COURT OF APPEALS

SECOND DISTRICT OF TEXAS

FORT WORTH

NO. 02-14-00249-CV 

BRAND FX, LLC D/B/A BRAND FX 

BODY COMPANY

APPELLANT

V.

CURTIS RHINE APPELLEE 

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FROM THE 271ST DISTRICT COURT OF WISE COUNTY

TRIAL COURT NO. CV14-05-321

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OPINION

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In this interlocutory appeal, appellant Brand FX, LLC appeals from the trial 

court’s order denying its motion to compel arbitration and later motion to 

reconsider. We reverse the trial court’s order and remand for entry of an order 

compelling arbitration.
2

I. BACKGROUND

A. EMPLOYMENT WITH BRAND FX

Appellant Brand FX, LLC is “a Delaware limited liability company” that is 

publicly traded. Brand FX designs, produces, markets, and sells utility truck 

bodies and touts revenues of $75,000,000. On October 4, 2013, Brand FX hired 

appellee Curtis Rhine as its chief financial officer. On November 6, 2013, Rhine 

signed an employment contract with Brand FX, which set out Brand FX’s 

performance expectations, provided for severance pay if Rhine was fired “for any 

reason other than [c]ause,” and mandated that any employment disputes would 

be subject to arbitration. The arbitration clause provided:

Any dispute related to your employment, performance, or 

compensation shall be resolved exclusively through arbitration, held 

in New York, New York by and in accordance with the rules of the 

American Arbitration Association. Decisions of the arbitrator shall be 

in accordance with applicable state law and not based upon the 

principle of ex-aequo et bono.

[1]

 The arbitrator shall state the 

reasons for any award and shall not have the power to amend or 

modify this agreement. The unsuccessful party shall pay all costs of 

arbitration, including costs of the other party. 

On November 27, 2013, Rhine entered into a separate subscription agreement 

with Brand FX under which Rhine was able to buy publicly-traded Brand FX stock 

and acquire a 1% interest in Brand FX. 

On February 13, 2014, Brand FX’s chief executive officer and Rhine’s 

immediate supervisor, Art De St. Aubin, informed Rhine by letter of “concerns 

 1

This doctrine allows a decision-maker to decide issues under equitable 

principles instead of legal rules. Black’s Law Dictionary 679–80 (10th ed. 2014).
3

with respect to [Rhine’s] employment,” delineated several instances of “willful 

misconduct,” and offered Rhine “an opportunity to cure” (the notice letter). De St. 

Aubin warned Rhine that if he failed to improve within thirty days, he would be 

fired for cause as provided in the employment contract. On March 17, 2014, 

Brand FX fired Rhine for cause. 

B. UNDERLYING SUIT, DEFAULT, AND MOTION TO COMPEL ARBITRATION

Rhine filed suit against Brand FX, alleging that Brand FX (1) committed 

“statutory libel per se” by asserting in the notice letter that Rhine committed willful 

misconduct and (2) breached the employment contract by failing to provide a

cure period in good faith, falsely asserting his termination was for cause, and 

failing to give him severance pay. After Brand FX failed to timely answer, Rhine 

moved for default judgment as to Brand FX’s liability. See Tex. R. Civ. P. 239. 

The trial court granted the motion for default judgment and set a hearing for July 

17, 2014 to hear evidence regarding Rhine’s unliquidated damages. See Tex. R. 

Civ. P. 243. On July 15, 2014, Brand FX filed a motion to compel arbitration and 

also sought to have the default judgment set aside and a new trial ordered. In its 

motion to compel, Brand FX raised the arbitration provision in the employment 

contract, asserted that Rhine’s claims fell within the scope of the agreement, and 

sought arbitration “to the American Arbitration Association consistent with the 

terms of [the arbitration] agreement.” The trial court set a nonevidentiary hearing 

on Brand FX’s motions for July 28, 2014. 
4

Rhine filed a response to Brand FX’s motion to compel on July 25, 2014, 

three days before the hearing. Rhine asserted that the arbitration clause was 

unenforceable because Brand FX waived its right to arbitrate and because the 

agreement was substantively unconscionable. Although Rhine served the 

response on Brand FX by certified mail, Brand FX did not receive the response 

until after the hearing and the trial court’s ruling. 

At the July 28 hearing, Rhine asserted for the first time that the arbitration 

clause was governed by the Texas Arbitration Act (the TAA) and not the Federal 

Arbitration Act (the FAA). The distinction was important because under the TAA, 

a personal-injury claim may not be subject to an arbitration agreement unless the 

party’s attorney signs the arbitration agreement. See Tex. Civ. Prac. & Rem. 

Code Ann. § 171.002 (West 2011). Rhine also argued that the agreement was 

unconscionable and that Brand FX had waived arbitration. Brand FX asserted 

that the agreement was governed by the FAA because of its activities involving

interstate commerce and that it had not waived its right to arbitrate. At the 

hearing, the trial court denied the motion to compel but set aside the default 

judgment. 

C. MOTION TO RECONSIDER

On August 5, 2014, Brand FX filed a motion to reconsider the denial to 

allow the trial court to “address [Rhine’s] arguments” raised at the hearing and

included in Rhine's response, which Brand FX received after the hearing and the 

trial court’s ruling. Brand FX attached De St. Aubin’s affidavit, which expounded 
5

upon Brand FX’s activities involving interstate commerce and averred that 

Rhine’s duties included supervising Brand FX’s financial activities in Brand FX’s 

manufacturing locations in Iowa, Indiana, Minnesota, and Texas. Brand FX more 

fully responded to Rhine’s waiver argument and addressed whether the 

agreement was substantively unconscionable. In its prayer for relief, Brand FX 

requested that the trial court grant the motion to reconsider, abate Rhine’s case, 

and “order [Rhine] to submit his claims to the American Arbitration Association 

consistent with the terms of their agreement.” The trial court set a nonevidentiary 

hearing on Brand FX’s motion to reconsider for August 11, 2014. Rhine 

responded to the motion to reconsider on August 7, 2014, and asserted that any 

evidence filed in support of the motion to reconsider that was not part of the trial

court’s initial determination could not be taken into account on reconsideration. 

Rhine then asserted that because there was no evidence supporting an 

interstate-commerce connection, the TAA applied; thus, his defamation claim 

was not subject to the arbitration agreement. Finally, Rhine contended that the 

agreement was unconscionable, violated the rules of the American Arbitration 

Association (the AAA), and was waived. In addition, Rhine filed a motion to 

strike Brand FX’s new evidence—namely, De St. Aubin’s affidavit—submitted 

with its motion to reconsider. 

At the hearing, Brand FX expounded on its arguments that the FAA 

applied, and Rhine asserted that no new evidence on the issue could be 

considered. Brand FX argued that its motion to reconsider was necessary 
6

because it was “unaware that [Rhine] was going to argue that the [TAA] applied.” 

Brand FX again raised its argument that the arbitration agreement was 

enforceable and that Rhine’s claims fell within its scope. On August 15, 2014, 

the trial court denied Brand FX’s motion to reconsider but did not rule on Rhine’s 

motion to strike. On August 18, 2014, Brand FX filed a notice of appeal from the 

order denying its motion to compel and from the order denying its motion to 

reconsider. In a sole issue, Brand FX asserts that the trial court abused its 

discretion by failing to compel arbitration. 

II. DISCUSSION

A. SCOPE OF OUR REVIEW

Rhine asserts that we may not consider the evidence Brand FX submitted 

with its motion to reconsider to support its argument that the FAA applied. 

Indeed, Rhine has filed a motion to strike “any untimely evidence” from the 

clerk’s record. Rhine bases his argument on the fact that an interlocutory appeal 

from a motion to reconsider the denial of a motion to compel is not statutorily 

authorized. Thus, Rhine posits that any filings relating to the motion to 

reconsider are not properly part of this appeal, which is only authorized as to the 

denial of the motion to compel. 

We conclude that striking properly filed trial court documents from the 

clerk’s record would be inappropriate. Any document that was filed in the trial 

court is subject to designation in the clerk’s record. See generally Tex. R. App. 

P. 34.5. But our scope of review is not determined by a document’s inclusion in 
7

the clerk’s record. See In re C.A.K., 155 S.W.3d 554, 559 (Tex. App.—San 

Antonio 2004, pet. denied) (refusing to strike items from clerk’s record and noting 

“inclusion of a document in the clerk’s record does not necessarily mean it is 

relevant to the merits of the appeal”); Roventini v. Ocular Sciences, Inc., 111 

S.W.3d 719, 726 (Tex. App.—Houston [1st Dist.] 2003, no pet.) (recognizing 

filing of supplemental clerk’s record does not compel consideration of its 

contents). If we may appropriately consider a document in the clerk’s record as 

part of our authorized review of a trial court’s order or judgment, we will. And the 

converse is true as well. See generally Hon. Deborah Hankinson & Rick 

Thompson, Standards and Scope of Review, 29 The Advocate (Tex.) 6, 6 (2004) 

(“The scope of review, as the name suggests, delineates the portion of the 

appellate record that an appellate court may consider in deciding whether the 

trial court erred and whether that error warrants reversal.”). Therefore, we deny 

Rhine’s motion to strike portions of the clerk’s record.

But we are still left with the question of whether the evidence Rhine 

submitted to the trial court in support of its motion to reconsider should be 

considered in our review of the trial court’s denial of arbitration.2

 Interlocutory 

orders may be appealed only if permitted by statute and only to the extent 

jurisdiction is conferred by statute. Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 

 2

Rhine does not argue that Brand FX failed to timely file its notice of 

appeal; thus, our jurisdiction is not at issue. Rhine only asserts that the

legislature’s limited grant of appellate jurisdiction over interlocutory appeals 

affects the scope of our review, not our jurisdiction in this instance. 
8

272 (Tex. 1992) (orig. proceeding). We strictly construe statutes authorizing 

interlocutory appeals because they are a narrow exception to the general rule 

that interlocutory orders are not immediately appealable. CMH Homes v. Perez, 

340 S.W.3d 444, 447–48 (Tex. 2011); 3 Roy W. McDonald & Elaine Carlson, 

Texas Civil Practice § 19:56 (2d ed. 2000 & Supp. 2013–14). Under both the 

FAA and the TAA, the denial of a motion to compel arbitration is immediately 

appealable, but the denial of a motion to reconsider the denial of a motion to 

compel arbitration is not immediately appealable. See 9 U.S.C.A. § 16 (West 

2009); Tex. Civ. Prac. & Rem. Code Ann. § 51.016 (West 2015), § 171.098 

(West 2011); Nazareth Hall Nursing Ctr. v. Castro, 374 S.W.3d 590, 593–94 

(Tex. App.—El Paso 2012, no pet.); AXA Fin., Inc. v. Roberts, No. 03-07-00079-

CV, 2007 WL 2403210, at *3 (Tex. App.—Austin Aug. 23, 2007, no pet.) (mem. 

op.). 

We conclude that we may not consider any new evidence submitted in 

support of Brand FX’s motion to reconsider. Although we have jurisdiction over 

this appeal because Brand FX filed its notice of appeal within twenty days after 

the trial court denied its motion to compel, we may not review the denial of the

motion to reconsider. Our statutory authorization does not extend to such orders

under either the FAA or the TAA. See 9 U.S.C.A. § 16; Tex. Civ. Prac. & Rem. 

Code Ann. §§ 51.016, 171.098. In its motion to reconsider, Brand FX requested 

the same relief and relied on the same arbitration agreement that it had included 

in its motion to compel. See Nazareth Hall, 374 S.W.3d at 594 (concluding 
9

interlocutory appeal from denial of motion to reconsider not authorized under the 

FAA because motion to reconsider based on same arbitration agreement which 

was subject of motion to compel); cf. Lucchese, Inc. v. Solano, 388 S.W.3d 343, 

348–49 (Tex. App.—El Paso 2012, no pet.) (holding interlocutory appeal from 

amended motion to compel authorized under the FAA because amended motion 

to compel was based on separate and different arbitration agreement than 

agreement relied on in original motion to compel; thus, amended motion was not 

a disguised motion to reconsider). Further, the arguments Brand FX raised to 

the trial court at the hearing on its motion to compel were again included in its 

motion to reconsider. Therefore, because an interlocutory appeal is not

authorized from the denial of a motion to reconsider in these circumstances, we 

will not consider any new evidence submitted in support of Brand FX’s motion to 

reconsider. Cf. Lopez v. Casa Pontiac GMC Buick, Inc., No. 14-11-00001-CV, 

2011 WL 5926683, at *4 (Tex. App.—Houston [14th Dist.] Nov. 29, 2011, no pet.)

(mem. op.) (holding affidavit filed after motion to compel denied, which raised

unconscionability defense to arbitration, could not be considered as evidence 

supporting the defense).

Brand FX heavily relies on a mandamus opinion from the Texas Supreme 

Court in which the supreme court considered evidence submitted in support of a 

motion to reconsider the denial of a motion to compel and concluded that the 

FAA applied to an arbitration agreement. In re Nexion Health at Humble, Inc., 

173 S.W.3d 67, 68 (Tex. 2005) (orig. proceeding). In Nexion, however, the 
10

supreme court merely determined that Nexion did not waive its right to arbitration 

under the FAA merely because it raised the application of the FAA for the first 

time in its motion to reconsider. Id. at 68–69. The Nexion court was not faced 

with statutory authorization to review the denial of a motion to reconsider the 

ruling on a motion to compel arbitration and whether that statutory authorization 

extended to a review of a denial of a motion to reconsider. Indeed, interlocutory 

appeals from the denial of a motion to compel were not authorized until 2009. 

See In re Santander Consumer USA, Inc., 445 S.W.3d 216, 218 (Tex. App.—

Houston [1st Dist.] 2013, orig. proceeding). Thus, Nexion is inapplicable to the 

procedural posture of this appeal.

B. FAA OR TAA?

Brand FX argues that the FAA applied to the trial court’s determination of 

the enforceability of the arbitration agreement. Rhine contends that because 

Brand FX did not meet its burden to prove application of the FAA, the TAA 

applies. As we stated before, this distinction is important because it determines 

which claims are subject to the arbitration agreement. See Tex. Civ. Prac. & 

Rem. Code Ann. § 171.002.

The FAA applies to any contract that contains a written agreement to 

arbitrate, covers a dispute at issue, and involves interstate commerce. See 

9 U.S.C.A. § 2; Tex. Echo Land & Cattle, LLP v. Gen. Steel Domestic Sales, 

LLC, No. 02-12-00372-CV, 2013 WL 3064513, at*1 (Tex. App.—Fort Worth June 

20, 2013, no pet.) (mem. op.). Rhine argues that the TAA applies to the 
11

enforceability of the arbitration agreement because Brand FX failed to carry its 

burden to show that the contract involved interstate commerce. Because the 

arbitration agreement at issue did not explicitly state that the FAA or the TAA

applies, Brand FX bore the burden to show that the FAA governed the arbitration 

agreement. See IKON Office Solutions, Inc. v. Eifert, 2 S.W.3d 688, 696 (Tex. 

App.—Houston [14th Dist.] 1999, no pet. & orig. proceeding). This burden is not 

onerous and is satisfied with evidence that the contract in fact has some link to

interstate commerce. See Wee Tots Pediatrics, P.A. v. Morohunfola, 268 

S.W.3d 784, 789–90 (Tex. App.—Fort Worth 2008, no pet. & orig. proceeding); 

Palm Harbor Homes, Inc. v. McCoy, 944 S.W.2d 716, 719–20 (Tex. App.—Fort 

Worth 1997, orig. proceeding). “Commerce under the [FAA] is broadly construed 

and the amount of commerce considered in the contract need not be substantial.” 

In re Chevron U.S.A., Inc., 419 S.W.3d 329, 336 (Tex. App.—El Paso 2010, orig. 

proceeding [mand. denied]).

In the employment context, the “relationship between an employer who is 

regularly engaged in activities related to interstate commerce and its employees 

is affected by interstate commerce as a matter of law and implicates commerce 

clause issues.” In re Big 8 Food Stores, Ltd., 166 S.W.3d 869, 880 (Tex. App.—

El Paso 2005, orig. proceeding). The evidence before the trial court when it 

decided Brand FX’s motion to compel showed that Brand FX was incorporated in 

Delaware with its principal place of business in New York. See Jack B. Anglin, 

842 S.W.2d at 270 (holding court may consider pleadings and any other 
12

evidence before the trial court at the time of the motion to compel arbitration to 

determine whether a contract affects interstate commerce). Brand FX designs, 

manufactures, produces, and sells composite (as opposed to steel) utility truck 

bodies, toppers, and inserts. The trucking industry is commonly known to involve 

interstate commerce. Cf. Forged Components, Inc. v. Guzman, 409 S.W.3d 91, 

98 (Tex. App.—Houston [1st Dist.] 2013, no pet.) (holding manufacturer of steel 

for the oil-and-gas industry was engaged in interstate commerce for purposes of 

the FAA); Chevron, 419 S.W.3d at 336 (concluding arbitration agreement 

governed by the FAA because claims to be arbitrated concerned the oil-and-gas 

industry, which involves interstate commerce as “a matter of common 

knowledge”). Although Rhine was hired to work out of Brand FX’s office in 

Texas, Rhine’s position as CFO required him to oversee Brand FX’s financial 

operations at all its locations. Brand FX’s “Operating Partner” who offered Rhine 

the job with Brand FX was located in New York. Rhine’s employment with Brand 

FX provided for Rhine’s ability to purchase a percentage ownership interest in 

Brand FX, a publicly-traded corporation. 

We conclude that these facts established as a matter of law that the 

parties’ contract affected or involved interstate commerce; thus, the arbitration 

agreement was governed by the FAA.3

 See, e.g., Capital Income Props.–LXXX 

 3

As a result, the arbitration agreement governed Rhine’s personal-injury 

claim—statutory libel per se—even though not signed by Rhine’s attorney. See 

In re Macy’s Tex., Inc., 291 S.W.3d 418, 419 (Tex. 2009) (orig. proceeding). The 
13

v. Blackmon, 843 S.W.2d 22, 23 (Tex. 1992) (orig. proceeding); Forged 

Components, 409 S.W.3d at 98; Am. Med. Techs., Inc. v. Miller, 149 S.W.3d 265, 

269 (Tex. App.—Houston [14th Dist.] 2004, no pet. & orig. proceeding). 

Accordingly, we will review the trial court’s factual and legal determinations 

regarding the enforceability of the arbitration agreement under the dictates of the 

FAA.

C. STANDARD OF REVIEW

We review the denial of a motion to compel arbitration for an abuse of 

discretion. Garcia v. Huerta, 340 S.W.3d 864, 869 (Tex. App.—San Antonio 

2011, pet. denied). See generally 6 Roy W. McDonald & Elaine Carlson, Texas 

Civil Practice § 44:19[a] (2d ed. rev. 2014) (discussing appellate standard of 

review regarding arbitration issues). In this review, we defer to a trial court’s 

factual findings if they are supported by the evidence but accord no deference to 

a trial court’s resolution of questions of law. Perry Homes v. Cull, 258 S.W.3d 

580, 598 (Tex. 2008), cert. denied, 555 U.S. 1103 (2009).

Whether there is a valid and enforceable arbitration agreement is a legal 

question subject to de novo review. Id.; Garcia, 340 S.W.3d at 869. Once the 

party seeking to compel arbitration proves that a valid arbitration agreement 

exists, a strong presumption in favor of arbitration arises and the burden shifts to 

the party resisting arbitration to establish a defense to enforcing arbitration. 

 

FAA preempts the TAA’s signature requirement for personal-injury claims. 

Nexion, 173 S.W.3d at 69. 
14

Whether the party resisting arbitration has established a defense to arbitration—

such as waiver or unconscionability—is a legal issue also subject to de novo 

review. In re Poly–Am., L.P., 262 S.W.3d 337, 348 (Tex. 2008) (orig. 

proceeding); Perry Homes, 258 S.W.3d at 598; Delfingen US–Tex., L.P. v. 

Valenzuela, 407 S.W.3d 791, 798 (Tex. App.—El Paso 2013, no pet.). The 

determination of any facts relevant to a defense, however, is a question of fact 

for the trial court, which we review deferentially for record support. Delfingen, 

407 S.W.3d at 798–800. If an arbitration agreement is present, the claims are 

encompassed by the agreement, and the party opposing arbitration failed to 

prove any defense to enforcement, the trial court has no discretion but to compel 

arbitration. See In re FirstMerit Bank, N.A., 52 S.W.3d 749, 753–54 (Tex. 2001) 

(orig. proceeding). In other words, a trial court that refuses to compel arbitration 

under a valid and enforceable arbitration agreement has abused its discretion. In 

re Odyssey Healthcare, Inc., 310 S.W.3d 419, 422 (Tex.) (orig. proceeding), cert. 

denied, 131 S. Ct. 319 (2010).

D. ENFORCEABILITY OF ARBITRATION AGREEMENT

Rhine does not assert that he and Brand FX did not enter into an 

arbitration agreement or that his claims do not fall within the scope of the 

arbitration agreement under the FAA. Rhine contends that the arbitration 

agreement is unenforceable because Brand FX waived its right to seek 

arbitration and the agreement itself was substantively unconscionable. 
15

1. Waiver

Rhine argues that Brand FX waived the right to compel arbitration by 

substantially invoking the judicial process. Rhine asserts that by moving for a 

new trial and by failing to move for arbitration before its liability was established, 

Brand FX substantially invoked the judicial process to Rhine’s detriment and, 

thus, waived its right to arbitration. A party waives an arbitration provision when 

it substantially invokes the judicial process to the other party’s detriment. In re 

Bank One, N.A., 216 S.W.3d 825, 827 (Tex. 2007) (orig. proceeding). “[T]here is 

a strong presumption against waiver,” and even if present, it must be intentional. 

EZ Pawn Corp. v. Mancias, 934 S.W.2d 87, 89 (Tex. 1996) (writ of error & orig. 

proceeding). The Texas Supreme Court has explicitly held that a party does not 

substantially invoke the judicial process by moving to set aside a default 

judgment and requesting a new trial. Bank One, 934 S.W.2d at 827; see also 

Paul Jacobs, P.C. v. Encore Bank, N.A., No. 01-12-00699-CV, 2013 WL 

3467197, at *4 (Tex. App.—Houston [1st Dist.] July 9, 2013, no pet.) (mem. op.)

(collecting cases regarding what actions are not considered substantial 

invocation). We can hold no differently here and therefore conclude that Brand 

FX did not substantially invoke the judicial process such that it waived its right to 

compel arbitration. Rhine failed to meet his burden to establish waiver.

2. Unconscionability

Rhine next argues that the arbitration agreement was substantively 

unconscionable because it potentially would shift the costs of the arbitration to 
16

Rhine if he lost, New York is not an appropriate forum, and the arbitrator does 

not have the ability to modify the agreement. As we previously stated, 

unconscionability is a question of law that we review de novo, while deferring to 

the trial court’s discretion to determine the facts relevant to the issue. See 

Whataburger Restaurants LLC v. Cardwell, 446 S.W.3d 897, 908 (Tex. App.—El

Paso, 2014, pet. filed). Rhine’s unconscionability arguments raise the gross onesidedness of the agreement’s terms. See Olshan Found. Repair Co. v. Ayala, 

180 S.W.3d 212, 215 (Tex. App.—San Antonio 2005, pet. denied). We conclude 

that Rhine failed to meet his burden to prove his defenses to enforcement of the 

arbitration agreement; thus, the trial court’s contrary conclusion on these issues

of law was an abuse of discretion. 

Rhine first contends that the cost-shifting provision renders the agreement 

unconscionable. Although excessive costs of arbitration may in certain 

circumstances render an arbitration agreement substantively unconscionable, the 

potential for shifting costs, standing alone, does not render an arbitration 

agreement unconscionable. FirstMerit Bank, 52 S.W.3d at 757; Lawson v. 

Archer, 267 S.W.3d 376, 384 (Tex. App.—Houston [14th Dist.] 2008, no pet. & 

orig. proceeding); In re Weeks Marine, Inc., 242 S.W.3d 849, 859–60 (Tex. 

App.—Houston [14th Dist.] 2007, orig. proceeding [mand. denied]). There is no 

evidence in the record to support the amount of potential costs or Rhine’s 

inability to pay those potential costs should he lose. Rhine failed to establish that 

the cost-shifting provision rendered the agreement unconscionable. See Green 
17

Tree Fin. Corp. v. Randolph, 531 U.S. 79, 92, 121 S. Ct. 513, 522 (2000); Pilot 

Travel Ctrs., LLC v. McCray, 416 S.W.3d 168, 181–82 (Tex. App.—Dallas 2013, 

no pet.); G.T. Leach Builders, L.L.C. v. TCMS, Inc., No. 13-11-310-CV, 2012 WL 

506568, at *5–6 (Tex. App.—Corpus Christi Feb. 16, 2012, no pet.) (mem. op.);

cf. Olshan Found., 180 S.W.3d at 215–16 (holding evidence of amount of AAA’s 

fees combined with plaintiff’s testimony that he could not pay the fees 

established arbitration agreement was unconscionable).

As part of his unconscionability argument based on cost shifting, Rhine 

asserts that the applicable arbitration rules—the rules of the AAA—prohibit the 

shifting of fees onto the losing party. As pointed out by Brand FX, the AAA rule 

relied on by Rhine solely addresses arbitrator expenses and does not expressly 

prohibit other cost shifting between the parties. Further, Rhine’s failure to submit 

any evidence supporting his argument that the cost shifting would be unfair or 

unreasonably one-sided is fatal to his unconscionability argument. See 

Whataburger, 446 S.W.3d at 912–13 (holding no evidence admitted to show AAA 

fees and costs specifically applicable to arbitration; thus, trial court erred by 

concluding agreement unconscionable); Shamrock Foods Co. v. Munn & 

Assocs., Ltd., 392 S.W.3d 839, 848–50 (Tex. App.—Texarkana 2013, no pet.) 

(holding trial court erred by concluding agreement was substantively 

unconscionable because no evidence showed costs of arbitration would be 

prohibitively expensive). See generally 7 Tex. Jur. 3d Arbitration & Award § 26 

(2013) (discussing considerations courts use to determine if agreement 
18

unconscionable based on excessive cost and noting employee must present 

supporting evidence).

Rhine next argues that the choice of forum in the agreement—New York—

renders the agreement unconscionable because New York is not an adequate 

and accessible substitute to litigation. His argument solely rests on the increased 

expenses involved if all parties and witnesses were required to travel to New 

York to arbitrate the dispute. Again, it was Rhine’s burden to prove the likelihood 

of incurring such costs and to provide some specific information concerning 

those potential costs. See Odyssey Healthcare, 310 S.W.3d at 422; Poly–Am., 

262 S.W.3d at 356. “[T]he ‘risk’ that [a claimant] will be saddled with prohibitive 

costs is too speculative to justify the invalidation of an arbitration agreement.” 

Green Tree, 531 U.S. at 91, 121 S. Ct. at 522. Other than Rhine’s conclusory 

assertions that he might incur substantial costs and expenses if all parties and 

witnesses are located outside of New York and if he fails to prevail, there is no 

record evidence showing what the costs would be or that those costs would 

consume his potential recovery. Rhine failed to carry his burden to show the 

forum-selection clause in the arbitration agreement was unconscionable. See 

Odyssey Healthcare, 310 S.W.3d at 422.

In his final argument, Rhine asserts that the agreement is unconscionable 

because the arbitrator does not have the discretion to amend or modify the 

agreement. We can find no case law supporting Rhine’s assertion that a 

limitation on the authority of the arbitrator, which does not preclude the arbitrator 
19

from interpreting the parties’ agreement and applying it to the facts of the dispute, 

renders an arbitration agreement unconscionable. Although Rhine cites Poly–

America in support of his assertion, that case merely provided that because the 

contract at issue allowed the arbitrator to modify unconscionable terms, the costsplitting provision could not be found unconscionable. Poly–Am., 262 S.W.3d 

at 357. We do not read Poly–America to require a conclusion that all 

agreements not giving the arbitrator discretion to modify the agreement are 

unconscionable as a matter of law. Further, this argument is predicated on 

Rhine’s assertion that the cost provisions are unconscionable, rendering the lack 

of arbitrator discretion to modify the cost provisions likewise unconscionable. We 

already have concluded that Rhine failed to carry his burden to show that the 

cost provisions were unconscionable; therefore, his lack-of-discretion assertion 

fails as well. 

III. CONCLUSION

Although we did not consider any evidence submitted in support of Brand 

FX’s motion to reconsider, we conclude that Brand FX showed that its 

employment contract with Rhine affected interstate commerce such that the FAA 

applies to the arbitration agreement. Brand FX met its burden to show the

existence of a valid arbitration agreement between the parties; however, Rhine 

failed to meet his burden to prove his defenses against enforcing the otherwise 

valid arbitration provision. See FirstMerit Bank, 52 S.W.3d at 756. Thus, the trial 

court clearly abused its discretion by failing to compel arbitration. See Odyssey 
20

Healthcare, 310 S.W.3d at 422. We sustain Brand FX’s issue on appeal, reverse 

the trial court’s order denying Brand FX’s motion to compel arbitration, and 

remand to the trial court for entry of an order compelling the parties’ dispute to 

arbitration pursuant to the parties’ arbitration agreement. See Tex. R. App. P. 

43.2(d), 43.3(a); IHS Acquisition No. 171 v. Beatty-Ortiz, 387 S.W.3d 799, 810 

(Tex. App.—El Paso 2012, no pet.).

/s/ Lee Gabriel

LEE GABRIEL

JUSTICE

PANEL: LIVINGSTON, C.J.; MEIER and GABRIEL, JJ.

DELIVERED: February 26, 2015