301 F. Supp. 3d 175
D.C. Cir.2018Background
- Tatneft (Russian joint-stock company) invested in Ukrainian joint venture Ukrtatnafta; shareholder disputes and Ukrainian court actions deprived Tatneft of control/ownership according to the arbitral tribunal.
- Tatneft initiated UNCITRAL arbitration under the Russia–Ukraine BIT; tribunal issued a Merits Award (July 29, 2014) awarding $112 million plus interest for breaches of the BIT (including failure to provide fair and equitable treatment). The Paris Court of Appeal later upheld the award.
- Tatneft filed a petition in D.D.C. (Mar. 30, 2017) to confirm and enter judgment on the Merits Award under the New York Convention and FAA; Ukraine opposed, moved to dismiss (FSIA, forum non conveniens), sought jurisdictional discovery, and moved to stay pending French cassation proceedings.
- Ukraine’s defenses: sovereign immunity (FSIA), forum non conveniens, alleging Tatneft is state-controlled (not a “private party”), tribunal lacked authority over certain claims, and Article V New York Convention defenses (tribunal impartiality/composition; U.S. public policy).
- Court rulings: denied Ukraine’s motions to dismiss, to take jurisdictional discovery, and to stay; held Tatneft’s confirmation petition in abeyance and ordered Tatneft to file a reply to Ukraine’s opposition by April 19, 2018.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FSIA arbitration-exception jurisdiction (§1605(a)(6)) | Tatneft: award made pursuant to Russia–Ukraine BIT and governed by New York Convention; exception applies | Ukraine: Tatneft is state-controlled (not a “private party”); award not "pursuant to" an agreement to arbitrate for some claims; lack of standing for certain claims | Court: FSIA exception applies; will not re‑decide arbitrability—defers to tribunal and Paris Court of Appeal; denies dismissal on this ground |
| Implied-waiver jurisdiction (§1605(a)(1)) | Tatneft: Ukraine waived immunity by agreeing to arbitrate in a New York Convention signatory (France) | Ukraine: theory not pleaded originally; should be waived | Court: accepts implied waiver theory as alternative basis and considers it; denial of dismissal stands |
| Forum non conveniens | Tatneft: U.S. forum needed to attach any Ukrainian commercial assets in U.S.; Ukrainian courts are inadequate because dispute implicates prior Ukrainian judicial acts | Ukraine: Ukraine or France (or other fora) are adequate alternatives; Tatneft’s assertions speculative | Court: follows TMR Energy precedent; finds no adequate alternative forum and denies dismissal on forum non conveniens |
| Article V New York Convention defenses; stay and jurisdictional discovery | Tatneft: tribunal decided jurisdictional/admissibility issues; Paris Court of Appeal upheld award; U.S. confirmation appropriate; discovery unnecessary; stay unwarranted because French set-aside is inactive | Ukraine: seeks discovery to show Tatneft is not a private party; argues tribunal impartiality and U.S. public policy defeat confirmation; seeks stay pending French Cassation/cassation-related proceedings | Court: denies jurisdictional discovery as moot (tribunal and Paris Court of Appeal rulings); denies stay (French proceeding inactive/deactivated); orders Tatneft to reply to Article V objections before ruling on confirmation |
Key Cases Cited
- Belize Social Dev. Ltd. v. Government of Belize, 794 F.3d 99 (D.C. Cir.) (FSIA framework and burden allocation)
- Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (U.S. 1989) (FSIA is sole basis for jurisdiction over foreign states)
- Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480 (U.S. 1983) (court must ensure an FSIA exception applies before exercising jurisdiction)
- Chevron Corp. v. Republic of Ecuador, 795 F.3d 200 (D.C. Cir.) (courts should not relitigate arbitrability under FSIA; limited jurisdictional inquiry)
- Creighton Ltd. v. Government of State of Qatar, 181 F.3d 118 (D.C. Cir.) (implied‑waiver analysis tied to New York Convention signatory status)
- TermoRio S.A. E.S.P. v. Electranta S.P., 487 F.3d 928 (D.C. Cir.) (Article V is exclusive grounds to refuse enforcement under Convention)
- TMR Energy, Ltd. v. State Property Fund of Ukraine, 411 F.3d 296 (D.C. Cir.) (no adequate alternative forum where U.S. is only forum to attach sovereign commercial assets)
- Europcar Italia S.p.A. v. Maiellano Tours, Inc., 156 F.3d 310 (2d Cir.) (factors for staying confirmation pending foreign set-aside proceedings)
- BG Group PLC v. Republic of Argentina, 134 S.Ct. 1198 (U.S. 2014) (arbitrability review rules; parties may delegate arbitrability to arbitrators)
- Landis v. North American Co., 299 U.S. 248 (U.S. 1936) (district courts' inherent power to stay proceedings)