Next Generation Bar Exam Quiz
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CIVIL PROCEDURE
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A software company licensed its product to a customer under an agreement requiring binding arbitration of all disputes arising out of or relating to the agreement. The software company learns that the customer is using the software for far more users than its license permits. The software company files a diversity action in federal district court, with the amount in controversy exceeding $500,000, and moves for a temporary restraining order and preliminary injunction preventing the customer from exceeding the licensed number of users until an arbitration panel can be convened. The customer moves to compel arbitration and stay the court action, arguing that once arbitration is demanded the court has no authority to grant injunctive relief.
Which of the following is the most significant legal issue raised by these facts?
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