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O n A ppeal fr om t he M ay27, 2004 O r der o f th e U n ited S tate s D istric t C o u rt fort he M i ddl e D i s t r i ctof Penns y l vani a ( D . C . N o. 04- cv- 00118) D istric t Ju d g e : H o n . A . R ich a rd C a p u to A r gued Sept ember16, 2005 Be f o r e : RO TH, M c KEE a n d F I S HER, C i r cui tJ udges ( Fi l ed: D ece m ber5, 2005)Si nce w e ar e w r i t i ng pr i m ar i l yfort he part i es w ho ar e fa m i l i arw i t h t he fa ctual 1 and proced ural back groun d o f t his dis pu t e, w e w i l l abb revi at e ou r di scussi on of the fact s. 2 R O B E R T J . M U R PH Y ( A r gued) M urphyL aw O ffi ce 208 C hes t nutSt r eet D unm or e, PA 18411 A t t or neyforA ppel l ee M I C H A E L W . M cTIG U E , J r . , ( A r gued) D rin k e r, B id d le & R e a th 1 8 & C h e rryS tre e ts th O n e L o g an S q u are Phi l adel phi a, PA 19103 A t t or neyforA ppel l ant OP I NI ON M cK E E , C i r cui tJ udge. T -M o b ile U S A , In c . (T -M o b ile) a p p e a ls th e d istric t co u rt’s d e n ial o f th e M o tio n to D i s m i s s and C om pel A rbi t r at i on t hati tfi l ed i n r es pons e t o D i gi t al Si gnal ’ s s ui tal l egi ng br eac h of contr actand r el at ed cl ai m s . For t he r eas ons bel ow , w e w i l l r ever s e and r emand f o r f u rt h e r p ro c e e d in g s c o n s is te n t w ith th is o p in io n . I. 1 I n A pr i l of 2000, T - M obi l e s entD i gi t al Si gnal a pr opos ed D eal erA gr eement cont ai ni ng t he t erm s and condi t i ons pur s uantt o w hi ch D i gi t al Si gnal w as t o be an author i zed T- M obi l e dea l er . T he agr eementcont ai ned an a rbi t r at i on cl aus e w hi ch s t at edThe a rbitration re quirement ha d cer tain exceptions as set forth in ¶ 12.11.5. How ever , 2 the par ties do not contend that these e x ceptions are re levant to this dispute. 3 i n par tt hat : “al l cl ai m s , count er cl ai m s , cr os s - cl ai m s , and di s put es betw een D eal erand C om pany( i ncl udi ng w hetheranypar t i cul ardi s put e i s arbi t r abl e her eunder ) , s hal l be r es ol ved bys ubm i s s i on t o bi ndi ng arbi t r at i on. ” ¶ 12. 11. 1 T he agr eemental s o cont ai ned 2 a n in teg ra tio n c lau se . T h a t cla u se sta ted : “T h is A g re e m e n t re p re se n ts th e e n tire, c o m p lete fin al an d ex clus ive A g ree m en t betw ee n the p arti es h ere to w ith resp ec t t o m att ers addr es s ed i n t hi s A gr eementand, exce ptas expr es s l ypr ovi ded her ei n, s hal l notbe aff ect ed byr efe r ence t o anyot herdocument s . ” ¶ 12. 3. Fi nal l y , t he agr eements t at ed: “Exceptas s etfor t h her ei n, anyamendm ent s t o t hi s A gr eementm us tbe i n w r i t i ng and sig n e d b yD e a ler a n d b yth e V ice P re sid e n t o f S a les f o r C o m p a n y . A n ya m e n d m e n ts s i gned bys om eone othert han the V i ce Pr es i dentof Sal es forC om panys hal l be nul l and v o id .” ¶ 1 2 .5 . D i gi t al Si gnal ’ s Pr es i dents i gned the agr eementand i ni t i al ed ea ch page . D i gi t al Si gnal ’ s V i ce Pr es i dental s o s i gned a c opyof the agr eement . A copyof the agr eement w a s a ttac h e d a s a n e x h ib it t o th e C o m p lain t th a t D ig ital S ig n a l f iled in th e d istric t co u rt. T h at ex h ibitco n tai n s the w o rds “ su b ject t o ad d en d u m ” h an d w ri tt en ab o v e the P reside n t’ s sig n a tu re , b u t th a t p h ra se is c ro ss e d o u t. T h e re is n o e v id e n c e a s to w h o w ro te “ su b jec t to ad d en d u m , ” w h en itw as w ri tt en , o r w h o cro ssed the lan g u ag e o u t, an d the d istri ct co u rt m a d e n o f

in d in g re g a rd in g th e a u th e n tic ity o f th a t la n g u a g e . T he r ecor d does cont ai n a documentt hatpurpor t s t o be an a ddendum t o t he D eal er4

A gr eement . T hat“adde ndum ” i s nots i gned bya r epr es ent at i ve of T- M obi l e orD i gi t al S ig n a l. I n M ayof 2000, D i gi t al Si gnal and T-M obi l e agr eed thatt he D eal erA gr eement t hathad bee n pr oper l yexec ut ed di d notpr oper l yr efl ectt hatD i gi t al Si gnal w as t o be c o m p e n s a te d a t th e “ tie r 5 " c o m m itm e n t le v e l a s th e p a rt ie s h a d in te n d e d . A c c o rd in g ly, a T - M obi l e r epr es ent at i ve s enta s econd D eal erA gr eementt o D i gi t al Si gnal and di r ect ed t hatal l copi es of the i ni t i al D eal erA gr eementbe des t r oy ed. H ow ever , aft erD i gi t al S ig n a l co m p lain e d th a t th e p a g e s o f th e se c o n d a g re e m e n t w e re n o t n u m b e re d , T -M o b ile s enta thi r d copyof the D eal erA gr eement . T he onl ydi ffe r ence s betw een the thi r d copy and the exe cut ed fi r s tcopyw er e thatt he page s of the thi r d copyw er e number ed, and the com m i t m ent l evel w as properl yst at ed as “t i er 5, ” w hich w as consi st ent w i t h the part i es’ o ri g in a l u n d e rs ta n d in g . E ach of t he thr ee c opi es , i ncl udi ng t he i ni t i al copyt hathad bee n dul yexec ut ed by D ig ital S ig n a l an d T -M o b ile, c o n tain e d th e a rb itratio n a n d in teg ra tio n c lau se s s e t f o rth above. A l t hough D i gi t al Si gnal nevers i gned the s econd ort hi r d agr eement s , i tnever obj ect ed t o t he s ubs t ance of thos e agr eement s exce ptfort he i ni t i al err orr egar di ng t he appr opr i at e l evel of compensa t i on. M or e than tw o and one- hal f y ear s l at er , D i gi t al Si gnal fi l ed the i ns t ants ui tfor br eac h of contr act , and r el at ed cl ai m s , and T-M obi l e moved t o di s m i s s t he s ui tand compel arbi t r at i on. T he di s t r i ctcour tdeni ed T-M obi l e’ s m ot i on bas ed s ol el yon D i gi t alOur review is plenar y . Lloyd v. Hovena , 369 F.3d 263, 273 ( 3d Cir. 2004), 3 5 Si gnal ’ s compl ai ntand the “s ubj ectt o addendum” not at i on cont ai ned i n t he uns i gned co p yo f th e D ea ler A g ree m en t th at D igit al S ign al att ac h ed to it s co m p lai n t. T h e c o u rt r eas oned thatt he part i es di d nothave a n agr eementt o arbi t r at e s i nce the D eal er A gr eementw as “s ubj ectt o addendum” and the purpor t ed adde ndum cont ai ned a not at i on t o “s t r i ke arbi t r at i on. ” Thus, t he di s t r i ctcour tconcl uded thatD i gi t al Si gnal never a c c e p te d T -M o b ile ’s f

ir s t p ro p o s e d D e a le r A g re e m e n t c o n ta in in g th e a rb itr a tio n c la u s e . T h e c o u rt a p p a re n tlyb e liev e d th a t D ig ital S ig n a l’s P re sid e n t w ro te “ su b jec t to a d d e n d u m ” o n th e a g re e m e n t a n d a tta c h e d a n a d d e n d u m b e f o re re tu rn in g it to T -M o b ile . In th e c o u rt ’s view , that co n sti tuted a re jecti o n o f T -M o b il e’s o ff er a n d a c o u n ter of

fe r. A ccor di ngl y , t he courtconcl uded that“ther e i s s i m pl yno m utual i t yr egar di ng t he arbi t r at i on cl aus e, and, t her efor e, t her e i s no agr eementt o arbi t r at e as al l eged i n t he C om pl ai nt . . . . T he put at i ve agr eementt o arbi t r at e ther efor e fa i l s on t he bas i s of f u n d a m e n ta l c o n tr a c t la w .” A p p . a t 4 a . T h is a p p e a l f o llo w e d . II. 3

“ A rb itratio n is a m a tter o f c o n tra c t b e tw e e n th e p a rties , an d a ju d icia l m a n d a te to arbi t r at e mustbe pr edi cat ed upon an a gr eementt o t hateff ect . ” P ar - Kni tMi l l

s , I nc. v. S to c kb r id

g e Fa b r ic s C o ., In c . 636 F. 2d 51, 54. ( 3d C i r . 1980) . A cour tm us tcompel a rb itr a tio n if

th e re is c le a r e v id e n c e th a t th e p a rt ie s e n te re d in to a n a g re e m e n t to a rb itr a te . 9 U .S .C . § § 3 , 4 ; G e n . E lec . C o . v. D e u tz , 2 7 0 F .3 d 1 5 4 (3 d C ir. 2 0 0 1 ). T h e in q u iryin toB ot h par t i es agr ee thatPenns y l vani a l aw governs t hi s di s put e, and the di s t r i ct 4 c o u rt a p p lie d P e n n s y lv a n ia la w a s s p e c if ie d in th e D e a le r A g re e m e n t. See, C o. des B au xi t es v. A rgon au t -Mi dw est Ins. , 8 8 0 F . 2 d 6 8 5 , 6 8 8 -89 (3d C ir . 1 9 8 9 ). 9 U .S. C. § 4 p ro vid e s, in re le va nt p art : 5 A par ty ag grieve d by

the alleg ed failure, neg lect, or refusal of another to arbitrateunder a written agreement for a

rbitration may

petition any

United States district court ...for an order direc ting that suc h arbitration procee d in the manner provided for

in such agreement... The c ourt shall hear the par ties, and upon beingsatisfied that the makingof the agreement for a

rbitration or the f

ailure to c omply

therewith is not i n issue, the cour t shall make a

n order direc ting the pa

rties to proce ed to ar

bitration in acc ordanc e with the terms of the agreement... If th e m akin g of the arbitration agree m ent or t he fai lure, neglect , or re fu sal to performthe sam e be in issu e, the c ourt shall p roce ed summ arily to the t rial there of. . . . Id . (empha sis added). 6 w hethert he part i es agr eed t o s ubm i tt hei rdi s put es t o arbi tr at i on, and the s cope of any arbi t r at i on agr eementi s governed by“or di narys t at e l aw pr i nci pl es governi ng contr act for m at i on. ” Id . 4 “A naked a s s er t i on . . . bya part yt hati tdi d noti nt end t o be bound byt he t erm s of an arbi t r at i on agr eementi s i ns uffi ci ent ” t o r ai s e an i s s ue of f actaboutt he exi s t ence of an a g re e m e n t to a rb itr a te . P a r-Kn it Mill s , 636 F. 2d at55. H ow ever , an unequi vocal deni al “ac compani ed bys uppor t i ng aff i davi t s , . . . i n m os tcas es s houl d be s uffi ci entt o r equi r e a ju ryd e ter m in a tio n o n w h e th e r th e re h a d in f a c t b e e n [ a n a g re e m e n t to su b m it t o arbi t r at i on] . ” Id . In o rd e r f o r u s to c o n c lu d e a s a m a tter o f law th a t n o a g re e m e n t to arbi t r at e exi s t ed betw een T- M obi l e and D i gi t al Si gnal , t her e mustbe no genui ne i s s ue of m at er i al fac tar i s i ng fr om t he pl eadi ngs orat t ache d exhi bi t s . 9 U . S. C . § 4. See a l so P ar- 5 Kn it Mill s , 6 3 6 F .2 d a t 5 4 .7

H er e, as w e not ed above , t her e i s a s i gned D eal erA gr eementcont ai ni ng an a rb itratio n c lau se , an d th a t ag re e m e n t sp e c if ica llysta tes th a t itis “ th e e n tire, c o m p lete fi nal and exc l us i ve A gr eementbetw een the part i es . ” M or eover , i ti s undi s put ed thatt he agr eementr equi r es t hat“anyamendm ent s [t o i t ] m us tbe i n w r i t i ng and s i gned by[D i gi t al Si gnal ] . . . . ” Thatevi dence of an a rbi t r at i on agr eementi s count er ed onl ybyD i gi t al S ig n a l’s d e n ials , an d a c o p yo f th e D e a ler A g re e m e n t th a t h a s th e p h ra se “ su b jec t to addendum” cr os s ed out . D i gi t al Si gnal has notpr ovi ded a c opyof anyexec ut ed a d d e n d u m , n o r h a s it e x p lain e d a n y th in g a b o u t th e m y ste rio u s a d d e n d u m , o r th e e q u a lly m y s t er i ous r efe r ence t o i ton t he exhi bi tt o D i gi t al Si gnal ’ s compl ai nt . I ti s di ffi cul tforus to u n d erstan d w h ythe d istri ct co u rtd id n o t end it s inq u irythere an d g ran t T -M o b il e’s M ot i on t o D i s m i s s and C om pel A rbi t r at i on. T h ere is no thing o n this reco rd to su p p o rtthe c o n clus ion that T -M o b il e’s c o m m u n ica tio n to D ig ital S ig n a l re g a rd in g th e in c o rre c t co m m itm e n t lev e l co n tain e d in th e f irst D e a ler A g re e m e n t h a d a n y th in g to d o w ith th e a lleg e d a d d e n d u m . T -M o b ile m ade no r efe r ence t o anyaddendum i n i t s negot i at i ons w i t h D i gi t al Si gnal , and di s cus s i ons of the cha nges t o t he D eal erA gr eementr efe r r ed onl yt o t he “t i er5" c o m m itm e n t le v e l, a n d p a g e n u m b e ri n g . E ven as s um i ng t hatt her e w as an adde ndum t o t he agr eement , t her e i s not hi ng on th is re c o rd to e s ta b lis h w h o a d d e d it, w h e n it w a s a d d e d , o r w h o c ro s s e d th e p h ra s e o u t. T hus t her e i s no w ayof know i ng w hetherT - M obi l e eve n s aw t he al l eged a ddendum, or8

t h a ti ts o m e h o w t ru m p s th e p r o p e r l ye x e c u t e d a rb i t r a t i o n a n d i n t e g r a t i o n c l a u s e s . We t her efor e fa i l t o s ee how t he di s t r i ctcour tcoul d have c oncl uded thatD i gi t al Si gnal r ej ect ed the s i gned D eal erA gr eementand made a count er offe r . T hatr es ul tpl ace s bus i nes s es i n t he t enuous pos i t i on of havi ng t o r el yon dul yexec ut ed w r i t t en contr act s at th e ir p e ril. T her e i s no di s put e thatt he arbi t r at i on cl aus e i s s uffi ci ent l ybr oad t o i ncl ude arbi t r at i on of D i gi t al Si gnal ’ s contr actcl ai m s , and the di s t r i ctcour terr ed i n al l ow i ng D i gi t al Si gnal ’ s r atherephemer al r efe r ence t o an “a ddendum” t o defe atenfor cementof th e D e a le r A g re e m e n t a s w ri tte n . I V. A ccor di ngl y , w e w i l l r ever s e the or derdeny i ng T - M obi l e’ s M ot i on t o D i s m i s s and C om pel A rbi t r at i on and r emand t he mat t ert o t he di s t r i ctcour tw i t h di r ect i ons t hati tgr ant t hatm ot i on.