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May 12, 2006
Supreme Court Ruling Explained
By QBlog in Arbitration
The Missouri Supreme Court issued its opinion and ruling in Nitro Distributing, Inc., et. al. v. Jimmy Dunn et. al. on May 2, 2006. The case is about whether two motivational businesses owned by Amway distributor Ken Stewart - "Nitro Distributing" and "West Palm Convention Services" - have to arbitrate their lawsuit against several other Amway distributors and their respective "tools" businesses - primarily those involved in an Amway "Line of Affiliation" or "system" called Pro-net.
The defendants are: Jimmy Dunn; Jimmy V. Dunn & Associates, Inc.; Hal Gooch; Gooch Support Systems, Inc.; Gooch Enterprises, Inc.; Bill Childers; TNT, Inc.; Tim Foley; T&C Foley, Inc. ; Steven Woods; G.F.I. International, Inc.; Parker Grabill; Grabill Enterprises, Inc.; Pro Net; Don Brindley; Global Support Services, Inc.; Pro Net Global I, Inc.; and Robert A. Blanchard.
Nitro was Stewart's tape, video and book company. West Palm was the business through which he provided speaking services at conventions.
No Confusion
This case should not be confused with Stewart's individual case in the Missouri federal court against Amway and Quixtar, in which United States District Court Judge Richard Dorr ruled that Amway's arbitration agreement was legally unenforceable because it was procedurally and substantively unconscionable. Judge Dorr's order is still on appeal in the federal Eighth Circuit Court of Appeals.
This case involves Stewart's tools businesses as the plaintiff instead of Stewart himself, and it's against other tools kingpins and their tools businesses from the system of which Stewart's tools businesses were once a part - ProNet.
Importantly, unlike the case in Judge Dorr's court, this opinion does not deal with whether the Amway/Quixtar arbitration agreement is legally valid. It mainly concerns whether the different parties can sue to enforce the Amway arbitration agreement as third parties (they can't, said the Missouri Supreme Court) and whether some of the defendants could enforce a different arbitration agreement that was part of the ProNet contracts (they could, held the court).
No Legal Basis
The Missouri Supreme Court concluded that there was no legal basis for any of the parties to enforce the Amway/Quixtar arbitration agreements against Stewart's tools businesses because the tools businesses did not sign the agreements with Amway and, therefore, they weren't legally bound to arbitrate under that agreement. The court also decided that since the suit wasn't against Amway and wasn't brought by an Amway distributor, the Amway arbitration clause wouldn't apply to the lawsuit anyway.
However, the court found that there was another arbitration agreement that came about as part of the formation of ProNet. With regard to the ProNet arbitration agreement, the court held that West Palm never signed it and could not be bound by if for the same reasons West Palm was not bound by the Amway arbitration agreement. On the other hand, Stewart did sign the ProNet arbitration agreement in the name of Nitro. Thus, the court concluded that Nitro was bound by the ProNet arbitration agreement. Not all of the defendants had signed the ProNet agreement though - only Gooch, Childers, Foley, Woods, Grabill, Dunn, Pro Net, and Blanchard.
The court concluded that Nitro's lawsuit against Gooch, Childers, Foley, Woods, Grabill, Dunn, Pro Net, and Blanchard had to be dismissed because of the ProNet arbitration agreement, but that West Palm's claims against all of the defendants could go forward in the trial court, as could Nitro's claims against the non-signatories to the ProNet agreement, Gooch Systems, Gooch Enterprises, TNT, Pro Net I, Global and Brindley.
End Result
The end result: the majority of the case will go back to the trial court as a regular lawsuit, while a small part will be resolved in arbitration. Obviously, this opinion does not have as wide an impact on the arbitration agreements as the federal case involving Amway/Quixtar itself. However, it could be very important, particularly if discovery reveals information about how these tools systems operate.
Comments
RE: The importance of all this.
When was the last time you heard about a case regarding Amway/Quixtar in open court?
Ty,
There have been a number of recent cases in open court. Anderson, Stewart, Morrison, etc. What are you trying to say in the above? All you do is ask open ended questions that could have several meanings. Explain yourself. When was the last time you had any intelligent ideas to add to a discussion?
"Lying cowardly Kingpins!!!!"
"Lying cowardly Kingpins!!!!"
A person that has aligned himself with the MLM that has the worst reputation in the industry is questioning my intelligence.
Hmmm...let's start with how confused you are, Tex:
1. Anderson's case was not in open court, it was in JAMS.
2. Stewart's case will now go to open court because of the ruling, prior to that, not in open court.
Now for a lesson about open ended questions...
Example of an open ended question:
When will Tex get a clue and stop defending the "sinking ship" that is Quixtar?
Example of a question that has an answer:
When was the last time you heard about a case regarding Amway/Quixtar in open court?
Anderson's case was also in court, than dragged into arbitration, and is in arbitration again, for a different reason. However, many of the former court and both arbitration documents are on his site. Stewart has been in court and has a favorable ruling, which is being appealed as we speak. Many of all of the above documents, and Morrison's court documents are also on the web.
The ship that is sinking is the lying coward "kingpin" excessive tool profit ship.
Any questions?
The kingpin tool profits ship and the Quixtar ship have been one in the same since 1983. A cursory reading of amquix.info or even this site's archives will establish that. It is no secret that the IBOIA board trains judges for and controls JAMS arbitration on behalf of Quixtar, therefore legally linking the kingpins and the corporation. Their interests are one in the same, neither can survive without the other now. The big problem is, no matter how much corporate malfeasance there is with Quixtar...will they ever sink? According to the New York Times and Newsweek (quoted from Eric Scheibler's site), Rich Devos and Jay Van Andel both individually donated $2 million to the Republican 527 "Progress for America" for the 2004 elections. At the 2000 and 2004 Republican conventions, all the higher ups were treated to an incredible evening on the yacht of Rich Devos. They have contributed some of the largest soft money donations in history to the Republican party before campaign finance reform forced them to find the loophole through the 527s, and give even more. With this kind of clout, do you really think the ship will ever sink?
Then why didn't your buddy Bill Clinton do something during the 8 years he disgraced the Presidential office?
The issue here is not democrat/republican. Democrats and the Clinton administration especially have lots of difficulties explaining soft money and contributions. If Devos and Van Andel were left wing hippies and not right wing neocons, they would still have the money, donations, and resulting clout associated with them. The question is whether this political clout will keep a sinking ship afloat?
I think the corp will cut the "kingpins" loose when things get serious enough to be a survival issue.
Hey...
I signed up in March of this year (06). I was presented with "the plan" by a lady a considered friend. When I first saw it, it seems to good to be true- making 100k in two to five years, but I gave her I chance to explain it fully. The diagrams were circular, the new IBO being the nucleus, and Qxtr and BWW besides the primary circle. However, the pyramid figure did pop up later in the presentation, although rather latently. I still cast the thought of it being a sceme aside because I was told of all the partner stores that Qxtr associates with, and how much is paid back to IBO's annually. All I had to do was buy from myself.
After the first month was over, I was told I NEEDED to attend a conferrence in Baltimore. I was feeling jipped. It was 30 days later; I had no IBO's under me,and no money either.I had been contacting folksfrom the gate (but everybody isn't stupid, right?) The "association" with like minded people was going to fix my frustrations about the business, so I was led to think. So, I went. And I was hoodwinked again. Bill Britt spoke,but he and the other speakers only left more bitter seeds in my mind. He was OUTRIGHT against liberals/democrats, and said "If you want to be rich in this business,you'd better be Conservative!" Not only that, but the cost of the event was $100! I asked my upline why it cost so much, if in fact the company leaders are trying to help us make money- not spend. She replied that the speakers have to be paid and the ballroom had to be paid too. When I explained to her the math behind all those people, paying one C note a pop, and how much it actualy cost the Renfros to rent that room out, she got indignated.
To make a long,long story shorter, is it almost four months later for me, I only have one member and client. I had spent about $600+ on books, tapes, products recommended by my sponser, and fuctions. I feel completely used; I am a hard working young woman,just trying to set my son up with some financial stability, which I couldn't get. And because of that desire, I have been robbed by people I trusted, and they don't think they're doing anything wrong. Anytime I have a question about Qxtr, I am told I have Stinkin' thinkin', and I'm an 80 percenter. A failure in otherwords. According to my upline "the system didn't fail..." I did. I am so angry.
QBlog,
Congratulations, this is back up to the high standards of meaningful debate this blog deserves, especially after the past several days of pathetic postings about minor issues. Note the www.baron55.com site is back up (at least temporarily), which is about the former lying coward "kingpin" Bruce Anderson, because of a tool tift with fellow "kingpin" Hal (shoot that baboon, he looks like Jesse Jackson) Gooch. Your last statement about exposing how the tool systems operate, and the excessive tool profits that result for the "kingpins", is exactly on target.
Posted by: Tex | May 12, 2006 3:44 AM