PKT Associates, INC. v. Granum Group, LLC
MEMORANDUM OPINION AND ORDER. For all the foregoing reasons, Plaintiff's petition to enforce the foreign arbitration award is GRANTED. The Clerk is respectfully directed to enter judgment for Plaintiff in the amount of $111,250.00 in damage s, $7,327.26 in interest, $570.09 in costs, and additional interest at a rate of 4 percent per annum (calculated on a per diem basis between the date of this opinion and the date of payment). The Clerk is also respectfully directed to terminate all open motions and to close the case. SO ORDERED. (Signed by Judge Valerie E. Caproni on 7/12/2018) (rjm)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
PKT ASSOCIATES, INC.,
GRANUM GROUP, LLC,
DATE FILED: 7/12/2018
VALERIE CAPRONI, United States District Judge:
Plaintiff PKT Associates, Inc. brings this action against Defendant Granum Group, LLC
for the enforcement of a foreign arbitration award, pursuant to the Convention on the
Recognition and Enforcement of Foreign Arbitral Awards (the “Convention”), 9 U.S.C. § 201
et seq. For the following reasons, Plaintiff’s petition to enforce the award is GRANTED.
In March and April 2016, Plaintiff and Defendant entered into three contracts for
Defendant to sell approximately 625 metric tons of chickpeas to Plaintiff. See Compl., Dkt. 1,
¶ 11. The contracts obligated Defendant to ship the chickpeas from Russia to India and Pakistan.
See id. The contracts provided that all disputes would be resolved in arbitration before the Grain
and Feed Trade Association (“GAFTA”), an international organization. See id. Ex. A ¶ 2.3.
Defendant breached the contract in September and October 2016 by failing to ship the
chickpeas as promised. See id. Ex. A ¶¶ 3.7, 4.1–4.3. In November 2016, Plaintiff initiated
arbitration before GAFTA. See id. Ex. A ¶ 3.9. The parties each filed submissions to the
arbitration panel. See id. Ex. A ¶ 1.7. The panel awarded Plaintiff $111,250.00 in damages, plus
interest at 4 percent per annum (compounded quarterly beginning on November 18, 2016).
Id. Ex. A ¶ 6.1. Plaintiff alleges that Defendant has failed to pay the arbitration award. See id.
Plaintiff filed the Complaint in this case on February 8, 2018. See Compl. Plaintiff
served Defendant on February 26, 2018, but Defendant has not answered the Complaint or
otherwise appeared in this action. See Aff. of Service, Dkt. 6.
The Court Has Subject-Matter Jurisdiction Over This Action
A petition to enforce arbitration does not independently present a federal question, so
whether the Court has jurisdiction turns on whether the Convention applies. See LGC Holdings,
Inc. v. Julius Klein Diamonds, LLC, 238 F. Supp. 3d 452, 460 (S.D.N.Y. 2017) (citing Bakoss v.
Certain Underwriters at Lloyds of London Issuing Certificate No. 0510135, 707 F.3d 140, 142
n.4 (2d Cir. 2013)). Here, both parties are citizens of the United States, see Compl. ¶¶ 2–3, so
the Convention applies only if the parties’ relationship “involves property located abroad,
envisages performance or enforcement abroad, or has some other reasonable relation with one or
more foreign states,” 9 U.S.C. § 202. The parties’ agreement to sell and ship products outside of
the United States is sufficient to meet this standard. See LGC Holdings, 238 F. Supp. 3d at 461
(collecting cases). As a result, the Convention applies to this action, and the Court has subjectmatter jurisdiction over it.
Plaintiff’s Petition to Enforce the Arbitration Award Is Granted
No Exception to Enforcement of Arbitration Awards Applies Here
This Court is required to confirm a foreign arbitration award falling under the Convention
unless the Court finds that an exception specifically enumerated in the Convention applies.1
This Court’s power under the Convention to review the arbitration award is limited because the award was
not made in the country where this Court is located. See Compl. Ex. A ¶ 1.13; LGC Holdings, 238 F. Supp. 3d at
See 9 U.S.C. § 207; LGC Holdings, 238 F. Supp. 3d at 465. The party seeking to avoid
enforcement of the award bears the burden of showing that one of these exceptions applies.
See NAR S.p.A.-Industria Nastri Adesivi v. I.R. Indus., 5 F. Supp. 2d 203, 204 (S.D.N.Y. 1998).
But if a petition to enforce an arbitration award is unopposed, a court need not inquire on its own
into whether an exception to enforcement applies. See id.
Here, Defendant has failed to answer Plaintiff’s allegations or otherwise appear in this
action, so no exception to enforcement has been raised. Nothing in Plaintiff’s Complaint gives
the Court reason to believe that the dispute between the parties is so unusual that the Court
should inquire further. Thus, Plaintiff’s petition to enforce the arbitration award of damages plus
interest and costs is GRANTED.
The Court Awards Damages and Interest to Plaintiff
The award entitles Plaintiff to $111,250.00 in damages, plus interest at 4 percent per
annum (compounded quarterly beginning on November 18, 2016). Compl., Ex. A ¶ 6.1. As an
initial matter, the Court awards Plaintiff $111,250.00 in damages. As for interest, in court filings
and at a May 18, 2018 conference, Plaintiff stated that it would waive its right to compound
interest and, instead, accept a simple per diem interest calculation (at a rate of 4 percent per
annum). See Aff. for Judgment by Default, Dkt. 7-2, at 2. The Court therefore awards Plaintiff
interest at a rate of 4 percent per annum, calculated on a per diem basis between November 18,
2016 and the date of this opinion, July 12, 2018, for a total interest calculation of $7,327.26. The
Court also awards Plaintiff additional interest, calculated on a per diem basis at a rate of 4
percent per annum, between the date of this opinion and the date of payment.
464–65. If Plaintiff had brought this action in the United Kingdom, which is where the arbitration award was made,
the reviewing court could have broader review powers. See LGC Holdings, 238 F. Supp. 3d at 464–65.
The Court Awards Costs to Plaintiff
Plaintiff seeks to recover the costs of this lawsuit, namely, the $400.00 filing fee and
$170.09 in service-of-process costs. See Aff. for Judgment by Default, Dkt. 7-2, at 2. Costs are
generally not recoverable from an opposing party, but courts have inherent power to award them
in successful petitions to confirm arbitration awards “when a challenger refuses to abide by an
arbitrator’s decision without justification.” Trs. of the N.Y.C. Dist. Council of Carpenters
Pension Fund v. Coastal Envtl. Grp., Inc., No. 16-CV-6004, 2016 WL 7335672, at *3 (S.D.N.Y.
Dec. 16, 2016) (internal quotation marks omitted) (quoting Int’l Chem. Workers Union, Local
No. 227 v. BASF Wyandotte Corp., 774 F.2d 43, 47 (2d Cir. 1985)).
An award of costs is justified here. After participating in the arbitration process,
Defendant was bound to pay Plaintiff the arbitral award. Defendant’s failure to do so, without
justification, has caused Plaintiff to incur the costs of initiating this lawsuit. Equity demands that
Plaintiff be reimbursed for these costs. Accordingly, the Court awards Plaintiff $570.09 in costs.
For all the foregoing reasons, Plaintiff’s petition to enforce the foreign arbitration award
The Clerk is respectfully directed to enter judgment for Plaintiff in the amount of
$111,250.00 in damages, $7,327.26 in interest, $570.09 in costs, and additional interest at a rate
of 4 percent per annum (calculated on a per diem basis between the date of this opinion and the
date of payment).
The Clerk is also respectfully directed to terminate all open motions and to close the case.
United States District Judge
Date: July 12, 2018
New York, New York
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