Attia v. Oura Ring, Inc.

Background

Peter Attia sued Oura Ring, Inc. and Oura Health Oy over alleged failures to compensate him for medical advisory services. Attia alleged that he provided services during 2017 and 2018, including beta testing the Oura Ring, promoting it, recommending product changes, making business introductions, and suggesting doctors for validation studies. He alleged that the companies promised to compensate him with advisory stock options and later refused to honor the options contract.

Attia asserted claims for breach of contract, quantum meruit, promissory estoppel, and negligent misrepresentation. The defendants moved to compel arbitration and sought dismissal or, alternatively, a stay of the proceedings. They relied mainly on an arbitration clause in a shareholder agreement that Attia accepted when he invested in Oura Health Oy. The defendants argued that the clause covered the lawsuit because the alleged compensation for Attia’s advisory work also involved options.

Arbitration Agreement

The court explained that the party seeking arbitration must prove that an arbitration agreement exists and covers the dispute. Although the shareholder agreement contained an arbitration clause, the court found that the shareholder agreement concerned the parties’ relationship as shareholders, including restrictions on transferring shares and options. It did not show that the parties intended it to govern a separate arrangement for compensating advisory services.

The court treated Attia’s investment agreement and advisory-services agreement as independent agreements involving different subject matters and consideration. The fact that both involved the same parties and used the word “options” did not establish that they were interrelated or that the advisory dispute fell within the shareholder agreement’s arbitration clause.

Advisor Agreement

The court also considered whether the alleged advisory agreement itself required arbitration. For purposes of the motion, the defendants accepted that the court had to assume, in the light most favorable to Attia, that an agreement for advisory services existed. The defendants argued that the Advisor Agreement incorporated the shareholder agreement and therefore its arbitration clause.

The court rejected that argument. It found that the relevant language incorporated shareholder-agreement provisions concerning restrictions on transferring options and shares, not unrelated provisions such as arbitration. The court also noted that the Advisor Agreement referred to a shareholder agreement dated April 17, 2015, which the defendants conceded did not exist. The reference therefore did not clearly and unequivocally incorporate the operative shareholder agreement. The court added that the emails discussed in the opinion did not themselves refer to arbitration or incorporate an arbitration agreement.

Disposition

The court concluded that Attia and Oura Health Oy did not form an agreement to arbitrate the claims concerning the advisory arrangement. It therefore denied the defendants’ motion to compel arbitration. Because the court found no agreement to arbitrate, it did not decide whether the shareholder agreement contained a sufficiently clear delegation of arbitrability questions or whether Oura could be compelled to arbitrate as a nonparty to the shareholder agreements. The court set a telephonic case-management conference for April 16, 2024, and directed the parties to submit a joint case-management statement by April 9, 2024.