EUROP LASMA, S.A. P la in t if f,
v. SOL ENA G ROUP , INC.

Defendan t. UNITED STAT ES DIS TRICT COURT F OR THE D ISTRIC T OF CO LU M BIA

Ci vi l A cti on 08 -01 08 9 (H HK)

MEMORAN DUM OP IN ION Plaintiff Europlasma S.A. (“ Europlasma” ) bring s this action to enforc e the ter ms of a promissory

note re quiring Def

endant Solena G roup, Inc. (“ Solena”) to pay Europlasma the principal amount of €394,517, plus interest at an a nnual rate of 4%, in c onsideration for equipment that Solena purc hased a nd rec eived f

rom Europlasma. B efor e the c ourt is Solena’s motion to di smiss or, in the alternative, to stay and compe l arbitration [##6, 7] and Europla sma’s motion for summary

judgme nt [ #9]. Upon consideration of the motions, the oppositions thereto,
and the argume nts of

c ouns e l at a

he ari ng , th e c ourt

c on c lud e s th a t So le na ’s mot ion to d ism iss should be denied a

nd Europlasma’ s summary judgme nt motion s hould be g rante d.
I. BACKG ROUND A. P rom issory Note On or a bo ut O c tob e r 3 , 2 00 6, Sol e na or de re d a pla sma tor c h f ro m E ur op la sma

and pa id the shipping c osts and part of the purcha se price . On September 14, 2007, the par

ties executed
an unsec ured pr omissory

note (“Note”) for the ba lance of €394,517 re maining on the torch2

purcha se, plus interest at a n annual r ate of

4%. Compl. ¶¶ 6-7; Compl. Ex h. 1 (“N ote”) . The No te pr ov ide s th at if

Sol e na fa ils to m e e t it s o bli g a tio ns un de r t he No te , E ur op la sma

is e nti tle d to
re c ov e r a ll c os ts, inc lud ingre a so na ble a tto rn e y ’s fe e s, inc ur

re d in c oll e c tin g or

a tte mpt ingto collect on the note , “whe ther or not a lawsuit is commenced.” Note at 1. Solena did not make the re quired pa

y ment on the Note by

its due date of January

10, 2008. B. M as te r Te am ing Ag r e e m e nt On May 29, 2007, afte r the torc h purcha se and be fore the execution of the Note , the parties e ntere d into the Master Te aming Ag ree ment (“A g ree ment”). Mot. to Dismiss at 2 & Exh. 2 (“Ma ster Te aming Ag ree ment”). A mong othe r thing s, the Ag ree ment states that “Solena commits to t reat Europlasma a s its P ref err ed Provider of

torch sy stems, and as such, Solena
c omm its to p ur c ha se a ll o f t he pla sma

tor c h s y ste ms f

ro m E ur op la sma

fo r S ole na

Pr oje c ts
u t i l i z i n g S o l e n a

T e c h n o l o g y

f r o mth e d a t e o f

th i s a g r e e m e n t . ” A g r e e m e n t¶ 1
. 2
. 1
. In
c on sid e ratio n f

or Euro pla sma

se rv inga s So le na ’s e xclu siv e so ur c e , E ur op la sma a g re e d to provide Solena w ith discount pricing f or the purc hase of

multipl e torc h sy stems. Id. ¶ 1.2.2. The parties a g ree d that the Ag ree ment would have a term of thre e y ear s “fr om the date f irst above written, which te rm may

be re newe d or extended by the par ties.” Id. ¶ 5.1. Th e Agre e me nt i nc lud e s an a lte rn a tiv e dis pute re so lut ion c la us e that r e a ds : 6. 2 I f [s ic ] the e ve nt o f a c on tr ov e rs y , c la im o r d isp ute ari sin g out of or re latin g to t

his Agre e me nt, the re pr e se ntativ e s o f t he Part ie s sh a ll m e e t and

c on fe r i n g oo d f

a ith neg otiations with t he objec t of rea chingmutual ag ree ment and a se ttlement. I f the Part ie s’ re pr e se ntativ e s a

re un a ble to a g re e , s uc h r e pr e se ntativ e s sh a ll p ro mpt ly commence discussion with respec t to resolving the dispute throug h non-binding alternative dispute resolution (“AD R”) proc edure s fashioned by the re prese ntative themselves or w ith the assistance of persons or or g anizations ex perie nced in AD R proce dures suc h as the International Chamber of Commerc e.3

6.3 Any

controve rsy , claim or dispute ar ising out of or relating to this Ag ree ment, or the bre ach the reof

, that the Parties ca

n not [ sic] amicably

resolve unde r the proce dures in Ar

ticle 6.2., shall be settled by arbitration administ ere d by the International Chamber of Commerc e under its Com merc ial Arbitration Rules using a n arbitrator that both Parties consent to in writing , and judg ment on the awa rd re ndere d by

the ar bitrator(s) may

be ente red in a

ny court having jur isdiction the re of . T he pla c e of

arb itr a tio n s ha ll b e L on do n, En g land and the arb itr a tor

sh a ll deter mine the matters in dispute in ac corda nce w ith Applicable L aw. The parties ag ree that the awa

rd of the a

rbitrator sha ll be binding a nd shall be the sole a

nd exclusive remedy

amongthem reg ardingclaims, counter claims, issues or acc ountings pre sented to the a rbitrator. Id. ¶¶ 6.2, 6.3. Finally , the Ag ree ment contains an integration cla use, spec ifying that “[t] his Ag ree ment constitutes the entire a g ree ment betwee n the Parties, re lating to the subje ct matter he reof , and superse des any

previous agree ments or under standing s betwee n them, whether oral or written.” Id. ¶ 10.1. II. AN AL YSI S A. Because The Note Is Unam bigu ous, Th e Court Will Not Consid er Extr insi c Evidence Euro pla sma ’s c omp la int

ra ise s a sin g le c la im: br e a c h o f p ro mis so ry no te . So le na

mov e s to dismiss Europlasma’ s complaint on the g rounds that the dispute over the Note is subject to the Ma ste r T e amin g Agre e me nt’ s ma nd ator y arb itr a tio n c la

us e . E ur op la sma

re sp on ds that th e No te contains no ar

bitration provision and bec ause it is unambig uous on its face , the cour t should not
c on sid e r a

ny e xtri ns ic e vid e nc e , s uc h a s th e Ma ste r T e amin g Agre e me nt. Th e c ourt a g re e s w ith Europlasma. In rele vant par

t, the Note states that Solena pr omises to pay Europlasma the sum of €394,517, plus interest on the unpaid princ ipal at the annua l rate of 4% fr om the date of

the Note, September 14, 2007. The Note provide s that the unpaid principa l and ac crue d interest shall beDelaw are law applies be cause both the Note and the Ag ree ment specify that they 1 should be g overne d and construe d in acc ordanc e with Dela war e law. N ote at 1; Ag ree ment ¶ 6.1. The Supreme Court of Dela war e has se t forth the ana ly sis a court should under take 2 when de termining whether the claim bef

ore it is subject to arbitration. Parfi Holding AB v. Mirror Image I

nternet, Inc

. , 817 A.2d 149, 155 (De l. 2002). First, the c ourt must “deter mine 4 pa y a ble in f ull on Janu ary 10 , 2 00 8. Th e No te c ou ld n ot b e c le are r a nd is unambi g uo us . See Rhone-P oulenc Basic Che ms. Co. v. Ame rican Motorists Ins. Co. , 6 16 A. 2d 11 92 , 1 19 6 ( De l. 1992) (“ [A] contra ct is ambig uous only when the pr ovisions in controversy are rea sonably

or fairly susceptible of diff

ere nt interpretations or may have two or

more diff

ere nt meaning s.”). 1 Under well-settled pr inciples of contr act law , “[u] nambig uous written agree ments should be enfor ced a ccor ding to their terms, without using e x trinsic evidenc e ‘to interpr et the intent of the parties, to var

y the terms of the contra ct or to cr eate an ambiguity .’” MBIA I ns. Corp. v. Royal Indem . Co., 426 F.3d 204, 210 ( 3rd Cir. 2005) ( qu oti ng Ea gleIn du s. v . D e Vi lbi

ss H e alt h Ca re , 70 2 A .2 d 1 22 8, 12 32 (D e l. 1 99 7) ); Cap ita l M gm t. C o. v . B ro wn , 813 A.2d 1094, 1097 (De l. 2002) (“I f a c ontrac t is unambiguous, extrinsic evidence may not be used to interpr et the intent of the parties, to var

y the terms of the contra ct or to cr eate ambig uity .”). Solena argues that the Maste r Te amin g Agre e me nt r e qu ir e s a rb itr atio n o f t

he dis pute ov e r n on -p ay

me nt o f t he No te . B e c a

us e the Note is unambiguous, howeve r, the c ourt will not consider evide nce deho rs the Note, including the Master Te aming Ag ree ment. B. Were The Court To Consid er t he Agre em ent, It Would Find Th at The Dispu te Is Not Sub jec t to Ar bitration. Even if the c ourt wer e to consider the Ag ree ment, it would find the Ag ree ment’s arbitration provision does not “arise out of or relate to the Ag ree ment” ¶ 6.2, a nd there fore does not require arbitration of the dispute reg ardingnon-pay ment of the Note
. 2whether

the ar bitration clause is broa d or nar row in scope ,” then “ apply the re levant scope of the provision to the asserte d leg al claim to deter mine whether

the claim fa lls withi n the scope of the contra ctual provisions that requir e ar bitration.” Id. I f the a

rbitration clause is narrow , the cour t “will ask if the c ause of

action pursue d in court direc tly relates to a rig ht in the contrac t.” On the other ha nd, if the cla

use is broad, “ the cour

t will defer to a

rbitration on any

issues that touch on contra ct rig hts or contra ct per formanc e.” Id. Under Delaw are law, the Agree ment’s ar bitration clause — c alling f or ar bitration of “a 3 controve rsy , claim or dispute ar ising out of or relating to this Ag ree ment” — is broad. De tro it Med. Ctr. v. Prov ider Healthnet Se rvs ., 269 F. Supp. 2d 487, 492 (D. D el. 2003) (“ Courts that have c onsidered similar languag e in ar bitration clauses ha

ve found that the ‘ar ising out of or relating to this Ag ree ment’ languag e is indicative of a broad a rbitration provision.”) ( citing case s). 5 When a contra ct contains a broad a rbitration clause , as her e, to determine whether the 3 dispute at issue is subject to arbitration, the court must ask whethe r the c laim at issue would be
asser table eve n if the contra ct containingthe ar bitration clause did not exist. Parfi Holding AB , 81 7 A .2 d at 15 5. Whe re the purp or te dly arb itr a ble c la im “ wo uld

be ind e pe nd e ntl y

and se pa rate ly
asser table” e ven if the a

rbitration clause contra ct did not exi st, the claim is not “in connec tion with” the contr act c ontaining the arbitration clause. Id
. Under this analy sis, the court finds that Europla sma’s cla im based on Solena’s nonpay ment of the Note would exis t even in the a bsence of the Agree ment. The purpose of the Ag ree ment was to establish Europla sma as Solena’ s exclusive torch provider and to guara

ntee Solena discounting pricingin consideration for that exclusive arr ang ement. The Ag ree ment
cre ates no rig hts or obligations necessa ry for Eur oplasma’s c laim for bre ach of a promissory

note. Indeed, no pr ovision in t he Agree ment cre ates a n obligation upon which Europlasma c ould base a claim of bre ach of

a promissory

note. In contra st, the Note alone provides a ba sis forThe followingfac tors also lead the court to conc lude that the Agree ment’s ar bitration 4 clause does not requir e ar bitration of the pre sent dispute: (a) the Ag ree ment’s prospec tive languag e, couple d with the fac t that the October 2006 purcha se had a lrea dy been c ompleted when the Ag ree ment was sig ned in May 2007; (b) the Agree ment’s lack of ref ere nce to the O ctober 2006 purcha se eve n though the Ag ree ment was sig ned in May 2007; (c) the Note’s lac k of ref ere nce to the A g ree ment even though the Note wa s signe d in September 2007; (d) the dif fe re nc e be tw e e n th e tor c h mo de l th a t w a s th e su bje c t of the Oc tob e r 2 00 6 p ur c ha se and tho se cover ed by

the Ag ree ment; (e) the Note’s pr ovision that if the obligation is not paid when due , Solena is “oblig ated to pay all costs of collec tion, including re asonable attorney fee s, whether or not a lawsui t is commenc ed ;” Note at 1 (emphasis adde d); and (f ) the sepa rate consideration supporting the Note and the Ag ree ment. 6 Euro pla sma ’s c la im. Ac c or din g ly , e ve n w e re the c ourt to c on sid e r t

he Agre e me nt, it w ou ld conclude that Europlasma’ s claim is not subject to arbitration. 4 C. Eur opl as m a I s Ent it le d t o Sum m ar y J udgm e nt , A s W e ll A s A tt or ne ys ’ F e e s a nd Costs. Sol e na do e s n ot d isp ute that th e No te c on ta ins no arb itr a tio n c la us e , th a t th e No te obligated Solena to pay

Europlasma by

J anuar y 10, 2008, and that Solena ha s failed to do so. B e c a us e the re is n o g e nu ine dis pute of mate ri a l f

a c t, t he c ourt fi nd s th a t E ur op la sma

is e nti tle d to
summa ry jud g me nt. The Note provides that if it is not paid when due, Solena is “obligated to pay

all costs of collection, includingrea sonable attorney fee s, whether

or not a law suit is commenced.” N ote at 1. Europlasma initially

reque sted attorney s’ fe es in the amount of $39,461.00 a nd costs of $737.35, totaling $40,198.35. In response to Solena’s objections to this amount as unrea sonable, Europlasma e numerated potential re ductions of its claim to a total of $27,705.85 in fee s and costs.At the ora l argument on Dec ember 17, 2008, the cour

t ordere d Europlasma to submit an 5 aff idavit to address Solena’ s argument that the amount of fe es Europla sma claimed w ere unrea sonable. 7 Sup ple me nta l A ff

ida vit of Joanne L . Z imo lzak. [#18 ] Th e c ourt fi nd s th a t th e re du c e d amou nt i s 5
re a so na ble , a nd that E ur op la sma

is the re fo re e nti tle d to $2 7, 70 5. 85 in atto rn e y s’ fe e s a nd c os ts. III . C ON CL USI ON F or the fo re g oin g re a so ns , So le na ’s mot ion to d ism iss , o r i n th e a lte rn a tiv e , to sta y and to
c omp e l arb itr atio n [## 6, 7] is DE NI ED and Euro pla sma ’s c ro ss- mot ion fo r s umm ary

jud g me nt i s G RA NT ED [#9] . An appr opriate or der a ccompa nies this memorandum opinion.
Henr y H. Kenne dy , J r. Un i t edS t at es Di s tri ctJ u d ge