Alstom Brasil Energia E Transporte LTDA et al v. Mitsui Sumitomo Seguros S.A.

Filing 32

ORDER AND OPINION CONFIRMING ARBITRATION AWARD re: 12 MOTION to Dismiss Petition To Confirm Arbitration Award filed by Mitsui Sumitomo Seguros S.A.: Mitsui's motion to dismiss the petition is DENIED. Alstom's petition to confirm the arbitration award is GRANTED. The Clerk shall mark document number 12 terminated, enter judgment in favor of Alstom confirming the Final Award dated July 10, 2015, and mark the case closed. (Signed by Judge Alvin K. Hellerstein on 6/20/2016) (tn)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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)(

ALSTOM BRASIL ENERGIA E TRANSPORTE
LTDA., ALSTOM POWER, INC.,

ORDER AND OPINION
CONFIRMING ARBITRATION
AWARD

PETITIONERS,
-against-

15 Civ.

82~ 1 (AKH)

MITSUI SUMITOMO SEGUROS S.A.,
RESPONDENT.

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)(

ALVIN K. HELLERSTEIN, U.S.D.J.:
When an insurer indemnifies its insured and sues the party believed to have
caused the damage that the insurer indemnified, what is the source of the insurer's right to sue?
If a supplier's product caused that damage, is it the supply contract between the insured and the

supplier? And if a clause in that contract provides that disputes be arbitrated, is that clause
binding on the insurer, or may the insurer disregard that clause and claim all other contract rights
that the insured had against its supplier?
These are the questions raised by the motions before me: petitioners' motion to
confirm the arbitration award in its favor, and respondent's motion to dismiss the petition for
lack of jurisdiction. For the reasons stated in this opinion, I grant petitioners' motion, and deny
respondent's motion.
I.

Factual Background

A. The Parties

Petitioners, Alstom Power, Inc. and Alstom Brasil Energia e Transporte Ltda.

("Alstom Power" for the former, "Alstom Brasil" for the latter, and "Alstom" for both) are
corporations incorporated in Delaware and Brazil, respectively. Alstom Brasil provides power

generation equipment and services to companies in Brazil. Alstom Power has its principal place
of business in Windsor, Connecticut, and provides power generation-related services around the
world.
Mitsui Sumitomo Seguros S.A. ("Mitsui") is an insurance company incorporated
in Brazil. It is a subsidiary of the Japanese company, Mitsui Sumitomo Insurance Group, which,
through many subsidiary and affiliated companies, provides a variety of insurance products, in
the United States and many other countries.
Alumina do Norte do Brasil S.A. ("Alunorte''), although not a party to this action, is
nevertheless significant to these proceedings. Alunorte 's facility in Barcarena, Brazil, is an
aluminum refiner. Pursuant to a supply contract with Alunorte, Alstom sold and delivered two
steam generation units to be installed in that facility. In August of 2007, Alunorte had to shut
down the facility because of ruptures in the specialized aluminum tubing ("Freeboard Tubes"),
that was a component part of the steam generation units supplied by Alstom. In September of
2007, as Alunorte restarted the facility, a fire began because of debris in the steam generation
system. Both incidents caused substantial property damage and lost profits. After the incidents,
on July 20, 2009, Alunorte and Alstom entered into an additional compromise agreement, a
"Certificate of Conclusion and Final Receipt," under which each party confirmed that the other
had complied with its contractual obligations, and released the other party from all actual or
potential claims through that date. Dkt. No. 6(10), Arbitration Award,

~89,

at p. 25.

Alunorte also made claim against Mitsui to recover its property and profit losses
under the insurance and indemnity contract granted by Mitsui for the year between February 5,
2007 and February 5, 2008. Mitsui settled the claim by paying Alunorte $ 24,558,073.11.
On April 15, 2014, Mitsui sued Alstom in the Brazilian courts, in Rio de Janeiro,
to recover its indemnity payment to Alunorte. Alstom served a Demand for Arbitration with
2

'l

Mitsui, on December 9, 2014, before the International Chamber of Commerce in New York City
("ICC"), thus invoking the arbitration clause of the Alstom-Alunorte ·supply contract, clause
24.1. Alstom moved to dismiss Mitsui's lawsuit in the Brazilian courts. Mitsui entered a special
appearance in the arbitration, contesting the jurisdiction of the arbitration tribunal. On February
5, 2015, the Secretariat of the ICC advised the parties that the ICC court had issued its decision,
under Articles 6(3) and 6(4) of the ICC rules, holding that the arbitration would proceed in New
York. These ICC rules are discussed further below, see irifra p. 5.
The arbitration hearings were held May 18 - 19, 2015. On July 10, 2015, the
arbitrators issued their Award, holding that the tribunal had jurisdiction over the parties and to
hear and to decide the dispute, that under both Brazilian law and under federal common law or
New York law, Mitsui was bound by the arbitration agreements set out in clause 24. l of the
contract between Alunorte and Alstom, and bound also by the release given by Alunorte to
Alstom; and that Mitsui could not sue Alstom in the courts of Brazil. It dismissed Mitsui' s claim
against Alstom, and the counterclaim of Alstom for damages, and held that each party was to bear its
own costs. See Dkt. Nos. 6(11)-(12), Arbitration Award, f,fl 255, 418-24, at pp. 62-63, 95.
Alstom petitioned to confirm the award in the Supreme Court of the State of New
York, New York County on August 6, 2015. NY CPLR § 7510. Mitsui timely removed the action
to this court. See 9 U.S.C. §§ 201, 203, 205 (Federal Arbitration Act ("FAA"), implementing the
Convention on the Recognition and Enforcement of Foreign Arbitral Awards ("New York
Convention")). Mitsui then filed a motion to dismiss Alstom's petition, arguing that Mitsui was not a
party to, and was not bound by, the arbitration agreement, that this court lacks personal jurisdiction,
and that the petition should be dismissed for forum non conveniens.

3

B. The Relevant Clauses of the Supply and Insurance Contracts
Clause 24.1 of the A1stom-A1unorte supply contract provides that
"disagreements ... that cannot be amicably settled" are to be arbitrated. It states:
The disagreements and casus omissus arising under 1 this contract that
cannot be amicably settled by the good faith negotiation of the parties, ...
shall be submitted to the arbitral court ....
Dkt. No. 20(2), p. 15. Clause 24.l(d) provides the site of arbitration (New York City),
its nature (the ICC), and the rules that will govern (ICC Rules).
The Arbitral Court ... shall conduct the arbitration according to the Rules
of the International Chamber of Commerce (ICC) at a site in New York
City, New York, USA.
Id Clause 24.1 (g) provides the law to govern the arbitrators:

Any decision or award of the arbitrators shall be based solely on the
Articles of this Agreement. If the subject matter for the decision or award
is not provided for in such Articles, it shall be based on the law of Brasil,
but only to the extent such law is consistent with the Articles of this
Agreement.
Id. at p. 16. Clause 10 of Mitsui' s Insurance Agreement with Alunorte provides

subrogation rights to Mitsui against third parties "whose acts or deeds ... cause[ d] the
indemnified damage." It states:
I. The Insurer, once the indemnity of the loss has been paid, will be
subrogated, up to the fulfillment of this indemnity, to the Insured's
rights and actions against third parties whose acts or deeds have led to
the cause of the indemnified damage, being able to demand from the
Insured, at any time, the assignment agreement and the appropriate
documents for the exercise of these rights.
2. The Insured cannot carry out any act which prejudices the Insurer's
right of subrogation or come to an agreement or settle with third
parties responsible for the loss, except with previous and express
authority from the Insurer.

1

The arbitrators corrected the parties' "free'' interpretation. The "correct translation," they held, was "arising from,"
or "originating in or out of," or "resulting from," or "derived from." Dkt. No. 6(10), Arbitration Award, ill 30, at
p 36. Mitsui had argued that its claim did not arise under the contract, but by operation oflaw.

4

,,

Dkt. No. 6( 10), Arbitration Award, ~85, at p.24.

II.

Discussion
A. Mitsui's Obligation to Arbitrate the Dispute with Alstom

Customarily, the question of a dispute's arbitrability is for the court, except if the
parties have agreed to submit that question to the arbitrators. First Options of Chicago, Inc. v.

Kaplan, 514 U.S. 938, 944 (1995). And, "a court must defer to an arbitrator's arbitrability
decision when the parties submitted that matter to arbitration." Id
Here, Mitsui made a special appearance to challenge the jurisdiction of the ICC
arbitration tribunal over it. Under the ICC's rules of arbitration, the ICC secretariat can refer a
question of jurisdiction either to the arbitration tribunal, or to the ICC International Court of
2

Arbitration. See ICC Rules, Art. 6(3) ("any question of jurisdiction or. of whether the claims
may be determined together in that arbitration shall be decided directly by the arbitral tribunal,
unless the Secretary General refers the matter to the Court for its decision"); Art. 6(4) ("In all
cases referred to the Court under Article 6(3), the Court shall decide whether and to what extent
the arbitration shall proceed. The arbitration shall proceed if and to the extent that the Court is
prima facie satisfied that an arbitration agreement under the Rules may exist."). The arbitrators
were given that issue, and held that since Alunorte had the obligation to arbitrate disputes with
Alstom, Mitsui, as subrogee of Alunorte, had the same obligation. Pursuant to the choice of law
clause of the Alunorte-Alstom supply contract, the arbitrators applied Brazilian law as to the
nature of the subrogation right, and held:
Article 786 of the Brazilian Civil Code (and Clauses IO and 15 of the
Mitsui Policy) thus clearly lay down the rule that the insurer, upon
payment of the indemnity, subrogates into the rights and actions which the
insured had against the third party. The rights and actions transferred
from the insured to the insurer are the same rights and act!ons, and the
2

The International Court of Arbitration of the ICC is its "independent arbitration body." ICC Rules, Art. 1(1). The
Court does not itselfresolve disputes, but administers the resolution of disputes by arbitral disputes. Id, Art. 1(2).

5

same nature of rights and actions the insured had, and only those rights
and actions.
Dkt. No. 6(11), Arbitration Award, ill 78, at p. 47. Quoting from one ofMitsui's experts, the
arbitration tribunal emphasized:
[T]he insured's rights and actions against the third party are, by mere
operation of law (ipso jure) transferred to the insurer.

Id at ~179. And it does not matter if the transferred rights sound in tort or contract. "[W]hether
contractual or legal," whether rights and actions are transferred by the insurance contract or by
operation of law, "subrogation under Brazilian law entails that the insurer is subrogated into
whatever rights and actions the insured had in the first place. Id at ~i 80.
Mitsui takes issue with this conclusion of the arbitrators and argues that this court
should determine if Mitsui is bound by Alstom's and Alunorte's agreement to arbitrate disputes
between them, and not give deference to the arbitration panel's determination. Mitsui argues that
since the Alunorte-Alstom supply contract was made in Brazil and to be performed in Brazil, and
since Mitsui's insurance agreement with Alunorte was also made and performed in Brazil,
Brazilian law should control. Mitsui argues that under Brazilian case law, since Mitsui was not a
party to the contract between Alunorte and Alstom, it should not be bound by their agreement.
Because Mitsui, a non-signatory to the arbitration agreement, "did not clearly
agree to submit the question of arbitrability to arbitration," the question of whether they are
bound to the arbitration provision is subject to "independent review." First Options, 514 U.S. at
947. No deference is due on this issue to the determination of the arbitrators as to whether
Mitsui was within its jurisdiction. "[A]rbitration is a matter of contract and a party cannot be
required to submit to arbitration any dispute which he has not agreed so to submit," Republic of

Ecuador v. Chevron Corp., 638 F.3d 384, 392 (2d Cir. 2011) (quoting AT & T Techs., Inc. v.
Commc'ns Workers ofAm., 475 U.S. 643, 648 (1986)), and thus whether Mitsui is bound by the
6

arbitration agreement is a question of contract law. This court, not the arbitrators, must decide in
the first instance which state's contract law to apply, federal law or the law of Brazil, on the issue of
Mitsui's obligation to arbitrate.
A federal court ordinarily decides conflicts-of-law issues with reference to the
choice-of-law rules of the forum state. See Curley v. AMR Corp., 153 F.3d 5, 12 (2d Cir. 1998)
(in diversity cases, "it is well settled that a federal court must look to the choice of law rules of
the forum state"); see also Rest. (2d) Confl. § 3 (1971 ), Rep. Note, cmt. (d). The forum is the
U.S. District Court of the Southern District of New York. Mitsui removed the case from the
Supreme Court, New York County, on the ground of federal jurisdiction. 9 U.S.C. §§ 202, 205.
Federal jurisdiction is based on the Convention on the Recognition and Enforcement of Foreign
Arbitral Awards, adopted by 156 state parties, including the United States and Brazil. See

generally id. § 201 et seq. (Federal Arbitration Act ("FAA"), implementing Convention on
Recognition and Enforcement of Foreign Arbitral Awards ("New York Convention")). Unlike a
case based on diversity of citizenship, where federal courts look to state-law for the rule of
decision, see Arthur Andersen LLP v. Carlisle, 556 U.S. 624, 629-30 (2009), in a case brought
under the New York Convention, chapter two of the FAA, federal law governs, see Smith/Enron

Cogeneration Ltd P'ship v. Smith Co generation Int'!. Inc., 198 F .3d 88, 96 (2d Cir. 1999); see
also Corporacion Venezolana de Fomento v. Vintero Sales Corp., 629 F.2d 786, 795 (2d Cir.
1980) ("This is a federal question case, however, and it is appropriate that we apply a federal
common law choice of law rule in order to decide which of the concerned jurisdiction's
substantive law ... should govern.").
One important consideration in the choice-of-law determination of a contract
dispute is what the parties intended. See Motorola Credit Corp. v. Uzan, 388 F.3d 39, 50 (2d
Cir. 2004) ("We have applied a choice-of-law clause to determine which laws govern the validity
7

of an agreement to arbitrate."); Rest. (2d) of Confl. § 187 (I 971) ("The law of the state chosen
by the parties to govern their contractual rights and duties will be applied if the particular issue is
one which the parties could have resolved by an explicit provision in their agreement directed to
that issue."). Here, the contract between Alunorte, Mitsui's insured, and Alstom did provide a
choice-of-law clause - Brazil - but "only to the extent such law is consistent with the Articles of
this Agreement" and "if the subject matter for the decision or award is not provided for in such
Articles." Dkt. No. 20(2), fi24. l (g), p. 16. And, the same contract also required "good faith
negotiation" of"disagreements and casus omissus" and then, if negotiations failed, arbitration of
disputes by the ICC in New York. Dkt. No. 20(2),

~24.1,

p. 15. Alunorte and Alstom thus

intended that any dispute would take place before the ICC in New York, and not in the Brazilian
courts, or any other courts. The forum in which sophisticated parties chose to conduct arbitration
proceedings (the ICC in New York City) reflects their expectation, to which Mitsui, as
subrogated party, succeeded, as to the governing law and the liberal arbitration policy that they
can there expect. See Rest. (2d) Confl. § 218 ( 1971) ("Provision by the parties in a contract that
arbitration shall take place in a certain state may provide some evidence of an intention on their
part that the local law of this state should govern the contract as a whole. ");see also Mitsubishi
Motors Corp. v. Soler Chrysler-Plymouth. Inc., 473 U.S. 614, 631 (1985) ("federal policy"

embodies a "strong belief in the efficacy of arbitral procedures").
The application of federal arbitration law, consonant with the "general principles
of domestic contract law," is thus appropriate, and consistent with the parties' demonstrated
intent through their selection of a U.S. arbitral forum. Sarhank Grp. v. Oracle Corp., 404 F.3d
657, 661 (2d Cir. 2005) ("Under American law, whether a party has consented to arbitrate is an
issue to be decided by the Court in which enforcement of an award is sought. . . . [A ]nd the
Court decides, based on general principles of domestic contract law, whether the parties agreed
8

·'
to submit the issue of arbitrability to the arbitrators."). Under clearly established principles
applied in the federal courts, "a party may be bound by an agreement to arbitrate even in the
absence of a signature." McAllister Bros. v. A & S Transp. Co., 621 F.2d 519, 524 (2d Cir. 1980)
(citing A/S Custodia v. Lessin International, Inc., 503 F.2d 318 (2d Cir. 1974); Fisser v.

International Bank, 282 F.2d 231, 235 (2d Cir. 1960)); Thomson-CSF, SA. v. Am. Arbitration
Ass'n, 64 F.3d 773, 776 (2d Cir. 1995). A related "clearly established" general rule is that "an
insurer-subrogee stands in the shoes of its insured." Am. Bureau ofShipping v. Tencara

Shipyard SP.A., 170 F.3d 349, 353 (2d Cir. 1999) (internal quotation marks omitted).
Accordingly, "any defenses that are valid against the insured are also applicable against the
insurer." Gibbs v. Hawaiian Eugenia Corp., 966 F.2d 101, 106 (2d Cir. 1992). Thus, "if the
named plaintiffs would be required to submit the controversy to arbitration, then plaintiffs'
insurer will be similarly bound." Solomon v. Consol. Resistance Co. ofAm., 97 A.D.2d 791, 792
(2d Dep't 1983). "[T]here is 'no valid basis in law or equity why an arbitration clause should not
be enforced against a subrogee. "' Stolt Tankers BV v. Allianz Seguros, S.A., 2011 WL 2436662,
at *2 (S.D.N.Y. June 16, 2011) (quoting Lumbermans Mut. Cas. Co. v. Borden Co., 268 F.Supp.
303, 314 (S.D.N.Y. 1967)); see also American Bureau ofShipping, 170 F.3d at 352.
The Mitsui-Alunorte insurance contract gave Mitsui a clear subrogation right,
"once the indemnity of the loss has been paid." Dkt. No. 6(10), Arbitration Award,

~86,

at p. 24.

The Alunorte-Alstom supply contract required "good faith negotiation" of "disagreements and

casus omissus" and then, if negotiations failed, arbitration of disputes by the ICC in New York.
Dkt. No. 20(2), if24.1, p. 15. Mitsui knew when it extended insurance that it would be assuming
subrogation rights, and taking over the rights of its insureds, should it have to indemnify its
insureds. These rights are defined by contracts made by the insureds, and Mitsui, as insurer, can

9

,.

have no better, or different, rights than those belonging to its insured. As Article 786 of the
Brazilian Code describes those rights:
After the indemnity is paid, the insurer will acquire by subrogation, within
the limits of the respective value, the rights and actions that would be
entitled to the Insured against the one committing the damage.
Dkt. Nos. 6(10)-(11), Arbitration Award, fil68, at pp. 43-44. By pursuing Alunorte's contract
claim against Alstom, Mitsui was bound by the arbitration clause that would have bound
Alunorte.
Mitsui makes essentially two arguments in support of its motion to dismiss. First,
it characterizes its dispute as arising from a tort committed by Alstom against Alunorte and, it
argues, the arbitration clause between them was limited to contract disputes. Second, it argues
that Brazilian law governs and, under Brazilian law, a subrogated party does not have to
arbitrate. Both arguments lack merit.
Mitsui indemnified Alunorte for damages arising from Alstom's delivery of
defective piping in a power plant that Alstom contracted to deliver. There were no third parties
involved; only the parties to the Alunorte-Alstom supply contract.

Mit~ui's

characterization of

the contract dispute as a tort is an invention to serve an argument.
As to Brazilian law, Mitsui cites several decisions of Brazilian lower and
intermediate courts to the effect that arbitration is a procedural remedy, and a subrogated insurer,
advancing a substantive right, is not bound to follow the procedural remedy. See Mitsui Br. at 24
n.l 0 (collecting cases). Alstom cites a decision of an intermediate court to opposite effect, that a
subrogated insurer is bound by an arbitration clause in the contract to which it succeeds. See
Panalpina World Transport (PRC) Ltd v. Bradesco Auto-Re Companhia de Seguros, Sao Paulo

Court of Appeal ("SPCA") (Appeal no. 0149349-88.201 l .8.23.0100). Alstom's expert in the ICC,
Professor Luis Olavo Baptista, expressed the opinion that only the Supreme Tribunal de Justica,

IO

the highest Brazilian court, could issue a ruling with binding effect, and there is no such extant
ruling. See Dkt. No. 20(27), Arbitration Transcript, at pp. 257-59. The arbitrators took extensive
submissions on Brazilian law, and came to a conclusion opposite to that urged by Mitsui.
The arguments about Brazilian law are not relevant, for federal law governs, and
federal law makes it clear that Mitsui was bound to arbitrate the dispute with Alstom.
Accordingly, Mitsui's motion to dismiss the arbitration award for lack of jurisdiction is denied.
B. Personal Jurisdiction Over Mitsui

Mitsui argues that it lacks any contacts with the forum state, and thus that
personal and general jurisdiction in New York are improper. See Walden v. Fiore, 134 S. Ct. 1115
(2014); Daimler AG v. Bauman, 134 S. Ct. 746 (2014). But Mitsui's argument is unavailing. Just
as it is bound by the arbitration provision in the supply contract, it is equally bound by the forum
selection provision therein.
The arbitration agreement between Alstom and Alunorte designated New York as
the arbitral forum. The parties agreed to "conduct the arbitration ... at a site in the New York
City, New York, USA." Dkt. No. 20(2), fi24.l(d), p. 14. "It is well-settled that federal courts
applying New York law have personal jurisdiction over parties that agree to arbitrate their
disputes in New York." Am. Bureau ofShipping, 170 F.3d at 352; see also Merrill Lynch,
Pierce, Fenner & Smith v. Lecopolus, 553 F.2d 842, 845 (2d Cir. 1977). Such a designation

functions as the party's consent to jurisdiction, because "[t]o hold otherwise would be to render
the arbitration clause a nullity." Victory Transp. Inc. v. Comisaria Gen. de Abastecimientos y
Transportes, 336 F.2d 354, 363 (2d Cir. 1964).

"Because an insurer's 'right ofrecovery ... is governed by the same terms as the
insured's right of recovery,' an insurer-subrogee 'is equally bound by a consent to jurisdiction.'"
Stolt Tankers, 2011 WL 2436662 at *2 (quoting Farrell Lines Inc. v. Columbus Cello-Poly
11

Corp., 32 F.Supp.2d 118, 127 (S.D.N.Y. 1997) and Novorossiyk Shipping Co. v. China Pacific
Prop. Ins. Co., 2006 WL 3055964, at *I (S.D.N.Y. Nov. 16, 2006)); see also Am. Bureau of
Shipping, 170 F.3d at 352 ("But if the Owners are estopped from denying their obligations under
the arbitration agreement between Tencara and ABS, it follows that they are also estopped from
asserting a lack of personal jurisdiction based on that agreement."). As an entity standing in the
shoes of its signatory, the arbitration clause is enforceable against Mitsui and this court has
personal jurisdiction over it.
Mitsui' s objection to the service of process also fails. As this case was initially
filed in New York state court, Alstom served Mitsui by serving the Secretary of New York State,
and mailed a copy of the petition and other documents, requesting a return receipt, to Mitsui, and
received a signed return receipt. See N.Y. B.C.L. § 307. Mitsui argues that Alstom cannot avail
itself of section 307's requirements because Mitsui is not subject to general jurisdiction in the
state, citing Flick v. Stewart-Warner Corp., 76 N.Y.2d 50, 55 n. l (1990), and because Alstom
did not strictly comport with the procedural requirements of that section by filing proof of
process. 3 But"[ w]here a party has agreed to arbitrate and thus has consented to the jurisdiction
of the courts where arbitration is to take place, 'the sole function of process' is to notify the other
party of the proceedings." Stolt Tankers, 2011WL2436662, *2 (quoting Victory Transp., 336
F.2d at 363). Mitsui does not contend that it lacked actual notice, and other"[ c ]ourts have

3
In proceedings initiated in federal court, Federal Rule of Civil Procedure 4(f) applies to service upon individuals in
a foreign country and permits service "by any internationally agreed means of service that is reasonably calculated
to give notice, such as those means authorized by the Hague Convention." Fed. R. Civ. P. 4(f)(l). The Hague
Convention "enumerates several alternative methods of service, including: (1) service through the Central Authority
of member states; (2) service through consular channels; (3) service by mail ifthe receiving state does not object;
and (4) service pursuant to the internal laws of the State. The Second Circuit has noted however, that failure to
strictly adhere to the methods stipulated by the Convention 'is not automatically fatal to effective service,' and has
explained that the Convention 'should be read together with [Federal Rule of Civil Procedure] Rule 4, which
'stresses actual notice, rather than strict formalism.'" MidOil USA, LLC v. Astra Project Fin Pty Ltd, No. 12 CIV.
8484 PAC KNF, 2013 WL 4400825, at *5 n.3 (S.D.N.Y. Aug. 15, 2013), ajj'd, 594 F. App'x 48 (2d Cir. 2015)
(quoting Burda Med1a, Inc. v. Viertel, 417 F.3d 292, 301 (2d Cir. 2005) (emphasis in original)).

12

..
refused to dismiss actions when faced with similar objections to service." MidOil USA, LLC v.

Astra Project Fin. Pty Ltd., No. 12 CIV. 8484 PAC KNF, 2013 WL 4400825, at *2 (S.D.N.Y.
Aug. 15, 2013), affd, 594 F. App'x 48 (2d Cir. 2015) (citing Merrill Lynch, Pierce, Fenner &

Smith, Inc. v. Lecopulos, 553 F.2d 842, 845 (2d Cir. 1977)). Since Mitsui had effective notice of
the proceedings and was not prejudiced by the type of service employed, I find that the method
of service was sufficient. See Victory Transp., 336 F.2d at 364.

C. Forum Non Conveniens
Finally, Mitsui argues that New York is an improper forum for this action. See

Figueiredo Ferraz E Engenharia de Projeto Ltda. v. Republic ofPeru; 665 F.3d 384, 386 (2d
Cir. 2011); In re Arbitration between Monegasque De Reassurances SA.M v. Nak Naftogaz of

Ukraine, 311 F.3d 488, 499 (2d Cir. 2002).
In a forum non conveniens analysis, a court "determine[ s] what deference is owed
a plaintiffs choice of forum." Monegasque, 311 F .3d at 498 (citing lragorri v. United Techs.

Corp., 274 F.3d 65, 73 (2d Cir. 2001) (en bane)). The court also considers the availability of an
adequate alternative forum, and the balance of private interest factors, such as the convenience of the
litigants, and public interest factors, like the "administrative difficulties associated with court

congestion; [ ... ] the local interest in resolving local disputes; and the problems implicated in the
application of foreign law." Id. at 500 (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508-09
(1947)).
Here, one of the petitioners, Alstom Power, Inc., is a U.S. entity. The parties
agreed to, and did arbitrate this matter in New York. This agreement of both parties is entitled to
deference. Winterthur Int'! Am. Ins. Co. v. Bank of Montreal, 2002 WL 31521102, at *5 (S.D.N.Y.
Nov. 13, 2002) ("Because Defendants have agreed to arbitrate in New York, they are deemed to have
agreed that New York is a convenient forum not only for arbitration, but also for enforcement of the
13

•.
arbitration agreement"); Dain Bosworth, Inc. v. Fedora, I 993 WL 33642, at *2 (S.D.N. Y. Feb. 3,
I 993) ("this action was properly brought in the same forum in which the parties have agreed to
arbitrate").
Moreover, the arbitration has taken place in New York. See 9 U.S.C. § 204 ("An
action or proceeding over which the district courts have jurisdiction pursuant to section 203 of
this title may be brought in . . . in such court for the district and division which embraces the
place designated in the agreement as the place of arbitration if such pl~ce is within the United
States."). The litigants, having already conducted the arbitration here, cannot persuasively argue
that enforcing the arbitration award imposes some unique inconvenience. The private interest
factors thus weigh in favor of the present forum. And the public interest factors align similarly.
Since the arbitration took place in New York, federal law - rather than foreign law - is
implicated in the motion to vacate, or confirm, that award. Yusuf Ahmed Alghanim, 126 F.3d at
21. This court has a narrow and deferential role in confirming, or vacating, an arbitration award.
And such a role implicates the federal policy embodied in the FAA, towards facilitating "arbitral
procedures for the resolution of international commercial disputes" and enforcing "freely
negotiated choice-of-forum clauses." See Mitsubishi Motors Corp. v., Inc., 473 U.S. at 63 I. I
therefore find that dismissal on forums non conveniens grounds is not warranted.

D. The Award Should be Confirmed
The arbitrators issued an award in favor of Alstom on July 10, 2015, after hearing
several days of evidence. The arbitrators found that Alstom, after delivering the parts of its
steam generation units, was not responsible for storage conditions, maintenance of the materials,
or handling of the materials during the erection process. Dkt. No. 6(12), Arbitration Award,
~384,

at p. 87. Alstom was not responsible under the supply contract for the debris in the

Freeboard Tubes that caused the 2007 incidents. Id at i/385, at p. 88. The arbitrators issued the
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declaratory relief that Alstom had sought, holding that it had jurisdiction over Mitsui, and that, as
Alunorte's subrogee, Mitsui was bound by the arbitration clause. The arbitrators found that
Alstom was entitled to a declaration that Mitsui could not bring a warranty claim against Alstom
in the Brazilian court proceeding. Id The arbitration panel did not grant any monetary damages,
and directed each party to bear its own fees and costs.
Alstom now seeks to confirm the arbitration panel's findings in the petition
presently before the court. See 9 U.S.C. § 207 ("Within three years after an arbitral 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 ofrecognition or enforcement of the award specified in the said Convention."). And,
for the reasons stated above, this court should confirm the award.

III.

Conclusion

Mitsui's motion to dismiss the petition is DENIED. Alstom's petition to confirm
the arbitration award is GRANTED. The Clerk shall mark document number 12 terminated,
enter judgment in favor of Alstom confirming the Final Award dated July 10, 2015, and mark the
case closed.
SO ORDERED.
Dated:

June~ 2016
New York, New York

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