United States District Court, D. Maryland
CATHERINE C. BLAKE UNITED STATES DISTRICT JUDGE
before the court is defendant Financial West Investment
Group, Inc.'s ("FWG") renewed motion to compel
arbitration. For the reasons stated below, the court will
grant the motion.
AND PROCEDURAL HISTORY
David Kirkwood is a Maryland resident and former client of
defendant Financial West Investment Group, Inc.
("FWG"). FWG is a broker-dealer agency licensed by
the Financial Industry Regulatory Authority
("FINRA"). Through its regional offices, FWG
solicited clients to invest funds in various financial
instruments, including annuities. (Am. Compl. ¶ 6, ECF
No. 3). Gary Steciuk was the registered representative for
FWG's Hampstead, Maryland branch office from 2002 until
December 2011. (Id. ¶¶ 5, 7).
April 5, 2004, FWG opened an annuity account for Kirkwood.
(Def's Renewed Mot. to Compel Arbitration
("Def.'s Renewed Mot.") Ex. 3, ECF No. 68-4).
The New Account Form for the annuity listed Steciuk as
Kirkwood's FWG broker. (Id. at 2). Kirkwood
denies signing the New Account Form and suggests that Stecuik
forged Kirkwood's signature. (PL's Opp. to Def.'s
Mot. to Compel Arbitration at 3, ECF No. 58). Steciuk oversaw
and managed Kirkwood's annuity account until
2014. In July 2014, Kirkwood first became aware
that Steciuk was engaged in fraudulent activity related to
the annuity account. From 2006 until July 2014, Steciuk
defrauded Kirkwood by soliciting him to invest more than
$400, 000 in illegitimate annuities. (Am. Compl. ¶ 11).
Rather than investing Kirkwood's funds into legitimate
financial instruments, Steciuk instead invested them into his
own accounts and used the funds to his benefit, causing
Kirkwood ultimately to lose more than $350, 000.
(Id. at ¶¶ 12, 16). On March 27, 2015,
Steciuk pleaded guilty in this district to one count of mail
fraud, after having been charged with several federal
offenses in connection with Kirkwood's and other
defrauded investors' accounts. (Steciuk Criminal Docs.,
ECF No. 3 at 19, 56). Steciuk remains incarcerated at a
18, 2017, Kirkwood initiated this suit, alleging breach of
fiduciary duty through fraud and constructive fraud, breach
of contract, and negligent supervision. (Am. Compl.
¶¶ 17-36). FWG filed its first motion to compel
arbitration on June 6, 2018, requesting that the court
dismiss the case so that the parties may resolve their
dispute in arbitration. FWG argued that the basis for
Kirkwood's relationship with FWG was the New Account
Form, which includes a broad arbitration clause and
ostensibly bears Kirkwood's signature. The court denied
the motion without prejudice, noting that Kirkwood's
forgery allegation goes to the arbitrability of the dispute,
but that Kirkwood may be equitably estopped from making this
claim if Kirkwood relies on the New Account Form to establish
his contractual relationship with FWG. (Jan. 30, 2019 Memo,
at 4-6, ECF No. 63).
pending before the court is FWG's renewed motion to
compel arbitration. The motion has been fully briefed and no
oral argument is necessary. See Local Rule 105.6 (D.
United States Supreme Court has identified arbitration
agreements as "a specialized kind of forum-selection
clause that posits not only the situs of suit but also the
procedure to be used in resolving the dispute."
Scherk v. Alberto-Culver Co., 417 U.S. 506, 519
(1974). "[A] motion to dismiss based on a
forum-selection clause should be properly treated under Rule
12(b)(3) as a motion to dismiss on the basis of improper
venue." Sucampo Pharm., Inc. v. Astellas Pharma,
Inc., 471 F.3d 544, 550 (4th Cir. 2006); see also
Aggarao v. MOL Ship Mgmt. Co., 675 F.3d 355, 365-66
& n. 9 (4th Cir. 2012) (analyzing a dismissal in favor of
arbitration under Rule 12(b)(3)). Thus, motions to compel
arbitration may properly be treated as motions to dismiss for
improper venue pursuant to Fed.R.Civ.P. 12(b)(3).
a motion to dismiss under Rule 12(b)(3), the court is
permitted to consider evidence outside the pleadings."
Aggarao, 675 F.3d at 365-66 (citing
Sucampo, 471 F.3d at 550). Facts should be viewed in
the light most favorable to the plaintiff, and the plaintiff
is obligated "to make only a prima facie showing of
proper venue in order to survive a motion to dismiss."
Id. at 366 (internal citations omitted).
policy favors the resolution of disputes through arbitration.
New Prime, Inc. v. Oliveira, 139 S.Ct. 532, 543
(2019) (quoting Moses H. ConeMem'lHosp. v. Mercury
Constr. Corp., 460 U.S. 1, 24 (1983)). Under the Federal
Arbitration Act ("FAA"), arbitration agreements are
"valid, irrevocable, and enforceable, save upon such
grounds as exist at law or in equity for the revocation of
any contract." 9 U.S.C. § 2. Generally, however,
courts may not compel parties to submit to arbitration any
dispute they did not agree to arbitrate. Int'l Paper
Co. v. Schwabedissen Maschinen & Anlagen GMBH, 206
F.3d 411, 416 (4th Cir. 2000) (internal citation omitted).
Whether the parties have agreed to arbitrate a particular
dispute is a question of "arbitrability."
Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63,
to the FAA and related case law, "the question of who
decides arbitrability is itself a question of contract."
Schein, Inc. v. Archer & White Sales, Inc., 139
S.Ct. 524, 527 (2019). Jurisdiction to resolve the
arbitrability of an agreement generally resides with the
district court unless the arbitration agreement specifically
assigns the issue of arbitrability to the arbitrator.
Simply Wireless, Inc. v. T-Mobile US, Inc., 877 F.3d
522, 526 (4th Cir. 2017) (holding that courts should resolve
questions of arbitrability absent clear and unmistakable
evidence, beyond the mere presence of an expansive
arbitration clause, that the parties intended for an
arbitrator to determine arbitrability) (quoting Hayes v.
Delbert Servx. Corp., 811 F.3d 666, 671 n. 1 (4th Cir.
2016) and Peabody Holding Co. v. United Mine Workers of
Am., Int'l Union, 665 F.3d 96, 102 (4th Cir. 2012))
(internal quotation marks and further internal citations
omitted), abrogated on other grounds by Schein, 139
S.Ct. at 529. Courts must consider any challenge to the
validity of an agreement to arbitrate before ordering a case
to arbitration. See Rent-A-Center, 561 U.S. at
70-71. An allegation of forgery constitutes a challenge to
the validity of an agreement to arbitrate. See Gregory v.
Interstate/Johnson Lane Corp., 188 F.3d 501, 1999 WL
674765, at * 7 (4th Cir. Aug. 31, 1999) (per
curiam); Roach v. Navient Solutions, Inc.,
165 F.Supp.3d 343, 349 (D. Md. 2015); Monk v. Perdue
Farms Inc., 12 F.Supp.2d 508, 509 (D. Md. 1998).
argues that the court cannot consider Kirkwood's
challenge to the arbitration agreement because Kirkwood is
equitably estopped from claiming his signature is a forgery.
The doctrine of equitable estoppel recognizes that "it
is unfair for a party to rely on a contract when it works to
its advantage, and repudiate it when it works to its
disadvantage." Am. Bankers bis. Grp., Inc. v.
Long,453 F.3d 623, 627 (4th Cir. 2006). Pursuant to
this principle, a plaintiff cannot deny that he is bound by
an arbitration agreement when his claims against the
defendant "arise from the contract containing the
arbitration clause." Id. at 628 ...