- Per the rules promulgated by the major international arbitral bodies, arbitrators have broad discretion to issue awards for interim relief, or to make partial awards before resolving the ultimate dispute between the parties. However, under the FAA and the New York Convention, the federal courts do not have authority to confirm or enforce interlocutory awards; an award must be “final” in order for it to be subject to any court review. See, e.g., El Mundo Broad. Corp. v. United Steel Workers of Am., 116 F.3d 7, 9 (1st Cir. 1997) (under the FAA); Hall Steel Co. v. Metalloyd Ltd., 492 F. Supp. 2d 215 (E.D. Mich. 2007) (under the New York Convention).
- Nevertheless, an award which disposes of a separate independent claim may be confirmed by a district court, even though it doesn’t dispose of all the claims that were submitted to arbitration. See Metallgesellschaft A.G. v. M/V Capitan Constante, 790 F.2d 280, 283 (2d Cir. 1986); see also Publicis Commun. v. True North Communs. Inc., 206 F.3d 725, 729 (7th Cir. 2000) (under New York Convention, “[a] ruling on a discrete, time-sensitive issue may be final and ripe for confirmation even though other claims remain to be addressed by arbitrators.”).
- In addition, interim equitable awards, such as awards for preliminary injunctive relief, will likely be confirmed or enforced if they are necessary to make an ultimate award by the arbitral panel meaningful. See Pacific Reinsurance Mgmt. Corp. v. Ohio Reinsurance Corp., 935 F.2d 1019, 1023 (9th Cir. 1991) (“[t]emporary equitable orders calculated to preserve assets or performance needed to make a potential final award meaningful … are final orders that can be reviewed for confirmation and enforcement by district courts under the FAA”); Sperry Int'l Trade, Inc. v. Israel, 689 F.2d 301, 304 n.3 (2d Cir. 1982) (award requiring the establishment of an escrow account pending final determination of the merits was a “final” decision, “ripe for confirmation”); Southern Seas Navigation Ltd. v. Petroleos Mexicanos, 606 F. Supp. 692, 694 (S.D.N.Y. 1985) (arbitrators’ award of equitable remedies such as preliminary injunctive relief may be reviewable by a court).
- Some courts may require that the party seeking enforcement of a partial or interim award show that there is an urgent need for the relief requested. Hall Steel Co., 492 F. Supp. 2d at 715 (refusing to confirm an interim or partial arbitral award assessing costs against a party for a threshold issue, where there was no “immediate need” for such relief). Courts may also look to the arbitrators’ characterization of the award, and any agreement by the parties regarding court review of arbitral awards. Id. For example, where parties have agreed to bifurcate an arbitration into a liability and a damages phase, the liability award may itself be considered final and subject to review. Hart Surgical, Inc. v. UltraCision, Inc., 244 F.3d 231, 235-36 (1st Cir. 2001).
Practice Tip: Regardless of how the award is labeled, courts will be inclined to review an interim arbitral award if the party seeking review can show a time-sensitive need for judicial relief.
Ch. 22 Other Litigation Ancillary to International Arbitration
PETER SHERWIN, DANIELLA M. RUDY*, JEAN CLEMENTE*NOAH SISKIND GITTERMAN,
III. Confirmation and Enforcement of an Interim Award
* Not Yet Admitted