The opinion of the court was delivered by: JOY CONTI, District Judge
Plaintiff Advest, Inc. ("plaintiff" or "Advest") brought this
action under the Federal Arbitration Act, 9 U.S.C. §§ 1, et
seq. (the "FAA"), in the nature of a petition to compel
arbitration and stay a civil action that defendant George Wagner
("defendant" or "Wagner") commenced in state court. This court
heard evidence and argument during a bench trial on November 10,
2004. On January 5, 2005, the parties filed proposed findings of
fact and conclusions of law.
Pursuant to Federal Rule of Civil Procedure 52, this court
makes the following findings of fact and conclusions of law.
1. Advest is a corporation that provides securities brokerage,
investment banking, and asset management services. Advest is
licensed to do business within the Commonwealth of Pennsylvania.
Advest is a member of the National Association of Securities
Dealers ("NASD"). Joint Stipulations, ¶ 1. 2. In January 1996, Wagner became a client of Advest by opening
a brokerage account (the "Account") and signing an Advest Account
Application and an IRA Application. Joint Stipulations, ¶ 2.
3. According to the booklet accompanying the Advest Account
Application ("Account Agreement and Information About Your Advest
Account"), the agreement Wagner made with Advest concerning his
brokerage account includes "the Brokerage Agreement, . . . these
Definitions, the Account Application, and any other written
agreements between us concerning the Brokerage Account. . . ."
Joint Stipulations, Ex. 1 at 17.
4. The Advest Account Application, IRA Application, and the
booklet accompanying the Advest Account Application ("Account
Agreement and Information About Your Advest Account") (together,
the "Agreements") are clearly identified as Advest account
documents. Joint Stipulations, Ex. 1. Plaintiff's uncontested
testimony at trial establishes that Advest prepared the original
forms of these documents. Trial Transcript at 21.
5. The Agreements are contracts evidencing a transaction
involving commerce, as defined by the Federal Arbitration Act,
9 U.S.C. § 1. Joint Stipulations, ¶ 3.
6. The Agreements included, inter alia, several clauses
dealing with the arbitrability of disputes arising under the
Agreements. Joint Stipulations, Ex. 1.
7. Immediately above Wagner's signature on page 2 of the Advest
Account Application is the following language:
By signing below, I also acknowledge that . . . I
have received, read and understand the terms and
conditions of the Account Agreement set forth in the
accompanying booklet. . . . In accordance with the
pre-dispute arbitration clause in Section 15 of the
Brokerage Agreement on page 7, I am agreeing in advance to arbitrate any
controversies which may arise with you.
Joint Stipulations, Ex. 1 at second page (unnumbered) (emphasis
8. In addition, Section 15 of the Advest Account Agreement
contains the following arbitration clause:
You agree that all controversies which may arise
between us, including but not limited to those
involving any transaction or the construction,
performance, or breach of the Account Agreement or
any other agreement between us, whether entered into
prior, on or subsequent to the date hereof, shall be
determined by arbitration. . . . This arbitration
provision shall be enforced and interpreted
exclusively in accordance with applicable Federal
law, including the Federal Arbitration Act.
Joint Stipulations, ¶ 4; Joint Stipulations, Ex. 1 at 7-8
9. Immediately above Wagner's signature on the IRA Application
is the following language:
I have received and read the Advest, Inc. Prototype
Individual Retirement Account Plan and Disclosure
Statement, the Advest Brokerage Agreement (Appendix
A), and the Beneficiary Information below. . . . By
signing below, I also acknowledge that, in accordance
with the pre-dispute arbitration clause in Section 5
of the Brokerage Agreement, I am agreeing in advance
to arbitrate any controversies which may arise with
Joint Stipulations, Ex. 1 at 7-8 at third page (unnumbered)
(emphasis in original).
10. The Agreements define the terms "[w]e/us/our/Advest" to
mean "Advest, its subsidiaries, affiliates, officers, directors,
agents or employees." Joint Stipulations, Ex. 1 at 18.
11. During the relevant time period, "Nussbaum Partners"
referred to a group of licensed securities representatives
employed by Advest. Joint Stipulations, ¶ 8; Trial Transcript at
5. 12. All members of "Nussbaum Partners" worked as a team and
pooled their commissions. Trial Transcript at 5.
13. All members of "Nussbaum Partners" were employees of
Advest. In Pittsburgh, they worked at the Advest office at 3400
One Oxford Center. Trial Transcript at 5-6.
14. "Nussbaum Partners" did not maintain separate office space,
did not file tax returns in the name of "Nussbaum Partners", and
did not have any separate employees. Trial Transcript at 5-6.
15. "Nussbaum Partners" was not listed on the building registry
of One Oxford Center, where Advest maintains its Pittsburgh
office. Trial Transcript at 7.
16. "Nussbaum Partners" did not maintain a separate telephone
listing in the name of "Nussbaum ...