United States District Court, S.D. New York
OPINION & ORDER
A. ENGELMAYER, District Judge:
decision resolves a petition to confirm a foreign arbitration
award. On November 18, 2016, petitioner Albtelecom SH.A
("Albtelecom") filed a petition to confirm an
arbitration award (the "Award") pursuant to the New
York Convention on the Recognition and Enforcement of Foreign
Arbitral Awards, June 10, 1958, 21 U.S.T. 2517, 330 U.N.T.S.
38, 9 U.S.C. §§ 201-08 (the "New York
Convention"); see also 9 U.S.C. § 203
(giving United States district courts original jurisdiction
over actions or proceedings falling under the New York
Convention). Dkt. 1 (the "Petition" or
"Pet."). The 41-page Award, rendered September 2,
2015 by an arbitrator of the ICC International Court of
Arbitration ("ICC") on consent of the parties, is
against respondent UNIFI Communications, Inc.
("Unifi"). In addition to confirmation of the
Award, Albtelecom seeks a damages award from Unifi based on
Unifi's alleged breach of the Award. It argues that
Unifi's failure, post-Award, to make all payments
required by the Award triggers an enhanced damages remedy
under the Award. Unifi resists confirmation of the Award, but
principally resists Albtelecom's bid for a judgment of
damages premised on a finding of breach. Unifi asks the Court
to dismiss or stay Albtelecom's petition for confirmation
and enforcement. It notes, inter alia, that, after
the filing of Albtelecom's petition, Unifi initiated a
new ICC arbitration in Switzerland, aimed at examining
whether the parties' post-Award communications excused
Unifi's obligations under the Award.
reasons that follow, the Court confirms the arbitration Award
and enters judgment in favor of Albtelecom consistent with
the terms of that Award. However, the Court does not reach in
this ruling whether Unifi has complied with or breached the
Award; whether compliance with the Award was excused in whole
or part based on the parties' post-Award dealings; or
what, if any, damages may be merited for Albtelecom under the
Award to the extent of any noncompliance by Unifi. The Court
also does not reach the issue of whether, assuming Albtelecom
were continue to pursue a claim of breach, whether this Court
is the proper forum to resolve such a claim, or whether such
claims are more properly resolved elsewhere (e.g.,
the ICC arbitration that Unifi represents it has brought in
The Arbitral Award
matter stems from the Contract between Albtelecom and Unifi,
entered into on August 8, 2006, for the provision of
international telecommunications services. A dispute later
arose under the Contract, with Albtelecom claiming that Unifi
had not paid Albtelecom fully for its services rendered.
Award ¶ 4.
29, 2012, Albtelecom initiated arbitral proceedings against
Unifi. Bollen Decl. ¶ 4. It did so pursuant to paragraph
21 of the Contract, which provided that disputes between the
parties were to be resolved by arbitration pursuant by an
arbitrator appointed by the ICC pursuant to the ICC's
rules. Bollen Decl. ¶ 3 (citing Contract ¶ 21). On
January 11, 2013, on consent of the parties, an arbitral
tribunal, consisting of a sole arbitrator, Joachim Knoll, was
constituted. Bollen Decl. ¶ 5; Award ¶¶ 16-17.
proceedings proceeded before arbitrator Knoll throughout 2013
and into October 2014. Award ¶¶ 18-56. On October
5, 2014, counsel for Albtelecom and Unifi jointly advised the
arbitrator that they were engaged in settlement discussion.
Bollen Decl. ¶ 14; Award ¶¶ 57-58. The
arbitrator therefore stayed further proceedings, but when
these discussions broke down, arbitration proceedings
resumed. Award ¶¶ 59-78.
April 17, 2015, counsel jointly advised the arbitrator that a
settlement agreement had been entered into. Bollen Decl.
¶ 14; Award ¶ 96 (reproducing parties'
settlement agreement, including detailed payment schedule);
id. ¶ 97. On April 18, 2015, upon the
parties' joint request, the arbitrator stayed the
arbitral proceedings and cancelled a scheduled evidentiary
hearing. Id. ¶ 98. On April 21, 2015, the
parties asked the arbitrator "to issue a Consent Award
whch shall in its general part (ground of the award)
reproduce the settlement agreement and in its decision
(ruling) reproduce clause 2 as well as the annex of the
Settlement agreement." Bollen the supplemental
declaration of Daniel Hochstrasser, Dkt. 21
("Hochstrasser Suppl. Decl."); and the supplemental
declaration of Adrian Shatku, Dkt. 32 ("Shatku Reply
Decl."). Decl. ¶ 14; Award ¶ 100. The parties
thereafter furnished the arbitrator with a copy of the
settlement agreement. Award ¶ 102.
16, 2015, the arbitrator provided a draft of his proposed
Award to the parties, for their review and comment. Award
¶ 106. The parties commented on the draft award,
suggesting minor changes which the arbitrator accepted.
Id. The arbitrator agreed to issue an Award on
consent. Id. ¶ 115 ("Against this
background, and in the absence of any public policy-based
concerns against the rendering of an award by consent, the
Sole Arbitrator agrees to render an award by consent.")
On July 29, 2015, the arbitrator closed the arbitral
proceedings, pursuant to Article 27 of the ICC. Id.
Award was issued September 2, 2015. It awarded Albtelecom the
amount of EUR 1, 088, 000, which Unifi was to pay by bank
transfer in 39 monthly installments, which the Award
specified by date and amount. Award ¶ 118. The Award
further provided that, should Unifi fail to make payments
consistent with the schedule it set and fail to cure under
the terms provided by the settlement agreement, Albtelecom
was entitled to claim EUR 2, 100, 000 from Unifi.
Id. The Award further provided that payments overdue
under the Award were to "bear interest at the rate of
2.5% per year, and fixed costs of $115, 000, which were to be
born by Albtelecom." Id. Each party was
responsible for bearing its own legal and other costs in
connection with the arbitral proceedings and the settlement
agreement. Id. Neither party appealed the Award.
Bollen Decl. ¶I8.
Unifi's Alleged Failure to Pay Under the Award
alleges that, after the Award issued, Unifi made the first
three installment payments under it-due in September,
October, and November 2015-although the latter two were paid
after the deadline set in the Award. Bollen Decl.
¶¶ 21-23. However, it alleges, Unifi did not make
any further payments or cure its failure to timely pay.
Id. ¶ 24. Albtelecom alleges that after it
issued a notice of failure to pay, Unifi responded with the
"spurious" claim that "any delay in payment
occurred with Albtelecom's full knowledge and
understanding." Id. ¶ 26. Albtelecom
alleges that, as of November 16, 2017, Unifi had paid it only
EUR 396, 000, and that it is therefore entitled, under the
Award to EUR 1, 704, 000 ...