Magazine article Dispute Resolution Journal

AAA Files Amicus Brief in Collateral Attack Case

Magazine article Dispute Resolution Journal

AAA Files Amicus Brief in Collateral Attack Case

Article excerpt

INTERNATIONAL DEVELOPMENTS

On Jan. 17, 2007, the American Arbitration Association and the Swiss Arbitration Association jointly filed an amicus curaie (friend of the court) brief in Gulf Petro Trading Co. v. Nigerian National Petroleum Corp. et al., a case pending before the U.S. Court of Appeals for the 5th Circuit that involves two important issues: (1) the circumstances in which losing parties in arbitration may collaterally attack an arbitration award, and (2) the appropriate forum for such challenges under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

The arbitration award that gave rise to the underlying litigation arose out of an arbitration between Gulf Petro, a Texas business, and the Nigerian National Petroleum Corp. When their joint venture failed, Gulf Petro commenced an arbitration in Switzerland before the Chamber of Commerce and Industry in Geneva. The arbitrators never reached the merits of the dispute, finding in favor of the respondent on a procedural ground-that Gulf Petro was never timely or properly incorporated and thus was not entitled to seek relief. A Swiss court confirmed the award and denied Gulf Petro's motion to vacate. Gulf Petro then moved in federal court in Texas to vacate the award. The court declined to do so and the 5th Circuit affirmed that decision.

Then Gulf Petro filed its third lawsuit in federal court in Texas challenging the award on federal and state law grounds, alleging the arbitrators were bribed. The district court dismissed the case, finding that the plaintiff's lawsuit constituted an impermissible collateral attack on the award. …

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