Law360, Washington (September 3, 2015, 12:38 PM ET) — A bankrupt metal fabrication shop resisted General Dynamics Land Systems Inc.’s dismissal bid in Texas federal court Wednesday, arguing that it’s questionable that a valid arbitration agreement exists to resolve its $3.7 million fraud suit alleging the General Dynamics division breached the pair’s contract to build Israeli military tanks.
The arbitration agreement was not obvious in GDLS’s purchase orders, and GDLS has yet to show proof that there was an arbitration clause in place in the first purchase order Elite Precision Fabricators Inc. said it received in June 2011, according to the response brief.
Nor should GDLS be able to force arbitration and skirt litigation for taking $3.7 million worth of parts off of Elite’s hands when the two agreed to a work stoppage on the armored personnel carrier project and then refuse to pay for those goods, according to Elite, an action it cites as directly responsible for driving it into Chapter 11 bankruptcy in March 2014.