Commercial arbitration is increasing in frequency and value. Recent cases have addressed two emerging issues. The first is whether a nonsignatory to an arbitration clause can compel or avoid arbitration. The second, more novel issue, is whether a nonsignatory can compel another nonsignatory to arbitration.

These issues arise in a variety of contexts. For example, where a franchise agreement requires arbitration between the franchisee and the franchisor, but the dispute involves affiliated companies who are not signatories. Courts often stay disposition of a related lawsuit pending the outcome of the arbitration. Similarly in leases where dispute resolution calls for arbitration but enforcement of the guarantee does not. We are fortunate to have helpful guidance on these issues from these recent cases.

‘Devon MD v. Double Medical International (Hong Kong) Limited and Double Medical Technology’

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