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Mmawc, LLC. v. Zion Wood OBI Wan Trust

Supreme Court of Nevada

September 5, 2019

MMAWC, LLC. D/B/A WORLD SERIES j OF FIGHTING, A NEVADA LIMITED LIABILITY COMPANY; BRUCE DEIFIK, AN INDIVIDUAL; AND NANCY AND BRUCE DEIFIK FAMILY PARTNERSHIP, LLLP, A COLORADO LIMITED LIABILITY PARTNERSHIP, Appellants,
v.
ZION WOOD OBI WAN TRUST; SHAWN WRIGHT, AS TRUSTEE OF ZION WOOD OBI WAN TRUST; AND WSOF GLOBAL, LLC, A WYOMING LIMITED LIABILITY COMPANY, Respondents.

          Appeal from a district court order denying a motion to dismiss and to compel arbitration. Eighth Judicial District Court, Clark County; Nancy L. Allf, Judge.

          Kennedy & Couvillier, PLLC, and Maximiliano D. Couvillier III, Las Vegas, for Appellants.

          Law Offices of Byron Thomas and Byron E. Thomas, Las Vegas, for Respondents.

          BEFORE HARDESTY, STIGLICH and SILVER, JJ.

          OPINION

          SILVER, J.

         The Federal Arbitration Act (FAA) protects arbitration agreements and preempts state laws that single out arid disfavor arbitration. In this appeal, we determine whether the FAA preempts NRS 597.995, which requires agreements that include an arbitration provision to also include a specific authorization for the arbitration provision showing that the parties affirmatively agreed to that provision.

         The parties to this appeal entered into a settlement agreement. That settlement agreement referenced a licensing agreement that included an arbitration provision. After the plaintiffs below sued to enforce the settlement agreement, the defendants moved to compel arbitration and dismiss the complaint on the basis that the settlement agreement incorporated the licensing agreement's arbitration clause. The district court denied the motion, concluding the arbitration provision was unenforceable because it did not include the specific authorization required by NRS 597.995.

         We hold that the FAA preempts NRS 597.995, and accordingly, we conclude that statute does not void the arbitration clause at issue here. We further conclude that the claims in the underlying complaint are subject to arbitration, and therefore the complaint must be dismissed.

         I.

         MMAWC is a Nevada corporation that, at the time relevant here, was doing business as World Series of Fighting. In 2012, MMAWC and Vincent Hesser entered into a licensing agreement providing Hesser the right to use MMAWC's licensed marks outside of North America. Hesser thereafter assigned all of his rights and interest in the license to World Series of Fighting Global, Ltd. (WSOF Global). WSOF Global's president was Shawn Wright, who also served as trustee of the Zion Wood Obi Wan Trust, a member of MMAWC.

         MMAWC and others, including Bruce Deifik and the Nancy & Bruce Deifik Family Partnership (of which Bruce Deifik is the general partner), became embroiled in litigation with various parties and entities, including WSOF Global, Wright, and Zion Wood Obi Wan Trust. Eventually these and other parties entered into a comprehensive settlement agreement. As part of that settlement, the parties also amended the licensing agreement and MMAWC's operating agreement.

         Clause 9 of the settlement agreement provided that the settlement agreement was the entire agreement between the parties "[slave and except the separate agreements provided in Section[] ... 2" of the settlement agreement. Pertinent here, clause 2.1 of the settlement agreement stated as follows:

The 10/15/12 Hesser License shall be reaffirmed and remain in full force and effect as of the date of this Agreement, as amended by the execution of the Amendment to Consulting and Master Licensing Agreement in the form attached hereto and incorporated herein as Exhibit B. The license is a material part of settlement on behalf of Hesser and Wright ....

         Importantly, the amended licensing agreement referenced in clause 2.1 also included a newly added ...


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