G.E. Transport S.P.A. v. Republic of Albania

693 F. Supp. 2d 132, 2010 U.S. Dist. LEXIS 24180
CourtDistrict Court, District of Columbia
DecidedMarch 16, 2010
DocketCivil Action No.: 08-2042 (RMU)
StatusPublished
Cited by25 cases

This text of 693 F. Supp. 2d 132 (G.E. Transport S.P.A. v. Republic of Albania) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
G.E. Transport S.P.A. v. Republic of Albania, 693 F. Supp. 2d 132, 2010 U.S. Dist. LEXIS 24180 (D.D.C. 2010).

Opinion

MEMORANDUM OPINION

Granting in Part and Denying in Part Without Prejudice the Petitioners’ Motion for a Default Judgment and Confirmation of Arbitral Award

RICARDO M. URBINA, District Judge.

I. INTRODUCTION

This matter is before the court on the petitioners’ motion for a default judgment and to confirm an arbitral award rendered against the respondent, the Republic of Albania, Ministry of Public Works, Transport and Telecommunications (“Albania”), pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 (“the New York Convention”), 21 U.S.T. 2517, T.I.A.S. No. 6997. The petitioners, who entered into a contract with Albania to modernize a portion of that nation’s rail network, commenced an arbitration proceeding against Albania in the International Chamber of Commerce, International Court of Arbitration (“the ICA”), pursuant to an arbitration clause in the underlying agreement. At the conclusion of those proceedings, an ICA arbitral tribunal concluded that Albania had failed to fulfill its obligations under the contract and issued an arbitral award in excess of $20 million in favor of the petitioners. The petitioners commenced this proceeding to enforce the arbitral award against Albania, which has declined to respond to the petition or otherwise participate in these proceedings. Because the petitioners have established to the court’s satisfaction their entitlement to a default judgment and confirmation of the arbitral award, the court grants the petitioners’ request for a default judgment and confirms the arbitral award in the amount of $20,664,933.30. The petitioners, however, have not explained to the court’s satisfaction the basis of the prejudgment interest award requested in the motion; accordingly, the court denies without prejudice the petitioners’ request for prejudgment interest.

II. FACTUAL & PROCEDURAL BACKGROUND 1

This dispute arises out of a contract executed on September 15, 2003, under which the petitioners agreed to undertake the modernization of a portion of Albania’s national railway network. See Petrs’ Mot. *134 at 1; see generally Decl. of Henry Weisburg in Support of Petrs’ Mot. for Default J. & Confirmation of Arbitral Award (“Weisburg Decl.”), Ex. B (“Contract Agreement”). The contract provided that Italian law governed its terms. Contract Agreement § 31. In addition, the contract included an arbitration clause requiring the parties to submit any dispute arising out of the contract to arbitration proceedings in Rome, Italy under the auspices of the ICA. Id. § 30.2. The arbitration rules of the ICA provide that any award issued by an ICA tribunal is binding upon the parties. 2 See Petrs’ Mot. at 2.

On June 1, 2006, the petitioners filed a request for arbitration with the ICA, based on their determination that Albania no longer intended to honor its obligations under the contract. Id. Pursuant to the aforementioned arbitration clause, an arbitration proceeding was convened in Rome. Id. All of the parties to this action, including Albania, participated in the proceeding, 3 which was bifurcated into a phase on liability and a phase on damages. Id.

On October 1, 2007, the three-person arbitral tribunal issued a “Partial Award” in which it unanimously concluded that Albania had breached Article 1358 of the Italian Civil Code and was obliged to compensate the petitioners for the losses, including lost profits, caused by Albania’s breach. See Weisburg Decl., Ex. A at 3. On July 28, 2008, the arbitral tribunal issued a unanimous “Final Award,” in which it directed Albania to pay the petitioners Q10,619,016.79 and $145,601.32 in lost profits suffered by petitioner G.E. Transportation S.p.A., Q1,995,548.91 in lost profits suffered by petitioner Athena S.A., $328,500 in arbitration costs and Q207,452.45 as reasonable defense costs. Id. at 33. This court refers to the “Partial Award” and the “Final Award” collectively as the “Arbitral Award.”

Following the issuance of the Arbitral Award, Albania filed an application for the correction and interpretation of the award with the arbitral tribunal, which was denied. Petrs’ Mot. at 3. Albania subsequently filed an appeal in the Court of Appeals in Rome seeking to overturn the Arbitral Award. Id. As an interim measure, Albania requested that the Court of Appeals suspend the Arbitral Award and declare it null and void under Italian law. Id.

Approximately two weeks after Albania commenced the Italian appeal proceedings, the petitioners commenced this action seeking an order confirming the Arbitral Award pursuant to the New York Convention. Petrs’ Mot. at 3; see generally Pet. to Confirm Arbitration Award. The petitioners filed an amended petition on December 3, 2008. See generally Am. Pet. to Confirm Arbitration Award. After Albania failed to respond within sixty days of service of the amended petition, the Clerk of the Court entered default on March 26, 2009. See Entry of Default (Mar. 26, 2009). The petitioners filed this motion on April 17, 2009, requesting that the court *135 confirm the Arbitral Award and enter default judgment against Albania. See generally Petrs’ Mot. Albania has declined to file any opposition to the motion. As of the date the petitioners filed their motion, Albania had not paid any portion of the Arbitral Award. Petrs’ Mot. at 3.

On February 26, 2010, this court ordered the petitioners to submit a status report reflecting the current state of the Italian appeal proceedings, including whether the Italian court had granted Albania’s request for interim relief. See Minute Order (Feb. 26, 2010). The petitioners responded on March 2, 2010, reporting that on January 26, 2010, the Court of Appeals in Rome had denied Albania’s request to suspend enforcement of the Arbitral Award and remanded the case for a hearing on Albania’s appeal on June 11, 2011. Petrs’ Status Report (Mar. 2, 2010). 4 The petitioners state that “[bjased on this remand, and the extremely slow pace of legal proceedings in Italy, Petitioners’ Italian counsel now expects the proceedings initiated by Albania to continue until approximately 2014.” Id.

III. ANALYSIS

A. Legal Standard for Default Judgment Against a Foreign State

A court shall not enter a default judgment against a foreign state “unless the claimant establishes his claim or right to relief by evidence satisfactory to the court.” 28 U.S.'C. § 1608(e); see also Roeder v. Islamic Republic of Iran, 333 F.3d 228, 232 (D.C.Cir.2003).

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Bluebook (online)
693 F. Supp. 2d 132, 2010 U.S. Dist. LEXIS 24180, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ge-transport-spa-v-republic-of-albania-dcd-2010.