Robbins & Myers, Inc. v. Winger Associates, Inc.

874 F. Supp. 252, 1993 U.S. Dist. LEXIS 20809, 1993 WL 762584
CourtDistrict Court, D. Minnesota
DecidedAugust 2, 1993
DocketNo. 3-93 CIV 211
StatusPublished
Cited by1 cases

This text of 874 F. Supp. 252 (Robbins & Myers, Inc. v. Winger Associates, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Robbins & Myers, Inc. v. Winger Associates, Inc., 874 F. Supp. 252, 1993 U.S. Dist. LEXIS 20809, 1993 WL 762584 (mnd 1993).

Opinion

ORDER

ALSOP, Senior District Judge.

This matter came before the Court on June 24, 1993, on the plaintiffs motions for summary judgment and for an order staying arbitration. In this declaratory judgment action, Robbins & Myers, Inc. (“Robbins & Myers”) asks the Court for a declaration that various claims asserted by Winger Associates, Inc. (“Winger”) are not subject to arbitration.

I. FACTUAL BACKGROUND

The plaintiff, Robbins & Myers, is the successor-in-interest to Prochem Mixing Equipment, Ltd. (“Prochem”), a manufacturer of “agitators and mixers” for the process industries. The defendant, Winger, is a sales and marketing representative for manufacturers of various processing equipment.

On June 10, 1991, Prochem and Winger entered into a “Contract for Exclusive Representation” (the “Contract”). Under the terms of the Contract, Prochem granted Winger the exclusive privilege to sell Pro-ehem mixers, accessories, and parts in the “Upper Midwest” region. Winger agreed to solicit orders for Prochem products in return for a commission on all sales of Prochem products in its region. By its terms, the Contract “continue[d] in effect until thirty (30) days, or a shorter period if mutually agreed upon, after either party has received written notice of termination from the other.”

During the term of the Contract, Winger received commissions on eleven sales of Pro-chem products. Ten of these eleven sales were made by Winger to “end users” of Prochem products. These buyers utilized the Prochem products in their own manufacturing operations. The remaining sale was not made by Winger. However, Winger received a commission on the sale because it occurred in the Upper Midwest region.

Between June of 1991 and March of 1993, Winger also pursued 143 sales “leads” on behalf of Prochem. Ninety-eight of these leads involved end users. The remaining forty-five leads involved customers that would have resold the Prochem product in some manner.1

In February of 1992, Robbins &. Myers acquired Prochem’s assets. On September 11, 1992, Robbins & Myers notified Winger [254]*254that it was discontinuing the Contract effective 30 days from the date of the letter. Winger responded by asserting that Robbins & Myers’ actions violated the Termination of Sales Representative Act (the “Act”), Minn. Stat. § 325E.37, because Robbins & Myers had terminated the Contract without “good cause” and had failed to give Winger sufficient notice of the cancellation.

On March 11,1993, Winger filed a Demand for Arbitration with the American Arbitration Association, asserting claims for wrongful termination of the Contract in violation of the Act and breach of the Contract. On April 2, 1993, Robbins & Myers filed this declaratory judgment action. In this motion, Robbins & Myers argues that it is entitled to summary judgment because, as a matter of law, the Act does not govern this dispute and therefore Winger’s claims are not arbitrable.

II. ANALYSIS

A. The Summary Judgment Standard

The Supreme Court has held that summary judgment is to be used as a tool to isolate and dispose of claims or defenses that are either factually unsupported or are based on undisputed facts. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986); Hegg v. United States, 817 F.2d 1328, 1331 (8th Cir.1987). Summary judgment is proper, however, only if examination of the evidence in a light most favorable to the non-moving party reveals no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986).

The test for whether there is a genuine issue over a material fact is two-fold. First, the materiality of a fact is determined from the substantive law governing the claim. Only disputes over facts that might affect the outcome of the suit are relevant on summary judgment. Liberty Lobby, 477 U.S. at 252, 106 S.Ct. at 2512; Lomar Wholesale Grocery, Inc. v. Dieter’s Gourmet Foods, Inc., 824 F.2d 582, 585 (8th Cir.1987), cert. denied, 484 U.S. 1010, 108 S.Ct. 707, 98 L.Ed.2d 658 (1988). Second, any dispute over material fact must be “genuine.” A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party. Liberty Lobby, 477 U.S. at 252, 106 S.Ct. at 2512. It is the non-moving party’s burden to demonstrate that there is evidence to support each essential element of his claim. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553.

B. The Determination of Arbitrability

Initially, the Court must determine if the issue of arbitrability should be decided by the Court or an arbitrator. Winger argues that Robbins & Myers’ motions should be dismissed because this dispute is governed by Minnesota law and, under Minnesota law, the issue of arbitrability is initially determined by an arbitrator.

An agreement to arbitrate that affects interstate commerce is enforceable under the Federal Arbitration Act. See 9 U.S.C. § 2. Winger concedes that, under federal law, the issue of arbitrability is normally determined by the Court. See AT & T Tech. v. Communications Workers of Am., 475 U.S. 643, 649, 106 S.Ct. 1415, 1418, 89 L.Ed.2d 648 (1986). Winger argues, however, that the Federal Arbitration Act does not apply to this dispute because there is no underlying agreement to arbitrate. Therefore, the argument continues, the jurisdictional basis for this dispute is diversity of citizenship, and, under Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 822, 82 L.Ed. 1188 (1938), this Court is required to apply Minnesota state substantive law.

The Court finds it unnecessary to resolve the question of whether federal or state substantive law applies to the issue of arbitrability because in this case, even under Minnesota law, the issue of arbitrability is determined by the Court. Minnesota has adopted the Uniform Arbitration Act, which provides that

[o]n application, the court may stay an arbitration proceeding commenced or threatened on a showing that there is no agreement to arbitrate. Such an issue, when in substantial and bona fide dispute, shall be forthwith and summarily tried and [255]*255the stay ordered if found for the moving party. If found for the opposing party, the court shall order the parties to proceed to arbitration.

Minn.Stat. § 572.09(b). Under Minnesota law, the issue of arbitrability is submitted to an arbitrator only when the dispute concerns the scope of an arbitration agreement. See Duluth Police Local v.

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874 F. Supp. 252, 1993 U.S. Dist. LEXIS 20809, 1993 WL 762584, Counsel Stack Legal Research, https://law.counselstack.com/opinion/robbins-myers-inc-v-winger-associates-inc-mnd-1993.