Sterling Merchant Finance Ltd. v. Republic of Cabo Verde
261 F. Supp. 3d 48
| D.D.C. | 2017Background
- Sterling seeks to confirm a Singapore-based arbitration award against Cabo Verde under the NY Convention, the FAA, and FSIA.
- Cabo Verde failed to pay under a 2006 management contract for TACV; Sterling fully performed but was not paid.
- Arbitration seated in The Hague concluded Cabo Verde breached the contract, awarding Sterling USD 190,098.12, 8% interest, arbitration costs, and related interest, with other claims dismissed.
- Cabo Verde has not complied with the arbitral award.
- Sterling served Cabo Verde under FSIA § 1608(a)(3); default entered when Cabo Verde did not respond.
- Court grants default judgment to confirm the Arbitral Award under 9 U.S.C. § 207 and related FSIA authority.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court has subject matter jurisdiction | Sterling relies on NY Convention, FAA, and FSIA. | N/A (defaulted). | Court has subject matter jurisdiction. |
| Whether the court has personal jurisdiction over Cabo Verde | Service valid under FSIA § 1608(a)(3). | N/A (defaulted). | Court has personal jurisdiction. |
| Whether default judgment to confirm the award is appropriate | FSIA allows confirmation of awards; no defenses raised by Cabo Verde. | N/A (defaulted). | Default judgment is appropriate to confirm the award. |
| Whether the Arbitral Award should be confirmed under the NY Convention | Award falls within the NY Convention and was issued in a contracting state. | N/A (defaulted). | The award is confirmed. |
| Whether any NY Convention grounds warrant denial | No grounds exist; Cabo Verde defaulted and record shows none of Article V defenses apply. | N/A (defaulted). | No grounds to deny; confirmation granted. |
Key Cases Cited
- G.E. Transp. S.p.A. v. Republic of Albania, 693 F. Supp. 2d (D.D.C. 2010) (grounds for denial under NY Convention limited)
- Belize Soc. Dev., Ltd. v. Gov’t of Belize, 668 F.3d 724 (D.C. Cir. 2012) (court may not refuse enforcement except explicit Article V grounds)
- TermoRio S.A. E.S.P. v. Electranta S.P., 487 F.3d 928 (D.C. Cir. 2007) (strict standard for denial of recognition under NY Convention)
- Gold Reserve, Inc. v. Bolivarian Repub. of Venezuela, 146 F. Supp. 3d 112 (D.D.C. 2015) (heavy burden to show grounds for denial)
- Oveissi v. Islamic Republic of Iran, 573 F.3d 835 (D.C. Cir. 2009) (FSIA requires evidence-based entitlement to judgment upon default)
- Roeder v. Islamic Republic of Iran, 333 F.3d 228 (D.C. Cir. 2003) (default does not automatically entitle judgment)
- GSS Group Ltd. v. Nat’l Port Auth., 680 F.3d 805 (D.C. Cir. 2012) (service under FSIA suffices for personal jurisdiction with jurisdictional basis)
- Creighton Ltd. v. Gov’t of the Republic of Nicosia, 181 F.3d 123 (D.C. Cir. 1999) (NY Convention awards can be enforced via FSIA framework)