Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Ingen Group LLC v. Salient Arms International Inc.

United States District Court, W.D. Louisiana, Shreveport Division

September 26, 2018

INGEN GROUP, LLC
v.
SALIENT ARMS INTERNATIONAL, INC.

          Judge FOOTE MAGISTRATE Judge HORNSBY

          REPORT AND RECOMMENDATION

          Mark L. Hornsby U.S. Magistrate Judge

         Introduction

         Ingen Group, LLC (“Ingen”) entered into an exclusive distributorship agreement with Salient Arms International, Inc. (“SAI”) that allowed Ingen to be the exclusive dealer of SAI products in several states. Ingen alleges that it paid more than $350, 000 in deposits for products that SAI failed to provide. Ingen filed this civil action against SAI based on diversity jurisdiction.

         SAI responded to the complaint with a Motion to Stay and Compel Arbitration and/or Transfer Venue to Nevada (Doc. 14). The motion invokes an arbitration clause in the distributorship agreement. Ingen opposes the motion. It argues that the arbitration clause is void under Nevada law and that transfer of venue is not warranted. For the reasons that follow, it is recommended that the request to stay and compel arbitration be granted. It is not necessary to address the alternative request to transfer venue.

         Relevant Facts

         Ingen is a single-member LLC with its principal place of business in Claiborne Parish, Louisiana. It entered into an Exclusive Distributorship Agreement with SAI in January of 2017 that allowed Ingen to be the exclusive dealer of all SAI products in Hawaii, Colorado, Texas, Nebraska, Kansas, Virginia, Louisiana, Utah, Michigan, and Ohio. The products that Ingen was to distribute for SAI were various makes and models of firearms. Complaint, ¶¶ III-IV.

         The agreement required Ingen to pay SAI a deposit of fifty percent of the purchase price of items when Ingen placed an order, with the remaining fifty percent due within fifteen days after receipt of the item. The agreement provided that SAI would deliver standard production firearms within nine to twelve weeks after it received the fifty percent deposit. ¶¶ V - VI.

         Ingen began making orders shortly after the agreement was signed, but it stopped placing orders in August of 2017 because SAI had failed to provide a vast number of the firearms that were ordered. Ingen alleges that it delivered SAI deposits of $367, 849.79 and, despite amicable demand, SAI did not provide a date for shipment of the orders. A demand letter received no response. Ingen alleges that SAI has breached the agreement and caused it damages. ¶¶ VII-XIII.

         The distribution agreement is initialed on each page and signed at the end by representatives of Ingen and SAI. Paragraph 12(E) states that the agreement “shall be governed by and construed in accordance with the laws of the State of Nevada.” It also provides that, in the event of any controversy or claim arising out of or relating to the agreement or its breach, the parties shall first attempt to settle the dispute by mediation. “If settlement is not reached within sixty days after service of a written demand for mediation, any unresolved controversy shall be settled by arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules.” The agreement adds: “The place of arbitration shall be Las Vegas, Nevada.”

         Analysis

         SAI does not argue that this court is an improper venue, and it appears that venue here is appropriate under 28 U.S.C § 1391. SAI argues that transfer to Nevada is warranted under 28 U.S.C. § 1404(a) for the convenience of parties and witnesses, in the interest of justice, in the event the court determines that the arbitration provision is not binding. The undersigned finds, for the reasons set forth below, that the arbitration provision is applicable, so SAI's alternative request for transfer of venue need not be addressed.

         There is no dispute that the Federal Arbitration Act (“FAA”) is applicable to this agreement that concerns interstate transactions. Ingen does not contest that its claims fall within the broad scope of the arbitration clause that reaches “any controversy or claim arising out of or relating to this Agreement, or a breach thereof.” Ingen's only challenge to the motion to compel arbitration is an argument that the arbitration clause is void under Nevada law because it lacks specific authorization as required by a Nevada statute.

         Nevada Revised Statute § 597.995 provides, subject to an exception for collective bargaining agreements, that “an agreement which includes a provision which requires a person to submit to arbitration of any dispute arising between the parties to the agreement must include specific authorization for the provision which indicates that the person has affirmatively agreed to the provision.” The statute adds that if an agreement fails to include the specific authorization, the arbitration provision “is void and unenforceable.” Ingen argues that the agreement does not include a specific authorization provision that complies with the Nevada statute, and it ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.