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Civil Litigation No. 02-20431, 4/10/2003. Click here for the full text of this decision FACTS: The appellant, Paramount Saturn, asserts on appeal that the district court erred in granting the appellee’s (Saturn Distribution Corp.) motion to compel arbitration. Upon entering into a franchise agreement with Saturn in December 1997, Paramount became a Saturn franchisee in Houston. Subsequently, Paramount sought to purchase three additional dealerships from Saturn. Saturn did not sell the dealerships to Paramount. As a result, Paramount alleged that Saturn breached its statutory duty of good faith and fair dealing. Although the franchise agreement contained a broad arbitration provision, Paramount argued that the dispute was not arbitrable because the Texas Motor Vehicle Board had exclusive jurisdiction over the dispute. The only issue before the district court was whether to grant Saturn’s motion to compel arbitration. The district court granted Saturn’s motion to compel arbitration and closed the case without dismissing it. The order compelling arbitration was labeled “Final Judgment” and stated “[t]his is a final judgment.” HOLDING: Affirmed. The plain language of the Federal Arbitration Act makes “final” decisions, whether hostile to arbitration or not, immediately appealable, 9 U.S.C. �16(a)(3), but prohibits appeals from interlocutory orders favorable to arbitration. 9 U.S.C. �16(b); Sphere Drake Ins. PLC v. Marine Towing, 16 F.3d 666 (5th Cir. 1994). The order compelling arbitration, which arose out of independent proceedings, was a “final decision” pursuant to Green Tree Fin. Corp.-Ala. v. Rudolph, 531 U.S. 79 (2000), for three reasons: 1. the district court closed the case, Am. Heritage Life Ins. Co. v. Orr, 294 F.3d 702 (5th Cir. 2002); 2. the order was labeled “Final Judgment” and included the language “this is a final judgment,” which clearly expressed the intention of the court to effectively end the entire matter on its merits and leave nothing more to do but execute the judgment; and 3. the order was not accompanied by a stay of federal court proceedings. The dispute is arbitrable because the statutory duty on which Paramount bases its claim arises out of the parties’ franchise agreement, which contains a broad arbitration provision. Texas Revised Civil Statute Article 4413(36) �6.06(e) (Vernon Supp. 2001). There are no legal restraints external to the parties’ arbitration agreement that foreclose the arbitration of their dispute because the TMVB does not have exclusive jurisdiction of contractual disputes between franchisors and franchisees in the motor vehicle industry. Art. 4413(36), ��1.02, 3.01(a). Even if it did, the strong federal policy favoring arbitration preempts state laws that act to limit the availability of arbitration. Southland Corp. v. Keating, 465 U.S. 1 (1984). OPINION: Clement, J.; Benavides, Stewart and Clement, JJ.

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