Court Intervention in International Arbitration PDF

State Court Intervention
in International Arbitration:
The United States Perspective*
Carolyn B. Lamm & Eckhard R. Hellbeck**
Various instances exist in which parties may resort to State

court intervention prior to and during the course of an international arbitration.
As a general matter, the extent of State court intervention is defined by the
laws of the forum, which include any international treaties to which the State
is a party, such as the New York Convention1 and the ICSID Convention.2
Under the New York Convention, the forum in which, or under the laws of
which, the award was made has supervisory authority over the arbitration.3
In addition, 72 jurisdictions4 have adopted arbitration statutes based upon the
UNCITRAL Model Law, Article 5 of which prohibits the intervention of State
courts except where so provided in the Law.5
* This article is based upon a presentation given at the 27th AAA/ICC/ICSID Joint Colloquium on
International Arbitration, held in Paris on November 17, 2010.
** White & Case LLP, Washington, D.C.
1
Convention on the Recognition and Enforcement of Foreign Arbitral Awards (June 10, 1958), 330
U.N.T.S. 38 [New York Convention].
2
Convention on the Settlement of Investment Disputes between States and Nationals of Other States
(Mar. 18, 1965), 575 U.N.T.S. 159 [ICSID Convention].
3
New York Convention, supra note 1, arts. V(1)(e), VI.
4
See UNCITRAL, Status: 1985 UNCITRAL Model Law on International Commercial Arbitration,
available at http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration_
status.html (providing a list of jurisdictions with legislation based on the UNCITRAL Model Law).
5
UNCITRAL Model Law on International Commercial Arbitration, art. 5 (as amended 2006),
available at http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration.html.
94
State Court Intervention in International Arbitration 95
In the United States, the Federal Arbitration Act (FAA)6 governs State
court intervention in international arbitration. The FAA allows U.S. courts to
intervene in limited circumstances, including to compel arbitration,7 to appoint
arbitrators,8 and to compel witnesses to attend an arbitration hearing, or to
sanction a witness for failing to appear.9
Additionally, the role of State courts may be defined further in the parties
arbitration agreement, including any set of arbitration rules incorporated by
reference. Except with respect to interim measures, neither the AAA/ICDR
International Arbitration Rules10 nor the ICC Rules of Arbitration11 expressly
address State court intervention prior to the issuance of the arbitral award.
For ICSID arbitration, the situation is different: the ICSID Convention,
which 146 States have ratified, accepted, or approved,12 constitutes a lex specialis
to the general laws of the forum. In its Article 26, the ICSID Convention
provides that [c]onsent of the parties to arbitration under this Convention shall,
unless otherwise stated, be deemed consent to such arbitration to the exclusion
of any other remedy. In the words of Professor Schreuer, this provision of
Article 26 has the following two main features:
Exclusivity of ICSID arbitration as a remedy; and

[N]on-interference with the ICSID arbitration process once it has been
instituted.13
While State court intervention prior to issuance of the award is thus possible,
yet limited, in AAA/ICDR or ICC arbitration, it is generally excluded in
ICSID arbitration. For this reason, ICSID arbitration is often characterized as
a-national, devoid of any connection with the State courts until execution of a
final award. This article addresses recent developments in the area of State court
interventionpredominantly in the United States contextfrom the perspectives
of AAA/ICDR, ICC and ICSID arbitration, in the following instances:
6
9 U.S.C. 116, 201208, 301307 (1994). The FAA is not based upon the UNCITRAL Model
Law, although it incorporates some of its elements.
7
9 U.S.C. 4.
8
9 U.S.C. 5.
9
9 U.S.C. 7.
10
AAA/ICDR International Arbitration Rules, available at http://www.adr.org/sp.asp?id=33994.
11
ICC Rules of Arbitration, available at http://www.iccwbo.org/uploadedFiles/Court/Arbitration/
other/rules_arb_english.pdf.
12
See ICSID, Member States, http://icsid.worldbank.org/ICSID/FrontServlet?requestType=Case
sRH&actionVal=ShowHome&pageName=MemberStates_Home (listing 157 signatory States and 146
States that have deposited their instruments of ratification).
13
Christoph Schreuer et al., The ICSID Convention: A Commentary 351 (2d ed. 2009).
96 ICSID REVIEWFOREIGN INVESTMENT LAW JOURNAL
Compelling arbitration (I);

Obtaining an anti-suit injunction in aid of arbitration (II);
Enjoining the opposite party from proceeding with arbitration (III);
Challenging an arbitrator (IV);
Enforcing tribunal-ordered provisional or interim measures (V); and
Obtaining court-ordered discovery in the United States in aid of
arbitration (VI).
I. COMPELLING ARBITRATION
Under the New York Convention,
The court of a Contracting State, when seized of an action in a matter

in respect of which the parties have made an agreement within the
meaning of this article shall, at the request of one of the parties, refer the
parties to arbitration, unless it finds that the said agreement is null and
void, inoperative or incapable of being performed.14
Under the FAA,
A party aggrieved by the alleged failure, neglect, or refusal of another

to arbitrate under a written agreement for arbitration may petition any
United States district court which, save for such agreement, would
have jurisdiction under Title 28, in a civil action or in admiralty of
the subject matter of a suit arising out of the controversy between the
parties, for an order directing that such arbitration proceed in the manner
provided for in such agreement.15
In the United States, a federal or state court faced with a motion to compel
arbitration will thus resolve any doubts concerning the scope of an arbitration
agreement in favor of arbitration.16 U.S. federal courts have held that the pro-
arbitration policy bias of [the FAA] is particularly strong in the context of
international transactions.17 As a U.S. federal Court recently explained,
14
New York Convention, supra note 1, art. II(3) (emphasis added); see generally Carolyn B. Lamm &
Jeremy K. Sharpe, Inoperative Arbitration Agreements under the New York Convention, in Enforcement of
Arbitration Agreements and International Arbitral Awards: The New York Convention 1958
in Practice 297 (Emmanuel Gaillard & Domenico di Pietro eds. 2008) (providing further background).
15
9 U.S.C. 4 (emphasis added).
16
Moses H. Cone Meml Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 2425 (1983).
17
Coors Brewing Co. v. Molson Breweries, 51 F.3d 1511, 1514 (10th Cir. 1995); Deloitte Noraudit A/S
v. Deloitte Haskins & Sells, U.S., 9 F.3d 1060, 1063 (2d Cir. 1993).
if one party to a contract containing an arbitration clause attempts

to avoid arbitration and files suit in the district court, the other party
may move to stay or dismiss the action on the ground that the FAA
requires the arbitration clause to be enforced. 9 U.S.C. 3. If the Court
identifies an arbitrable issue, it must issue a stay or dismiss under 3.18
A. AAA/ICDR and ICC Arbitration
In a recent decision, the U.S. District Court for the Southern District of
New York articulated the standard as follows: In deciding whether to issue an
order compelling arbitration, the role of the Court is limited to determining:
(i) whether a valid agreement or obligation to arbitrate exists, and (ii) whether
one party to the agreement has failed, neglected, or refused to arbitrate.19
In that case, the parties had agreed to AAA arbitration in New York, and
both parties had in fact made initial appearances and submissions to the ICDR.20
Rather than submitting statements of defense, however, the Respondents
obtained ex parte injunctions from a court in Bombay, India, enjoining the
Claimant from proceeding with the arbitration.21 The Southern District held
that obtaining the injunctions constituted a refusal by the Respondents to
arbitrate, despite the fact that they had made an appearance in the arbitration;
accordingly, the Court issued an order compelling arbitration.22
Another recent case involved the unusual scenario where a party to an
ICC arbitration agreement first successfully brought suit in a U.S. federal
Court to compel arbitration but shortly thereafter returned to the Court
seeking to have the arbitration clause declared void. The party argued that
the arbitration agreement was substantively unconscionable because the ICCs
assessment of the advance on the arbitration costs, in the amount of US$
220,000, was confiscatory and punitive and imposed an unreasonable
financial burden.23 The U.S. Court of Appeals for the Ninth Circuit found
that the moving party itself had originally proposed the ICC arbitration clause
for the parties contract; that it had a copy of the ICC Rules of Arbitration
18
Slinger Manufacturing Co., Inc. v. Nemak, S.A., No. 08-C-656, 2008 WL 4425889, at *3 (E.D.
Wis. Sept. 24, 2008) (citing Shearson/American Express, Inc. v. McMahon, 482 U.S. 220, 226 (1987)).
19
Amaprop Ltd. v. Indiabulls Fin. Serv. Ltd., No. 10 Civ. 1853 (PGG), 2010 WL 1050988, at *3
(S.D.N.Y. Mar. 23, 2010) (quoting Jacobs v. USA Track & Field, 374 F.3d 85, 88 (2nd Cir. 2004)).
20
Id. at *12. The Claimant was a Cayman Islands corporation, whereas the Respondents were
incorporated in India.
21
Id. at *2.
22
Id. at *34, 10.
23
Kam-Ko Bio-Pharm Trading Co. Ltd.-Australasia v. Mayne Pharma (USA), Inc., 560 F.3d 935, 937
38 (9th Cir. 2009).
in its possession when it sought to compel arbitration, and that the ICC had
accurately calculated the US$ 220,000 advance on the basis of the costs tables
included in the ICC Rules of Arbitration and the sum alleged to be in dispute
(US$ 2,527,000 or more).24 On this basis, the Court concluded that the
moving party had failed to meet its burden of proving unconscionability, and
it affirmed the lower courts dismissal of the declaratory relief sought and its
directive to proceed with the ICC arbitration.25
Besides highlighting the U.S. courts pro-arbitration policy, this case
underlines the importance of obtaining thorough legal advice from an arbitration
practitioner when drafting dispute resolution clauses for international contracts,
including information on the potential costs of the procedures contemplated in
such clauses.
B. ICSID Arbitration
As Professor Schreuer explains, ICSID arbitral proceedings are intended to

be self-contained26:
The [ICSID] Convention provides for an elaborate process designed

to make arbitration independent of domestic courts. Even in the face
of an uncooperative party, ICSID arbitration is designed to proceed
independently without the support of domestic courts. This is evidenced
by the provisions on the constitution of the tribunal (Arts. 3740),
on proceedings in the absence of a party (Art. 45(2)), on autonomous
arbitration rules (Art. 44), on applicable law (Art. 42(1)), and on
provisional measures (Art. 47). It is only in the context of enforcement
that domestic courts may enter the picture (Arts. 5455).27
Thus, for example, where a party to an ICSID arbitration fails to cooperate

in the constitution of the arbitral tribunal, the ICSID Convention allows the
Chairman of the ICSID Administrative Counsel to make the necessary arbitrator
appointments.28 If a party fails to participate in the arbitral proceeding, the
tribunal may nonetheless go forward and render an award on the basis of the
24
Id. at 941.
25
Id. at 944.
26
Schreuer et al., supra note 13, at 351.
27
Id. at 35152.
28
ICSID Convention, supra note 2, art. 38 (If the Tribunal shall not have been constituted within
90 days after notice of registration of the request has been dispatched by the Secretary-General . . . , the
Chairman shall, at the request of either party and after consulting both parties as far as possible, appoint
the arbitrator or arbitrators not yet appointed.); ICSID Arbitration Rule 4.
record before it.29 Accordingly, there is no need for the other party to seek
the assistance of a State court in order to move the arbitration forward. As a
corollary to the exclusivity of ICSID jurisdiction, the ICSID Convention thus
removes the need for host States to subject themselves to the jurisdiction of
courts in other States, as well as avoids any complications resulting from foreign
sovereign immunity issues, in the pre-award phase.30
Georges Delaume has summarized the resulting obligations of a national
court as follows:
Within the scope of the [ICSID] Convention, domestic courts

must abstain from taking any action that might interfere with the
autonomous and exclusive character of ICSID arbitration. If a court in
a Contracting State becomes aware of the fact that a claim before it may
call for adjudication under ICSID, the court should refer the parties to
ICSID to seek a ruling on the subject. Until such a ruling is made, if the
possibility exists that the claim may fall within the jurisdiction of ICSID,
the court must stay the proceedings pending proper determination of
the issue by ICSID. Only in the event of an adverse decision by ICSID,
which, for example, may result from the Secretary-Generals refusal to
register a request for arbitration or from a decision of an ICSID arbitral
tribunal that the issue involved does not fall within its competence, may
the court in question resume hearing the case, assuming, of course, that
it has an independent basis for entertaining jurisdiction over the parties
and the subject matter of the dispute.31
As Delaume further explained, the rule of abstention means that no

domestic court in any Contracting State can compel an ICSID arbitration,
as such power would directly interfere with the prerogatives of the Secretary-
General of ICSID [i.e. the Secretary-Generals screening power under Article
36(3) of the ICSID Convention] and of ICSID arbitral tribunals to determine
their own jurisdiction under Article 41(1) of the ICSID Convention.32
In practice, the issue of whether a State court can compel ICSID
arbitration has apparently never arisen. More than 30 years ago, in MINE v.
Guinea, when a dispute arose between the Liechtenstein company Maritime
29
ICSID Convention, supra note 2, art. 45(2) (If a party fails to appear or to present his case at any
stage of the proceedings the other party may request the Tribunal to deal with the questions submitted to
it and to render an award.); ICSID Arbitration Rule 42.
30
Schreuer et al., supra note 13, at 352.
31
Georges Delaume, ICSID Arbitration in Practice, 2 Intl Tax & Bus. Lawyer 58, 68 (1984).
32
Id. at 6869.
International Nominees Establishment (MINE) and the Republic of Guinea,

MINE petitioned the U.S. District Court for the District of Columbia for
an order compelling Guinea to arbitrate the dispute in AAA arbitration
rather than ICSID arbitration.33 The parties original arbitration agreement
provided for disputes to be resolved by binding arbitration conducted by three
arbitrators selected by the President of the International Centre for Settlement
of Investment Disputes.34 Although the parties supplemented that agreement
by a further agreement purporting to consent jointly to submit their dispute
to ICSID arbitration,35 for reasons that remained undisclosed, MINE did not
pursue ICSID arbitration but chose to seek AAA arbitration solely on the basis
of the FAA.36 Specifically, MINE neither filed a request for arbitration with
ICSID at the time (although it did do so several years later), nor did it petition
the Court for an order compelling ICSID arbitration.37 The Court found
that compelling AAA arbitration under the FAA was the only mechanism
available to the Court in view of its inability to order the President of ICSID to
appoint arbitrators.38 Although it is debatable whether the parties arbitration
agreement could be construed as a consent to AAA arbitration under the FAA,
the Court apparently recognized the rule of abstention imposed upon it by
the ICSID Convention.
Subsequently, when Guinea appealed the District Courts decision to
enforce the ensuing AAA award, the U.S. Department of State intervened,
urging the Court of Appeals to find that agreements to arbitrate with ICSID
do not contemplate the involvement of domestic courts, at least not before
a final ICSID decision is to be enforced.39 The Court of Appeals ultimately
33
See Maritime Intl Nominees Establishment v. Republic of Guinea, 693 F.2d 1094, 109697 (D.C.
Cir. 1983) (summarizing the U.S. court proceedings commenced by MINE in 1978).
34
Id. at 1096.
35
Id.
36
Commentators have reached differing conclusions as to MINEs tactical reasoning. See, e.g.,
Schreuer et al., supra note 13, at 353 (explaining that MINE claimed in the U.S. Court that Guineas
failure to cooperate undermined its ability to establish ICSID jurisdiction); but see Delaume, supra note
31, at 64 (explaining that the parties had agreed, for purposes of ICSID jurisdiction, to treat MINE,
which was a Liechtenstein company, as a Swiss company given that Liechtenstein is not a party to the
ICSID Convention, but that MINE later took the view in the U.S. Court proceedings that this agreement
on MINEs nationality was ineffective); Bette Shifman, Maritime International Nominees Establishment v.
Republic of Guinea: Effect on U.S. Jurisdiction of an Agreement by a Foreign Sovereign to Arbitrate before the
International Centre for Settlement of Investment Disputes, 16 Geo. Wash. J. Intl L. & Econ. 451, 455
(1982) (quoting from MINEs petition to the U.S. Court that MINE had consulted with the ICSID
Secretariat, and that in the ICSID Secretariats view the joint consent suffered from certain technical
defects precluding ICSID arbitration).
37
Maritime Intl, 693 F.2d at 1096.
38
Maritime Intl Nominees Establishment v. Republic of Guinea, 505 F. Supp. 141 n.2 (D.D.C. 1981).
39
See Maritime Intl, 693 F.2d at 1103 (citing Brief for the United States as Intervenor and Suggestion
of Interest at 54).
overturned the District Courts decision to confirm the AAA award, albeit on
other grounds.40
II. OBTAINING AN ANTI-SUIT INJUNCTION

IN AID OF ARBITRATION
Anti-suit injunctions in aid of international arbitration are plainly intended

to protect an arbitral tribunals jurisdiction to adjudicate, and thereby enforce
the parties arbitration agreement. The New York Convention does not assign
a primary role to the court of any particular Contracting State (such as, for
example, the court at the seat of the arbitration) to supervise the courts of other
Contracting States in implementing the obligations to recognize arbitration
agreements and to refer the parties to arbitration. Rather, the New York
Convention places the burden on the parties to seek a reference in the forum
in which litigation has been brought.41 Accordingly, under Article II of the
New York Convention, it is not the role of a court in one Contracting State to
enjoin a party from pursuing litigation in a court of another Contracting State.
When invoking pro-arbitration policy, U.S. courts should keep this in mind,
not only as a matter of policy, but even more importantly because the New York
Convention has been implemented in the United States as federal law.42
As a threshold requirement, U.S. courts require the parties and the disputed
issues to be identical for an anti-suit injunction to be issued. In considering
whether to issue an anti-suit injunction, U.S. courts generally balance the
following policy interests: (1) the interest in enforcing arbitration agreements;
(2) the prevention of vexatious or oppressive litigation; and (3) principles of
international comity.
Anti-suit injunctions, however, are very difficult to enforce: their
extraterritorial effect directly interferes with the exercise of jurisdiction by
foreign courts, which may even include the court with supervisory jurisdiction
over the arbitration. This is necessarily an affront to the sovereignty of other
States and undermines international comity. Indeed, injunctions directed
against foreign litigation are but a unilateral attempt to resolve the perceived
problem of conflicting jurisdictions, and thus may not achieve their intended
effect. Even if they include the imposition of sanctions against a non-complying
40
Id. at 1112 (reversing the District Courts conclusion that it had subject matter jurisdiction to
confirm the AAA award on foreign sovereign immunity grounds, specifically that the record cannot
sustain a finding that Guinea had lost its sovereign immunity by virtue of waiver or of commercial
activity).
41
Id.
42
9 U.S.C. 201 et seq.
party, they may be ineffective because foreign courts are not bound to respect
them.43 They are enforceable in the issuing court to the extent that assets of the
offending party are within its jurisdiction. They are effective extraterritorially
only if the court issuing the injunction has both subject matter and in personam
jurisdiction, and, ultimately, if the enforcing court in its discretionas a matter
of international comitydecides to respect them.
Although the European Court of Justices West Tankers decision requires
courts of European Union Member States to accord trust to one anothers legal
systems and judicial institutions and, accordingly, to refrain from issuing anti-
suit injunctions against each other in aid of arbitration,44 this mutual trust
requirement does not apply to anti-suit injunctions restraining parties from
conducting court proceedings outside the European Union.
Neither are U.S. courts bound by such a requirement. The availability of
anti-suit injunctions from a U.S. court, however, is not without limitations.
It is certainly limited by the scope of the courts personal and subject matter
jurisdiction, as well as considerations of international comity and the degree to
which the U.S. forum has an interest in the parties dispute.
Thus, in a recent case, the U.S. District Court for the Southern District
of New York held: The power of federal courts to enjoin foreign litigation
in favor of arbitration is . . . well-established. Principles of comity counsel,
[however], that injunctions restraining foreign litigation be used sparingly and
granted only with care and great restraint.45
In deciding whether to issue anti-suit injunctions to protect an arbitral

tribunals jurisdiction, U.S. courts have adopted and modified the requirements
and criteria developed for anti-suit injunctions intended to protect their own
43
See generally Carolyn Lamm, Eckhard Hellbeck & Joseph Brubaker, Anti-Suit Injunctions in Aid of
International Arbitration: The American Approach, 12 Intl Arb. L. Rev. 115 (2009).
44
See Allianz SpA, Generali Assicurazioni Generali SpA v. West Tankers, Inc., ECJ Case C-185/07,
Judgment (Grand Chamber) (Feb. 10, 2009) (holding anti-suit injunctions to be incompatible with the
essential mutual trust required under Council Regulation 44/2001 of Dec. 22, 2000 on Jurisdiction and
the Recognition and Enforcement of Judgments in Civil and Commercial Matters, 2001 O.J. (L 12) 1
(Brussels I Regulation)).
45
Amaprop Ltd. v. Indiabulls Financial Services Ltd., No. 10 Civ. 1853 (PGG), 2010 WL 1050988,
at *4 (S.D.N.Y. Mar. 23, 2010) (citing Suchodolski Assoc. v. Cardell Fin. Corp., No. 03 Civ. 4148 (WHP),
2006 WL 332765 (S.D.N.Y. Nov. 16, 2006) (courts have enjoined foreign litigation in favor of parallel
arbitration) (citing Smith/Enron Cogeneration Ltd. Pship, Inc. v. Smith Cogeneration Intl, 198 F.3d 88, 99
(2nd Cir. 1999); Smoothline Ltd. v. N. Am. Foreign Trading Corp., No. 00 Civ. 2798 (DLC), 2002 WL
273301, at *6 (S.D.N.Y. Feb. 27, 2002))) and quoting Paramedics Electromedicina Comercial, Ltda. v. GE
Med. Sys. Techs., Inc., 369 F.3d 645, 653 (2nd Cir. 2004)).
jurisdictions. As a threshold requirement, the parties and the disputed issues

must be the same in the arbitration and the litigation sought to be enjoined
from proceeding. Thus, for example, in Ibeto Petrochemical v. M/T Beffen, a
U.S. Court enjoined the parties from conducting parallel litigation in Nigeria,
finding that both actions concerned the same issue of damages resulting from
seawater contamination of an oil shipment, and ordered the parties to arbitrate
their claims in London.46
Another case shows, however, that it is not necessary for the parties in the
arbitration and the foreign litigation to be strictly identical. In Paramedics v.
GEMS-IT, GEMS-IT first commenced arbitration against Paramedics in
Miami pursuant to their arbitration agreement. Subsequently, Paramedics
initiated litigation in a Brazilian court naming both GEMS-IT and its local
affiliate, GE Brasil, which was not a party to the arbitration agreement, as
defendants.47 The U.S. Court of Appeals for the Second Circuit found that
the parties were sufficiently similar to pass the threshold requirement given
that GE Brasil acted as the agent of GEMS-IT and was named in the Brazilian
action primarily on the basis of its identity with GEMS-IT as part of the same
group of companies.48
Once a U.S. court has determined that the threshold requirements
are met, it will turn to weighing the policy interest in enforcing arbitration
agreementsincluding the need to prevent vexatious or oppressive litigation
which violates principles of international comityin considering whether to
issue an anti-suit injunction.49 In this regard, the U.S. federal appellate courts
do not seem to apply a uniform approach. Although the courts do balance these
interests against each other based on the circumstances of the individual cases,
the Second Circuit on the whole appears to give some preference to furthering
the policy interests in enforcing arbitration agreements, while the Fifth Circuit
appears to give slightly more weight to comity.
In Ibeto Petrochemical v. M/T Beffen, the Second Circuit relied in part upon
vexation concerns to affirm an anti-suit injunction directed against litigation in
46
Ibeto Petrochemical Indus. Ltd. v. M/T Beffen, 475 F.3d 56, 6364 (2nd Cir. 2007) (finding that the
named parties were the same in both U.S. and Nigerian proceedings, and were bound by the arbitration
agreement, and resolution of the case by arbitration would be dispositive of the Nigerian proceeding).
47
Paramedics Electromedicina Comercial, Ltda. v. GE Med. Sys. Techs., Inc., No. 02 Civ. 9369 (DFE),
2003 WL 23641529, at *13 (S.D.N.Y. June 4, 2003) (citing cases applying arbitration agreements to non-
signatories who served as agents to signatories).
48
Paramedics Electromedicina Comercial, Ltda. v. GE Med. Sys. Techs., Inc., 369 F.3d 645, 652 (2nd
Cir. 2004) [Paramedics Appeal].
49
Karaha Bodas Co. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, 335 F.3d 357, 366
(5th Cir. 2003) [Karaha Bodas Appeal] (quoting Kaepa, Inc. v. Achilles Corp., 76 F.3d 624, 627 (5th Cir.
1996)).
Nigeria. The Court found that the Nigerian litigation might result in disparate
results because the Nigerian Court might not apply U.S. law and thus might
render a judgment inconsistent with the underlying arbitral award, potentially
provoking a race to judgment.50 Moreover, adjudication of the same issues in
separate actions would result in an inconvenience because of the movement
of the witnesses between the two venues.51 Although the Second Circuit found
that the parallel Nigerian litigation did not pose a threat to [its] jurisdiction
because both Nigerian and U.S. courts had personal jurisdiction,52 it held that
equitable considerations deter forum shopping and therefore favor anti-suit
injunctions.53 Observing that the policy favoring arbitration is a strong one, the
Second Circuit concluded that issuing an anti-suit injunction was fully justified
in this case, even though the Nigerian litigation was initiated first in time.54
In Paramedics, the U.S. District Court for the Southern District of New
York had already determined that a valid arbitration agreement existed before
the anti-suit injunction was requested. For this reason, the Court was concerned
that [a]ny decision to the contrary in the Brazilian court would undermine
the jurisdiction of this Court and the IACAC Arbitration Tribunal.55 The
Second Circuit explained further that because a foreign court might not give
res judicata effect to a United States judgment, an anti-suit injunction would
serve to protect the U.S. Courts jurisdiction.56 Additionally, the Second Circuit
observed that [f ]ederal policy strongly favors the enforcement of arbitration
agreements, and that this policy applies with particular force in international
disputes.57 For these reasons, the Court affirmed the anti-suit injunction issued
in that case.
In another case, LAIF X v. Axtel, the U.S. District Court for the Southern
District of New York declined to issue an anti-suit injunction on the ground
that [w]hile there is a strong United States policy of enforcing arbitration
clauses . . . there is an equally strong United States policy against interfering
with proceedings before a foreign sovereign.58 On appeal, the Second
Circuit repeated the arbitration policy but disagreed with the District Courts
conclusion that these policies were balanced in the circumstances of the case.
The Second Circuit found that the defendants initiation of litigation in Mexico
50
Ibeto, supra note 46, at 64.
51
Id. at 6465.
52
Id. at 65.
53
Id. at 64.
54
Id. at 65.
55
Paramedics, supra note 47, at *15.
56
Paramedics Appeal, supra note 48, at 654.
57
Id.
58
LAIF X SPRL v. Axtel, S.A. de C.V., 310 F. Supp. 2d 578, 581 (S.D.N.Y. 2004).
in this case did not amount to sidestepping arbitration because the defendant
also was participating in the arbitration and the litigation was limited to a
point of Mexican lawnamely, the issue of whether the parties were bound
to arbitrate under a Mexican enterprises bylaws. It also found that litigation in
Mexico concerning the relationship between a Belgian investor and a Mexican
enterprise in no way implicates the U.S. arbitration policy.59 For these reasons,
the Second Circuit affirmed the District Courts decision to reject the request
for an anti-suit injunction.
None of these decisions has clearly determined whether the federal
policy favoring enforcement of arbitration agreements, even in the context
of international disputes, alone is sufficient for a party to obtain an anti-suit
injunction, or whether vexation or other policy justifications must be shown to
be present. Nor have any of these decisions explained why an anti-suit injunction
is necessary or effective to ensure the enforcement of arbitration agreements.
In contrast, in the context of the enforcement of an arbitral Award, a U.S.
federal appellate Court has applied a different analysis. In Karaha Bodas v.
Pertamina,60 the Fifth Circuit reversed the District Courts decision to grant
an anti-suit injunction to prevent the defendant from pursuing a set-aside
action in Indonesia. In an UNCITRAL arbitration in Geneva, Karaha Bodas
Company (KBC) had prevailed on its claims that the Indonesian State-
owned energy company Perusahaan Pertambangan Minyak Dan Gas Bumi
Negara (Pertamina) had breached its contracts with KBC when Indonesia
suspended KBCs contracts to develop geothermal energy resources and
construct a geothermal power plant in West Java, Indonesia.61 On the basis of
the arbitration clauses language designating Indonesian law as the procedural
law of the arbitration, Pertamina sought to vacate the Award in the Jakarta
Central District Court in Indonesia after its attempt to have the Swiss court
set aside the Award was rejected because its deposit was not timely made.62
At KBCs request, the District Court issued an anti-suit injunction to enjoin
Pertamina from pursuing its Indonesian action, reasoning that the injunction
did not cause comity concerns because the Indonesian action was an attack
on this Courts jurisdiction and interfere[d] with this Courts inherent authority
to enforce its judgments.63 The District Court explained that its decision to
59
LAIF X SPRL v. Axtel, S.A. de C.V., 390 F.3d 194, 199200 (2nd Cir. 2004).
60
Karaha Bodas Appeal, supra note 49. In the interest of full disclosure, the authors of this article note
that they served as counsel for the Republic of Indonesias Ministry of Finance in this case and in related
proceedings in other courts.
61
Id. at 360.
62
Id. at 361.
63
Karaha Bodas Co. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, 264 F.Supp. 2d 470,
476, 47883 (S.D. Tex. 2002).
enforce the Award had already resolved the issues raised in the Indonesian
courts, that Indonesian law did not apply to vacate the arbitral Award, and that
Switzerland, not Indonesia, was the proper forum for setting aside the arbitral
Award under the New York Convention.64
On appeal, the Fifth Circuit reversed the District Courts decision, holding
that KBC had not demonstrated that the factors specific to an anti-suit
injunction weigh in favor of granting that injunction.65 Instead of discussing an
abstract policy of favoring arbitration, the Fifth Circuit observed that the New
York Convention66 distinguishes between courts with primary and secondary
jurisdiction, and permits primary jurisdictions to set aside or confirm awards
according to national law while restricting the review by secondary jurisdictions
to the limited grounds in Article V.67 The Fifth Circuit avoided deciding: (1)
whether Switzerland, as the jurisdiction in which the arbitration had in fact taken
place, was the only primary jurisdiction, as the District Court in Texas had found;
or (2) whether the Indonesian courts, as the jurisdiction under the laws of which
the Award was made, given that the arbitration clause referenced Indonesian
procedural law in addition to substantive law, also had primary jurisdiction to
set aside the Award, as the Jakarta Central District Court had decided68 after the
Texas District Courts decision.69 Instead, the Fifth Circuit applied the liberal
approach to anti-suit injunctions and weighed domestic judicial interests
including the need to prevent vexatious or oppressive litigation and to protect
the courts jurisdictionagainst principles of international comity.70
The Fifth Circuit concluded that an anti-suit injunction was not appropriate
because the New York Convention envisioned simultaneous litigation
proceedings in multiple jurisdictions to enforce an arbitral award.71 First,
the Court held that the Indonesian litigation was not vexatious or oppressive
because it did not cause any inequitable hardship, frustrate the speedy and
efficient determination of the awards enforceability, or result in problematic
duplicative litigation.72 The Court did not find any inappropriate hardship,
Id.
64
Karaha Bodas Appeal, supra note 49, at 364.

65
66
New York Convention, supra note 1.
67
68
Id. at 363. As discussed in subsequent litigation, the Indonesian Supreme Court later reversed the
decision of the Central District Court of Jakarta to set aside the award, concluding that only a Swiss court
had power to set aside the award. See In re Karaha Bodas Co. v. Perusahaan Pertambangan Minyak Dan Gas
Bumi Negara, 500 F.3d 111, 115 (2d Cir. 2007).
69
70
Id. at 366 (internal parentheses omitted).
71
Id. at 367.
72
Id. at 366. The Courts use of the word duplicitous instead of duplicative appears to be a
mistake.
delay, or duplicative litigation because the New York Convention provides for
multiple simultaneous proceedings,73 permits U.S. courts to enforce awards
notwithstanding annulment elsewhere,74 and allows differing standards of
review for courts in primary and secondary jurisdictions.75 Second, the Court
held that the Indonesian litigation did not threaten the integrity of the district
courts jurisdiction or its Judgment enforcing the Award76 because Article V of
the New York Convention granted U.S. courts discretion to enforce annulled
awards.77 Finally, the Fifth Circuit concluded that international comity weighed
against an anti-suit injunction because the dispute involved a company owned
by Indonesia, the injunctions effect tended to clash with the general principle
that a sovereign country has the competence to determine its own jurisdiction
and grant the kind of relief it deems appropriate, and an anti-suit injunction
would demonstrate an assertion of authority not contemplated by the New
York Convention.78
The Fifth Circuit balanced the competing interests of preventing vexation,
protecting jurisdiction, and promoting international comity, and ultimately
vacated the anti-suit injunction. Instead of invoking an amorphous pro-
arbitration policy, the Court enforced the arbitration policy it found in its
reading of the New York Convention. The Court determined that the New
York Convention established the balance between domestic judicial concerns
and international comity, and that the arbitration policy regarding enforcement
of arbitral awards militated against issuing an anti-suit injunction, despite the
expense, inconvenience, and delay that KBC would incur in the Indonesian
litigation. The Fifth Circuits approach may be seen as reasonable in light of
the fact that the United States has ratified the New York Convention and has
incorporated it into its domestic law. Therefore, the New York Convention
factors into both sides of the equation, the domestic interests and the interest
of international comity.
As Article II(3) of the New York Convention places the burden on the
parties to seek a reference to arbitration in the forum in which the litigation
is pending, courts should refrain from enjoining foreign litigation where the
parties themselves have the opportunity to seek such a reference.
73
Id. at 368.
74
Id. at 369.
75
Id. at 370.
76
Id.
77
Id ([T]he Indonesian annulment only has an effect here to the extent that our courts choose to
recognize it.).
78
Id. at 373.
Under the ICSID Convention, consent to ICSID arbitration makes

such arbitration the exclusive remedy,79 and arbitral tribunals have the right
to determine their own jurisdiction.80 It has been the consistent practice of
ICSID tribunals to protect this right by directing the parties to stay any parallel,
interfering national court litigation until a final decision on jurisdiction has
been made in the ICSID arbitration.
For example, in SGS v. Pakistan, the ICSID Secretary-General had just
registered SGSs request for arbitration when the Supreme Court of Pakistan
handed down a judgment in connection with an ongoing local arbitration,
enjoining SGS from pursuing the ICSID arbitration.81 The Court based its
injunction on the grounds, among others, that SGS had waived the right to
resort to ICSID arbitration by virtue of participating in the local arbitration
and in prior Swiss litigation, and had not made an investment within the
meaning of the applicable PakistanSwitzerland BIT.82
SGS immediately applied to the ICSID Tribunal, once it was constituted,
for provisional measures requiring Pakistan to cease its efforts to stay the ICSID
arbitration. Finding that it had the power to determine its own jurisdiction
under Article 41 of the ICSID Convention and on this basis to protect the
right of access to international adjudication, the ICSID Tribunal ordered
Pakistan to desist from having the Pakistani Court hold SGS in contempt, and
recommended that the local arbitration be stayed until the ICSID Tribunal
issued a decision on jurisdiction.83
III. ENJOINING THE OPPOSITE PARTY FROM

PROCEEDING WITH ARBITRATION
As the above-mentioned cases illustrate, there is a strong presumption in

favor of arbitration under the New York Convention, and also in many domestic
ICSID Convention, supra note 2, art. 26.

79
Id. art. 41.

80
81
Socit Gnrale de Surveillance S.A. v. Pakistan, through Secretary, Ministry of Finance, Judgment
(S. Ct. Pakistan, July 3, 2002), reprinted in 8 ICSID Rep. 356, 382 (2005).
82
Id. at 358.
83
SGS Socit Gnrale de Surveillance S.A. v. Islamic Republic of Pakistan, ICSID Case No.
ARB/01/13, Proc. Order No. 2 (Oct. 16, 2002), reprinted in 8 ICSID Rep. 388, 39294 (2005). In its
subsequent Decision on Jurisdiction, the Tribunal affirmed its jurisdiction over SGSs treaty claims but
declined jurisdiction over SGSs contract claims, which were the subject of the local arbitration and the
preceding Swiss litigation. SGS Socit Gnrale de Surveillance S.A. v. Islamic Republic of Pakistan, ICSID
Case No. ARB/01/13, Decision on Jurisdiction (Aug. 6, 2003), reprinted in 8 ICSID Rep. 406, 439, 441,
44748 (2005).
legal systems. As a general rule, arbitration agreements will be upheld and

enforced. Nonetheless, a party to an arbitral proceeding may attempt to have
a State court restrain the opposite party from proceeding with the arbitration.
A stark example of a partys resort to State courts to interfere with an

arbitration in this manner is the ICC arbitration commenced by the Italian
company Saipem against the State-owned oil and gas company of Bangladesh,
Petrobangla, concerning a contract to build a pipeline. The arbitral Tribunal,
composed of three eminent arbitrators, was seated in Dhaka, in accordance with
the parties arbitration agreement.84 In the course of the proceedings, the ICC
Tribunal issued several procedural decisions against Petrobangla, whereupon
Petrobangla filed an action in the local court seeking the revocation of the
arbitrators authority based on alleged arbitrator misconduct.85 Petrobangla also
petitioned the local court to stay all further proceedings of the ICC arbitration
and to restrain the opposite party and/or the tribunal by and from proceeding
further with the said arbitration.86 The Supreme Court of Bangladesh issued
a temporary injunction, which was later confirmed and maintained.87 After
Saipem had an opportunity to file objections against Petrobanglas request to
remove the arbitrators, the State court issued a decision revoking the arbitrators
authority on the grounds that the Tribunal has manifestly been in disregard of
the law and as such the Tribunal committed misconduct without, however,
adding any reasoning to support such a grave conclusion.88
The ICC Tribunal nonetheless decided to carry on its proceeding on the
ground that the challenge or replacement of the arbitrators in an ICC arbitration
falls within the exclusive jurisdiction of the ICC Court and not of the courts
of Bangladesh.89 Petrobangla thereupon obtained a further injunction from
the Bangladesh Supreme Court restraining Saipem from pursuing the ICC
Arbitration.90 The ICC arbitration proceeded nevertheless and concluded with
an Award in favor of Saipem.91 Petrobangla then sought to have the Bangladesh
84
See Saipem S.p.A. v. The Peoples Republic of Bangladesh, ICSID Case No. ARB/05/7, Award, para. 25
et seq. (June 30, 2009) (describing the proceedings conducted by the ICC Tribunal, which was composed
of Dr. Werner Melis (Chairman), Prof. Riccardo Luzzatto and Prof. Ian Brownlie, QC).
85
Id. paras. 3435.
86
Id. para. 36.
87
Id. paras. 37, 39.
88
Id. para. 155.
89
Id. para. 45.
90
Id. para. 47.
91
Id. para. 48.
Supreme Court set aside the Award, which the Court declined to do on the
ground that the Award was already null and void under the laws of Bangladesh,
based on the Courts prior revocation of the arbitrators authority.92
Saipem subsequently instituted an ICSID arbitration against Bangladesh
on the basis of the BangladeshItaly Bilateral Investment Treaty claiming
expropriation and other treaty breaches. The ICSID Tribunal reviewed the ICC
Tribunals procedural orders that the Bangladeshi Court had cited as the basis
for its finding of arbitrator misconduct, and could not find the slightest trace of
error or wrongdoing.93 It concluded that the Bangladeshi courts abused their
supervisory jurisdiction over the arbitration process94 by exercising it for an
end which was different from that for which it was instituted and thus violated
the internationally accepted principle of abuse of rights.95
The ICSID Tribunal also found that the State Courts revocation of the
arbitrators authority, together with their issuance of several anti-arbitration
injunctions, violated Bangladeshs obligation under Article II(1) of the New
York Convention to recognize international arbitration agreements because it
de facto prevent[ed] or immobilize[d] the arbitration that seeks to implement
that [arbitration] agreement thus completely frustrating if not the wording at
least the spirit of the Convention.96
Finally, the ICSID Tribunal found that the acts of the Bangladeshi Courts
constituted an expropriation of Saipems residual contractual rights under the
investment as crystallized in the ICC Award and awarded Saipem compensation
in the amount of the ICC Tribunals award.97
A recent decision of the U.S. District Court for the Southern District
of New York addressing a treaty-based arbitration, as opposed to arbitration
based on a contract, is also noteworthy in this context. In Ecuador v. Chevron,
the Court held that the strong presumption in favor of arbitration [under
U.S. federal law] is particularly true where the arbitration is pursuant to an
international treaty, here a treaty between Ecuador and the United States.98 In
that case, Ecuador and other petitioners were seeking a court order to enjoin
Chevron from pursuing an UNCITRAL arbitration it had commenced against
Id. para. 50.

92
Id. para. 155.

93
94
Id. para. 159.
95
Id. para. 161.
96
Id. paras. 16667 (quoting Stephen M. Schwebel, Anti-Suit Injunctions in International Arbitration:
An Overview, in Anti-Suit Injunctions in International Arbitration 34 (Emmanuel Gaillard ed.
2004)).
97
Id. para. 202.
98
Republic of Ecuador v. Chevron Corp., No. 09 Civ. 9958 (LBS), 2010 WL 1028349, at * 1 (S.D.N.Y.
Mar. 16, 2010), aff d, Nos. 101020-cv(L), 101026(Con), 2011 WL 905118 (2nd Cir. Mar. 17, 2011).
Ecuador on the basis of the U.S.Ecuador Bilateral Investment Treaty. As the

Court explained:
The explicitly stated purposes of the treaty were to encourage investment

by Americans in Ecuador and Ecuadorians in the United States by
assuring investors that an independent, neutral tribunal exists to
arbitrate claims such as the claim here that Ecuador is seeking to impose
liability unlawfully. . . . It is Chevrons claim that this is what Ecuador
is not in the process of doing. Thus a motion to stay here strikes at the
core purposes of the treaty between Ecuador and the United States.99
Finding that Chevrons Notice of BIT Arbitration presented at least one

arbitrable issue, the Court denied the motion to enjoin the arbitration.100 On
appeal, the U.S. Court of Appeals for the Second Circuit affirmed the District
Courts decision finding that, under the applicable UNCITRAL Arbitration
Rules, it was for the arbitral tribunal to decide on Ecuadors jurisdictional
objections.101 Although this case concerned an UNCITRAL arbitration,
its rationale certainly is instructive for court proceedings involving treaty
arbitrations conducted under other arbitration rules, such as those of the AAA/
ICDR or ICC.102
A remarkable counter-example is the injunction recently issued by the
Supreme Court of Belize enjoining Dunkeld International Investment Ltd., a
Turks and Caicos company, from pursuing an UNCITRAL arbitration it had
commenced against Belize on the basis of that countrys Bilateral Investment
Treaty with the United Kingdom.103 The Court based its decision on the grounds
that the arbitration was vexatious and oppressive because it duplicated three
actions already pending in the same Court concerning the same dispute, and
only served to increase the costs of litigation.104
99
Republic of Ecuador v. Chevron Corp., No. 09 Civ. 9958 (LBS), 2010 WL 1028349, at *1 (S.D.N.Y.
Mar. 16, 2010).
100
Id. at *2.
101
Republic of Ecuador v. Chevron Corp., Nos. 101020-cv(L), 101026(Con), 2011 WL 905118, at
*7 (2nd Cir. Mar. 17, 2011).
102
See, e.g., Agreement Between the Government of the Russian Federation and the Government of
the Republic of Lithuania on the Promotion and Reciprocal Protection of Investments, art. 10(2) (allowing
the investor to choose among ICC, domestic, Stockholm Chamber of Commerce and UNCITRAL
arbitration).
103
Attorney General v. Dunkeld Intl Invest. Ltd. et al., Claim No. 1042 of 2009, Decision and Order
(S. Ct. Belize Feb. 5, 2010).
104
Id. paras. 5060.
The courts of State parties to the ICSID Convention may not enjoin
parties from pursuing ICSID arbitration for the following two reasons: under
the exclusivity rule of Article 26 of the ICSID Convention, once the parties
have consented to ICSID arbitration, which they may have done even before
an arbitration has been instituted, they may not resort to State courts with
respect to the dispute, or the type of disputes, covered by the parties consent.
Additionally, under Article 41 of the ICSID Convention, an ICSID tribunal
shall be the judge of its own competence. A State court of a State party to
the ICSID Convention must therefore defer to the ICSID tribunal for the
determination of the tribunals jurisdiction.105
In 1987, the High Court in Wellington, New Zealand, had occasion to
address this issue in a dispute between Mobil Oil and the Government of
New Zealand.106 Shortly after Mobil had filed a request for arbitration against
New Zealand and the ICSID Secretary-General had registered the request, the
Government petitioned the Court for an interim injunction to restrain Mobil
from pursuing the ICSID arbitration on the ground that the dispute was
outside of the jurisdiction conferred upon ICSID by the parties agreement.107
Upon Mobils application, the Court stayed the proceeding in order to allow
the ICSID Tribunal, once constituted, to determine its own jurisdiction.108 In
so doing, the Court expressly recognized an ICSID tribunals power, under
Article 41(1) of the ICSID Convention, to determine its own jurisdiction.109 It
also thereby implicitly recognized the exclusivity rule enshrined in Article 26 of
the ICSID Convention.
IV. CHALLENGING AN ARBITRATOR
Commentators suggest that arbitrator challenges have been increasing over

recent years, and that they are often mounted as a tactic to disrupt and delay
arbitral proceedings.110 Whether the number of challenges has indeed risen is
difficult to tell because many proceedings remain confidential. Moreover, even
if the absolute number of arbitrator challenges per year has risen, this may
105
See Delaume, supra note 31, at 6869.
106
Attorney General v. Mobil Oil NZ Ltd., [1987] 2 NZLR 649, reprinted in 4 ICSID Rep. 117
(1997).
107
Id. at 12223, 126.
108
Id. at 139.
109
Id. at 128.
110
See, e.g., Ana Stani, Challenging Arbitrators and the Importance of Disclosure: Recent Cases and
Reflections, 16 Croat. Arb. Y.B. 205 (2009).
not represent a relative increase because the number of arbitral proceedings has
increased dramatically in the last several years. Anecdotal evidence certainly
shows that parties, at times, will not shy away from resorting to unfounded
arbitrator challenges in an attempt to delay the proceedings and increase the
costs for the other side.
In challenges to arbitrators brought in ICC and ICDR arbitrations, the
State court with jurisdiction over the seat of arbitration may be called to decide
on the challenge. While this is not the case for arbitrator challenges brought
under the ICSID Convention, ICSID cases have nonetheless demonstrated the
wide range of grounds on which parties have pursued challenges, as well as the
applicable standards for evaluating allegations of arbitrator bias.
A. ICSID Arbitration
Under Article 14(1) of the ICSID Convention, an arbitrator must be of

high moral character and recognized competence in the fields of law, commerce,
industry or finance, who may be relied upon to exercise independent judgment.111
In addition, the ICSID Convention establishes certain nationality requirements.112
Article 57 of the ICSID Convention allows a party to propose to a . . . Tribunal
the disqualification of any of its members on account of any fact indicating a
manifest lack of the qualities required by paragraph (1) of Article 14 . . . .
Recent published cases show that parties have sought to disqualify arbitrators
on a broad range of grounds that, in some cases, one might consider frivolous.
Indeed, in the vast majority of these cases, the challenge was rejected.
Despite this showing of creativity on the part of parties in devising grounds to
challenge arbitrators, there does not appear to have been any attempt to involve
State courts in such challenges. In any event, given that the ICSID Convention
clearly reserves the authority to decide on arbitrator challenges for the other
tribunal members or the chairman of the ICSID Administrative Council,113 a
State court would appear to lack authority to entertain such challenges.
In Cemex v. Venezuela, Venezuela challenged the Claimant-appointed
arbitrator, Robert von Mehren, on the ground that that he was a retired partner
of a law firm that was representing another claimant against Venezuela in another
ICSID arbitration, Holcim v. Venezuela, that also involved measures taken by
the Venezuelan Government concerning the cement industry.114 Venezuela
111
ICSID Convention, supra note 2, art. 14(1).
112
Id. arts. 38, 39.
113
Id. art. 58.
114
Cemex Caracas Investments B.V. and Cemex Caracas II Investments B.V. v. Bolivarian Republic of
Venezuela, ICSID Case No. ARB/08/15, Decision on Disqualification Proposal, para. 21 (Nov. 6, 2009).
argued that Mr. von Mehrens continuing relationship with the law firm gave
rise to an appearance of a lack of impartiality.115 The other two arbitrators116
dismissed the challenge without ruling on its substance because they found that
Venezuela had not promptly filed its proposal to disqualify Mr. von Mehren,
as required under ICSID Arbitration Rule 9(1). It found that Venezuela had let
more than five months lapse since it learned about the underlying facts before
it even raised the issue with the Tribunal and then waited another month before
filing the proposal.117
In PIP v. Gabon, Gabon challenged the Claimant-appointed arbitrator,
Prof. Ibrahim Fadlallah on the ground that he had been the president of
another ICSID tribunal that had issued an award against Gabon in a case that
involved certain similar factual and legal issues, on which Prof. Fadlallah already
had taken a position.118 The Chairman of the ICSID Administrative Council
rejected the challenge finding that Gabon had failed to prove the links between
the two cases and to establish a manifest lack of impartiality.119
In Perenco v. Ecuador, Ecuador challenged the Claimant-appointed
arbitrator, Judge Charles N. Brower, on the basis of a published interview
in which he had commented on Ecuadors attitude toward ICSID generally
and, in particular, with respect to provisional measures ordered in this, and a
parallel, ICSID arbitration.120 In this case, the parties had agreed in advance
that any arbitrator challenge would be resolved by the Secretary-General of the
Permanent Court of Arbitration at The Hague (PCA) on the basis of the IBA
Guidelines on Conflicts of Interest in International Arbitration.121 Pursuant to
the IBA Guidelines, an arbitrator shall be impartial and independent of the
parties at the time of accepting an appointment to serve and shall remain so
during the entire arbitration proceeding . . . .122 The Guidelines also provide
that an arbitrator shall withdraw
115
Id. para. 29.
116
See ICSID Arbitration Rule 9(4) (unless a disqualification proposal relates to a majority of the
tribunal members, the other members consider and vote on the proposal in the absence of the arbitrator
concerned).
117
Cemex, supra note 114, paras. 4445.
118
Participaciones Inversiones Portuarias SARL v. Gabonese Republic, ICSID Case No ARB/08/17,
Decision on Disqualification Proposal, paras. 1415 (Nov. 12, 2009).
119
Id. para. 34. Gabon had refused to submit the award in the other case as evidence of the alleged
links between the two cases. Id. paras. 11, 31. The Chairman of the ICSID Administrative Council was
called upon, under ICSID Arbitration Rule 9(4) and (5), to make the decision because the other two
tribunal members were unable to agree. Id. paras. 1, 12.
120
In the Matter of a Challenge in ICSID Case No. ARB/08/6 between Perenco Ecuador Ltd. and The
Republic of Ecuador & Empresa Estatal Petroleos del Ecuador (Petroecuador), PCA Case No. IR-20091,
Decision on Challenge, para. 27 (Dec. 8, 2009) [Perenco Challenge Decision].
121
Id. para. 9.
122
IBA Guidelines on Conflicts of Interest in International Arbitration, General Principle.
if facts or circumstances exist, or have arisen since the appointment,

that, from a reasonable third persons point of view having knowledge
of the relevant facts, give rise to justifiable doubts as to the arbitrators
impartiality or independence . . . . Doubts are justifiable if a reasonable
person and informed third party would reach the conclusion that there
was a likelihood that the arbitrator may be influenced by factors other
than the merits of the case as presented by the parties in reaching his or
her decision.123
As the IBA Working Group that drafted the Guidelines explained, a

challenge to the impartiality and independence of an arbitrator depends on the
appearance of bias and not actual bias.124
The PCA Secretary-General sustained the challenge, concluding that there
was such an appearance of bias in this case because the combination of the
words chosen by Judge Brower and the context in which he used them have
the overall effect of painting an unfavorable view of Ecuador in such a way
as to give a reasonable and informed third party justifiable doubts as to Judge
Browers impartiality.125
In Urbaser v. Argentina, the two Tribunal members hearing the challenge
stated the standard to be applied as follows: What matters is whether the
opinions expressed . . . are specific enough that a reasonable and informed third
party would find that the arbitrator will rely on such opinions without giving
proper consideration to the facts, circumstances, and arguments presented by
the Parties in this proceeding.126
In that case, the Claimants challenged the Respondent-appointed arbitrator,
Prof. Campbell McLachlan on the ground that the views he had expressed in his
scholarly publications on two issues that the Claimants considered critical for
the case: the most-favored-nation clause and the state of necessity.127 Applying
the standard quoted above, the Tribunal members concluded that the mere
showing of an opinion, even if relevant in a particular arbitration, is not
sufficient to sustain a challenge for lack of independence or impartiality of an
arbitrator.128
123
Id. at Conflict of Interest.
124
Perenco Challenge Decision, supra note 120, para. 43 (quoting IBA Working Group, Background
Information on the IBA Guidelines on Conflicts of Interest in International Arbitration (2004)).
125
Id. para. 48.
126
Id. para. 44.
127
Urbaser S.A. and Consorcio de Aguas Bilbao Bizkaia, Bilbao Biskaia Ur Partzuergoa v. Argentine
Republic, ICSID Case No. ARB/07/26, Disqualification Decision, paras. 2025 (Aug. 12, 2010).
128
Id. para. 45.
In Alpha Projektholding v. Ukraine, Ukraine challenged the Claimant-

appointed arbitrator, Dr. Yoram Turbowicz, on the basis that he and the
Claimants counsel had attended law school together about 20 years earlier.129
The two other Tribunal members issued a 30-page decision dismissing the
challenge because Ukraine had not proven any fact that would indicate a
manifest lack of impartiality or independence.130
B. AAA/ICDR and ICC Arbitration
Under Article 7.1 of the ICC Rules of Arbitration, an arbitrator must be

and remain independent of the parties involved in the arbitration. Additionally,
Article 15.2 requires the arbitral tribunal to act fairly and impartially. Under
Article 11.3, the ICC Court of Arbitration decides on the admissibility
and merits of any arbitrator challenges. The ICC Courts decisions are not
published. Article 7(1) of the ICDR International Arbitration Rules similarly
requires arbitrators to be impartial and independent. Under Article 8 of the
ICDR International Arbitration Rules, a challenge can be successful only if
circumstances exist that give rise to justifiable doubts as to the arbitrators
impartiality or independence.
These standards appear comparable to the standard for ICSID arbitration.
Unlike in ICSID arbitration, however, the rules for ICC and ICDR arbitration
do not contain a requirement that the lack of independence or impartiality be
manifest for a challenge to succeed. Moreover, unlike in ICSID arbitration,
the State court with jurisdiction over the seat of the arbitration may be seized
with an arbitrator challenge. In that case, the court will apply the national
arbitration laws in effect at the seat, as well as the applicable arbitration rules.
The way in which these different standards can impact challenge proceedings
became apparent in the challenge of Prof. Emmanuel Gaillard in Telekom Malaysia
v. Ghana, an UNCITRAL arbitration brought on the basis of the Ghana
Malaysia Bilateral Investment Treaty. In that arbitration, Ghana challenged
Prof. Gaillard, the Claimant-appointed arbitrator, on the ground that he was
concurrently acting as an advocate in another investor-State arbitration in which
he was seeking the annulment of an arbitral award on which Ghana relied as a
legal authority in its argument in the instant arbitration. Ghana argued that Prof.
Gaillards commitment to represent a certain position on behalf of his clients in
the other case would undermine his ability to remain impartial towards Ghanas
Alpha Projektholding GmbH v. Ukraine, ICSID Case No. ARB/07/16, Decision on Disqualification
129
Proposal (Mar. 19, 2010).

130
Id. para. 83.
opposite position on that issue in the instant arbitration. Ghanas subsequent

challenges of Prof. Gaillard were rejected by both the arbitral Tribunal and the
Secretary-General of the Permanent Court of Arbitration (as the appointing
authority). Ghanas further challenge to the District Court of The Hague, which
was the seat of the arbitration, however, yielded a different result. Applying
Dutch law, which provides that, in determining whether justified doubts exist
with respect to an arbitrators independence or impartiality, the Court must take
an objective point of view, which includes taking account of appearances. On
this basis, the Court concluded that Prof. Gaillards role as an advocate, in which
he will regard it as his duty to put forward all possibly conceivable objections
against the very award on which Ghana sought to rely, was incompatible with
his role as an arbitrator, in which he was called upon to rule on Ghanas opposite
position as to that Award.131
The issue of an arbitrator challenge resolved by the ICC Court of Arbitration
has recently arisen in litigation before the U.S. District Court for the District of
Columbia. In an action brought by Argentina to vacate an UNCITRAL Award
rendered in favor of BG Group, Argentina put forth the argument, among
others, that the Award should be vacated because the ICC Court had exceeded
its authority by failing to disqualify one of the members of the UNCITRAL
arbitral Tribunal.132 The Court found that this claim was without merit because
Argentina had neither disputed the ICC Courts authority to rule on the
arbitrator challenge nor submitted any evidence establishing the arbitrators
partiality.133
Two recent decisions of the Swiss Supreme Court134 highlight the issue
of whether, and to what extent, a partys multiple appointments of the same
arbitrator exposes the arbitrator to challenge. These decisions concerned two
parallel ICC arbitrations held in Zurich, with identically composed arbitral
tribunals. One of the parties sought the set-aside of both awards on the ground
that, according to a press report, the ICC Court of Arbitration had declined to
confirm the arbitrator appointed by the other party in another case because that
party had appointed the same arbitrator at least ten times.135 The Swiss Supreme
Court rejected the set-aside request, finding that the alleged relationship between
the other party and the arbitrator was not sufficiently established, and because
131
The Republic of Ghana v. Telekom Malaysia Berhad, Civ. No. HA/RK 2004.667, Challenge
Decision (D. Ct. The Hague Oct. 18, 2004); see Joseph Brubaker, The Judge Who Knew Too Much: Issue
Conflicts in International Adjudication, 2 Berkeley J. Intl L. 111, 13031 (2008) (discussing this case in
the context of other cases involving issue conflicts).
132
Republic of Argentina v. BG Group PLC, 715 F.Supp.2d 108, 121 (D.D.C. June 7, 2010).
133
Id.
134
X. v. Y., Cases Nos. 4A_256/2009 and 4A_258/2009, Judgments (Swiss S. Ct. Jan. 11, 2010).
135
Id. para. 3.1.1.
the requesting party had failed to challenge the arbitrator during the arbitration
and thus had waived the right to rely on this ground to seek a set-aside.136
In the UK, on the other hand, the English Court of Appeals decision in
Jivraj v. Hashwani137 gives rise to concern in the context of arbitrator challenges.
In that case, the Court held that an arbitration agreement providing that the
arbitrators should be respected members of the Ismaili community was void
because it violated English anti-discrimination regulations prohibiting employers
from discriminating on the basis of religion when choosing employees. Strictly
speaking, this case did not involve an arbitrator challenge, but rather an action
to set aside an arbitral award on the ground that the underlying arbitration
agreement was void. Nonetheless, this decision may open a Pandoras Box of
arbitrator challenges whenever the applicable arbitration rules or the parties
arbitration agreement contain certain requirements for arbitrators, such as
nationality requirements, that may arguably be seen as discriminatory.
V. ENFORCING TRIBUNAL-ORDERED PROVISIONAL

OR INTERIM MEASURES138
Differences also exist in State court enforcement of tribunal-ordered

provisional or interim measures in an ICC or ICDR arbitration between two
private parties as compared to an ICSID arbitration between a host State and a
private investor.
A. The Arbitral Tribunals Power to Issue Provisional Measures
The arbitration rules of all three institutions recognize the power of the
arbitral tribunal to issue provisional measures.139 Parties are, of course, also
free to include provisions in their arbitration agreement giving the tribunal the
power to order such measures.
The power of a tribunal to order interim remedies, however, is not simply
controlled by the applicable arbitration agreement and rules. It is also subject to
the municipal laws of the jurisdiction within which the arbitration takes place,
for at least two reasons.
Id. para. 3.1.2.

136
Nurdin Jivraj v. Sadruddin Hashwani, [2010] EWCA Civ 712.

137
138
An earlier version of this chapter was published as Carolyn B. Lamm & Lee A. Steven, The
Enforcement of Tribunal-Ordered Provisional Measures, in Commercial Mediation and Arbitration in
the NAFTA Countries 215 (Luiz M. Daz & Nancy A. Oretskin eds. 1999).
139
ICSID Arbitration Rule 39; ICDR International Arbitration Rules, art. 21; ICC Rules of
Arbitration, art. 23.
1. International arbitration conventions, including the New York

Convention,140 generally do not address the issue of whether an arbitral
tribunal has the power to grant provisional measures. Thus, an arbitral
tribunal is not likely to grant provisional relief unless the applicable
municipal law so permits.
2. Even if a tribunal orders provisional relief, a municipal court is not likely
to enforce such an award unless the applicable municipal law permits
such relief and allows for court enforcement.
The major exception to the above rule occurs in arbitration under the
auspices of the ICSID Convention, for the following reasons:
1. ICSID arbitration, by virtue of its international character, operates

as a self-contained system not subject to the control of any national
jurisdiction.
2. The ICSID Convention, in its Article 47, expressly gives tribunals
the power to order provisional relief. Therefore, it is incumbent upon
all State Parties to the Convention, as a matter of international treaty
obligation and notwithstanding possible contrary municipal law, to
recognize and enforce any provisional relief recommended by an ICSID
tribunal.
Before turning to the legal regime in the United States for enforcement
of tribunal-ordered provisional measures, it is important to remember why
enforcement may be necessary.
An arbitral tribunal generally has no power to enforce its own orders.
Although a party to an arbitration risks incurring the displeasure of a tribunal,
and thus prejudicing its case, if it refuses to comply with a provisional measure,
it nevertheless can choose to ignore the order without immediate consequence.
Thus, the only way the prevailing party can ensure that the adverse party
complies with tribunal-ordered provisional measures is to seek enforcement
by the appropriate judicial authority. The ICC Rules of Arbitration clearly
recognize this, providing that [t]he application of a party to a judicial
authority for . . . the implementation of any such measures ordered by an
Arbitral Tribunal shall not be deemed to be an infringement or a waiver of the
arbitration agreement and shall not affect the relevant powers reserved to the
Arbitral Tribunal.141
140
New York Convention, supra note 1.
141
ICC Rules of Arbitration, art. 23(2).
B. Enforcement of Tribunal-Ordered Provisional Measures in the United States
International arbitration in the United States is controlled by the FAA, which

is silent on the question of a tribunals power to order provisional measures.
U.S. courts, however, have recognized the inherent power of a tribunal under
the FAA to order provisional measures and will therefore enforce such orders
in appropriate circumstances. Of course, it is the nature of the appropriate
circumstances that will determine whether or not a court will enforce tribunal-
ordered provisional measures in a particular case. Disputes over enforcement
usually focus on three key areas: (1) the scope of the tribunals authority; (2)
the courts power to review the tribunals order; and (3) whether court review or
enforcement of the order is appropriate.
1. The Scope of an Arbitral Tribunals Authority to Award Provisional

Measures
U.S. courts have held that the FAA permits arbitral tribunals to order
provisional measures provided that the parties to the arbitration agreement
have, either expressly or impliedly, so agreed. In situations where the arbitration
agreement or applicable arbitration rules do not directly address the issue of
tribunal-ordered provisional measures, U.S. courts have reached different
conclusions on the presumption to be applied in determining whether the
tribunal has power to award provisional measures.
Most U.S. courts have recognized the power of a tribunal to order
provisional measures as long as this power is not in some way inconsistent with
the parties arbitration agreement. That is, there is a presumption in favor of
recognizing the power. A few courts have even stated that a tribunals power
to order provisional measures can be implied from the agreement to arbitrate
itself.142 A few U.S. courts, however, have reversed the presumption, holding in
essence that tribunals lack the power to issue provisional measures unless the
parties expressly (or at least by clear, unambiguous implication) authorize the
tribunal by agreement.143 The difference between these court decisions on the
presumption to be applied should become increasingly insignificant as more
142
See, e.g., Konkar Maritime Enterprises, S.A. v. Compagnie Belge dAffretement, 668 F.Supp. 267,
271 & n.3 (S.D.N.Y. 1987) (rejecting the assertion that the arbitral panel exceeded its powers under the
arbitration agreement by ordering the posting of a security, having found that [t]he issue of security . . .
was implicit in the submission of the main dispute to the Panel.).
143
See, e.g., Swift Industries, Inc. v. Botany Industries, Inc., 466 F.2d 1125, 113234 (3rd Cir. 1972)
(order of a cash security bond was in excess of the arbitrators authority because the parties agreement did
not mention a bond as a remedy).
and more arbitration rules expressly grant broad powers to the tribunal to order
provisional measures. No U.S. court has held that parties may not agree to
vest a tribunal with power to award provisional measures, and most decisions
actually reject such a conclusion.
Thus, as long as the parties expressly agree to give the tribunal the power
to order provisional measures, either directly in an arbitration agreement or
indirectly by incorporating by reference a set of arbitration rules, U.S. courts
will have the power to enforce tribunal-ordered provisional measures.144
2. The Power of a U.S. Court to Review Tribunal-Ordered Provisional

Measures
Section 10 of the FAA specifically permits enforcement only of final

awards. Parties resisting the enforcement of provisional measures have sometimes
argued that a provisional measures order is an interim award (i.e. not final)
and therefore not subject to judicial enforcement. U.S. courts have resolved
this apparent restriction on their power to enforce provisional measures by
distinguishing between two kinds of interim awards. Courts will not review or
otherwise enforce partial or interim awards that deal with the substantive issues of
the dispute (e.g. a finding on liability with a deferral on the amount of damages).
However, courts will enforce interim remedies such as preliminary injunctions
and attachments of property because such remedies are considered separate from
the merits and, as such, constitute final awards on a distinct issue.145
The articulated policy is that certain provisional measures are necessary to
preserve the integrity of the arbitral process and, unless immediately enforced,
would be rendered meaningless. Such tribunal-ordered measures are therefore
considered final orders that can be reviewed for confirmation and enforcement
by U.S. courts under the FAA.146
144
But see Charles Constr. Co. v. Derderian, 586 N.E.2d 992, 99596 (Mass. 1992) (Although this
Court did state that the power of a tribunal to order provisional measures can be implied from an agreement
to arbitrate, it nevertheless found this rule inapplicable to the facts of the case before it. The Court
narrowly construed the scope of the applicable arbitration rules chosen by the parties to restrict the type
of provisional measures the tribunal could order.). This case suggests that drafters of arbitration clauses
should look closely at the intended arbitration rules to make sure that the rules wording unambiguously
provides the arbitral tribunal with sufficiently broad powers.
145
See, e.g., Pacific Reinsurance Mgmt. Corp. v. Ohio Reinsurance Corp., 935 F.2d 1019, 102223
(9th Cir. 1991) (discussing the difference between the two kinds of interim awards); Publicis Commcn
v. True North Commucn, Inc., 206 F.3d 725 (7th Cir. 2000) (finding that an order of an international
arbitral tribunal directing one party to turn over certain tax records to the other party is final for
purposes of enforcement because the content of a decisionnot its nomenclaturedetermines
finality.).
146
Pacific Reinsurance, supra note 145, at 1023.
3. Whether Court Review and Enforcement of Tribunal-Ordered Provisional

Measures are Appropriate
The standard for judicial review of an arbitral tribunals award of provisional

measures (i.e. the grounds for vacating the award) is essentially the same as
that of a final award on the merits of the case.147 U.S. courts permit arbitral
tribunals broad, but not unlimited, discretion to fashion appropriate provisional
relief. Most courts agree with the position advocated by the Court in Sperry
International Trade,148 which stated that [u]nder New York law arbitrators have
power to fashion relief that a court might not properly grant. On the other
hand, courts have also denied enforcement where the provisional measure is
considered in excess of the authority granted by the applicable statutes, rules,
and agreements.149
U.S. courts hold that it is never appropriate to grant provisional measures
affecting third persons not party to the arbitration (e.g. attachment of funds
owed the adverse party by a third party, such as debt or a bank account).150
A tribunals ability to award provisional measures derives from the arbitration
agreement, and it therefore has no power over persons who have not agreed to
the arbitration of the dispute. Consequently, U.S. courts will not enforce any
tribunal-ordered provisional measures that purport to order a non-party to act
or refrain from acting in a certain way.
VI. OBTAINING COURT-ORDERED DISCOVERY IN

THE UNITED STATES IN AID OF ARBITRATION
Section 1782 of the U.S. Judicial Code, which permits a U.S. court to
order discovery of evidence for use in a proceeding in a foreign or international
tribunal, has received increased attention this year.151 The ongoing dispute
147
See id. (listing the criteria the Court should consider in a review of tribunal-ordered provisional
measures).
148
Sperry Intl Trade, Inc. v. Government of Israel, 689 F.2d 301, 306 (2nd Cir. 1982).
149
See Charles Constr. Co., supra note 144, at 99596.
150
Even state courts may decline to order pre-award attachment of funds allegedly owed the adverse
party by a third party. See, e.g., E.T.I. Euro Telecom International N.V. v. Republic of Bolivia, No. 08 Civ.
4247 (LTS), 2008 U.S. Dist. LEXIS 57538, at *24, 12 (S.D.N.Y. July 30, 2008) (vacating pre-award
order of attachment in favor of E.T.I. in an ICSID arbitration commenced against Bolivia because the
attached funds did not belong to Bolivia but rather to the State-owned company Entel, and E.T.I. failed
to show how the funds constituted an attachable debt obligation to Bolivia); see also E.T.I. Euro Telecom
International N.V. v. Republic of Bolivia, [2008] EWCA Civ 880 (July 28) (same, on the ground that Entel
was not a party to the ICSID arbitration).
151
28 U.S.C. Section 1782 provides as follows:
(a) The district court of the district in which a person resides or is found may order
between Chevron and the so-called Lago Agrio plaintiffs, as well as Ecuador,
has generated more than a dozen such discovery orders by federal district courts
across the United States, and several appeals have been noted. It remains to be
seen whether the various federal appellate courts will take the opportunity to
resolve some of the persisting uncertainties surrounding the issue of whether,
and to what extent, Section 1782 applies to international arbitration.
In Intel Corp. v. Advanced Micro Devices, Inc., the U.S. Supreme Court,
in 2004, held that Section 1782 granted district courts the authority to order
discovery in aid of proceedings before the Directorate-General for Competition
of the European Commission in the context of an antitrust complaint.152 It did
not directly address the issue of whether international arbitrations fall within
the ambit of Section 1782. Reviewing the legislative history of that provision,
however, the Supreme Court quoted an article by Prof. Hans Smit to the
effect that Congress understood the term tribunal to include investigating
magistrates, administrative and arbitral tribunals, and quasi-judicial agencies, as
well as conventional civil, commercial, criminal and administrative courts.153
After Intel, several U.S. district courts have granted discovery under Section
1782 to parties in international arbitrations, while others have denied such
discovery, instead following pre-Intel precedent.
Prior to Intel, the Second and Fifth Circuits had held that the terms foreign
or international tribunal were limited to governmental or inter-governmental
him to give his testimony or statement or to produce a document or other thing for use in a
proceeding in a foreign or international tribunal, including criminal investigations conducted
before formal accusation. The order may be made pursuant to a letter rogatory issued, or
request made, by a foreign or international tribunal or upon the application of any interested
person and may direct that the testimony or statement be given, or the document or other
thing be produced, before a person appointed by the court. By virtue of his appointment,
the person appointed has power to administer any necessary oath and take the testimony or
statement. The order may prescribe the practice and procedure, which may be in whole or
part the practice and procedure of the foreign country or the international tribunal, for taking
the testimony or statement or producing the document or other thing. To the extent that
the order does not prescribe otherwise, the testimony or statement shall be taken, and the
document or other thing produced, in accordance with the Federal Rules of Civil Procedure.
A person may not be compelled to give his testimony or statement or to produce a
document or other thing in violation of any legally applicable privilege.
(b) This chapter does not preclude a person within the United States from voluntarily
giving his testimony or statement, or producing a document or other thing, for use in a
proceeding in a foreign or international tribunal before any person and in any manner
acceptable to him.
152
Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 258 (2004).
153
Id. (quoting Hans Smit, International Litigation under the United States Code, 65 Colum. L. Rev.
1015, 102627 & nn.71, 73 (1965) (emphasis added)). Prof. Smit served as Reporter to the Commission
and Advisory Committee on International Rules of Judicial Procedure, which drafted the revised version
of Section 1782 that Congress adopted in 1964. Smit, id. at 1015 n.*.
entities, and did not include private arbitral panels.154 Since Intel, federal
district Courts in Delaware, Georgia, Massachusetts and Minnesota have held
that those terms did include private arbitration, including ICC and Vienna
International Arbitration Center arbitration.155 Conversely, federal district
Courts in Illinois and Texas have denied requests for discovery orders, holding
that Section 1782 did not apply to private arbitration.156 The Federal District
Court in New Jersey concurred with this view but found that the arbitration
in the case before it, an UNCITRAL arbitration on the basis of a bilateral
investment treaty (BIT), was not private but rather was being conducted
within a framework defined by two nations and is governed by the Arbitration
Rules of the United Nations Commission on International Trade Law, and on
this basis found that granting discovery was not clearly erroneous or contrary
to law.157
As mentioned, this year has seen a flood of Section 1782 discovery requests
by Chevron, and also by Ecuador, relating to the Lago Agrio dispute, which
includes litigation brought by residents of Lago Agrio against Chevron
in Ecuadorian courts concerning the environmental impact of Chevrons
investment, as well as an UNCITRAL arbitration brought by Chevron against
Ecuador on the basis of the EcuadorU.S. BIT.158 In this context, federal district
courts in California, Colorado, the District of Columbia, Georgia, New Jersey,
New Mexico, New York, Tennessee, and Texas have issued discovery orders. In
several of these cases, appeals have been docketed in the various federal appellate
courts.159 As these cases concern an UNCITRAL arbitration brought on the
154
See Natl Broadcasting Co., Inc. v. Bear Stearns & Co., Inc., 165 F.3d 184 (2nd Cir. 1999) (denying
discovery from a third party in connection with an ICC arbitration in Mexico); Republic of Kazakhstan
v. Biedermann Intl, 168 F.3d 880, 88182 (5th Cir. 1999) (following Natl Broadcasting, observing that
[t]here is no contemporaneous evidence that Congress contemplated extending 1782 to the then-
novel arena of international commercial arbitration, and denying discovery from a third party in aid of
an arbitration conducted under the auspices of the Arbitration Institute of the Stockholm Chamber of
Commerce).
155
See In re Application of ROZ Trading Ltd., 469 F.Supp.2d 1221 (N.D. Ga. 2006) (Vienna Centre
arbitration); In re: Application of Hallmark Capital Corp., 534 F.Supp.2d 951 (D. Minn. 2007) (Israeli
arbitration); La Comisin Ejecutiva, Hidroelctica del Ro Lempa v. Nejapa Power Co., No. 08135-GMS,
2008 WL 4809035 (D. Del. Oct. 14, 2008) (Swiss arbitration); In re: Application of Babcock Borsig AG,
583 F.Supp.2d 233 (D. Mass. 2008) (ICC arbitration in Germany).
156
See La Comisin Ejecutiva Hidroelctica del Ro Lempa v. El Paso Corp., 616 F.Supp.2d 481 (S.D.
Tex. 2008) (same Swiss arbitration as in Comisin Ejecutiva before the U.S. District Court for the District
of Delaware, supra note 155); In re an Arbitration in London between Norfolk Southern Corp. et al. and ACE
Bermuda Ltd., 626 F.Supp.2d 882, 884 (N.D. Ill. 2009) (Board of Arbitration in London).
157
In the Matter of the Application of Oxus Gold Plc., No. 0682-GEB, 2007 WL 1037387, at *5
(D.N.J. Apr. 2, 2007) (UNCITRAL arbitration under U.K.Kyrgyzstan BIT).
158
In re Application of Chevron Corp., No. 10 MC 00002 (LAK), 2010 WL 4910248, at *3 & n. 8,
*11 (S.D.N.Y. Nov. 10, 2010)
159
Id. at *3 & n.8.
basis of a treaty, it is not likely that any of the appellate courts will address the
issue of whether private arbitration is covered by Section 1782 because there
does not appear to be any disagreement, even on the basis of pre-Intel precedent,
that treaty-based UNCITRAL arbitration is not considered private for the
purposes of that provision.160 Nevertheless, it will be interesting to see whether
the federal appellate courts will adopt the recently issued, elaborately explained
interpretation of Section 1782 by Judge Kaplan of the U.S. District Court for
the Southern District of New York.161
Judge Kaplan held that Section 1782 authorized, but did not require,
the District Court to order discovery under the following three cumulative
conditions:
(1) The person from whom discovery is sought resides or is found

in the district of the district court to which the application is
made,
(2) The discovery is for use in a proceeding before a foreign tribunal,
and
(3) The application is made by a foreign or international tribunal
or any interested person.162
Citing Intel, Judge Kaplan then enumerated the following four discretionary
factors that a district court should consider in exercising its discretion once the
above statutory requirements are met:
(1) Whether the material sought is within the foreign tribunals

jurisdictional reach and thus accessible absent Section 1782 aid;
(2) The nature of the foreign tribunal, the character of the
proceedings underway abroad, and the receptivity of the foreign
government or the court or agency abroad to U.S. federal-court
jurisdictional assistance;
(3) Whether the Section 1782 request conceals an attempt to
circumvent foreign proof-gathering restrictions or other policies
of a foreign country or the United States; and
160
See id. at *15 (finding that an UNCITRAL tribunal established by an international treaty, is a
foreign tribunal for purposes of Section 1782 applications).
161
See, e.g., Chevron Corp. v. Berlinger, 629 F.3d 297, 31011 (2011) (affirming an earlier Section
1782 ruling of the S.D.N.Y. without, however, reaching the issue of whether a treaty-based international
arbitration qualifies as a proceeding in a foreign or international tribunal).
162
In re Application of Chevron Corp., supra note 158, at *14.
(4) Whether the subpoena contains unduly intrusive or burdensome

requests.163
In the only case thus far concerning a pending ICSID arbitration, Caratube
v. Kazakhstan, the U.S. District Court for the District of Columbia recently
denied a Section 1782 request.164 Assuming, without deciding, that the request
met the statutory requirements, including whether an ICSID tribunal qualified
as a foreign or international tribunal under Section 1782, the Court turned
directly to the discretionary factors.165
The Court first analyzed the ICSID Tribunals receptiveness to discovery
obtained on the basis of Section 1782. Under this standard, authoritative
proof that a foreign tribunal would reject evidence obtained with the aid of
section 1782 would weigh against granting such discovery.166 The Court
found that in this case no such authoritative proof existed. Rather, the
ICSID Tribunal had expressed concern for the maintenance of its control
of the arbitration proceedings but had declined to order Caratube to cease
and desist from pursuing this petition, and it reserved judgment on whether
it would accept as evidence documents obtained through this section 1782
proceeding.167
Analyzing the nature of the ICSID Tribunal and the character of its
proceedings, the Court found that in this case the ICSID Tribunal had put in
place a detailed schedule governing the arbitration proceedings more than
one year before Caratube made its Section 1782 application, and that discovery
between the parties was to close less than one month thereafter.168
The Court also found that the evidence before it suggested that Caratube
was attempting to circumvent the ICSID Tribunals control of the arbitrations
procedures.169 Moreover, the Court found that under ICSID Arbitration Rule
43 and the IBA Rules on the Taking of Evidence in International Commercial
Arbitration, which the parties and the ICSID Tribunal had agreed should
guide the discovery process in the arbitration, enabled the ICSID Tribunal
on its own to seek discovery assistance under Section 1782.170 However, by
unilaterally filing this petition, Caratube has side-stepped these guidelines, and
163
Id. at *15.
164
In re Application of Caratube Intl Oil Co., 730 F.Supp.2d 101 (D.D.C. 2010).
165
Id. at 105.
166
Id. at 106.
167
Id.
168
Id.
169
Id. at 107.
170
Id. at 108.
has thus undermined the Tribunals control over the discovery process.171 For
all of these reasons, the Court declined to issue a discovery order under Section
1782.172
CONCLUSION
How great then is the risk that a State court will intervene during the course
of an arbitration? With ICC and AAA/ICDR arbitration, the risk varies with the
jurisdiction that is the situs of the arbitration. For this reason, it is important,
when selecting the arbitral situs, to review its law and, on this basis, to assess
the extent to which courts will intervene. With ICSID arbitration, however, the
risk of State court intervention is limited or non-existent.
171
Id.
172
Id. at 10809.

Court Intervention in International Arbitration PDF

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Court Intervention in International Arbitration PDF

Uploaded by

Copyright:

Available Formats

State Court Intervention

Carolyn B. Lamm & Eckhard R. Hellbeck**

Various instances exist in which parties may resort to State

Exclusivity of ICSID arbitration as a remedy; and

Compelling arbitration (I);

Under the New York Convention,

The court of a Contracting State, when seized of an action in a matter

Under the FAA,

A party aggrieved by the alleged failure, neglect, or refusal of another

if one party to a contract containing an arbitration clause attempts

A. AAA/ICDR and ICC Arbitration

As Professor Schreuer explains, ICSID arbitral proceedings are intended to

The [ICSID] Convention provides for an elaborate process designed

Thus, for example, where a party to an ICSID arbitration fails to cooperate

Within the scope of the [ICSID] Convention, domestic courts

As Delaume further explained, the rule of abstention means that no

International Nominees Establishment (MINE) and the Republic of Guinea,

II. OBTAINING AN ANTI-SUIT INJUNCTION

Anti-suit injunctions in aid of international arbitration are plainly intended

A. AAA/ICDR and ICC Arbitration

In deciding whether to issue anti-suit injunctions to protect an arbitral

jurisdictions. As a threshold requirement, the parties and the disputed issues

Karaha Bodas Appeal, supra note 49, at 364.

Under the ICSID Convention, consent to ICSID arbitration makes

III. ENJOINING THE OPPOSITE PARTY FROM

As the above-mentioned cases illustrate, there is a strong presumption in

ICSID Convention, supra note 2, art. 26.

Id. art. 41.

legal systems. As a general rule, arbitration agreements will be upheld and

A. AAA/ICDR and ICC Arbitration

A stark example of a partys resort to State courts to interfere with an

Id. para. 50.

Id. para. 155.

Ecuador on the basis of the U.S.Ecuador Bilateral Investment Treaty. As the

The explicitly stated purposes of the treaty were to encourage investment

Finding that Chevrons Notice of BIT Arbitration presented at least one

IV. CHALLENGING AN ARBITRATOR

Commentators suggest that arbitrator challenges have been increasing over

Under Article 14(1) of the ICSID Convention, an arbitrator must be of

if facts or circumstances exist, or have arisen since the appointment,

As the IBA Working Group that drafted the Guidelines explained, a

In Alpha Projektholding v. Ukraine, Ukraine challenged the Claimant-

B. AAA/ICDR and ICC Arbitration

Under Article 7.1 of the ICC Rules of Arbitration, an arbitrator must be

Proposal (Mar. 19, 2010).

opposite position on that issue in the instant arbitration. Ghanas subsequent

V. ENFORCING TRIBUNAL-ORDERED PROVISIONAL

Differences also exist in State court enforcement of tribunal-ordered

A. The Arbitral Tribunals Power to Issue Provisional Measures

Id. para. 3.1.2.

Nurdin Jivraj v. Sadruddin Hashwani, [2010] EWCA Civ 712.

1. International arbitration conventions, including the New York

1. ICSID arbitration, by virtue of its international character, operates

B. Enforcement of Tribunal-Ordered Provisional Measures in the United States

International arbitration in the United States is controlled by the FAA, which

1. The Scope of an Arbitral Tribunals Authority to Award Provisional

2. The Power of a U.S. Court to Review Tribunal-Ordered Provisional

Section 10 of the FAA specifically permits enforcement only of final

3. Whether Court Review and Enforcement of Tribunal-Ordered Provisional

The standard for judicial review of an arbitral tribunals award of provisional

VI. OBTAINING COURT-ORDERED DISCOVERY IN

(1) The person from whom discovery is sought resides or is found

(1) Whether the material sought is within the foreign tribunals