Unreported / Non-Citable
Background
In December 2025, Trimble Inc., a major construction-tech and surveying-software company, sued Unity Software Inc. in the Northern District of California alleging that Unity breached a one-year purchase order for Unity software. Trimble alleges Unity demanded a “distribution fee” not contemplated by Unity’s Terms of Service and, when Trimble refused to pay, cut off Trimble and its third-party customers from access. Trimble asserted breach of contract, breach of the implied covenant of good faith and fair dealing, tortious interference with contracts, and declaratory judgment.
Trimble immediately moved for a TRO. The court denied the TRO, finding Trimble had not shown a significant threat of irreparable injury. Unity then moved to compel arbitration based on the arbitration provision in its Terms of Service.
The Court’s Holding
Judge Haywood S. Gilliam, Jr. granted the motion to compel arbitration.
The Unity Terms of Service contain an arbitration agreement that expressly invokes the FAA, requires AAA Commercial Arbitration Rules, and includes a delegation clause sending “any dispute arising out of, relating to or in connection with these Terms (including any disputes regarding the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to be)” to binding arbitration. Trimble conceded that the arbitration agreement is valid and binding but argued that its tortious interference claim sounded in tort and fell outside the agreement’s scope.
The court held the delegation clause was dispositive. Under Rent-A-Center, West, Inc. v. Jackson and Henry Schein, Inc. v. Archer & White Sales, parties can agree to delegate gateway questions of arbitrability to the arbitrator. The Ninth Circuit treats incorporation of the AAA Rules as “clear and unmistakable evidence” of such delegation under Mohamed v. Uber Technologies and Brennan v. Opus Bank. Because the parties clearly and unmistakably delegated arbitrability, the arbitrator — not the court — must decide whether Trimble’s tort claim falls within the agreement’s scope.
The narrow injunctive-relief carveout in the agreement (allowing pre-tribunal applications for temporary or preliminary equitable relief but not money damages) did not change the analysis. The court therefore granted the motion to compel arbitration and stayed the action pending arbitration.
Key Takeaways
- A delegation clause that incorporates AAA Commercial Arbitration Rules constitutes clear and unmistakable evidence that the parties intended to arbitrate arbitrability, even between sophisticated commercial counterparties.
- Plaintiffs cannot avoid a delegation clause by labeling some claims as tort claims. The arbitrator decides scope, including whether tortious interference and other tort theories fall within the agreement.
- A pre-tribunal injunctive-relief carveout in an arbitration agreement does not undermine the delegation clause for substantive disputes.
- Even when a TRO is denied as a separate matter, the underlying arbitration agreement still controls the merits of the dispute. The court can simultaneously deny preliminary relief and compel arbitration.
- Software vendors’ Terms of Service routinely contain enforceable arbitration provisions with broad delegation clauses; commercial counterparties accepting those Terms generally cannot litigate disputes in court.
Why It Matters
The dispute between Trimble and Unity reflects a recurring source of tension in the enterprise software market: end-user license terms that contain arbitration clauses with delegation provisions and that constrain the commercial deployment of the software. When the licensee disputes how the licensor is interpreting or enforcing those terms — for example, by demanding additional fees or cutting off access — the natural impulse is to seek a court’s intervention. This decision underscores that in most cases, the dispute will instead be funneled into AAA arbitration.
For software vendors, the opinion reinforces the value of including a clear AAA-Rules delegation clause in Terms of Service, even when commercial counterparties might prefer a different forum. For licensees and downstream distributors, the takeaway is to scrutinize the arbitration provisions in vendor Terms before deployment and to negotiate carve-outs at contract formation rather than relying on later litigation.