China National Chartering, Corp. v. Pactrans Air & Sea, Inc.

Filing 63

MEMORANDUM OPINION signed by the Honorable Charles P. Kocoras on 12/6/2012.Mailed notice(sct, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
CHINA NATIONAL CHARTERING, CORP.,
Plaintiff,
vs.
PACTRANS AIR & SEA, INC.,
Defendant.

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09 C 7629

MEMORANDUM OPINION
CHARLES P. KOCORAS, District Judge;
This matter comes before the Court on Plaintiff China National Chartering
Corp.’s (“China National”) petition for recognition and confirmation of a foreign
arbitration award against the Defendant, Pactrans Air & Sea, Inc. (“Pactrans”). China
National also moves for an award of attorneys’ fees against Pactrans and seeks the entry
of a final judgment against Pactrans pursuant to Federal Rule of Civil Procedure Rule
54(b). For the reasons set forth below, the foreign arbitrational award is confirmed, the
Court grants an award of reasonable attorneys’ fees and final judgment is entered.
BACKGROUND
In 2006, Devon International Trading Inc. (“Devon”) retained Pactrans, as a
freight forwarder, to ship a load of gypsum wallboard from China to Pensacola, Florida.
Pactrans is an international importer/exporter with its primary place of business located

in Bensenville, IL and branch offices located in Beijing, Tianjin, Dongguan, and
Qingdao, in the People’s Republic of China (“PRC”). Acting as Devon’s agent,
Pactrans chartered the ship M/V SANKO RALLY from China National to transport the
cargo.

China National is an international shipping company which ships cargo

throughout the world. On April 24, 2006, Pactrans and China National signed a
Uniform General Charter Agreement (“Charter Agreement”) securing China National’s
shipping vessel for the transportation of the wallboard. The Charter Agreement
included a provision for the arbitration of disputes arising from the Charter Agreement
to take place in Beijing, China. When the shipment of wallboard arrived in Pensacola
in June 2006, an inspection of the cargo revealed that it had been damaged during
transport.
A prolonged series of litigation ensued. In November 2006, China National filed
suit in the Southern District of New York seeking the pre-judgment attachment of
Pactrans’s assets to resolve its demurrage claim. China Nat. Chartering Corp. v.
Pactrans Air & Sea, Inc., 2009 WL 3805596 (S.D.N.Y. Nov. 13, 2009).
While the Southern District of New York suit was pending in the United States,
China National pursued the arbitration of its demurrage claims against Pactrans in
Beijing, China. In February 2009, China National and Pactrans appeared before the
China Maritime Arbitration Commission (“CMAC”) to arbitrate China National’s

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demurrage charge. On March 31, 2009 the CMAC found in favor of China National
issuing an award of $543,814.74, plus attorney and handling fees totaling $105,056.41
and arbitration costs of $8,575.53.
Pursuant to the procedures of PRC Arbitration Law, on August 7, 2009, Pactrans
appealed the CMAC arbitration award to the Tianjin Maritime Court. Pactrans raised
a multitude of procedural and substantive legal issues challenging the CMAC award.
On October 14, 2009, the Tianjin Maritime Court affirmed the CMAC award and
thoroughly addressed the reasoning for its decision. China National then sought the
recognition and enforcement of the CMAC award in the Southern District of New York.
Id. On November 13, 2009, the district court for the Southern District of New York
confirmed the foreign arbitration award, and awarded judgment in the amount of the
CMAC award. Id. Pactrans appealed the district court’s determination of personal
jurisdiction in the matter to the Second Circuit Court of Appeals.
On December 8, 2009, China National filed a petition for the recognition of a
foreign arbitration award with this Court.1 This Court stayed the case pending the
resolution of Pactrans’s appeal to the Second Circuit. China Nat. Chartering Corp. v.

1

China National’s petition correctly states the proper name for this Court in the Heading
portion. However it appears that the substantive pleading section of the motion was previously used
for China National’s petition in the Southern District of New York, without changing the court’s
name. Since the Heading portion of the petition correctly states the proper name for this Court, we
recognize China National’s intent to ask this District Court, in the Northern District of Illinois, to
grant its petition.
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Pactrans Air & Sea, Inc., 09-cv-7629, No. 30 (N.D. Ill. Jul. 13, 2010). On January 19,
2011, the Second Circuit determined that the maritime attachment of wire funds did not
provide the district court with personal jurisdiction over Pactrans.

China Nat.

Chartering Corp. v. Pactrans Air & Sea, Inc., 411 Fed. Appx. 370 (2nd Cir. 2011). The
district court for the Southern District of New York dismissed China National’s petition
to enforce the foreign arbitration award accordingly. China Nat. Chartering Corp. v.
Pactrans Air & Sea, Inc., 2012 WL 3101274 (S.D.N.Y. Jul. 31, 2012). On August 22,
2012, this Court lifted the stay of the case and further took under advisement the merits
of China National’s petition. China Nat., 09-cv-7629, No. 39 (N.D. Ill. Aug. 22, 2012).
The parties have completed briefing and the issues are ripe for decision.
LEGAL STANDARD
Confirmation of foreign arbitration awards are governed by the Convention on
Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the
New York Convention (“Convention”). See Slaney v. The Intern. Amateur Athletic
Federation, 244 F.3d 580, 588 (7th Cir. 2001). The requirements of the Convention
were incorporated into federal law in Chapter 2 of the Federal Arbitration Act (“FAA”).
9 U.S.C. § 201, et seq. “The goal of the Convention, and the principal purpose
underlying American adoption and implementation of it, was to encourage the
recognition and enforcement of commercial arbitration agreements in international

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contracts and to unify the standards by which agreements to arbitrate are observed and
arbitral awards are enforced in the signatory countries.” Scherk v. Alberto-Culver Co.,
417 U.S. 506, 520 n.15 (1974).
Under 9 U.S.C. § 207, within three years after an award falling under the
Convention is made, “any party to the arbitration may apply to any court having
jurisdiction under this chapter for an order confirming the award as against any other
party to the arbitration. The court shall confirm the award unless it finds one of the
grounds for refusal or deferral of recognition or enforcement of the award specified in
the said Convention.” 9 U.S.C. § 207.
Comporting with the deference accorded to foreign arbitral awards, Article 5 of
the Convention enumerates seven narrow grounds which can serve as the basis for a
courts refusal to recognize and enforce a foreign arbitration award. See Slaney, 244
F.3d at 588. Pactrans opposes confirmation of the foreign arbitration award and argues
that Article 5 bars enforcement based on 1) the invalidity of the arbitration agreement,
2) its lack of ability to present its case, 3) the failure of the arbitration panel to follow
the applicable law, and 4) recognition of the arbitration award would be against the
public policy of the United States. The Court will address each in turn.

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DISCUSSION
I. Validity of Arbitration Agreement
Pactrans first contends that the arbitration provision contained in the Charter
Agreement did not conform with the requirements of a valid arbitration agreement
under PRC Arbitration Law. This failure Pactrans argues, means that the CMAC did
not have jurisdiction to arbitrate the disputed claims, and consequently under Article
5(1)(a) the enforcement of the award must be denied. Article 5(1)(a) provides that
“recognition and enforcement of the award may be refused if the competent authority
in the country where recognition and enforcement is sought finds that . . . the
[arbitration] agreement is not valid under the law to which the parties subjected it to or
. . . under the law of the country where the award was made.” (Convention, Art.
5(1)(a)).
Pactrans raises three grounds challenging the validity of the CMAC’s jurisdiction
over the arbitration proceeding. Pactrans argues that the Charter Agreement failed to
meet the requirements of a valid arbitration agreement by: 1) failing to specify the
matters to be arbitrated, 2) failing to state the applicable law to be applied, and
3) failing to set forth the appropriate Arbitration Commission to conduct the arbitration.
Under PRC Arbitration Law, a valid arbitration agreement must contain: 1) the assent
of the parties to arbitrate their claims, 2) the matters to be arbitrated, 3) the Arbitration

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Commission selected by the parties. Article 16 Chapter III, Arbitration Law of the PRC,
Adopted 1994.
Before we examine the contract, the Court recognizes “[t]he preeminent concern
of Congress in passing the [Arbitration] Act was to enforce private agreements into
which parties had entered, a consideration which requires that we rigorously enforce
agreements to arbitrate.” Dean Witter Reynolds Inc. v. Byrd, 470 U.S. 213, 221 (1985).
When parties agree to have their disputes resolved through arbitration, they also agree
to accept the arbitrator’s view of the facts and the meaning of the contract. See United
Paperworkers Int’l. Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 37-38 (1987). In
interpreting a contract the court’s primary objective is to effectuate the intent of the
parties from the plain language of the agreement. See, e.g., Church v. General Motors
Corp., 74 F.3d 795, 798 (7th Cir. 1996).
A. Matters to be Arbitrated
Pactrans argues that the Charter Agreement did not adequately specify the
matters which could be brought to arbitration. In box 25 of the Charter Agreement,
within the Law and Arbitration section the contract states: “Arbitration in Beijing,
China.” The Charter Agreement provides that if the location of the arbitration is given,
as in this case, then the provisions of 19(c) apply. Charter Agreement provision 19(c)
states that; “[a]ny dispute arising out of this Charter [Agreement] shall be referred to

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arbitration at the place indicated in box 25, subject to the procedures applicable there.
The laws of the place indicated in box 25 shall govern this Charter [Agreement].”
The Charter Agreement clearly indicates that the parties intended to submit their
claims to arbitration in Beijing, China. In choosing the location of the arbitration
proceeding, the parties assented to the provisions of section 19(c). Section 19(c) clearly
states that any matter arising out of the Charter Agreement is subject to arbitration. In
this case, the heart of the CMAC arbitration proceeding dealt with resolving which
party would be responsible for incurring the demurrage costs, laid out in the Charter
Agreement. Due to the specificity of the matters which encompass the arbitration
agreement the Court finds that the arbitration agreement satisfies the “matters to be
arbitrated” requirement for a valid arbitration agreement under PRC law. Article 16,
Arbitration Law of PRC.
B. Applicable Arbitration Law
Pactrans argues that English Arbitration Law should have governed the
arbitration dispute, as opposed to PRC Arbitration Law. Pactrans’s contention is
without support or merit. As indicated above, the Charter Agreement section 19(c)
states that the applicable law of the location indicated on the form, Beijing, China,
would be applied to any arbitration proceeding. According to the language of the

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Charter Agreement the CMAC correctly applied PRC Arbitration Law, which is the law
which governs arbitration disputes in Beijing, China.
C. Arbitration Commission
Pactrans asserts that the failure of the Charter Agreement to include the
appropriate Arbitration Commission results in an incomplete arbitration agreement
under PRC law. Pactrans relies on Article 18 of the PRC Arbitration Law which states
in pertinent part that if the agreement is not clear about the selection of the Arbitration
Commission and the parties have failed to reach a supplemental agreement then the
arbitration agreement shall be invalid. Article 18 Chapter III, Arbitration Law of the
PRC, Adopted 1994.
The evidence in the record prominently shows that Pactrans assented to the
CMAC arbitration. “If a party willingly and without reservation allows an issue to be
submitted to arbitration, he cannot await the outcome and then later argue that the
arbitrator lacked authority to decide the matter.” AGCO Corp. v. Anglin, 216 F.3d 589,
593 (7th Cir. 2000). On August 8, 2007, Pactrans’s attorney sent a letter to China
National stating, “[w]e are counsel for Pactrans and on behalf of our client, confirm
agreement to arbitration of demurrage claims before CMAC.” Pactrans’s assent to
arbitrate its claims before the CMAC cannot be reconciled with its current challenge to
the validity of the arbitration agreement. Pactrans’s agreement to arbitrate its dispute

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before the CMAC constituted a supplemental agreement which properly established the
CMAC as the Arbitration Commission to hear the case.
For the aforementioned reasons the Charter Agreement constituted an enforceable
arbitration agreement under PRC Arbitration Law and therefore was properly before the
CMAC to arbitrate the dispute.
II. Ability to Present Case
Pactrans contends that the CMAC limited Pactrans’s ability to introduce evidence
and cross examine witnesses which resulted in a denial of Pactrans’s fundamental right
to due process. Under Article 5(1)(b) of the Convention, proof that a party was “unable
to present his case” constitutes a proper defense. (Convention, Art. 5(1)(b)). The
application of this defense corresponds to the due process defense that a party was not
given the opportunity to be heard at a meaningful time and in a meaningful manner as
defined in

Mathews v. Eldridge, 424 U.S. 319, 333 (1976). Generica Ltd. v.

Pharmaceutical Basics, Inc., 125 F.3d 1123, 1129 (7th Cir. 1997). An arbitral award
should not be enforced if Pactrans proves that they were not given a meaningful
opportunity to be heard, as due process jurisprudence defines it. Id. The arbitration
panel provides a fundamentally fair hearing if adequate notice is given, a hearing on the
evidence is provided, and the decision of the arbitrator is impartial. Id.

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A. Introduction of Evidence
Pactrans argues that during the arbitration proceeding, CMAC unfairly admitted
and considered all of the evidence submitted by China National and expressly refused
to consider the evidence tendered by Pactrans. Pactrans concludes that if its evidence
would have been considered the results of the arbitration proceeding would have been
different.
“Our judicial system is not meant to provide a second bite of the apple for those
who have sought adjudication of their disputes in other forums and are not content with
the resolution they have received.” Slaney, 244 F.3d at 581. The Supreme Court has
noted that “[a]rbitrators are not bound by the rules of evidence.” Bernhardt v.
Polygraphic Co., 350 U.S. 198, 203-04 n.4 (1956). Nor are arbitrators required to hear
all of the evidence tendered by the parties.

Hoteles Condado Beach v. Union

De Tronquistas, 763 F.2d 34, 39 (1st Cir. 1985). District courts do not sit to hear claims
of factual or legal error by an arbitrator as an appellate court does in reviewing
decisions of lower courts. See United Paperworks, 484 U.S. at 37-38.
Pactrans mainly cites its failed attempts to admit several substantive emails
between the parties, which allegedly establish a defense to China National’s claim. The
CMAC award opinion provided a detailed description of the evidence offered by China
National and Pactrans in conjunction with a description of what each piece of evidence

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sought to prove. Additionally the CMAC ruling contains arguments for and against the
admission of the evidence and finally the CMAC’s decision on the evidence. The
CMAC thoroughly reviewed the admissibility of each piece of evidence and reached a
conclusion based on the application of PRC Arbitration Law. Ultimately the arbitration
panel determined that some of the evidence submitted by Pactrans was not credible and
expressed their doubts concerning the authenticity, legality, and relevance to the case.
Contrary to Pactrans’s assertion, they were able to submit their evidence to the
CMAC for consideration. Pactrans submitted its evidence to the CMAC which had the
duty to weigh the credibility and relevance of the evidence to assess its importance in
reaching a final decision. Although the final determinations on the value of the
submitted evidence did not yield a positive result for Pactrans, the CMAC did take the
evidence into consideration. Pactrans has not pointed to a single instance where the
evidentiary ruling of the CMAC failed to comport with the standards of due process.
Pactrans is not able to sustain a due process claim based on their lack of opportunity to
submit evidence.
B. Cross Examination
Pactrans contends that the CMAC unjustly suppressed its right to cross examine
witnesses, which interfered with their ability to present their case. However, a review
of the record shows that no oral witness testimony was offered during the arbitration

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proceeding. Pactrans does not point to a single instance when they attempted to cross
examine a witness and was prevented from doing so. Without substantive examples
establishing their assertion, Pactrans’s complaint alleging a prohibition on cross
examination is not persuasive when countered with the evidence establishing a complete
lack of testimony. For the aforementioned reasons the Court finds that the CMAC did
not prevent Pactrans from cross examining witnesses and presenting its case. A review
of the CMAC proceeding makes it clear that Pactrans was afforded all the process that
it was due.
III. In Accordance with the Laws of the Arbitration Forum
Pactrans asserts that the CMAC failed to follow PRC Arbitration Law. Article
5(1)(d) provides a defense against enforcement if the procedures employed by the
arbitration panel were not in “accordance with the law of the country where the
arbitration took place.” (Convention, Art. 5(1)(d)). Pactrans highlights several rulings
which they assert were contrary to the law of the PRC. First, Pactrans claims that the
CMAC awarded attorney and handling fees in excess of what PRC Arbitration Law
allows. Second, Pactrans states that they were prejudiced by the incorrect Notification
of Arbitration they received from the CMAC. Finally, Pactrans argues that the CMAC
impermissibly allowed China National to be represented by an attorney who was not
permitted to practice before the CMAC.

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A. Fees Awarded
Pactrans asserts that the CMAC panel did not follow CMAC Arbitration Law
when it calculated the award for attorney and handling fees. CMAC Arbitration Article
66 allows for the losing party to pay for expenses “incurred by the winning party in
dealing with the case.” Article 66 Chapter II, CMAC Arbitration Rules, Adopted 2004.
However, Rule 66 caps the potential award at 10% of the total amount awarded to the
winning party. Id. The CMAC awarded China National $543,814.74 for the demurrage
charge claim. Pactrans asserts that the attorney and handling fee award in the amount
of $105,056.41 was above the statutory maximum allowable by CMAC Arbitration Law
Rule 66. China National argues that Pactrans waived its argument concerning the
CMAC’s calculation of attorney and handling fees when they failed to raise it with the
CMAC panel and the Tainjin Maritime Court.
Generally, waiver is “the intentional relinquishment of a known right.” SethnessGreenleaf, Inc. v. Green River Corp., 65 F.3d 64, 67 (7th Cir. 1995). Waiver of a
contractual right can be express or implied from actions taken which are inconsistent
with the assertion of a right. Cent. States, Se. and Sw. Areas Pension Fund v. Schilli
Corp., 420 F.3d 663, 672 (7th Cir. 2005). “It is axiomatic that arguments not raised
below are waived on appeal.” Keene Corp. v. International Fidelity Ins. Co., 736 F.2d
388, 393 (7th Cir. 1984).

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CMAC Arbitration Article 68 permits either party to request the CMAC to
review any “writing, typing, calculating, and similar errors contained in the award
within 30 days from the date of receipt of the award.” Article 68 Chapter II, CMAC
Arbitration Rules, Adopted 2004. Pactrans did not submit a request for the CMAC to
review the calculation of fees, and likewise Pactrans failed to challenge the calculation
of fees with the Tainjin Maritime Court. Because Pactrans chose to omit its challenge
to the attorney and handling fees award from the CMAC and the Tainjin Maritime
Court, their claim is implicitly waived. See Winforge, Inc. v. Coachment Industries,
Inc., 691 F.3d 856, 872 (7th Cir. 2012) (explaining that waiver applies where a party
voluntarily or intentionally relinquishes a known right).
B. Notification of Arbitration Proceeding
Pactrans argues that the Notice of Arbitration sent to them by the CMAC was
defective and prejudiced the preparation of their defense. Pactrans points to the fact
that the original Notice of Arbitration stated the arbitration was a domestic case and the
applicable law to be applied was China International Economic and Trade Arbitration
Regulations, as opposed to Chinese Maritime Arbitration Law.
Pactrans fails to specify how it was prejudiced by the incorrect Notice of
Arbitration. The record indicates that the misprint was limited to the Chinese language
portion of the Notice of Arbitration. The English version of the Notice of Arbitration
correctly stated the appropriate case classification and applicable arbitration law.
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Finally the record shows that at the initial arbitration proceeding Pactrans raised the
issue involving the incorrect Notification of Arbitration. The CMAC cured any potential
damage by adjourning and rescheduling the hearing for a later date. The Court finds
that Pactrans was not prejudiced in the preparation of its defense.
C. Presence of Attorney During Proceeding
Pactrans contends that the CMAC wrongfully allowed China National to be
represented by Lianjun Li (“Li”), of the Hong Kong law firm Richards Butler, who was
not permitted to practice in mainland China. Pactrans asserts that China National’s
representative was acting as an attorney, as opposed to an authorized agent, which was
impermissible under CMAC Arbitration Law.
Article 21 of the CMAC Arbitration Rules allows parties to choose authorized
agents and authorized attorneys to deal with matters related to the arbitration
proceeding. Article 21 Chapter II, CMAC Arbitration Rules, Adopted 2004. When the
issue of China National’s representation was raised during the CMAC hearing, the panel
reasoned that Article 21 does not restrict an individual’s participation in the arbitration
proceeding based on his nationality being other than that of the PRC. The record
demonstrates that prior to the CMAC proceeding, Pactrans was asked if they objected
to Li’s presence and representation of China National, which they did not. Without an
objection from Pactrans the CMAC panel allowed Li to assist with the arbitration on
China National’s behalf. Additionally, China National was primarily represented by
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Henry Hai Li (‘Hai Li”), from a law firm based in Shenzhen, PRC. Li was supposed
to represent China National during the initial hearing, however it was postponed.
Thereafter Hai Li assumed the role of lead counsel throughout the rest of the arbitration
proceeding, with Li attending the remainder of the proceedings as a representative of
China National. In consideration of permissible allowance of representation contained
in Article 21 of the CMAC Arbitration Rules and Pactrans’s assent to Li’s presence,
Pactrans’s parsing of the type of representation Li was acting under is unconvincing.
IV. Public Policy
Pactrans lastly contends that a conflict of interest between the CMAC and China
National existed because both are controlled by the Chinese Government. Pactrans
argues this conflict of interest warrants the denial of the arbitration award on public
policy grounds, contained in Article 5(2)(b).

Article 5(2)(b) provides that,

“[r]ecognition and enforcement of an Arbitral Award may also be refused if the
competent authority in the country where recognition and enforcement is sought finds
that . . . the recognition or enforcement of the award would be contrary to public policy
of that country.” (Convention, Art. 5(2)(b)). The Convention’s public policy defense
has been narrowly construed to give effect to the Convention’s goal of encouraging the
timely and efficient enforcement of awards.

Slaney, 244 F.3d at 593 (citing

Fotochrome, Inc. v. Copal Co., Ltd., 517 F.2d 512, 516 (2d Cir. 1975)). As the Second
Circuit noted, “an expansive construction of this defense would vitiate the Convention’s
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basic effort to remove preexisting obstacles to enforcement.” Parsons & Whittemore
Overseas Co., Inc., v. Societe Generale De L’Industrie Du Papier (RAKTA), 508 F.2d
969, 973 (2d Cir. 1974).
Pactrans asserts that China National’s association with the Chinese Government
prohibited them from obtaining a fair hearing. Pactrans mainly supports its proposition
by pointing to the disparate results obtained between the contested Beijing CMAC
arbitration proceeding and a completely different CMAC arbitration proceeding in
Shanghai which Pactrans participated in. Pactrans claims that the Shanghai CMAC
arbitration proceeding which involved Pactrans and Devon, both U.S. companies, was
starkly different from the Beijing CMAC proceeding. In supporting their argument for
the bias of the Beijing CMAC proceeding, Pactrans merely restates all the
aforementioned issues at the heart of its argument against enforcement of the arbitration
award. As discussed above the procedures of the arbitration proceeding were conducted
in accordance with the terms of the Charter Agreement and PRC Arbitration Law. This
Court is mindful of its limited role in reviewing the Beijing CMAC arbitration award
and we decline the invitation to delve into a secondary Shanghai arbitration proceeding
conducted by a different arbitration panel, in a different location, concerning different
parties. The Court is not convinced that the procedures employed by the CMAC are
indicative of a biased proceeding to substantiate a disqualifying relationship.

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Absent support for its argument, the Court is left with Pactrans’s assertion that
China National’s involvement with the Chinese Government influenced the arbitration
proceeding. Pactrans has not provided sufficient evidence showing that a bias existed,
or that any such connection had a substantive effect on the arbitration proceeding.
Pactrans’s conclusory assertion does not amount to a disqualifying claim that would be
contrary to the public policy of this country.
V. Attorneys’ Fees
China National seeks an award of attorneys’ fees against Pactrans. China
National argues that Pactrans asserted misleading and groundless arguments in the
course of contesting the confirmation of the foreign arbitration award. Under the
American rule, a party must pay its own attorneys’ fees and expenses unless there is
express statutory authorization to the contrary. Fednav Intern. Ltd. v. Cont’l. Co., 624
F.3d 834, 838-39 (7th Cir. 2010).

However when a party acts, “in bad faith,

vexatiously, wantonly, or for oppressive reasons,” a court may award attorneys’ fees
under its inherent equitable powers. See F.D. Rich Co., Inc., v. United States, 417 U.S.
116, 129 (1974).
Pactrans has engaged in a prolonged struggle to contest the confirmation of the
foreign arbitration award. In the course of their pursuit, Pactrans has submitted baseless
and un-substantiated arguments to support their position.

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Pactrans’s arguments

concerning the appropriateness of the CMAC as the proper Arbitration Commission, its
lack of opportunity to cross examine witnesses, the prejudicial effect of the incorrect
Notification of Arbitration, the presence of a China National representative during the
arbitration proceeding, and the bias of the CMAC proceeding were submitted under the
guise of legitimacy, but lacked any meritorious foundation. The Court finds that an
award of reasonable attorney’s fees is warranted based on Pactrans’s submission of
baseless arguments which unnecessarily multiplied the proceedings.

The Court

encourages the parties to resolve the award of reasonable attorneys’ fees amongst
themselves, prior to submitting the allocation of fees to the Court’s discretion. The
Court does not find that punitive damages should be imposed.
VI. Motion for Final Judgment
China National moves the Court for entry of a final judgment against Pactrans
based on the Court’s confirmation of the arbitration award.

There are three

prerequisites to the entry of a judgment under Rule 54(b). First, the claim upon which
certification is sought must constitute a single “claim for relief.” See, e.g., Indiana
Harbor Belt R.R. Co. v. American Cyanamid Co., 860 F.2d 1441, 1444-45 (7th Cir.
1988). Second, the judgment entered on the claim must be final within the meaning of
28 U.S.C. § 1291. See United States v. Ettrick Wood Prod., Inc., 916 F.2d 1211, 1217
(7th Cir. 1990) (judgment is final when it resolves all claims against a particular party).
Finally, we must find that there is no just reason for delay, taking into consideration
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judicial efficiency and equity. Curtiss-Wrights Corp. v. General Elec. Co., 446 U.S. 1,
8 (1980) (Rule 54(b) determination based on “judicial administrative interests as well
as the equities involved.”).
The confirmation of the foreign arbitrational award resolves all claims brought
by China National in this action. A judgment in China National’s favor will also result
in the conservation of judicial resources and will not prejudice any party. The Court
finds that the judgment is final and there is no reason for delay and therefore grants final
judgment, in the amount of the total CMAC Arbitration Award, in favor of China
National against Pactrans pursuant to Rule 54(b).
CONCLUSION
For the reasons set forth above, China National’s petition for confirmation of the
foreign arbitration award is granted. China National’s request for attorneys’ fees is
granted. China National’s motion for entry of a final judgment is granted.

Charles P. Kocoras
United States District Judge
Dated: December 6, 2012

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