Opinion
8:03CV182
November 19, 2003
MEMORANDUM AND ORDER
INTRODUCTION
This matter is before the court on defendant's motion to dismiss or, in the alternative, motion to stay and compel arbitration. Filing No. 9. Defendant argues that this court lacks subject matter jurisdiction and the contract between the parties requires arbitration in this case, as both parties to this lawsuit are active members of the National Grain and Feed Association (NGFA) which subjects its members to mandatory arbitration. Plaintiff has not responded to the motion. I have carefully reviewed the record, brief, index of evidence, and relevant case law. I conclude that the motion to dismiss should be granted, and I will dismiss this case without prejudice.
Plaintiff filed this lawsuit in Nebraska state district court and defendant moved it to federal court. Filing No. 1. The gist of the conflict involves a consulting agreement between the parties wherein the defendant agreed to consult with the plaintiff, in consideration of an initial fee of $4,000.00. The plaintiff alleges that the defendant performed negligently under the agreement and it has incurred losses in excess of $800,000.00.
DISCUSSION
It appears that both parties were active members of the NGFA. The NGFA bylaws provide for arbitration. Filing No. 10, Ex. 2, Index of Evidence, Art. XI. The NGFA Arbitration Rules provide:
(a) The National Grain and Feed Association (NGFA) may properly consider a case involving a dispute between or among the following:
(1) Active members of the National Association (among whom arbitration by the National Association is made compulsory by the Association Bylaws). For purposes of compulsory arbitration, the term "dispute" shall mean issues involving the warehousing, processing, manufacturing, merchandising, financing, transportation, or distribution of grain or feed, or feed ingredients within or between the United Sates, Mexico or Canada or any issue involving NGFA Trade Rules[.]
Filing No. 10, Ex. 3, § 3. The plaintiff's petition alleges grain merchandising disputes. Although the agreement to arbitrate is not contained in a contract between the parties, it is contained in the NGFA bylaws which both parties belong.
The Federal Arbitration Act, 9 U.S.C. § 1 et seq., is applicable to arbitration agreements between the members of NGFA which affect commerce. Nagel v. ADM Investor Services, Inc., 1998 WL 25208 (N.D. Ill. 1998); see also, Hoffman v. Cargill, Inc., 236 F.3d 458 (8th Cir. 2001). In this case the parties are corporations located in different states doing business across state lines. Thus, the affecting commerce requirement is met. I have carefully reviewed the arbitration agreement and determined that the claims by the plaintiff are within the terms of the agreement to arbitrate. See ATT Tech., Inc. v. Communications Workers of America, 475 U.S. 643, 649 (1986).
Because all of the claims made by the plaintiff are subject to arbitration, I have the discretion to dismiss this matter for lack of subject matter jurisdiction rather than to stay it and compel arbitration. Kalinski v. Robert W. Baird Co., Inc., 184 F. Supp.2d 944, 946 (D. Neb. 2002). As in Kalinski, the plaintiff in this case has not presented me with any reasons why I should stay this case rather than dismiss it. I shall, therefore, dismiss this case, and the plaintiff can choose whether to initiate arbitration.
THEREFORE, IT IS ORDERED that the defendant's motion to dismiss, Filing No. 9, is granted, and plaintiffs petition is dismissed without prejudice.