Alghanim v. Alghanim, 828 F. Supp. 2d 636

Bassam and Kutayba Alghanim divided their family business empire in 2008 amid disputes over assets and control.
March 12, 2008 General Points of Settlement and a broader March 12 Agreement were executed, the latter containing a dispute-resolution clause naming Kuwait’s Prime Minister as final arbiter.
March 27, 2008 Memorandum of Understanding (MOU) integrated the earlier settlements and included a dispute-resolution clause directing final decisions to the Kuwaiti Prime Minister.
Bassam filed Kuwaiti court actions in 2009 seeking receivership and profit accounting; YAAS accounting action was dismissed for lack of jurisdiction due to arbitration clauses, with Kuwaiti Cassation later affirming arbitration.
Bassam filed email-hacking and related claims in this district in 2009; the court later addressed whether arbitration under the March Agreements could extend to non-signatories and govern the scope and arbitrability of claims.
Defendants renewed their motion to stay arbitration in light of the Kuwaiti Cassation decision affirming arbitration and the Convention’s requirements.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the March Agreements require arbitration under the FAA/Convention.	Bassam contends the clauses are arbitration agreements.	Defendants argue arbitration is mandated.	Yes; the clauses constitute arbitration agreements under federal law and Kuwaiti law.
Whether Omar and Waleed (non-signatories) can compel arbitration.	Non-signatories should not be bound so broadly.	Equitable estoppel or agency principles may bind non-signatories.	Under federal law, Omar and Waleed may be compelled to arbitrate; under Kuwaiti law, stay pending arbitration is also warranted.
Scope of the arbitration clauses with respect to plaintiff's claims.	Claims do not fall within the clauses.	Claims relate to the subject matter of the March Agreements.	The claims are within the scope of the arbitration clauses under both federal and Kuwaiti law.
Arbitrability of the federal statutory claims.	Statutory claims may be nonarbitrable under Kuwaiti law.	Statutory claims are arbitrable; vindication concerns addressed under Mitsubishi/Mitsubishi-derived tests.	Federal statutory claims are arbitrable; Kuwaiti public order and future-torts theories do not defeat arbitrability.
Whether the court should stay the action pending arbitration.	A stay is unwarranted for non-signatory claims.	Stays are appropriate to promote economy and consistency pending arbitration.	Stay granted as to moving defendants pending arbitration.

Louis Dreyfus Negoce S.A. v. Blystad Shipping & Trading Inc., 252 F.3d 218 (2d Cir. 2001) (scope of arbitration clause; broad vs narrow; presumption of arbitrability)
Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (U.S. 1985) (Arbitrability; federal policy favoring arbitration; use of federal substantive law)
Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (U.S. 1983) (liberal federal policy favoring arbitration; contract-based interpretation)
Perry v. Thomas, 482 U.S. 483 (U.S. 1987) (state law governs contract validity/enforceability; preemption vs. Convention)
JLM Indus., Inc. v. Stolt-Nielsen SA, 387 F.3d 163 (2d Cir. 2004) (scope of arbitration; reliance on Mitsubishi; disputes beyond contract terms)
Ragone v. Atlantic Video at Manhattan Ctr., 595 F.3d 115 (2d Cir. 2010) (equitable estoppel; interrelatedness of disputes with arbitration clause)
Ross v. American Express Co., 547 F.3d 137 (2d Cir. 2008) (non-signatories bound by arbitration if intertwined with agreement; not connected textually to contracts)