Newco Ltd. v. Government of Belize, No. 08-2010 (D.D.C. Aug. 7, 2015)
Plaintiff, Newco Limited, brought an action pursuant to the Federal Arbitration Act (“FAA”), 9 U.S.C. § 207 and the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) to confirm an arbitral award made against Defendant, the Government of Belize (“GOB”).
Plaintiff concluded a 30-year Concession Agreement with Defendant, entitling it to operate and make improvements to Belize’s international airport. The agreement included a dispute resolution clause providing for arbitration in Miami, Florida under the UNCITRAL Arbitration Rules. Eleven months after the parties concluded the agreement, Defendant terminated it without cause. Plaintiff initiated arbitration and the tribunal found that Defendant breached the Concession Agreement, awarding $4,259,832.81, plus costs and interest.
In response to Plaintiff’s action to confirm the Award, the GOB started a lawsuit against Plaintiff in Belize obtaining a worldwide anti-suit injunction against Plaintiff and declarations that the Award was deficient. The GOB moved to stay the U.S. action to confirm the award. The GOB’s motion was granted pending resolution of the proceedings before the Belizean Supreme Court.
In 2013, the Belizean Supreme Court found that Plaintiff’s claim for an enforcement order was “well founded.” The U.S. District Court for the District of Columbia thereafter concluded that it had jurisdiction to confirm the award, and found that none of the grounds for refusal set out in Article V of the New York Convention applied.
Specifically, the district court noted that the only defense raised by the GOB under Article V was that the award had “not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made,” due to the pending litigation in the Supreme Court of Belize. The district court explained that this argument was moot, as the Belizean court had found that the award was well founded. The district court further noted that the authority of the Belizean court to set aside or suspend the award was “suspect” because the U.S. was the seat of the arbitration and therefore the award could only be set aside or suspended by a U.S. court.
The court dismissed Defendant’s remaining defenses in a footnote, granting Plaintiff’s motion to confirm the award and to enter judgment.