994 F.3d 1181
10th Cir.2021Background
- 2006 Option Agreement between Goldgroup and DynaResources gave Goldgroup the right to earn up to 50% of DynaMexico; the agreement required arbitration in Denver under AAA rules and specified Mexican law for share-acquisition substantive issues.
- Goldgroup exercised the option in 2011, became a 50% shareholder, and disputes over governance followed; DynaUSA held a shareholder meeting that diluted Goldgroup’s shares, prompting Goldgroup to seek annulment in Mazatlán (Mexico), while DynaResources pursued other litigation (including a Texas suit later dismissed).
- Goldgroup filed a Demand for Arbitration in Denver in 2014; DynaResources sought injunctions in U.S. (D. Colo., Judge Krieger) and Mexican courts to block the arbitration, arguing the arbitration clause was invalid or waived.
- Judge Krieger upheld the arbitration clause and directed arbitrability issues to the arbitrator; a Mexico City court later ruled arbitration waived (the Mexico City Order), but Goldgroup and the AAA say they were not properly served and pursued an amparo.
- The arbitrator (applying AAA-ICDR rules) found the arbitration clause valid, rejected waiver and forum-shopping defenses, and issued an award for Goldgroup in 2016; the federal district court confirmed the award and the Tenth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument (Goldgroup) | Defendant's Argument (DynaResources) | Held |
|---|---|---|---|
| Whether Goldgroup waived the right to arbitrate | Goldgroup: filing the Mazatlán suit and defending Texas suit did not waive arbitration of Option Agreement disputes | DynaResources: Goldgroup’s prior resort to courts constitutes waiver of arbitration | Not preserved for appeal as to factual waiver; court doubted waiver in any event |
| Whether FAA vacatur defenses apply to nondomestic awards rendered under U.S. law | Goldgroup: Convention controls, but FAA defenses may apply to awards made under U.S. law | DynaResources: Only Convention defenses are available to defeat confirmation | FAA §10 defenses are available when award was rendered in or under U.S. law |
| Whether arbitrator exceeded authority by deciding waiver (arbitrability) | Goldgroup: parties incorporated AAA rules (clear-and-unmistakable delegation) so arbitrator could decide arbitrability | DynaResources: Waiver is a court question; arbitrator lacked authority to decide it | Arbitrability was delegated to arbitrator by AAA rules; even if reviewed de novo, vacatur not warranted |
| Whether Mexico City court’s ruling annulled the award under Convention art. 5(1)(e) | Goldgroup: Mexico City court lacked competence and applied wrong (Mexican procedural) law; arbitration was pending in Denver under AAA rules | DynaResources: Mexico City Order effectively annulled the arbitration and bars confirmation | Article 5(1)(e) inapplicable: Mexico City court lacked competence and applied wrong procedural law; defense fails |
Key Cases Cited
- Dish Network L.L.C. v. Ray, 900 F.3d 1240 (10th Cir. 2018) (deference to arbitrator and precedent treating incorporation of AAA rules as delegation of arbitrability)
- Yusuf Ahmed Alghanim & Sons v. Toys "R" Us, 126 F.3d 15 (2d Cir. 1997) (Convention contemplates domestic vacatur rules where award made under local law)
- BG Group PLC v. Republic of Argentina, 572 U.S. 25 (2014) (treatment of §10(a)(4) defenses to nondomestic awards rendered in the U.S.)
- Oxford Health Plans LLC v. Sutter, 569 U.S. 564 (2013) (arbitrator’s decision will not be overturned if it 'even arguably' construes or applies the contract)
- Compañía de Inversiones Mercantiles, S.A. v. Grupo Cementos de Chihuahua S.A.B. de C.V., 970 F.3d 1269 (10th Cir. 2020) (narrow construction of Convention defenses; challenger bears burden of proof)
- CEEG (Shanghai) Solar Sci. & Tech. Co. v. LUMOS LLC, 829 F.3d 1201 (10th Cir. 2016) (Convention defenses are generally exclusive for awards rendered under foreign arbitral law)
- Industrial Risk Insurers v. M.A.N. Gutehoffnungshutte GmbH, 141 F.3d 1434 (11th Cir. 1998) (contrasting view that only Convention defenses apply to awards subject to the Convention)