Opinion ID: 1735181
Heading Depth: 1
Heading Rank: 3

Heading: Claims under the Asset Purchase Agreement

Text: ¶ 13. Sullivan's complaint alleges that, From the inception ... the defendants did not provide adequate funding, marketing support, or other resources necessary for Protex Weatherproofing to succeed. Sullivan further claims the formation of Protex Weatherproofing was a sham, that ATX entered the Asset Purchase Agreement solely for the purpose of obtaining the patents, and that ATX never had any intention of making Protex Weatherproofing a viable company. ¶ 14. Sullivan's complaint alleges four causes of action against Protex Weatherproofing and ATX: fraud, breach of contract, gross breach of duty of good faith and fair dealing and misrepresentation. Sullivan bases each of these causes of action on his claim that he was not paid what he was due under the Employment Contract. ¶ 15. COUNT I.  FRAUD, alleges he was fraudulently induced into signing the Asset Purchase Agreement and selling his patents in return for false promises of consideration, including the [Employment] Contract. ¶ 16. COUNT II.  BREACH OF CONTRACT, alleges that defendants [1] are liable to [Sullivan] for wrongfully and tortiously breaching their [Employment] Contract with Plaintiff in failing to continue the compensation or providing a lump sum payment as required under the Contract. The claim for breach of contract does not allege any breach of the Asset Purchase Agreement. ¶ 17. COUNT III.  GROSS BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING, alleges the defendants breached their duty by failure to provide the consideration promised to [Sullivan] under the Asset Purchase Agreement and [Employment] Contract. ¶ 18. COUNT V.(sic)  MISREPRESENTATION, alleges the defendants misrepresented the consideration and support it would provide to [Sullivan]. ¶ 19. Sullivan cannot deny that his entire complaint, and each cause of action, involves a dispute or controversy arising out of, relating to, or in connection with [the Employment Contract], or the interpretation, validity, construction, performance, breach, or termination thereof. Nor can Sullivan deny that he has sued ATX for breach of the Employment Contract. Consequently, Sullivan bound himself to arbitrate the claims. ¶ 20. Sullivan must arbitrate his claims for a second reason. The Asset Purchase Agreement and the Employment Contract were part of a global transaction. In Sullivan v. Mounger, 882 So.2d 129 (Miss. 2004), an employment agreement containing an arbitration provision and other agreements not containing arbitration provisions, were executed as part of a global transaction. When a dispute arose under a document which did not contain an arbitration provision, we held that when separate documents are executed at the same time, by the same parties, as part of the same transaction, they may be construed as one instrument. Id. at 135, ¶ 21. ¶ 21. In Mounger, we cited with approval Neal v. Hardee's Food Systems, Inc., 918 F.2d 34 (5th Cir.1990), and Personal Security & Safety Systems, Inc. v. Motorola Inc., 297 F.3d 388 (5th Cir.2002). The Neal court held: Under general principles of contract law, separate agreements executed contemporaneously by the same parties for the same purposes and as part of the same transaction are to be construed together. Neal, 918 F.2d at 37 (emphasis added). Mounger, 882 So.2d at 135. The Personal Security & Safety Systems, Inc. court held: [T]he licensing agreement's arbitration provision governs claims arising out of the stock purchase agreement because the agreements were executed together as part of the same overall transaction and therefore are properly construed together. Personal Security & Safety Systems, Inc. 297 F.3d at 390. Mounger, 882 So.2d at 134. ¶ 22. The separate opinion says Mounger is distinguishable because in the case sub judice, the same parties did not sign each agreement. This is surprising for two reasons. ¶ 23. First, the same parties did not sign all the same documents in Mounger. One of the documents in issue was the Mutual Release and Termination Agreement which was entered into between Sullivan, Tritel and other `undersigned parties' who were not signatories on the other documents. Mounger, 882 So.2d at 133-34. ¶ 24. Second, for purposes of Sullivan's breach of contract claim, the separate opinion easily adopts Sullivan's position [2] that, pursuant to the alter ego doctrine, ATX and Protex Weatherproofing are the same parties. However, for purposes of denying the defendants' request to arbitrate, the separate opinion finds they are separate. This reasoning is bewildering; ATX is either the alter ego of Protex Weatherproofing, or it is not. ¶ 25. Mounger did not require, and we have never held, that in order for documents to be construed together, they must include a written provision which specifically recites that all documents are part of an integrated, or global, transaction. ¶ 26. In advocating this new requirement, the separate opinion relies heavily on the Integrated Transaction provision discussed in Mounger. However, this reliance is misplaced. This Court in Mounger specifically pointed out that the Stock Purchase Agreement, one of the documents sued upon by the plaintiff in Mounger, [did] not contain the Integrated Transaction provision. Mounger, 882 So.2d at 133.