Justia International Law Opinion SummariesArticles Posted in Arbitration & Mediation
Commodities & Minerals Enterprise Ltd. v. CVG Ferrominera Orinoco, C.A.
Appellant CVG Ferrominera Orinoco, C.A. (“Ferrominera”), appealed from the district court’s judgment confirming a foreign arbitral award and granting attorney’s fees and costs in favor of Petitioner Commodities & Minerals Enterprise Ltd. (“CME”). Ferrominera challenges the judgment on three grounds. First, it argues that the district court lacked personal jurisdiction because CME never served a summons on Ferrominera in connection with its motion to confirm the arbitral award. Second, Ferrominera contends that the district court erred in confirming the arbitral award based on purported lack of jurisdiction by the arbitral panel, issues with the scope of the award, and conflicts with United States public policy. Third, it argues that the district court abused its discretion in awarding attorney’s fees and costs in favor of CME. The Second Circuit held that a party is not required to serve a summons in order to confirm a foreign arbitral award under the New York Convention. The court concluded that the district court properly enforced the arbitral award, but that it erred in awarding attorney’s fees and costs. Accordingly, the court affirmed in part and vacated in part. The court wrote that CME complied with the service of notice requirements of the New York Convention and the FAA, and the district court properly exercised personal jurisdiction over Ferrominera. Further, the court explained that Ferrominera has not borne its burden to show that the arbitration agreement is invalid where, as here, it has put forth no arguments whatsoever under the applicable law. View "Commodities & Minerals Enterprise Ltd. v. CVG Ferrominera Orinoco, C.A." on Justia Law
Tecnicas Reunidas De Talara S.A.C. v. SSK Ingenieria Y Construccion S.A.C.
Técnicas Reunidas de Talara S.A.C., a Peruvian corporation, subcontracted with SSK Ingeniería y Construcción S.A.C., another Peruvian corporation, to provide electromechanical work on the refinery project. In response to a contract dispute, the arbitral panel issued a $40 million award to SSK. During the arbitration, two of Técnicas's attorneys withdrew and joined the opposing party’s law firm. More than a month later Técnicas objected in the International Court of Arbitration to alleged conflicts of interest held by the arbitrators, but its objection made no mention of the attorney side switching. The district court agreed with Técnicas that a public policy against attorney side-switching exists in the United States but concluded that the public policy was not contravened in this case because there was no actual prejudice and Técnicas waived its objection. At issue on appeal concerns whether a party to an international arbitration can obtain a vacatur of an adverse arbitral award because two of its attorneys withdrew and joined the opposing party’s law firm during the arbitral proceedings. The Eleventh Circuit affirmed the judgment. The court explained that Técnicas waived its right to complain. The court explained thatTécnicas, the losing party in the arbitration, had knowledge of the attorney side-switching but did not object until Técnicas received an adverse award more than a year later, The court wrote that its conclusion is consistent with the well-settled principle “that a party may not sit idle through an arbitration procedure and then collaterally attack that procedure on grounds not raised . . . when the result turns out to be adverse.” View "Tecnicas Reunidas De Talara S.A.C. v. SSK Ingenieria Y Construccion S.A.C." on Justia Law
Preble-Rish Haiti, S.A. v. BB Energy USA
Plaintiff-Appellee Preble-Rish Haiti, S.A. filed this case pursuant to Rule B of the Supplemental Rules for Admiralty or Maritime Claims in the Federal Rules of Civil Procedure. It sought to attach assets to secure a partial final arbitration award against the Republic of Haiti and the Bureau de Monétisation de Programmes d’Aide au Developpement (BMPAD). Garnishee BB Energy USA, L.L.C.(BB Energy) admitted to holding credits belonging to BMPAD located in the Southern District of Texas. Although BB Energy raised BMPAD’s sovereign immunity from prejudgment attachment again, the district court stated it had already decided that issue and cited its August 10, 2021 order. BB Energy appealed the January 4, 2022 order pursuant to the collateral order doctrine The Fifth Circuit reversed the district court’s ruling and vacated the writ of attachment. The court explained that to satisfy Section 1610(d), an explicit waiver of immunity from prejudgment attachment must be express, clear, and unambiguous. Anything short of that is insufficient. Here, because there is no such explicit waiver in the contract or elsewhere, the district court erred in concluding BMPAD waived its sovereign immunity from prejudgment attachment. View "Preble-Rish Haiti, S.A. v. BB Energy USA" on Justia Law
Esso Expl. and Prod. Nigeria Ltd. v. Nigerian Nat’l Petroleum Corp.
Esso Exploration and Production Nigeria Limited, (“Esso”) the Nigerian subsidiary of an international oil corporation, asked federal courts in the United States to enforce an arbitral award of $1.8 billion, plus interest, against the Nigerian National Petroleum Corporation (“NNPC”) that Nigerian courts have partially set aside. Courts in Nigeria previously set aside the Award in part. Nonetheless, Esso seeks enforcement of the entire Award under the New York Convention. NNPC urges dismissal of Esso’s suit for lack of personal jurisdiction and on the basis of forum non-conveniens, and it opposes the petition for enforcement on the merits. The Second Circuit determined affirmed the district court’s rulings because its factual determinations were meticulous and its legal conclusions sound. The court held that NNPC has standing on cross-appeal to challenge the denial of its motion to dismiss, even though the district court ruled in its favor on the merits. NNPC has such standing because our partial vacatur on the merits revives the action against it, and it may face an adverse ruling on remand. On considering NNPC’s challenges to the district court’s denial of its motion to dismiss for want of personal jurisdiction and forum non-conveniens. The court wrote that although the district court should have broadened its analysis under the Pemex standard, it ultimately agreed with its conclusion that U.S. courts owe the Nigerian judgments setting aside the Award comity. The court concluded, however, that the district court went too far by refusing to enforce not only those parts of the Award that the Nigerian courts set aside but also those parts of the Award that remain viable under the Nigerian judgments. View "Esso Expl. and Prod. Nigeria Ltd. v. Nigerian Nat'l Petroleum Corp." on Justia Law
Rachan Reddy v. Rashid Buttar
Plaintiff, a citizen and resident of Vietnam, initiated arbitration proceedings in Singapore against Defendant, then a citizen and resident of North Carolina regarding a dispute related to a sale of property in the Philippines. Plaintiff obtained a $1.55 million award against Defendant, and then brought this case asking the court to enforce the award. The district court rejected Defendant's jurisdictional challenges and granted summary judgment in favor of Plaintiff. Defendant appealed.The Fourth Circuit affirmed the district court's order granting summary judgment to Plaintiff. In so holding, the court rejected Defendant's claim that the district court lacked subject matter and personal jurisdiction, and that the court erred in finding no disputed issues of material fact. View "Rachan Reddy v. Rashid Buttar" on Justia Law
ZF Automotive U. S., Inc. v. Luxshare, Ltd.
Parties involved in arbitration proceedings abroad sought discovery in the U.S. under 28 U.S.C. 1782(a), which authorizes a district court to order the production of evidence “for use in a proceeding in a foreign or international tribunal.” One case, a contract dispute between private parties, was proceeding under the Arbitration Rules of the German Institution of Arbitration and involves a private dispute-resolution organization. The second case is proceeding against Lithuania before an ad hoc arbitration panel, in accordance with the Arbitration Rules of the U.N. Commission on International Trade Law.The Supreme Court held that the parties are not entitled to discovery. Only a governmental or intergovernmental adjudicative body constitutes a “foreign or international tribunal” under 28 U.S.C. 1782; the bodies at issue do not qualify. While a “tribunal” need not be a formal “court,” attached to the modifiers “foreign or international,” the phrase is best understood to refer to an adjudicative body that exercises governmental authority. The animating purpose of section 1782 is comity: Permitting federal courts to assist foreign and international governmental bodies promotes respect for foreign governments and encourages reciprocal assistance. Extending section 1782 to include private bodies would be in significant tension with the Federal Arbitration Act, which governs domestic arbitration; section 1782 permits much broader discovery than the FAA.The Court acknowledged that the arbitration panel involving Lithuania presents a harder question. The option to arbitrate is contained in an international treaty rather than a private contract but the two nations involved did not intend that an ad hoc panel exercise governmental authority. View "ZF Automotive U. S., Inc. v. Luxshare, Ltd." on Justia Law
Process and Industrial Developments Limited v. Federal Republic of Nigeria
After P&ID petitioned for confirmation of an arbitral award against Nigeria, Nigeria moved to dismiss for lack of jurisdiction and asserted sovereign immunity under the Foreign Sovereign Immunities Act (FSIA). The district court denied the motion on the ground that Nigeria impliedly waived sovereign immunity by joining The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention).Following its determination that it has appellate jurisdiction under the collateral order doctrine, the DC Circuit affirmed the district court's denial of Nigeria's motion to dismiss for lack of jurisdiction on different grounds, concluding that a foreign court's order ostensibly setting aside an arbitral award has no bearing on the district court's jurisdiction and is instead an affirmative defense properly suited for consideration at the merits stage. In this case, because the requirements of the arbitration exception under 28 U.S.C. 1605(a)(6) are satisfied, Nigeria’s sovereign immunity has been abrogated. View "Process and Industrial Developments Limited v. Federal Republic of Nigeria" on Justia Law
Leonard A. Sacks & Associates P.C. v. International Monetary Fund
Sacks is a law firm with a 20-year history of working with the International Monetary Fund (IMF). In 2011, IMF hired Sacks to negotiate disputed claims of various contractors that worked on the renovation of its headquarters. The parties’ contract asserts IMF’s immunity from suit and provides that any disputes not settled by mutual agreement shall be resolved by arbitration. In a subsequent fee dispute between Sacks and IMF, Sacks filed a demand for arbitration with the AAA. The arbitration panel awarded Sacks $39,918.82 plus interest but denied Sacks’ claim of underpayment in connection with earlier work.Sacks sued the Fund, claiming that the award should be vacated pursuant to the D.C. Code as “the result of misconduct by the arbitrators.” IMF removed the case to federal court and moved to dismiss it on immunity grounds pursuant to its Articles of Agreement, given effect in the U.S. by the Bretton Woods Act, 22 U.S.C. 286h. Sacks asserted the contract waived immunity by expressly providing for arbitration pursuant to the AAA Rules, which contemplate courts’ entry of judgment on arbitral awards. The D.C. Circuit affirmed the dismissal of the suit. The AAA Rules and D.C. law contemplate judicial involvement in the enforcement of arbitral awards, so arguably the contract also does so but an international organization's waiver of the immunity must be explicit. The parties' contract expressly retains the IMF’s immunity, reiterating it even within the arbitration clause. View "Leonard A. Sacks & Associates P.C. v. International Monetary Fund" on Justia Law
Tatneft v. Ukraine
The DC Circuit affirmed the district court's grant of Tatneft's petition to confirm and enforce its arbitral award against Ukraine. The court agreed with the district court's decision rejecting Ukraine's arguments that the court should have declined to enforce the award under The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), and should have dismissed the petition on the basis of forum non conveniens. In this case, the enforcement of the arbitral award should not have been denied under the New York Convention arti. (V)(1)(C) where the district court neither exceeded its discretion nor made legal error when it denied Ukraine's motion for supplemental briefing, made years after the parties had initially briefed the merits; Ukraine can pay the $173 million judgment without risking a collapse; the district court did not exceed its authority under the New York Convention; and the court rejected Ukraine's contention that the district court mistakenly enforced the award in spite of the public policy and improper composition exceptions. Furthermore, the court has squarely held that forum non conveniens is not available in proceedings to confirm a foreign arbitral award because only U.S. courts can attach foreign commercial assets found within the United States. View "Tatneft v. Ukraine" on Justia Law
Al-Qarqani v. Saudi Arabian Oil Co.
This case stems from plaintiffs' claim of rights under a 1933 agreement between Standard Oil of California and the Kingdom of Saudi Arabia and a 1949 agreement between the purported ancestors of plaintiffs and the Arabian American Oil Company. Plaintiffs seek to enforce an arbitral award against defendant, Saudi Arabian Oil Company (Saudi Aramco), which they were awarded by an Egyptian arbitration panel.After determining that plaintiffs' motion for reconsideration tolled the period for filing a notice of appeal, consistent with Federal Rule of Civil Procedure 83(a)(2), the Fifth Circuit vacated the district court's judgment and remanded with instructions for the district court to dismiss the case based on lack of jurisdiction. The court concluded that Saudi Arabian Oil Company is an instrumentality of a foreign state and is therefore immune from suit under the Foreign Sovereign Immunities Act of 1976 (FSIA). The court stated that the arbitral proceedings give every appearance of having been a sham, and there exists no agreement among these parties to arbitrate this dispute, or anything else for that matter. The court decided that, instead of denying the petition for enforcement, the case is more properly dismissed for lack of jurisdiction, given that Saudi Aramco qualifies as a foreign state for purposes of the FSIA. View "Al-Qarqani v. Saudi Arabian Oil Co." on Justia Law