United States District Court, D. New Jersey
Robert H. Montgomery, Esquire, Law Offices of Robert H. Montgomery, Philadelphia, Pennsylvania, Counsel for Plaintiff.
Douglas M. Long, Esquire, Long Marmero & Associates LLP, Woodbury, New Jersey, Counsel for Defendant.
NOEL L. HILLMAN, District Judge.
This matter comes before the Court by way of motion of Defendant, Pro Computer Service, LLC (hereafter, "PCS"), seeking dismissal of this action based on a mandatory arbitration clause purportedly contained in an agreement between the parties. PCS alternatively seeks a stay of the litigation and to compel arbitration, which is currently pending before the American Arbitration Association (hereafter, "AAA"). Plaintiff, Holdbrook Pediatric Dental, LLC (hereafter, "Holdbrook"), opposes the motion. The Court has considered the submissions of the parties and decides this matter pursuant to Fed.R.Civ.P. 78.
For the reasons that follow, PCS' motion will be denied without prejudice.
Holdbrook operates two pediatric dental practices in New Jersey. On April 1, 2014, Holdbrook entered into an agreement with PCS whereby PCS would provide information technology services to Holdbrook in exchange for a monthly fee. The agreement at issue, a "Managed Support Plan, " is attached to the complaint.
Holdbrook alleges that on July 24, 2014, one of its representatives informed PCS by telephone that Holdbrook was dissatisfied with the services that PCS provided. Within approximately fifteen minutes of that conversation, PCS allegedly remotely accessed Holdbrook's computers, created network passwords, and failed to provide the passwords to Holdbrook. As a result, Holdbrook was locked out of its server. Although Holdbrook demanded that access to the network be restored, PCS purportedly refused to do so until the following day. Holdbrook contends that as a result, it was unable to access its electronic business records, including patient files, and was forced to cancel eighty-three previously scheduled appointments for July 24, 2014 and July 25, 2014.
Holdbrook brings this action pursuant to the Computer Fraud and Abuse Act, 18 U.S.C. § 1030(a)(5)(A)(i), based upon PCS' alleged knowing transmission of a program, information, code or command that intentionally caused damage without authorization to a protected computer. Holdbrook also asserts state law claims for breach of contract, tortious interference with business relationships, and negligence.
Despite Holdbrook's filing of this civil action on October 2, 2014, five days later PCS filed a demand for arbitration with the AAA. PCS' position in the arbitration and in the motion to dismiss presently before the Court is that the Managed Support Plan agreed to by Holdbrook contains a mandatory arbitration clause.
The Managed Support Plan does not, in itself, contain an arbitration provision. Rather, the provision is contained in a separate "Terms and Conditions" document that, according to PCS, was integrated into the contract. (Br. in Supp. of Mot. to Dismiss or, in the Alternative, to Compel Arbitration and Stay Litigation Pending Arbitration (hereafter, "PCS' Br.") 3-4.) The Managed Support Plan had been sent in electronic form to Holdbrook, and the "Terms and Conditions" document was attached as a hyperlink to the last page of the contract, directly above the line where a Holdbrook representative could sign to indicate acceptance of the agreement. (Id. at 4.) Holdbrook argues that it did not agree to the separate "Terms and Conditions" and is not bound by the arbitration clause contained therein. (Pl.'s Br. in Opp. to Def.'s Mot. to Dismiss or, in the Alternative, to Compel Arbitration and Stay Litigation Pending Arbitration (hereafter, "Holdbrook's Opp. Br.") 4-8.)
As Holdbrook asserts a claim under federal law, the Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331. The Court may exercise supplemental jurisdiction over ...