United States District Court, S.D. Mississippi, Southern Division
EAGLE REBAR & CABLE COMPANY, INC. PLAINTIFF
SOUTHERN INDUSTRIAL CONTRACTORS, LLC; ADS, LLC; and TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA DEFENDANTS
ORDER GRANTING IN PART AND DENYING IN PART MOTION TO
COMPEL ARBITRATION AND STAY PROCEEDINGS
GUIROLA, JR., CHIEF U.S. DISTRICT JUDGE
THE COURT is the Motion to Compel Arbitration and Stay
Proceedings  filed by the defendant Southern Industrial
Contractors, LLC. No party has responded to the Motion. After
reviewing the Motion, the record in this matter, and the
applicable law, the Court finds that the Motion to Compel
Arbitration and Stay Proceedings should be granted as to
Eagle Rebar's claims against Southern Industrial. To the
extent that Southern Industrial is seeking to compel
arbitration of Eagle Rebar's claims against ADS, LLC,
another defendant that has not made an appearance in this
lawsuit, the Court finds that the Motion should be denied.
Southern Industrial's request for a stay is granted.
Industrial served as the general contractor on a construction
project at the port in Gulfport, Mississippi. The defendant
Travelers Casualty and Surety Company allegedly provided a
payment bond to Southern Industrial for the project. Southern
Industrial retained the defendant ADS, LLC, and the plaintiff
Eagle Rebar & Cable Company, Inc., to work as
subcontractors on the project. ADS also retained Eagle Rebar
to perform portions of ADS's subcontract.
Rebar filed this lawsuit, claiming that the defendants have
not paid it for the work it performed pursuant to the
subcontract with Southern Industrial and the sub-subcontract
with ADS. Southern Industrial seeks an order compelling
arbitration and staying this lawsuit pending arbitration.
MOTION TO COMPEL ARBITRATION
Federal Arbitration Act (FAA) applies to arbitration
agreements involving interstate commerce. 9 U.S.C. Â§ 1, 2.
Southern Industrial is a Louisiana limited liability company,
and Eagle Rebar is a Mississippi corporation. Southern
Industrial has represented to the Court that the port
construction project was a multi-million-dollar construction
project involving entities and supplies from multiple states,
and no party has objected to this characterization. Since the
subcontract involved interstate commerce, the agreement to
arbitrate contained in the subcontract is governed by the
FAA, which "establishes a liberal policy favoring
arbitration and a strong federal policy in favor of enforcing
arbitration agreements." See New Orleans Glass Co.
v. Roy Anderson Corp., 632 F. App'x 166, 169 (5th
Cir. 2015) (holding that a construction subcontract was
governed by the FAA); see also Pers. Sec. & Safety
Sys. Inc. v. Motorola Inc., 297 F.3d 388, 392 (5th Cir.
2002) (discussing FAA policy favoring arbitration).
determine whether the parties agreed to arbitrate this
dispute, we ask 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."
Sharpe v. AmeriPlan Corp., 769 F.3d 909, 914 (5th
Cir. 2014) (internal quotation marks omitted). Courts also
"consider whether any federal statute or policy renders
the claims non-arbitrable." Will-Drill Res., Inc. v.
Samson Res. Co., 352 F.3d 211, 214 (5th Cir. 2003). Any
doubts regarding the scope of the arbitration clause are
generally resolved in favor of arbitration. Pers. Sec.
& Safety Sys. Inc., 297 F.3d at 392.
subcontract between Southern Industrial and Eagle Rebar
30.0 Notwithstanding the above, and except for
Contractor's rights to terminate for convenience as set
forth herein above, the Parties agree to work in good faith
to resolve issues that may arise under this Subcontract or
related to the Project pursuant to the following process as a
condition precedent to the filing of any legal action:
(a) First level review will be performed by Contractor's
Project manager and Subcontractor's counterpart. In the
event the disagreement is not resolved to both Parties'
satisfaction after reasonable and diligent efforts, within
five (5) business days from the time a Party's
representative first provides written notice to the other
Party's representative, the issue shall be submitted to
(b) The Contractor's and Subcontractor's Senior
Executive level shall perform a second review of any
(c) In the event the disagreement is not resolved within five
(5) business days to both Parties' satisfaction after
reasonable and diligent efforts, any matter remaining
unresolved may then be filed as a legal action in a court
located in the county where the Project is located. However,
Subcontractor hereby stipulates and agrees that at the sole
and exclusive option of the Contractor, any claim, dispute[,
] issue[, ] or matter remaining unresolved arising from or in
any way whatsoever connected with the Subcontract or Project
shall be submitted to binding arbitration to be administered
by the American Arbitration Association in accordance with
the American Arbitration Association Construction Industry
Arbitration Rules which arbitration ...