Telenor Mobile Communications AS v. STORM LLC

Summary

The United States Court of Appeals for the Second Circuit affirmed confirmation of an international arbitral award in favor of Telenor Mobile Communications AS against Storm LLC. The court held that Storm's agent had at least apparent authority to execute the shareholders agreement containing the arbitration clause and that the arbitration panel did not manifestly disregard the law by declining to give preclusive effect to related Ukrainian judgments. The court also discussed limited review of arbitral awards under the New York Convention and the presumptions governing arbitrability.

Holdings

1. The panel did not manifestly disregard the law because it had colorable reasons to conclude that the Ukrainian proceedings were procedurally unsound and collusive, including the lack of notice to Telenor and the related corporate entities' involvement.
2. Enforcement of the arbitral award against Storm was not contrary to United States public policy under Article V(2)(b) of the New York Convention.
3. Storm was not entitled to a trial because it failed to present some evidence sufficient to support a genuine dispute over whether Nilov had authority to bind Storm to the agreement.
4. Nilov had apparent authority as a matter of law to execute the 2004 agreement on Storm's behalf, and no genuine issue of material fact required a trial.

Questions Presented

1. Whether the arbitration panel manifestly disregarded the law by refusing to give preclusive effect to Ukrainian judgments declaring the 2004 shareholders agreement invalid and nonarbitrable.
2. Whether enforcement of the arbitral award violated the public-policy defense under Article V(2)(b) of the New York Convention because compliance allegedly would conflict with Ukrainian judgments.
3. Whether the arbitration panel manifestly disregarded Sphere Drake by failing to require a trial on the arbitrability issue.
4. Whether Storm presented sufficient evidence to create a genuine issue concerning Nilov's apparent authority to execute the 2004 agreement and thereby require a trial on arbitrability.

Disposition

affirmed