* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 07-60813

Summary Calendar

AMERIPRISE FINANCIAL SERVICES, INC

Plaintiff - Appellee

v.

ALFRED D ETHEREDGE

Defendant - Appellant

Appeal from the United States District Court

for the Southern District of Mississippi, Jackson

USDC No. 3:07-CV-404

Before KING, DAVIS, and CLEMENT, Circuit Judges.

PER CURIAM:*

Defendant-appellant Alfred D. Etheredge appeals the district court’s

orders denying his requests to conduct discovery and granting the motion to

compel arbitration filed by plaintiff-appellee Ameriprise Financial Services, Inc.

We affirm.

United States Court of Appeals

Fifth Circuit

F I L E D

May 6, 2008

Charles R. Fulbruge III

Clerk
No. 07-60813

1 Ameriprise is a financial services firm and a member of various self-regulatory

organizations, including the New York Stock Exchange and the National Association of

Securities Dealers.

2

I. FACTUAL AND PROCEDURAL BACKGROUND

In 2001, Alfred Etheredge opened a securities brokerage account with

Ameriprise Financial Services, Inc.(“Ameriprise”).1 On May 14, 2007, Etheredge

filed suit against Ameriprise and his Ameriprise broker, James McKennon, in

the Circuit Court of Lincoln County, Mississippi. In his suit, Etheredge asserted

claims for negligence, breach of fiduciary duty, breach of contract, and fraud

based on alleged misrepresentations and mismanagement regarding Etheredge’s

brokerage account at Ameriprise. 

On July 16, 2007, Ameriprise filed a complaint in federal district court

seeking to compel Etheredge to submit the claims pending in state court to

arbitration. Attached to Ameriprise’s complaint were copies of an Advantage

IRA Application (the “IRA Application”) and an American Express Financial

Advisors SPS Advantage Service Agreement(the “Service Agreement”), in which

the parties seemingly agreed to arbitrate all disputes arising from their financial

relationship. Specifically, the IRA Application states in the second paragraph

directly above Etheredge’s signature that his account is “governed by a

predispute arbitration clause which is found in Section 13 of the [Service

Agreement],” and that he, as the customer, “acknowledges receipt of the

predispute arbitration clause.” The Service Agreement also reflects Etheredge’s

signature directly below the statement, “This Agreement contains a pre-dispute

arbitration clause in Paragraph 13, which begins on Page 4.” At Paragraph 13

of the Service Agreement, the arbitration provision provides, in relevant part:

Any controversy arising out of, or relating to

[Etheredge’s] account, to transactions with [Ameriprise]

or [Ameriprise’s] agents and/or employees, or to this

Agreement or the breach thereof, shall be settled by

arbitration and conducted pursuant to the Federal
No. 07-60813

3

Arbitration Act before the National Association of

Securities Dealers Inc., the Midwest Stock Exchange,

the New York Stock Exchange, the American Stock

Exchange, or the Municipal Securities Rulemaking

Board as [Etheredge] may elect.

On July 31, 2007, Ameriprise filed a motion to compel arbitration of

Etheredge’s claims, urging that: (1) a written agreement to arbitrate existed

between Ameriprise and Etheredge, evidenced by the IRA Application and the

Service Agreement; (2) the Federal Arbitration Act (the “FAA”) governed the

enforcement of the arbitration clause; (3) all of Etheredge’s claims alleged in his

state court action were within the scope of the arbitration clause in the Service

Agreement; and (4) no external federal policy or statute rendered Etheredge’s

claims non-arbitrable. In opposition to the motion to compel, Etheredge argued

that the arbitration clause was “invalid and unenforceable due to fraud in the

factum, fraud in the inducement, lack of mutuality, and unconscionability.”

Then, Etheredge asserted that he should be permitted “discovery prior to any

ruling” on the motion to compel. In particular, Etheredge requested a discovery

period “to conduct a handwriting and/or signature analysis, obtain information

relating to the circumstances involved in the production of said arbitration

clause, and ascertain other documentation and information relating to the

arbitration clause in question.” 

On September 17, 2007, the district court denied Etheredge’s request for

discovery, stating that Etheredge did not reasonably require discovery to present

his position as to the validity of the arbitration agreement. The district court

specifically noted that Etheredge “is certainly aware of the circumstances in

which he signed the subject arbitration agreement, and of the terms and

appearance of the agreement itself,” and that although he may claim to want

sufficient time to have a signature analysis performed, “he has not denied that
No. 07-60813

4

he signed the arbitration agreement.” The district court then allowed Etheredge

five additional days to respond to the motion to compel arbitration. 

In his supplemental response to the motion to compel, Etheredge again

asserted that the arbitration clause was invalid and that he would like to

conduct discovery, including a handwriting analysis. Etheredge attached an

affidavit, in which he stated that he did “not recall at any time signing or filling

out” the IRA Application or Service Agreement. On October 2, 2007, the district

court once again denied the request for discovery, stating that Etheredge “has

failed to suggest how discovery would aid him in crafting a response to

[Ameriprise’s] motion.” Thereafter, the district court granted the motion to

compel arbitration. This timely appeal followed.

II. DISCUSSION

Etheredge only argues on appeal that the district court abused its

discretion in denying him his requests for discovery prior to its granting of

Ameriprise’s motion to compel arbitration. Etheredge contends that because he

“does not recall signing or executing an arbitration agreement,” limited discovery

was warranted to determine the authenticity and validity of the agreement to

arbitrate and the circumstances surrounding its purported execution. “We

review a district court’s discovery decisions for abuse of discretion and affirm

such decisions unless they are clearly unreasonable or arbitrary.” Patterson v.

Mobil Oil Corp., 335 F.3d 476, 492 n.15 (5th Cir. 2003) (citing Moore v. Willis

Indep. Sch. Dist., 233 F.3d 871, 876 (5th Cir. 2000)). 

To determine whether parties should be compelled to arbitrate a dispute,

courts perform a two-step inquiry. Banc One Acceptance Corp. v. Hill, 367 F.3d

426, 429 (5th Cir. 2004). “First, the court must determine whether the parties

agreed to arbitrate the dispute. Once the court finds that the parties agreed to

arbitrate, it must consider whether any federal statute or policy renders the

claims non-arbitrable.” Id. (quoting R.M.Perez & Assocs., Inc. v. Welch, 960F.2d
No. 07-60813

2

It is telling that even after the district court pointed out in its first order that

Etheredge did not deny signing the documents in question, Etheredge merely asserted in his

affidavit attached to his supplemental response that he did not “recall” signing the documents.

5

534, 538 (5th Cir. 1992)). The first inquiry requires consideration of two issues:

(1) whether there is a valid agreement to arbitrate between the parties; and

(2) whether the dispute in question falls within the scope of that arbitration

agreement. Id. (emphasis added) (citing Webb v. Investacorp, Inc., 89 F.3d 252,

258 (5th Cir. 1996)). Under this rubric, Etheredge argues that discovery was

necessary to prove the existence of a valid agreement to arbitrate between

himself and Ameriprise. We disagree.

In his requests for discovery in the district court, Etheredge contended

that he should be permitted to conduct discovery “in order to obtain information

in support of his claim thatthe subject arbitration clause is invalid” due to fraud

in the factum, fraud in the inducement, lack of mutuality, and unconscionability.

However, Etheredge never suggested what evidence relevant to these defenses

he suspected to find through discovery. Indeed, the only specific discovery

request that Etheredge submitted to the district court was for a handwriting

analysis. He maintained that a handwriting analysis was necessary because he

did not “recall” signing or executing the document. However, as the district

court noted in its first order denying the discovery request, Etheredge never

denied that the signatures on the IRA Application or the Service Agreement

were his own.2 Nor did he even suggest circumstances which might lead one to

doubt that those signatures were his, such as forgery by Ameriprise or one of its

brokers. Moreover, because the documents in question were attached to

Ameriprise’s complaint, Etheredge was in possession ofthese documents atleast

two months prior to his response to the motion to compel. If in fact Etheredge

questioned whether the signatures were his own, nothing precluded him from
No. 07-60813

3 Etheredge responds in his reply brief that, according to the Code of Ethics for

Graphologists, when a graphologist is giving an opinion based upon an examination of a

photocopy of a document, his opinion is to be qualified as such, until examination of an original

can be made. Thus, according to Etheredge, discovery was necessary to obtain the original

documents in question. Because Etheredge did not base his request for discovery in the district

court on this “originals versus photocopies” distinction, we do not consider it now in

determining whether the district court abused its discretion in denying the discovery request.

See Langhoff Props., L.L.C. v. B.P. Prods. N. Am., 519 F.3d 256, 261 n.12 (5th Cir. 2008)

(“Generally, arguments not raised in the district court are waived [on appeal].”). 

6

going forward with the handwriting analysis.3 Thus, under these circumstances,

the district court did not abuse its discretion in denying Etheredge’s requests for

discovery prior to granting Ameriprise’s motion to compel arbitration. See Moses

H. Cone Mem’l Hosp. v. Mercury Const. Corp., 460 U.S. 1, 22 (1983) (providing

that in determining whether to compel arbitration, the FAA requires “an

expeditious and summary hearing, with only restricted inquiry into factual

issues.”). 

III. CONCLUSION

For the foregoing reasons, we AFFIRM the orders of the district court

denying the requests for discovery and compelling arbitration.