Early 2011 MBP + Thunderbolt Display Issues

I have an early 2011 Macbook Pro (with Thunderbolt port) and I just bought a new Thunderbolt Display and a Twelve South BookArc, in which the MBP sits in with lid closed. I have the full apple usb keyboard and a magic mouse for this setup as well.

The issues I am having is when I put the MBP to sleep using option+command+eject and then try and wake it back up, I have to open the lid, type in the password and then unplug and plug the thunderbolt cable back in to get the Thunderbolt Display to wake up.

Hitting keys and mouse doesn't do it.

This is a pain since it sits in the bookarc most of its time, until I grab it to use remotely.

It actually woke up on its own with keyboard activity once... but it has never worked since.

Anyone know how to fix this?

I have the latest updates on my MBP, so that cant be the issue.

I found that if I unplug the TB cord, I can get the TBD to wakeup with the login screen. Just having to unplug and plug it back in is kind of a pain and worse, I dont want to wear out either the TB cable end or the TB port on the MBP.

Has to be a fix for this.