Suburban Leisure Center, Inc. v. AMF Bowling Products, Inc.

Facts

Plaintiff was a distributor of leisure equipment with its own stores. Defendant franchised pool tables and accessories. The two entered into an oral franchise agreement which granted Plaintiff the right to promote and sell Defendant’s products in its stores. Later, the two entered a written e-commerce contract that obligated Plaintiff to deliver and install Defendant’s products ordered over the internet to customers living in areas where Plaintiff had stores. The written agreement contained a merger clause stating that the agreement superseded all previous agreements between the parties. It also contained a clause requiring binding arbitration for the resolution of all disputes. At some point, Defendant informed Plaintiff that it could no longer promote or sell Defendant’s products. Plaintiff filed suit in state court for breach of the oral franchise agreement and Defendant removed the case to federal court where it moved to dismiss or to require arbitration. The trial court found that Plaintiff’s claims did not arise from the written e-commerce agreement since that agreement did not discuss the ability of Plaintiff to promote or sell Defendant’s products. Defendant’s motions were denied and Defendant appealed.