International Arbitration Team Achieves Victory for Turkish Construction Company as D.C. Federal Judge Issues $30MM Judgment Confirming Arbitral Award Against Libya

Early last month, U.S. District Judge Jia M. Cobb (District of Columbia) confirmed an arbitral award against Libya on behalf of firm client Etrak, a Turkish construction company, in a dispute arising from Libya’s failure to pay under a settlement agreement it entered with Etrak. Libya opposed confirmation, arguing that the case should be stayed during parallel enforcement proceedings in Turkey and Curaçao, and that the Award was invalid in any case. Judge Cobb disagreed and issued an order denying the stay and confirming the Award. Read more on Law360.com.

In her ruling, Judge Cobb concluded that the New York Convention permitted a stay of confirmation proceedings only during the pendency of any set aside proceeding or appeal of the Award in the jurisdiction it was made. Thus, because Libya’s set aside proceeding in Switzerland—the seat of the Arbitration—was concluded and in Etrak’s favor, the Court denied the stay.

Judge Cobb went on to reject Libya’s arguments against confirming the Award. Libya primarily argued the Award was contrary to the public policy of res judicata, because—as a defensive strategy in the arbitration—Libya had obtained a domestic court judgment finding the settlement agreement invalid. After first noting that Libya could point to no opinion denying confirmation due to the “public policy” of res judicata, Judge Cobb went on to reject the argument on the facts. She determined that the claims were not the same in the two proceedings, and, moreover, the Swiss court overseeing Libya’s failed set aside proceeding had already determined that Libya’s domestic proceeding did not undermine the Award. Libya’s attempts to seek reconsideration of such determination before Judge Cobb was itself in violation of res judicata principles. Judge Cobb went on to confirm the Award and issue judgment in Etrak’s favor in the amount of USD 30,128,994.40, plus post-judgment interest.

“Etrak is pleased that the district court has confirmed its award in all respects and looks forward now to vigorously pursuing all avenues available domestically in the United States to fulfill the terms of the award,” said Fishman Haygood partner Benjamin Reichard, who leads the firm’s International Arbitration team and serves as lead counsel to Etrak. Also representing the claimant were Fishman Haygood attorneys Jim Swanson and Molly Wells.

Fishman Haygood’s International Arbitration team handles a number of disputes arising under bilateral investment treaties (“BIT”s). Sovereign nations enter BITs to protect investors of their country who make investments in their partner country under the treaty. In such matters, the firm represents claimant construction companies in confidential arbitrations against respondent sovereign nations who expropriated or otherwise impaired the claimant’s investment within respondent’s borders in violation of the applicable BIT.

Click here to read more about the firm’s International Arbitration team.