Benasra

This is a libel action in which the defendants (a corporation and its president) claim the plaintiff (an individual) ought to be compelled to arbitrate simply because he is president of another corporation that had a licensing agreement with the defendant corporation. The essence of the defendants’ position is that the plaintiff, who happens to have signed the licensing agreement as president of another corporation, is bound by the arbitration provision in that agreement either as an agent of the corporation or as a third party beneficiary of the licensing agreement. The trial court rejected the defendants’ motion to compel arbitration and so do we.

Background

In 1992 and 1994, Guess?, Inc., entered two license agreements with Pour le bebe, Inc. and Pour La Maison, Inc. (collectively PLB). Both agreements provide for arbitration. Both agreements were signed on behalf of PLB by Michel Benasra (its president) in the same form:

In May 1999, Guess terminated the license agreements and demanded arbitration, claiming a right to recover past due royalties and damages arising from PLB’s alleged infringement of Guess’s trademark rights. About two weeks later, Guess’s president…