The opinion of the court was delivered by: Dalzell, J.
Plaintiff Law Office of Marvin Lundy ("Lundy Law") seeks a permanent injunction against defendant, Whitehaven S.F., LLC ("Whitehaven"), from proceeding with an arbitration against it, as well as costs and attorneys' fees in the amount of $8,750. For the reasons set forth below, we will grant plaintiff's motion in part and enjoin the arbitration while declining to award attorneys' fees or costs.*fn1
A. Anomalous Procedural History
On September 8, 2010, plaintiff Lundy Law filed a motion for a preliminary injunction, seeking to prevent Whitehaven from proceeding with an arbitration against Lundy Law that was then scheduled to take place in New York City on September 15, 2010. What takes Lundy Law's motion out of the mine run is that Lundy Law filed it without first bothering to file a complaint, notwithstanding the rigor of Fed. R. Civ. P. 3. That Rule directs that "[a] civil action is commenced by filing a complaint with the court." To be sure, actions to compel arbitration have been commenced on motions to compel, as in Engineers Ass'n v. Sperry Gyroscope Co., 251 F.2d 133 (2d Cir. 1952) (arbitration under § 301 of the Labor Management Relations Act). But we are aware of no case where, as here, a party seeking to enjoin an arbitration did so without complying with Rule 3's straightforward direction.
After informing the parties at the originally scheduled hearing that this matter could not proceed without a complaint, we without objection continued further proceedings until October 19 so plaintiff could comply with Rule 3.*fn2 At the October 19 hearing, we at last had the benefit of both a complaint and a motion for relief in hand, as well as pretrial memoranda from both parties and a joint stipulation of facts and exhibits.
The parties at the October 19 hearing agreed that we could treat the motion for a preliminary injunction as one for a final injunction. As the parties also agreed that the stipulated facts and exhibits constituted the entire universe of facts in this case, we proceed to a final resolution of this controversy.
B. Jointly Stipulated Facts
The parties stipulate that Lundy Law represented an unnamed client, K.B., in a case involving a July 21, 2007 motor vehicle accident On three occasions in 2008, K.B. entered into agreements with Whitehaven. Pursuant to each agreement, Whitehaven advanced K.B. $2,000 and also charged K.B. an application fee of $250 and an origination fee of $200. Whitehaven also charged K.B. 4.99% interest per month, with a minimum payment of $3,500 due for each agreement. Three times that year, K.B. also signed a "Plaintiff's Lien in Favor of Whitehaven and Attorney Acknowledgment" ("Plaintiff's Lien"). Lundy Law signed a separate area of the document, titled "Lien Acknowledged and Agreed," at the bottom of the last page of each Plaintiff's Lien, and an employee of Lundy Law notarized K.B.'s signature on the Agreements and Plaintiff's Liens. Parties' Joint Stip. of Facts & Exhibits ("Facts") (Oct. 6, 2010) at 1.
On May 17, 2010, K.B. settled her personal injury claim against the third-party tortfeasor for $77,500. After payment of legal fees and costs and medical provider expenses, Lundy Law tendered the balance of the settlement's net proceeds, $15,009.06, to Whitehaven by a July 28, 2010 check. That check contained an endorsement stamp stating "Endorsement Constitutes Acceptance in full Satisfaction of outstanding bills". Whitehaven crossed this stamp out before depositing the check and endorsed it with the notation, "Partial Payment Only, under protest, with prejudice, and with all rights reserved." Id. at 1-2.
On August 24, 2010, Whitehaven filed a Demand for Arbitration with the American Arbitration Association, with a hearing locale of New York City, against Lundy Law, one of its attorneys, Steven L. Chung, Esq., and K.B. In response, on September 8, 2010, Lundy Law filed the present Motion for Preliminary Injunction. The parties have stipulated to remove Chung in his individual capacity from both the New York arbitration proceeding and this case. Id. at 2.
The parties have stipulated to the admissibility of all relevant exhibits.*fn3
In exchange for paying $2,000 to K.B. on each occasion that she signed an agreement with Whitehaven, Whitehaven received a contingent interest in K.B.'s claim. Had K.B. not received any payoff from her claim, she would have owed Whitehaven nothing. See, e.g., Ex. 1 to Exhibits ¶¶ 12, 15. The agreements between K.B. and Whitehaven all state that:
This AGREEMENT is made and entered into . . . between Whitehaven S.F. LLC, a Delaware Limited Liability Company, having an address at 350 Fifth Avenue, Suite 5701, New York, New York, 10118 (hereinafter referred to as "Whitehaven S.F. LLC") and [K.B.], Philadelphia, PA 19104, (hereinafter referred to as "Plaintiff") and his/her successors and/or assigns.
See, e.g., id. at Preamble. The agreements also provide that:
Any controversy or claim arising out of or relating to this contract, including without limitation the interpretation, validity, enforceability or breach thereof, shall be settled by final, binding arbitration administered by the American Arbitration Association (hereinafter referred to as "AAA") in accordance with its Commercial Arbitration Rules, and judgment on ...