May 24, 2018
from the United States District Court for the Western
District of Wisconsin. No. 3:17-cv-00773-jdp - James D.
Peterson, Chief Judge.
Manion and Barrett, Circuit Judges, and Gettleman, District
Barrett, Circuit Judge.
Inc. asks us to reverse the district court for making a
factual mistake. The district court found that WeConnect was
not a party to the arbitration agreement it sought to
enforce. WeConnect says that the district court misunderstood
the nature of its relationship with the entity named in the
arbitration agreement. Because the district court did not
clearly err, we affirm its ruling.
Goplin worked for WeConnect, Inc. When he began his
employment, he signed an arbitration agreement called the
"AEI Alternative Entertainment Inc. Open Door Policy and
Arbitration Program." The agreement referred to an
entity named AEI throughout; it never mentioned We-Connect.
This error became significant several months later, when
Goplin sued WeConnect in federal court.
brought a collective action under the Fair Labor Standards
Act and a class action asserting claims under Wisconsin law.
Invoking the agreement Goplin had signed, We-Connect filed a
motion to dismiss and compel arbitration. Fed.R.Civ.P.
12(b)(3). It attached an affidavit from its Director of Human
Resources stating, among other things, that "I am
employed by WeConnect, Inc.-formerly known as Alternative
Entertainment, Inc. or AEI-as Director of Human
raised several arguments in opposition, but only one is
relevant here: he claimed that WeConnect was not a party to
the agreement and therefore could not enforce
He directed the district court to language on WeConnect's
website, which stated the following:
WeConnect formed when two privately held companies,
Alternative Entertainment, Inc. (AEI) and WeConnect
Enterprise Solutions, combined in September 2016…
Working together, AEI and WeConnect Enterprises could be as
nimble as the next great technological innovation required.
Our founders… saw that we were stronger together. And
we officially became one company, WeConnect.
contended that this language supported his position that AEI
and WeConnect were two distinct legal entities. His
arbitration agreement was with the now-defunct AEI, and
WeConnect could not enforce an agreement that he had entered
with another company. Under Wisconsin law, which applies
here, "[t]he general rule is that only a party to a
contract may enforce it." Sussex Tool & Supply,
Inc. v. Mainline Sewer & Water, Inc., 605 N.W.2d
620, 622-23 (Wis. Ct. App. 1999).
reply, WeConnect disputed Goplin's characterization of
its relationship with AEI. It asserted that WeConnect and AEI were
not two different legal entities, but rather two names for
the same legal entity-AEI was the company's original name
and WeConnect is its new one. It emphasized that the
affidavit from the Director of Human Resources referred to
WeConnect as a company "formerly known" as AEI.
Thus, WeConnect argued, a contract with AEI was a
contract with WeConnect. This was a name change, not a
district court held that WeConnect failed to meet its burden
of demonstrating that it was a party to the arbitration
agreement or otherwise entitled to enforce it. It discounted
the affidavit from the Director of Human Resources as
conclusory and noted that "WeConnect's own website
indicates that AEI ceased to exist in September 2016, when it
merged with WeConnect Enterprise Solutions to form
We-Connect, Inc." Because the court found that "AEI
isn't just another name for WeConnect, " it denied
WeConnect's motion to compel arbitration.
filed a motion for reconsideration. This time, it attached
more substantial evidence-including some corporate-form
documents and affidavits from its lawyer and CEO-to support
its claim that AEI had undergone a name change rather than a
merger. But the district court pointed out that new evidence
cannot be introduced in a motion for reconsideration unless
the moving party shows "not only that [the] evidence was
newly discovered or unknown to it until after the hearing,
but also that it could not with reasonable diligence have
discovered and produced such evidence [during the pendency of
the motion]." Caisse Nationale de Credit Agricole v.
CBI Indus., Inc., 90 F.3d 1264, 1269 (7th Cir. 1996)
(citations omitted). ...