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GRIFFIN INDUSTRIES, INC. v. PETROJAM

November 3, 1999

GRIFFIN INDUSTRIES, INC. AND OCEAN LOGISTICS CORPORATION, AS CHARTERERS, PETITIONER,
v.
PETROJAM, LTD. AS OWNER OF THE M/V PETROJAM TRADER, RESPONDENT.



The opinion of the court was delivered by: Sweet, District Judge.

OPINION

Petitioners Griffin Industries, Inc. and Ocean Logistics Corporation have moved, pursuant to Rule 59(e) of the Federal Rules of Civil Procedure and Local Rule 6.3, for an order: (i) vacating this Court's opinion dated July 21, 1999, and judgment dated July 28, 1999, to the extent that the opinion and judgment deny Petitioners' motion to vacate or modify the arbitral awards dated December 14, 1998 and December 22, 1998 ("arbitral awards") and grant Respondent Petrojam's cross-motion to confirm the arbitral awards; (ii) granting Petitioners' motion to vacate or modify the arbitral awards and denying Respondent's motion to confirm the arbitral awards; and (iii) directing that hearings be held before the arbitrators. For the reasons set forth below, Petitioners' motion is denied.

Facts and Prior Proceedings

The factual background of this case has been set forth in a prior opinion of this Court, familiarity with which is assumed. See In re Arbitration between Griffin Industries, Inc. and Petrojam, Ltd., 58 F. Supp.2d 212 (S.D.N.Y. 1999). Facts and prior proceedings relevant to the instant motion are set forth below.

On September 11, 1997, Respondent wrote to the chairman of the arbitration panel (the "Panel") hearing the dispute between Petitioners and Respondent, requesting "an opportunity to emphasize certain aspects of its claims via oral hearing." The Panel responded by facsimile of September 15, 1997, stating that a hearing would be scheduled after receipt of the parties' supplementary submissions. On September 25, 1997, Respondent sent its supplementary submissions to the Panel, enclosed within a letter which asked again for the opportunity of an oral hearing, and requested the opportunity to submit posthearing legal memoranda. Several months later, after several apparent discovery delays, Petitioners' supplemental documentation was received by the Panel.

On February 5, 1998, Respondent proposed to the Panel a timetable for presentation of written arguments in the dispute, suggesting that Respondent submit its initial argument on March 20, 1998, that Petitioners answer by April 10, and that Respondent reply by May 1. The proposal also advised that it "may be possible to rest on the written submissions and avoid an oral hearing." The Panel, not hearing any objection from Petitioners, agreed to the proposed timetable.

Petitioners failed to timely submit their response brief by April 10, at which point Respondent requested that the Panel rule on the information then before it. The Panel declined to do so, instead notifying Petitioners that it was "prepared to act on the information received to date" and that their "prompt cooperation would be appreciated." Petitioners' Brief was received by the Panel on or around April 22, 1998.

On May 8, 1998, Petitioners wrote to Respondent, suggesting that the parties stipulate to certain facts, but that other facts were in dispute. Petitioners did not send a copy of this correspondence to the Panel.

On October 9, 1998, Respondent wrote to the Panel inquiring "as to the status of the panel's deliberations," and the "relative timing of the panel's ruling." On October 20, 1998, Petitioners wrote to the Panel in response, alleging that "there is significant dispute as to alleged facts, expenses and information which has not been furnished, and is not in the record. This matter does not appear to be in a proper posture for ruling, and we would suggest discussion should be directed to hearings. . . ." Petitioners added that they "did not wish to appear to acquiesce to possible ruling at this stage, until the panel and counsel have had benefit of all available facts."

On December 14 and 22, 1998, the Panel issued the final arbitration awards.

On February 12, 1999, Petitioners wrote to the Panel, complaining that the Panel had ruled without holding a hearing — despite Petitioners' letter of October 20, 1998 — and requesting that the Panel "reopen" the proceedings. On February 17, 1999, the chairman of the Panel replied to Petitioners that he "never received the faxes of October 9 and 20." The chairman also noted that follow-up hard copies were not received, nor were copies sent to the two other arbitrators on the Panel. Finally, the chairman stated that the Panel was "functus officio and by its own power . . . unable to reopen the record or modify the awards."

On March 11, 1999, Petitioners moved this court to vacate or modify the arbitration awards. Respondent, which had previously filed a petition in the United States District Court for the Southern District of Florida to confirm the arbitration awards, cross-moved to confirm the awards or to transfer the action to the Southern District of Florida.

By this Court's order of July 21, 1999, Petitioners' motion to vacate or modify the arbitration awards was denied, Respondent's motion to transfer was denied and Respondent's motion to confirm the arbitration awards was granted.

Petitioners filed the instant motion on August 12, 1999. Opposition and reply papers were received through August 27, 1999, at which time ...


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