First Circuit Clarifies Standard of Review and Evidentiary Proof Applicable to Motion to Compel Arbitration

Air-Con Inc. is a Puerto Rico corporation that specializes in the sale and distribution of air conditioners in Puerto Rico and the Caribbean. A dispute arose between Air-Con and its supplier, Daikin Applied Latin America LLC. Daikin moved to compel arbitration after Air-Con filed suit in a Puerto Rican court. The district court of Puerto Rico granted Daikin’s request, finding that Air-Con and Daikin had operated pursuant to the terms of an agreement between Air-Con and Daikin’s parent company since the inception of their distribution relationship and the arbitration provision of the agreement between Air-Con and Daikin’s parent applied to the dispute. In addition, the district court read certain allegations from Air-Con’s complaint as admitting that its written agreement with Daikin’s parent applied to the dispute…

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