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Travelport Global Distribution Systems B.V v. Bellview Airlines Limited

September 10, 2012

TRAVELPORT GLOBAL DISTRIBUTION SYSTEMS B.V., PETITIONER,
v.
BELLVIEW AIRLINES LIMITED RESPONDENT.



The opinion of the court was delivered by: Denise Cote, District Judge:

OPINION & ORDER

Travelport Global Distribution Systems B.V. ("Travelport") seeks an order compelling Bellview Airlines Limited ("Bellview") to arbitrate pursuant the terms of the parties' written Distribution Agreement. For the following reasons, its petition is granted.

BACKGROUND

The following facts are undisputed unless otherwise noted. Travelport is a foreign business corporation organized and existing under the laws of the Netherlands. Bellview is a Nigeria corporation. On March 21, 1997, Travelport (then known as Galileo International Partnership) entered into a Distribution Agreement with Bellview, pursuant to which Bellview was to distribute in Nigeria a computerized travel reservation system owned by Travelport. The Distribution Agreement contained the following provision (the "Arbitration Provision"):

19. GOVERNING LAW; JURISDICTION AND ARBITRATION

19.1 This Agreement and all disputes arising under or in connection with this Agreement, including actions in tort, shall be governed by the laws of the State of New York, United States of America.

19.2 Any dispute or controversy, or claim arising out of or related to this agreement, or the breach, termination or invalidity thereof, may be submitted to arbitration in the United States in accordance with the UNCITRAL Arbitration rules in force at the date of reference. The Appointing Authority shall be the United States Council of Arbitration and such appointment will be in accordance with its "Procedures for Arbitration."

On October 3, 2011, Travelport advised Bellview by letter that it would terminate the Distribution Agreement due to Bellview's alleged material breach of multiple obligations unless Bellview cured its breach within 30 days. By letter dated October 5, Bellview denied that it was in breach of the agreement and requested that Travelport withdraw its notice of termination. Travelport responded by letter dated October 31 declining to withdraw the notice of termination. By letter dated November 1, Bellview stated as follows:

Obviously a dispute has arisen with respect to the agreement and we think it is in the best interest of both parties to submit to arbitration in the spirit of clause 19.2 of the agreement.

Travelport terminated the Distribution Agreement by letter dated November 3.

On November 10, Bellview initiated an action (the "Nigeria Action") in the Federal High Court in the Federal Republic of Nigeria (the "Nigeria High Court") by filing a summons. The summons sought a declaration that a dispute had arisen between the parties and that Bellview was entitled to refer the dispute to arbitration, and an order for injunctive relief. On November 14, the Nigeria High Court issued a restraining order enjoining Travelport from terminating the Distribution Agreement and from appointing another entity to distribute its computerized travel reservation system in Nigeria. On November 24, Travelport filed two applications to the Nigeria High Court to discharge the restraining order. Both applications were denied. Travelport submitted a response to Bellview's November 10 summons by affidavit dated December 16. Travelport's response agreed that the dispute should be submitted to arbitration but contested the other relief requested.

Travelport served a notice of arbitration on Bellview on January 26, 2012 seeking damages, costs, and a declaration that Travelport lawfully terminated the Distribution Agreement. By letter dated February 24, Bellview stated its intention to continue pursuing the Nigeria Action because it had concluded that the arbitral body specified in the Distribution Agreement, the United States Council of Arbitration, is a "non-existent body" and the Arbitration Provision was therefore "incapable of being performed."

On March 7, Bellview initiated contempt proceedings against Travelport's directors and officers for alleged violations of the November 14 restraining order. Also on March 7, the Nigeria High Court issued an order notifying these directors and officers that disobedience of its orders would result in them being found in contempt of court.

On March 15, Bellview filed a motion before the Nigeria High Court requesting leave to amend its November 10 summons in order to allow the Nigeria High Court to adjudicate the underlying dispute directly instead of referring it to arbitration. The motion alleges that the Arbitration Provision cannot be performed and "is not mandatory." On April 26, 2012, Bellview filed a second summons before the Nigeria High Court for damages and ...


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