Opinion ID: 4028382
Heading Depth: 3
Heading Rank: 1

Heading: Procedurral Framew

Text: work The F Federal Arrbitration A Act (the ʺF vides that ʺ[a] writteen FAAʺ) prov provisio on in . . . a contract . . . to settlee by arbitraation a con ntroversy tthereafter arising out of [thee] contract . . . shall b be valid, irrrevocable,, and enforrceable.ʺ 99 U.S.C. § § 2. The Su upreme Co ourt has reepeatedly iinstructed that the FAA ʺembod d[ies] [a] na ational pollicy favorin ng arbitrattion.ʺ AT& &T Mobilitty LLC v. Concepccion, 563 U.S. 333, 346 6 (2011) (seecond alteeration in o original) (q quoting Buckeyee Check Cashing, Inc. v v. Cardegnaa, 546 U.S. 440, 443 (22006)). ʺ[T T]his policy y is founded d on a desire to preserve the partiesʹ abillity to agreee to arbitrrate, ratherr than litiigate, disp putes.ʺ Sch hnabel v. Trrilegiant Coorp., 697 F.33d 110, 1188 (2d Cir. 2012). B But the FA AA ʺdoes n not require parties to arbitrate w when they y have not ‐ 10 ‐ agreed to do so.ʺ Id. (quoting Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S. 468, 478 (1989)). The question of whether the parties have agreed to arbitrate, i.e., the ʺquestion of arbitrability,ʺ is an issue for judicial determination unless the parties clearly and unmistakably provide otherwise. Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 83 (2002); see also Bensadoun v. Jobe‐Riat, 316 F.3d 171, 175 (2d Cir. 2003). ʺThis principle ʹflow[s] inexorably from the fact that arbitration is simply a matter of contract between the parties.ʹʺ Wachovia Bank, Natʹl Assʹn v. VCG Special Opportunities Master Fund, Ltd., 661 F.3d 164, 171 (2d Cir. 2011) (quoting First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 943 (1995)). The threshold question of whether the parties indeed agreed to arbitrate is determined by state contract law principles. Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 27 (2d Cir. 2002). The question of arbitrability usually arises in the context of a motion to compel arbitration. Under the FAA, parties can petition the district court for an order directing that ʺarbitration proceed in the manner provided for in such agreement.ʺ 9 U.S.C. § 4. The district court must stay proceedings once it is ʺsatisfied that the parties have agreed in writing to arbitrate an issue or issues ‐ 11 ‐ underlying the district court proceeding.ʺ WorldCrisa Corp. v. Armstrong, 129 F.3d 71, 74 (2d Cir. 1997) (quoting McMahan Sec. Co. v. Forum Capital Mkts. L.P., 35 F.3d 82, 85 (2d Cir. 1994)). In deciding motions to compel, courts apply a ʺstandard similar to that applicable for a motion for summary judgment.ʺ Bensadoun, 316 F.3d at 175. The summary judgment standard requires a court to ʺconsider all relevant, admissible evidence submitted by the parties and contained in pleadings, depositions, answers to interrogatories, and admissions on file, together with . . . affidavits.ʺ Chambers v. Time Warner, Inc., 282 F.3d 147, 155 (2d Cir. 2002) (internal quotation marks omitted). In doing so, the court must draw all reasonable inferences in favor of the non‐moving party. See Wachovia Bank, 661 F.3d at 171‐72. ʺIf there is an issue of fact as to the making of the agreement for arbitration, then a trial is necessary.ʺ Bensadoun, 316 F.3d at 175 (citing 9 U.S.C. § 4 (ʺIf the making of the arbitration agreement . . . be in issue, the court shall proceed summarily to the trial thereof.ʺ)); accord Sphere Drake Ins. Ltd. v. Clarendon Natʹl Ins. Co., 263 F.3d 26, 30 (2d Cir. 2001). ʺ[B]ut where the undisputed facts in the record require the matter of arbitrability to be decided against one side or the other as a matter of law, we may rule on the basis of that ‐ 12 ‐ legal issue and ʹavoid the need for further court proceedings.ʹʺ Wachovia Bank, 661 F.3d at 172 (quoting Bensadoun, 316 F.3d at 175). In this case, Amazon did not move to compel arbitration and instead moved pursuant to Rule 12(b)(6) to dismiss the complaint for failure to state a claim upon which relief may be granted, relying on the arbitration provision in the 2012 Conditions of Use. See Fed. R. Civ. P. 12(b)(6). Some district courts in this Circuit have treated motions to dismiss based on mandatory arbitration clauses as motions to compel arbitration. See, e.g., Begonja v. Vornado Realty Tr., No. 15 Civ. 4665 (PAE), 2016 WL 356090, at  n.1 (S.D.N.Y. Jan. 29, 2016); Cupples v. Valic Fin. Advisors, Inc., No. 13‐CV‐4501(JS)(AKT), 2014 WL 4662272, at  (E.D.N.Y. Sept. 18, 2014); Jillian Mech. Corp. v. United Serv. Workers Union Local 355, 882 F. Supp. 2d 358, 363 (E.D.N.Y. 2012). The district court here, however, specifically declined to do so because, it reasoned, Amazon had not explicitly or implicitly asked the court to order arbitration. We agree with the district court that because Amazonʹs motion to dismiss neither sought an order compelling arbitration nor indicated that Amazon would seek to force Nicosia to arbitrate in the future, it was proper not to construe the motion to dismiss as a motion to compel arbitration, to which the summary judgment standard would apply. ‐ 13 ‐ Nicosia argues that the district court erred in not construing Amazonʹs motion as a motion to compel arbitration, citing Bensadoun v. Jobe‐Riat, 316 F.3d 171 (2d Cir. 2003). There, we held that it was ʺappropriateʺ to use the ʺsummary judgment standard . . . in cases where the District Court is required to determine arbitrability, regardless of whether the relief sought is an order to compel arbitration or to prevent arbitration.ʺ Id. at 175. We did not, however, hold that the summary judgment standard was ʺmandatoryʺ in such cases. When the moving party does not manifest an intention to arbitrate the dispute, Bensadoun does not require the district court to convert the motion to dismiss to one to compel. Here, given the absence of a clear indication of Amazonʹs intent to compel Nicosia to arbitrate, the district court properly proceeded with the motion as one to dismiss, without converting it to a motion to compel arbitration.3 Accordingly, we review the district courtʹs ruling as the grant of a motion to dismiss pursuant to Rule 12(b)(6). We review de novo the dismissal of a complaint pursuant to Rule 12(b)(6), construing the complaint liberally, accepting all factual allegations as 3 We do not decide whether, in the absence of an indication of an intent on the part of the movant to compel arbitration, the district court has discretion to convert a motion to dismiss to a motion to compel. We hold only that the district court did not err in not converting under the circumstances here. ‐ 14 ‐ true, and drawing all reasonable inferences in the plaintiffʹs favor. Chen v. Major League Baseball Props., Inc., 798 F.3d 72, 76 (2d Cir. 2015). ʺTo survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ʹstate a claim to relief that is plausible on its face.ʹʺ Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A complaint ʺis deemed to include any written instrument attached to it as an exhibit or any statements or documents incorporated in it by reference.ʺ Chambers, 282 F.3d at 152 (quoting Intʹl Audiotext Network, Inc. v. AT&T Co., 62 F.3d 69, 72 (2d Cir. 1995) (per curiam)); see also Brass v. Am. Film Techs., Inc., 987 F.2d 142, 150 (2d Cir. 1993). ʺWhere a document is not incorporated by reference, the court may nevertheless consider it where the complaint ʹrelies heavily upon its terms and effect,ʹ thereby rendering the document ʹintegralʹ to the complaint.ʺ DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 111 (2d Cir. 2010) (quoting Mangiafico v. Blumenthal, 471 F.3d 391, 398 (2d Cir. 2006)); see also Chambers, 282 F.3d at 153. A ʺnecessary prerequisiteʺ for taking into account materials extraneous to the complaint ʺis that the ʹplaintiff rely on the terms and effect of the document in drafting the complaint; mere notice or possession is not enough.ʹʺ Global Network Commc’ns, Inc. v. City of New ‐ 15 ‐ York, 458 F.3d 150, 156 (2d Cir. 2006) (alterations omitted) (quoting Chambers, 282 F.3d at 153). This generally occurs when the material considered is a ʺcontract or other legal document containing obligations upon which the plaintiffʹs complaint stands or falls, but which for some reason ‐‐ usually because the document, read in its entirety, would undermine the legitimacy of the plaintiffʹs claim ‐‐ was not attached to the complaint.ʺ Id. at 157. Even where a document is considered ʺʹintegralʹ to the complaint, it must be clear on the record that no dispute exists regarding the authenticity or accuracy of the document.ʺ DiFolco, 622 F.3d at 111 (quoting Faulkner v. Beer, 463 F.3d 130, 134 (2d Cir. 2006)). ʺIt must also be clear that there exist no material disputed issues of fact regarding the relevance of the document.ʺ Faulkner, 463 F.3d at 134. This principle is driven by a concern that a plaintiff may lack notice that the material will be considered to resolve factual matters. See Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991). Thus, if material is not integral to or otherwise incorporated in the complaint, it may not be considered unless the motion to dismiss is converted to a motion for summary judgment and all parties are ʺgiven a reasonable opportunity to present all the material that is pertinent to the motion.ʺ Fed. R. Civ. P. 12(d). ‐ 16 ‐ um, when iit is appareent ‐‐ on th In su he face of tthe complaaint and documeents propeerly incorp porated theerein ‐‐ thaat claims arre subject tto arbitratiion, a districct court ma ay dismisss in favor o of arbitratiion withou ut the delay y of discoveery. See Gu uidotti v. Leegal Helpers Debt Resoolution, L.L L.C., 716 F..3d 764, 7774‐76 (3d Cir.. 2013). If, however, there is a dispute ass to the releevance, au uthenticity,, or accuraccy of the do ocuments relied upo on, the disttrict court may not d dismiss thee complaint with th hose materrials in min nd. Cf. Chaambers, 2822 F.3d at 154. If the district court is go oing to rely y on the ex xtrinsic maaterials, th he proper ccourse is to o convertt the motio on to a mottion for summary jud dgment diismissing tthe case in n favor off arbitratio on, after prroviding notice to thee parties aand an opp portunity tto be heard.