Oehme, Van Sweden & Associates, Inc. v. Maypaul Trading & Services Ltd.
902 F. Supp. 2d 87
D.D.C.2012Background
- OvS seeks confirmation of an arbitration award, while respondents move to vacate it under DC law.
- Dispute arose from a contract for architectural and landscape design on a Kyiv, Ukraine property.
- Agreement executed February 2, 2007 between OvS and Maypaul, with Pinchuk involved in project negotiations as a client.
- Addendum and ownership structure involved Svit Shylahiv, Transport Investments, and EastOne/Pantoho; Pinchuks controlled EastOne Group.
- Arbitration clause in the contract provided for AAA Construction Rules; Pinchuk is a non-signatory but played a central role in project decisions.
- Arbitrator held Pinchuk liable under theories of veil-piercing, estoppel, and agency, and awarded OvS damages, fees, and interest; court must determine arbitration enforceability and any grounds to vacate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pinchuk is bound to arbitrate as a nonsignatory | OvS argues Pinchuk bound via agency/estoppel/veil. | Pinchuk contends no agreement to arbitrate arbitrability and not bound as nonsignatory. | Pinchuk bound through apparent authority; arbitration must proceed. |
| Whether the arbitrator had jurisdiction over Pinchuk | OvS asserts arbitrator could decide arbitrability; Pinchuk objected. | Pinchuk argues no clear assent to arbitrate arbitrability. | Court independently decides; Pinchuk bound under agency/apparent authority. |
| Whether the award was manifestly disregarding the law on the merits | OvS contends arbitrator properly found modification and breach, or restitution. | Maypaul argues legal errors warrant vacatur for manifest disregard. | No manifest disregard; award affirmed on merits. |
| Whether reimbursable expenses, prejudgment interest, and attorneys’ fees were properly awarded | OvS seeks full award including interest and costs per AAA Rules. | Maypaul contends improper application of caps and interest rate. | No reversible error found; award sustained. |
Key Cases Cited
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (whether parties clearly and unmistakably agreed to arbitrate arbitrability)
- Lopata v. Coyne, NA (D.C. 1999) (extremely limited judicial review of arbitration awards)
- Cathedral Ave. Coop., Inc. v. Carter, 947 A.2d 1143 (D.C. 2008) (manifest disregard standard described)
- Fraternal Order of Police/Dept. of Corr. Labor Comm. v. D.C. Pub. Emp. Relations Bd., 973 A.2d 174 (D.C. 2009) (manifest disregard standard application)
- Dorsky Hodgson & Partners, Inc. v. Nat'l Council of Senior Citizens, 766 A.2d 54 (D.C. 2001) (apparent authority and agency concepts in arbitration context)
- Int'l Paper Co. v. Schwabedissen Maschinen & Anlagen GMBH, 206 F.3d 411 (4th Cir. 2000) (equitable estoppel binding nonsignatories)
- A.B. Shipping v. American Bureau of Shipping, 170 F.3d 349 (2d Cir. 1999) (nonsignatory estoppel and third-party beneficiary principles)