Collins LLC is a manufacturer of carpets that are sold toretailers throughout the United States. Collins employs a team ofsales people that cold call and subsequently meet with commercialbuyers with samples of carpet.  During one such meeting,PMart, a large retail chain, places an oral order for 2,500 8’x10’Series K carpets that are marketed as made from a syntheticpolyester fiber which is resistant to stains and is less expensivethan a traditional fiber.

Following the meeting, Collins LLC sends a confirmation noticeto PMart that states:

“Confirmation Notice: 2,500 8’x10’ Series K carpets, assorteddesigns, catalog no. K88094.  Unit Cost: $100. Paymentdue on receipt. FOB Seller. In the event of a dispute, the partiesagree to enter into binding arbitration using AAA arbitrationrules.”

Collins subsequently delivered 2,500 carpets to PMart, but uponinspection PMart determined that the carpets were not made from thematerials shown during the meeting where the order was placed, andrejects the goods.  When Collins refused to refundPMart’s payment, PMart files a civil lawsuit for breach of contractin the federal district court.  Collins moves to dismisson the grounds that the parties are obliged to arbitrate theirdisputes privately.  Using the UCC § 2-207, discusswhether an agreement was reached by the parties, and if so, whetherthe dispute must be resolved by binding arbitration.