870 F.3d 370
5th Cir.2017Background
- Daewoo (South Korean buyer) contracted with AMT for pig iron to be delivered in New Orleans; contracts contained New York arbitration clauses; AMT did not deliver.
- Daewoo sued in federal court (E.D. La.) seeking an order to compel arbitration and obtained a maritime attachment of the pig iron; it then amended to obtain a Louisiana non-resident attachment under La. Code Civ. Proc. art. 3542.
- Thyssenkrupp Mannex (TKM), another creditor of AMT, obtained a state-court attachment on the same cargo and intervened in federal court, moving to vacate Daewoo’s federal attachment.
- The district court vacated Daewoo’s Louisiana non-resident attachment on the ground that a motion to compel arbitration is not an “action for a money judgment” under Article 3542.
- On appeal, the Fifth Circuit found federal Convention jurisdiction (arbitral agreements fell under the Convention and the attachment related to those agreements) and held that Louisiana law permits pre-suit non-resident attachments in aid of an expected confirmation action if statutory requirements are met.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal court has jurisdiction under the Convention to issue attachment in aid of arbitration | Convention covers the arbitration agreements and the attachment relates to those agreements, so federal jurisdiction exists | Attachment cannot be in aid of arbitration absent express Convention remedy | Held: Yes — Convention confers jurisdiction; provisional remedies in aid of arbitration are within §203 when related to a covered agreement |
| Whether a suit to compel arbitration is an “action for a money judgment” under La. Code Civ. Proc. art. 3542 | The arbitration nature does not change that the plaintiff seeks ultimately to recover money; attachment should be available | A motion to compel arbitration seeks an order to arbitrate (non-monetary), so it is not an action for a money judgment | Held: No — a motion to compel arbitration is not directly an action for a money judgment |
| Whether Louisiana non-resident attachment (Art. 3542) authorizes pre-petition attachment to secure an anticipated confirmation/monetary judgment from arbitration | Art. 3502 allows pre-petition writs if procedural requirements are met and a confirmation action would be for a money judgment | District court: Article 3542 requires the underlying suit itself be for money; pre-suit attachment in this context not authorized | Held: Yes — Art. 3502 permits pre-petition attachment in aid of an anticipated confirmation (money) action if statutory prerequisites and good cause are shown |
| Whether Daewoo complied with Art. 3502 and demonstrated need for pre-petition attachment | Daewoo followed Art. 3502 procedures and showed arbitration would likely produce a money award and that immediate security was necessary | TKM did not dispute procedural compliance and conceded confirmation would produce a money judgment | Held: Yes — Daewoo met Art. 3502 requirements; the attachment was valid and dissolving it was erroneous |
Key Cases Cited
- Freudensprung v. Offshore Tech. Servs., Inc., 379 F.3d 327 (5th Cir. 2004) (elements for Convention coverage of arbitration agreements)
- E.A.S.T., Inc. of Stamford v. M/V Alaia, 876 F.2d 1168 (5th Cir. 1989) (pre‑arbitration vessel arrest not inconsistent with Convention; provisional remedies may aid arbitration)
- BP Exploration Libya Ltd. v. ExxonMobil Libya Ltd., 689 F.3d 481 (5th Cir. 2012) (Convention jurisdiction exists where suit relates to a covered arbitration agreement)
- Acosta v. Master Maint. & Constr. Inc., 452 F.3d 373 (5th Cir. 2006) (interpretation of “relates to” for Convention removal/jurisdiction analysis)
- Borden, Inc. v. Meiji Milk Prods. Co., 919 F.2d 822 (2d Cir. 1990) (recognition of provisional remedies in aid of arbitration)