Kanazawa Ltd., a Corporation v. Sound, Unlimited, a Corporation

In 1968, Sound, Unlimited and Kanazawa Ltd. entered into a joint corporate venture involving commerce in Guam. Kanazawa brought an action in the District Court of Guam seeking an accounting and judgment for monies due under the agreement. The written contract contains an agreement to arbitrate controversies and claims arising out of the venture. Sound, Unlimited moved for a stay pending arbitration and for an order compelling Kanazawa to arbitrate. The motions were denied upon the ground that there is no statute, applicable in Guam, providing for enforcement of agreements to arbitrate. Sound, Unlimited takes this interlocutory appeal pursuant to 28 U.S.C. § 1292 (b).

The Federal Arbitration Act states that a written provision to arbitrate in a contract evidencing a transaction “involving commerce” is valid and enforceable. 9 U.S.C. § 2 . “Commerce” includes commerce “ * * * in any Territory of the United States * * 9 U.S.C. § 1 . The question presented is whether commerce in Guam is commerce “in any Territory of the United States” as the phrase is used in 9 U.S.C. § 1 . We think it is.

Kanazawa has not favored us with any arguments to the contrary, it having failed to submit a…