MJR International Inc. v. American Arbitration Ass'n

596 F. Supp. 2d 1090, 2009 U.S. Dist. LEXIS 9097, 2009 WL 225974
CourtDistrict Court, S.D. Ohio
DecidedFebruary 2, 2009
DocketCase 06-CV-0937
StatusPublished
Cited by1 cases

This text of 596 F. Supp. 2d 1090 (MJR International Inc. v. American Arbitration Ass'n) is published on Counsel Stack Legal Research, covering District Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
MJR International Inc. v. American Arbitration Ass'n, 596 F. Supp. 2d 1090, 2009 U.S. Dist. LEXIS 9097, 2009 WL 225974 (S.D. Ohio 2009).

Opinion

*1093 OPINION & ORDER

ALGENON L. MARBLEY, District Judge.

I. INTRODUCTION

This matter is before the Court on Plaintiff MJR International, Inc.’s (“MJR’s”) Motion for Summary Judgment (dkt. no. 42). MJR filed suit against Defendant the American Arbitration Association, Inc. (“AAA”) and Defendant Victoria’s Collection, Inc. (“VC”) seeking: (1) to obtain a preliminary and permanent injunction to stay arbitration proceedings between VC and a third company pending this Court’s determination of whether MJR is bound to participate in that arbitration; and (2) to obtain a declaratory judgment that MJR is not bound to participate in that arbitration.

For the reasons set forth below, MJR’s Motion for Summary Judgment is DENIED. Also VC’s Motion for Leave to File a Surreply in Opposition to MJR’s Motion for Summary Judgment (dkt. no. 46) is GRANTED. Finally, VC’s Motion for Leave to File a Motion for Summary Judgment (dkt. no. 55), which was filed six months after the deadline for dispositive motions, is DENIED.

II. BACKGROUND

A. Factual Background

The Parties

This dispute centers around the contractual dealings of three companies, each of whom wanted to buy or sell Victoria’s Secret Direct (“VSD”) clothing on the secondary market. MJR has the exclusive right to sell “excess” VSD products, i.e. returned or discontinued items, on the secondary market. (Def.’s Opp’n Br. Ex. 2, MJR/Oxford Agreement). YK Investment Inc. (“YKI”) is a South Korean Company that wanted to buy VSD clothing. YKI subsequently assigned its interest to VC. Thus, VC is used synonymously with YKI throughout this opinion and VC is a defendant in this case.

Oxford Investment Group, LLC (“Oxford”) was to act as the middle man in the transaction between MJR and VC. Specifically, Oxford agreed to buy VSD clothing from MJR each month and resell it to VC. To this end, MJR and Oxford entered into two agreements. The first was the March 3, 2003, Korean Representation and Sales Agreement (“Korean Representation and Sales Agreement”), which states:

MJR International Inc. (MJR) is the exclusive contractual holder with Victoria Secret Direct (VSD) ... Oxford Investment Group LLC ... is an entity that exclusively represents the interest of MJR with regard to sales of VSD product to South Korea through its partnership with YKI Inc. (YKI) a South Korean company that wishes to engage in the purchase of authorized VSD product.

The second was the June 17, 2003 Agreement between MJR and Oxford (“MJR/Oxford Agreement”), which states:

Whereas, [Oxford] and MJR entered into an Agreement dated March 3, 2003, whereby [Oxford] has been given the exclusive right to represent the interests of MJR with respect to sales of VSD Products in South Korea and to contract with YK Investment Inc. (“YKI”) for sales of VSD Products in South Korea; and [w]hereas, YKI desires to purchase Products from MJR through [Oxford] and [Oxford] desires to facilitate sales of Products with YKI, pursuant to the terms and conditions, specified in this Agreement ... [Oxford] and MJR hereby agree as follows.

*1094 Section 4.8 of that Agreement also contains a broad arbitration clause requiring that:

[a]ny controversy arising under, out of, or in connection with, or relating to, this Agreement and any amendment thereof, or breach thereof, including any disagreements as to the interpretation of any provision of this Agreement shall be determined and settled by arbitration in accordance with the rules of the American Arbitration Association.

The MJR/Oxford Agreement further specifies that it is to be governed by Ohio state law. (MJR/Oxford Agreement § 4.5.)

The Oxford/VC Agreement

YKI was VC’s predecessor in interest. YKI wanted to buy VSD clothing from MJR, through Oxford, and sell it in the South Korean market. Negotiations between YKI and Oxford took place in the summer of 2003.

Jeffrey Bradshaw (“Bradshaw”), MJR’s president, stated in his deposition that during the negotiations, he provided Oxford with a 2002 letter from VSD that stated that MJR was VSD’s exclusive vendor. Bradshaw’s deposition testimony also confirms that he gave the letter to Oxford “for the purpose of [Oxford] letting YKI know that ... MJR was the exclusive vendor for sell-off of Victoria’s Secret Direct.” (Def.’s Opp’n Br. Ex. 8, 46-47.) In a second letter dated July 1, 2003, addressed to both Oxford and VC, Bradshaw reiterated that MJR was the only vendor of VSD products to the South Korean market. (Id. Ex. 8, 46-47; Ex. 5.)

On July 3, 2003, less than one month after signing the MJR/Oxford Agreement with MJR, Oxford entered into an agreement with YKI (“VC/Oxford Agreement”). The VC/Oxford Agreement mirrored the terms of the MJR/Oxford Agreement. For example the VC/Oxford Agreement describes the purpose of the Agreement as follows:

WHEREAS, MJR International Inc. (“MJR”) has been given the exclusive right by Victoria Secret Direct (“VSD”) ... to sell new, original excess first quality VSD products (“VSD Products”), as evidenced by the letter annexed hereto as Exhibit A; and WHEREAS [Oxford] and MJR entered into an Agreement dated March 3, 2003, whereby [Oxford] has been given the exclusive right to represent the interests of MJR with respect to sales of VSD Products in South Korea and to contract with YKI for sales of VSD Products in South Korea; and WHEREAS, YKI desires to purchase VSD Products from MJR through [Oxford], and [Oxford]desires to facilitate sales of VSD Products with YKI ... [Oxford] and YKI hereby agree as follows....

Also like the MJR/Oxford Agreement, Section 5.8 of the VC/Oxford Agreement contains a broad arbitration clause requiring that:

[a]ny controversy arising under, out of, in connection with, or relating to, this Agreement and/or the Guarantee Fee Agreement, and any amendment thereof, or breach thereof, including any disagreement as to the interpretation of any provision of this Agreement and/or the Guarantee Fee Agreement, shall be determined and settled by arbitration in accordance with the rules of the American Arbitration Association.

The VC/Oxford Agreement is to be governed by New York State law. (VC/Oxford Agreement, § 5.5.) The 2002 VSD letter to MJR that Bradshaw provided to Oxford is attached to the VC/Oxford Agreement as Exhibit A. MJR did not sign the VC/Oxford Agreement.

*1095 Shortly after executing the VC/Oxford Agreement, YKI requested permission to assign its interest to VC. MJR and Oxford jointly granted permission for the assignment in a July 16, 2003 letter. It states:

THIS LETTER IS TO CONFIRM OUR (MJR/[OXFORD]) AUTHORIZATION FOR YKI INC TO ASSIGN THE EXCLUSIVE RIGHTS FOR KOREAN MARKET OF VSD PRODUCTS TO THEIR NEW COMPANY “VICTORIA’S COLLECTION” (SAME CEO).

That letter is on MJR letterhead and was signed by both Bradshaw and Richard Peluso, Oxford’s Director.

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Bluebook (online)
596 F. Supp. 2d 1090, 2009 U.S. Dist. LEXIS 9097, 2009 WL 225974, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mjr-international-inc-v-american-arbitration-assn-ohsd-2009.