Justia Arbitration & Mediation Opinion Summaries

Ultra Deep Picasso Pte. Limited (Ultra Deep) is a contractor specializing in undersea vessel operations for marine construction. Dynamic Industries Saudi Arabia Ltd. (Dynamic) subcontracted Ultra Deep for a project related to a contract with Saudi Aramco. Ultra Deep completed work worth over ten million dollars but alleged that Dynamic failed to pay, breaching their agreement. Ultra Deep filed a complaint in the Southern District of Texas, seeking breach of contract damages and a maritime attachment and garnishment of Dynamic’s funds allegedly held by Riyad Bank.The district court granted Ultra Deep an ex parte order for attachment of Dynamic’s assets at Riyad Bank. Dynamic responded with motions to dismiss for lack of personal jurisdiction, improper venue, and to compel arbitration, which were denied. Dynamic and Riyad Bank then moved to vacate the attachment order, arguing that Ultra Deep failed to show Dynamic had property in the Southern District of Texas. The magistrate judge held a hearing and found that Ultra Deep did not present evidence that Dynamic’s property was within the district. The district court adopted the magistrate judge’s recommendation, vacated the attachment order, and dismissed the case with prejudice.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court held that for a valid Rule B attachment, the property must be found within the district. It concluded that a bank account is located where its funds can be withdrawn. Since Ultra Deep failed to show that Dynamic’s property was within the Southern District of Texas, the court affirmed the district court’s decision to vacate the attachment order and dismiss the case. View "Ultra Deep Picasso v. Dynamic Industries Saudi Arabia Ltd." on Justia Law

The plaintiff, Mary Rodgers-Rouzier, worked as a bartender on steamboats operated by American Queen. She alleged that she and her coworkers were wrongly denied overtime wages. Rodgers-Rouzier filed a suit as a collective action, and over one hundred of her coworkers joined her proposed collective action. Meanwhile, American Queen moved to dismiss the case, arguing that Rodgers-Rouzier had agreed to arbitration. The district court denied the motion, but American Queen moved again to dismiss based on the arbitration agreement, this time invoking Indiana state law. The district court granted this motion, over Rodgers-Rouzier’s objections.The district court had previously denied American Queen's motion to dismiss the case for improper venue because Rodgers-Rouzier had agreed to arbitration. However, American Queen then moved again to dismiss based on the arbitration agreement, this time invoking Indiana state law. The district court granted this motion, over Rodgers-Rouzier’s objections that American Queen had waived its argument and the court lacked authority to apply Indiana law in this context. The court further determined that all the workers who had filed consent forms were not parties to the action.The United States Court of Appeals for the Seventh Circuit reversed the district court's decision. The court concluded that although American Queen’s arguments were not waived and the court had authority to enforce the arbitration agreement under Indiana law, Indiana law would hold American Queen to its bargain that its arbitration agreement was governed by the Federal Arbitration Act (FAA). Therefore, Rodgers-Rouzier’s case may continue in federal court. The court did not decide whether it may do so as a collective action and left that question for further litigation. View "Rodgers-Rouzier v. American Queen Steamboat Operating Company, LLC" on Justia Law

The case involves Puerto Rico Fast Ferries LLC ("Fast Ferries") and Mr. Cade, LLC and SeaTran Marine, LLC ("SeaTran") (collectively, "defendants-appellees"). Fast Ferries had entered into a Master Time Charter Agreement with Mr. Cade, LLC to charter the motor vessel Mr. Cade and procure a licensed crew. The agreement contained mediation and forum-selection clauses. When the final Short Form expired, Fast Ferries returned the vessel to its home port in Louisiana. A year later, Fast Ferries filed a complaint against Mr. Cade, LLC and SeaTran alleging breach of contract and liability pursuant to culpa in contrahendo. The defendants-appellees moved to dismiss the complaint, arguing that the Master Agreement was still in effect and required a written agreement for the charter of M/V Mr. Cade.The district court granted the motion to dismiss in part, concluding that the Master Agreement did not contain a termination date and remained in effect. Therefore, the contract's mediation and forum-selection clauses were binding on the parties. However, the district court did not address Fast Ferries' argument that SeaTran was not a signatory of the agreement and, therefore, could not invoke the mediation and forum-selection clauses contained therein.On appeal, the United States Court of Appeals for the First Circuit affirmed the district court's order on the defendants-appellees' motion to dismiss. The court held that the Master Agreement was still in effect and that SeaTran, despite being a non-signatory, could enforce the Master Agreement's mediation and forum-selection clauses. The court reasoned that Fast Ferries' claims against SeaTran were necessarily intertwined with the Master Agreement, and thus, Fast Ferries was equitably estopped from avoiding the mediation and forum-selection clauses with respect to SeaTran. View "Puerto Rico Fast Ferries LLC v. SeaTran Marine, LLC" on Justia Law

In this case, the United States Court of Appeals for the Ninth Circuit affirmed the district court's decision to vacate the plaintiffs' quasi in rem attachment of a vessel owned by Bergshav Aframax Ltd., a defendant in an admiralty action seeking fulfillment of arbitration awards. The arbitration awards were owed to the plaintiffs by B-Gas Ltd., renamed Bepalo, a different corporate entity. The plaintiffs tried to hold Aframax liable for the arbitration awards by arguing that Aframax and Bepalo were alter egos, essentially the same entity.However, the court found that the plaintiffs failed to show a reasonable probability of success on their veil piercing theory, which would be required to establish that Aframax and Bepalo were alter egos. The court found that the plaintiffs did not demonstrate that Bepalo was dominated and controlled by the Bergshav Group, the parent corporate group of Aframax. The court noted that the minority shareholders of Bepalo exercised independent judgment in approving the relevant transactions, countering the claim that the Bergshav Group had total domination of Bepalo. Therefore, the court concluded that the plaintiffs had not met their burden of demonstrating a reasonable probability of success on their veil-piercing claim, leading to the affirmation of the district court's decision to vacate the attachment of the vessel. View "SIKOUSIS LEGACY, INC. V. B-GAS LIMITED" on Justia Law

In a dispute between Conti 11 Container Schiffarts-GMBH & Co. KG M.S. and MSC Mediterranean Shipping Company S.A., the United States Court of Appeals for the Fifth Circuit found that the District Court for the Eastern District of Louisiana lacked personal jurisdiction over the case and reversed the district court's decision. The dispute arose from an incident where three chemical tanks exploded onboard a cargo vessel chartered by Conti to MSC, causing extensive damage and three deaths. After Conti won a $200 million award from a London arbitration panel, Conti sought to confirm the award in the Eastern District of Louisiana. MSC argued that the court lacked personal jurisdiction. The Fifth Circuit agreed with the district court’s assessment that when confirming an award under the New York Convention, a court should consider contacts related to the underlying dispute, not just those related to the arbitration itself. However, the Fifth Circuit disagreed with the district court's ruling that MSC waived its personal jurisdiction defense through its insurer’s issuance of a letter of understanding. The court also disagreed with the district court's finding that the loading of the tanks in New Orleans conferred specific personal jurisdiction over MSC, as this contact resulted from the actions of other parties not attributable to MSC. Therefore, the Fifth Circuit reversed the lower court's decision and remanded the case with instructions to dismiss it for lack of personal jurisdiction. View "Conti 11. Container Schiffarts-GMBH & Co. KG M.S. v. MSC Mediterranean Shipping Co. S.A." on Justia Law

Psara Energy appealed the district court's order granting a motion to refer to arbitration this action alleging breach of contract, fraudulent transfer and corporate succession theories against the Advantage Defendants.The Fifth Circuit dismissed the appeal based on lack of appellate jurisdiction because the district court's order, which administratively closed the case, is not a final, appealable order under the Federal Arbitration Act. In this case, the collateral order doctrine does not apply to orders concerning arbitration governed by the FAA, and 28 U.S.C. 1292(a)(3) is inapplicable to referrals to arbitration in admiralty cases that do not determine a party's substantive rights or liabilities. View "Psara Energy, Ltd. v. Advantage Arrow Shipping, LLC" on Justia Law

Plaintiff appealed the denial of her petition to "vacate and/or alternatively to deny recognition and enforcement" of the foreign arbitral award in favor of her employer, Carnival, on her claims under the Jones Act and U.S. maritime law for injuries related to her carpal tunnel.The Eleventh Circuit affirmed the district court's denial of the petition, holding that plaintiff failed to establish that the foreign arbitral award offended the United States' most basic notions of morality and justice. Weighing the policies at issue and considering the specific unique factual circumstances of this case, the court held that plaintiff's Article V(2)(b) of the New York Convention defense failed. Therefore, the court held that the district court did not err in denying plaintiff's request that it refuse to enforce the arbitral award and dismissing her claims. View "Cvoro v. Carnival Corp." on Justia Law

Andromeda and Internaves entered into a shipping contract that unambiguously required the parties to submit their dispute to arbitration. At issue on appeal was where the parties agreed to arbitrate. The district court was unable to determine the site of arbitration and resorted to the statutory default forum, compelling arbitration in its own district. The court reversed and remanded with instructions to compel arbitration in London under English law. The court held that the parties' intention to arbitrate in London was discernible from the very terms they wrote into the contract and thus the parties provided for the forum, which the district court was obliged to recognize and uphold. View "Internaves de Mexico S.A. de C.V. v. Andromeda Steamship Corp." on Justia Law

The Fifth Circuit granted TKM's, the intervenor plaintiff, motion for panel rehearing and denied the motion for rehearing en banc. The court withdrew the prior opinion and substituted the following opinion.Daewoo filed suit against AMT, seeking an order compelling AMT to arbitrate and an attachment of pig iron owned by AMT. TKM attached the same pig iron in Louisiana state court and then intervened in the federal suit. The court held that it had subject matter jurisdiction under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, because Daewoo's suit related to a covered arbitration agreement. In this case, the parties dispute whether Louisiana's non-resident attachment statute allowed for attachment in aid of arbitration. The court declined to adopt a categorical approach to this issue and held that, because Louisiana law allowed for attachment in aid of yet-to-be-brought actions, non-resident attachment may be available in aid of arbitration when an eventual confirmation suit was contemplated. The court affirmed the district court's judgment, nonetheless, because Daewoo did not strictly comply with the attachment statute's procedural requirements. View "Stemcor USA Inc. v. Cia Siderurgica do Para Cosipar" on Justia Law

An arbitration provision in a maritime insurance policy is enforceable despite law in the forum state assertedly precluding its application. This case concerned the scope of insurance coverage Galilea bought for its yacht. The Ninth Circuit held that the Federal Arbitration Act (FAA), 9 U.S.C. 1-16, applied to the insurance policy but not the insurance application. In this case, the insurance application was not a contract, but the insurance policy was a contract subject to the FAA because the FAA constituted established federal maritime law for maritime transactions; federal maritime law was not precluded by Montana law under the McCarran-Ferguson Act, 15 U.S.C. 1012; and federal maritime law was not precluded by Montana law under M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972). The panel also held that the parties have delegated arbitrability issues to an arbitrator. Therefore, the panel affirmed the district court's order finding the policy's arbitration clause enforceable and affirmed the district court's order granting the Underwriters' motion to compel arbitration as to certain causes of action. The panel affirmed in part, reversed in part, and remanded. View "Galilea, LLC v. AGCS Marine Insurance Co." on Justia Law