Opinion ID: 64225
Heading Depth: 2
Heading Rank: 1

Heading: Overview Of Our Arbitration Clause Analysis

Text: We review de novo a district court’s denial of a motion to compel arbitration. JP Morgan Chase & Co. v. Conegie, 492 F.3d 596, 598 (5th Cir. 2007). A two-step analysis is applied to determine whether a party may be compelled to arbitrate. Id. First, we ask if the party has agreed to arbitrate the dispute. See id. (“The Court must first ascertain whether the parties agreed to arbitrate the dispute.”). If so, we then ask if “any federal statute or policy renders the claims nonarbitrable.” Id. (quoting Wash. Mut. Fin. Group, LLC v. 2 No. 07-60567 Bailey, 364 F.3d 260, 263 (5th Cir. 2004)). As neither party argues that a federal statute or policy would bar arbitration here, the issue before us is limited to the analysis’s first step. That first step itself contains two questions: (1) is there a valid agreement to arbitrate the claims and (2) does the dispute in question fall within the scope of that arbitration agreement. See id. We apply the federal policy favoring arbitration when addressing ambiguities regarding whether a question falls within an arbitration agreement’s scope, but we do not apply this policy when determining whether a valid agreement exists. Fleetwood Enters., Inc. v. Gaskamp, 280 F.3d 1069, 1073–74 & n.5 (5th Cir. 2002); see Westmoreland v. Sadoux, 299 F.3d 462, 465 (5th Cir. 2002) (“[W]e will read the reach of an arbitration agreement between parties broadly, but that is a different matter from the question of who may invoke its protections.”).1 Because the district court held, and neither party challenges, that the claims would otherwise be within the scope of the arbitration clause “[h]ad the defendant signed the contract,” the present case turns solely on the first question of whether a valid agreement exists. Put another way, we are asked to determine whether Sherer has agreed to arbitration with a nonsignatory, such as Green Tree.