore held that the parties were required to proceed to arbitration. Id. at 397-98.
In OwnZones Media Network, Inc. v. Sys. in Motion, LLC, No. 14-0994, 2014 WL 4626302, at *6 (W.D. Wash. Sept. 15, 2014), a court again considered the survival of an arbitration clause where the contract’s survival provision did not include the arbitration clause in a list of contract sections that would survive termination. The court in OwnZones found that it was “not clear that this list is intended to be an exhaustive inventory of the contract provisions that survive termination of the contract.” Id. The court noted that “the survival clause omits certain procedural provisions that ordinarily would be expected to survive termination of the contract, including, for example, the contract’s integration and severability clauses,” and that “[i]t would be a strained reading of the contract to conclude that, upon expiration, the parties no longer intended the agreement to be severable or the ban on extrinsic evidence to be in effect.” Id. The court concluded that “the survival clause is, at best, ambiguous as to whether the parties’ duty to arbitrate survives termination of the contract” and found that “the survival clause does not rise to the level of the ‘clear implication’ necessary to rebut the presumption of arbitrability.” Id. at *7 (quoting Nolde Bros., 430 U.S. at 255).
Plaintiffs also cite the ASA, which contains an express survival clause, as purported evidence that Defendants knew how to ensure that the arbitration clause survived termination of a contract, if such was their intent. Defendants respond that the inclusion of a survival clause in the ASA is further evidence that the parties intended for the dispute resolution provision to survive termination, as it would be “absurd” for the parties to provide different dispute resolution procedures for contracts and claims that are intertwined. (Defs.’ Reply, ECF No. 67 at 9). The Court finds that the omission of a survival clause in the IP Sublicense Agreement, and the inclusion of a survival clause in the ASA, at best invites ambiguity as to whether the parties intended for the dispute resolution clause to survive expiration of the IP Sublicense Agreement. This evidence does not rise to the level of “clear implication” necessary to rebut the presumption of arbitrability.5 See Nolde Bros., 430 U.S. at 255.
In so finding, the Court rejects Plaintiffs’ reliance on Foster Wheeler Passaic, Inc. v. County of Passaic, 630 A.2d 280 (N.J. Super. Ct. App. Div. 1993), which was decided under New
In summary, Plaintiffs fail to demonstrate that the parties expressly negated the presumption in favor of post-termination arbitration, or clearly implied that their arbitration obligations would not survive termination of the IP Sublicense Agreement. Having considered the contract in its entirety, the Court concludes that the inclusion of survival language in Section 6.1 and in a subsequent contract does not clearly imply that the arbitration clause in the IP Sublicense Agreement was intended to terminate with the contract. Given the strong presumption in favor of
C. Plaintiffs’ Requests for Relief
Plaintiffs did not file a cross-motion yet request various forms of affirmative relief in their opposition brief. First, Plaintiffs request that the parties be compelled to participate in mediation prior to arbitration because the dispute resolution provisions in the ASA and IP Sublicense Agreement provide for a multi-tiered process which requires the parties to first seek mediation, then arbitration, and then further mediation. (Pls.’ Opp., ECF No. 63 at 1 n.1). Second, Plaintiffs request that Defendant CCH participate in this multi-tiered dispute resolution process.6 (Id. at 1). Third, Plaintiffs ask that the Court strike certain provisions of the ASA and IP Sublicense Agreement that purportedly conflict with the NJFPA. (Id.) Finally, Plaintiffs seek an Order compelling Defendants to produce the books and records of CC Philadelphia. (Id.) Each of these requests for relief is denied as set forth below.
a. Request to Compel Mediation
The dispute resolution provisions in both the ASA and the IP Sublicense Agreement provide for a multi-tiered dispute resolution process which requires the parties to first submit a dispute to mediation through the American Arbitration Association and only submit their dispute to binding arbitration if mediation is unsuccessful. Both contracts further provide that the parties must engage in post-arbitration mediation if one party disagrees with the arbitration award.
The FAA states that, upon motion of either party to a contract, a court shall compel arbitration of claims arising out of that contract if it contains a valid arbitration clause. See
Although the FAA expressly addresses only arbitration, some courts have interpreted this statutory language broadly to encompass mediation. “The Third Circuit has yet to rule on whether the Federal Arbitration Act governs contracts with mediation clauses, and courts outside this circuit have reached opposing conclusions.” Covoro Mining Sols., LLC v. Westlake Chemicals & Vinyls, LLC, No. 23-1362, 2024 WL 3181878, at *3 (D. Del. June 26, 2024). In Trujillo v. Gomez, No. 14-2483, 2015 WL 1757870, at *2 (S.D. Cal. Apr. 17, 2015), a court considered whether it could compel mediation pursuant to a tiered dispute resolution provision, similar to the one in the instant case, which required the parties to first participate in mediation before participating in binding arbitration. Although the court in Trujillo applied California law rather than the FAA, the court looked to federal law for guidance, noting that “FAA remedies, including motions to compel[,] are
Here, Defendants moved for an order compelling arbitration under the FAA. Plaintiffs request mediation but proffer no argument as to whether this Court has the authority under the FAA to compel the parties to first engage in mediation. (Pls.’ Opp., ECF No. 63 at 1, 4). In light of Plaintiff’s failure to properly file a cross-motion and the conflicting decisions set forth above, and absent any argument concerning this Court’s authority to compel mediation prior to or following arbitration, the Court declines to do so.
b. Request to Strike Provisions of the ASA and IP Sublicense Agreement
As noted above, Plaintiffs seek to strike provisions of the ASA and IP Sublicense Agreement. Specifically, Plaintiffs assert that each contract contains a fee-shifting provision that awards the prevailing party its reasonable attorneys’ fees and costs, as well as a “Limitation of Liability” provision that limits “aggregate liability.” (Pls.’ Opp., ECF No. 63 at 5). Plaintiffs contend that these provisions “run contrary to the text of and public policy underlying the NJFPA.” (Id.).
Even if the Court ignored the procedural irregularity and considered Plaintiffs’ request on the merits, such request would be denied. Plaintiffs’ request exceeds the scope of motion practice permitted pursuant to this Court’s Text Order dated October 22, 2025, which limited dispositive motions at this time to motions based on contractual dispute resolution provisions. (ECF No. 50). In addition, Plaintiffs’ request to strike contract provisions on the basis that they run contrary to the NJFPA requires a threshold finding that the NJFPA applies, which is a disputed issue in this
Plaintiffs rely on Spinetti v. Serv. Corp. Int’l, 324 F.3d 212 (3d Cir. 2003), in support of their argument that the Court may nonetheless strike certain provisions of the IP Sublicense Agreement and ASA that conflict with the NJFPA before the case proceeds to arbitration. Plaintiffs’ reliance on Spinetti, however, is misplaced. In Spinetti, the Third Circuit considered whether a court, when faced with an unenforceable contract provision, may sever provisions of an arbitration
In the instant case, however, Plaintiffs do not argue that a particular provision of the IP Sublicense Agreement or ASA renders either agreement in its entirety invalid or unenforceable. As there is no challenge to the validity of either contract, the Court need not determine as a threshold matter whether a particular contract provision should be stricken. Plaintiffs’ request to strike the attorneys’ fee and “Limitation of Liability” provisions of the IP Sublicense Agreement and ASA is consequently denied.
c. Request to Compel Production of Books and Records from CC Philadelphia
Finally, the Court addresses Plaintiffs’ request to compel Defendants to produce the books and records of CC Philadelphia. Plaintiffs represent that they were “open to mediation” with CC Philadelphia but requested production of CC Philadelphia’s books and records prior to mediation, which CC Philadelphia is purportedly required to produce pursuant to its operating agreement.
For the same reasons set forth above, the Court finds that Plaintiffs may not seek affirmative relief in an opposition brief. Moreover, Plaintiffs fail to address the relevance of the books and records of CC Philadelphia to the NJFPA claim or Defendants’ defenses in this case, see
For the foregoing reasons, Defendants’ Motion to Dismiss the Second Amended Complaint and Compel Arbitration Pursuant to
CHRISTINE P. O’HEARN
United States District Judge
Dated: July 21, 2026