Disruptive Nanotechonology Limited v. Elliot CA2/4

INTRODUCTION

Plaintiff Disruptive Nanotechnology, Ltd. (DNL) entered into two contracts with defendant Innova Medical Group, Inc. relating to the sale of Innova’s Covid-19 tests in the U.K. One contract was the Commission Agreement, under which DNL would get a commission for the sale of tests when DNL facilitated a sale between Innova and a buyer. The other contract was the Subdistribution Agreement, under which DNL would directly sell the product to buyers. DNL filed a complaint against Innova, its parent company Pasaca Capital, Inc., owner Charles Huang, and two principals at Innova, Daniel Elliott and Robert Kasprzak. DNL alleged that Innova breached the Commission Agreement by failing to pay certain commissions, and that the defendants fraudulently duped DNL into accepting decreased commissions so they could funnel to themselves commissions owed to DNL. DNL did not assert any claims under the Subdistribution Agreement. Defendants moved to compel arbitration. The Commission Agreement does not have an arbitration provision; it anticipates that disputes will be decided by courts in Los Angeles County. The Subdistribution Agreement contains an arbitration provision, and…