Smallwood

Gary Smallwood contracted with Allied Van Lines, Inc. and SIRVA, Inc. (collectively, AVL) to move some of his household goods from southern California to the United Arab Emirates (UAE) and to move the remainder of the goods — including a box full of firearms and ammunition — to storage. Instead, AVL shipped his weapons to the UAE. When UAE officials discovered Smallwood’s weapons, they arrested him, imprisoned him for 11 days and tricked him into pleading guilty to smuggling firearms. Smallwood alleges that he is facing deportation from the UAE and sues AVL based on various tort and contract theories. We must decide whether AVL may compel Smallwood to arbitrate pursuant to a foreign arbitration clause in their shipment contract. We hold that the contract’s foreign arbitration clause is unenforceable.

The district court denied AVL’s motion to compel arbitration, concluding that the shipment was governed by the Carmack Amendment, 49 U.S.C. § 14706 , and that the statute precludes enforcement of foreign arbitration clauses. AVL argues that the district court misinterpreted Car-mack and created an unnecessary conflict with federal arbitration law, which, according to AVL,…