Pharmaniaga Berhad v. EHealthline.com, Inc.

344 F. Supp. 3d 1136
CourtDistrict Court, E.D. California
DecidedSeptember 6, 2018
DocketNo. 2:17-cv-02672-MCE-EFB
StatusPublished
Cited by5 cases

This text of 344 F. Supp. 3d 1136 (Pharmaniaga Berhad v. EHealthline.com, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pharmaniaga Berhad v. EHealthline.com, Inc., 344 F. Supp. 3d 1136 (E.D. Cal. 2018).

Opinion

MORRISON C. ENGLAND, JR, UNITED STATES DISTRICT JUDGE

This Memorandum and Order disposes of the following currently pending motions (the "Motions"): (1) Petitioner Pharmaniaga Berhad's ("Pharmaniaga") Motion for Confirmation of Foreign Arbitral Award, Entry of Judgment, and Attorney's Fees Incurred in Confirming the Award (ECF No. 16, the "Motion to Confirm"); (2) Respondent E*Healthline.com, Inc. ("EHL")'s Motion to Dismiss (ECF No. 23, the "Motion to Dismiss"); (3) EHL's Motion to Vacate Arbitral Award (ECF No. 26, the "Cross-Motion to Vacate"); and (4) Pharmaniaga's Motion for Right to Attach Order and Writ of Attachment (ECF No. 43, the "Attachment Motion"). For the following reasons, the Motion to Confirm is GRANTED, and the remaining Motions are DENIED.1

*1140BACKGROUND

All of the Motions arise from the London-seated arbitration titled E*HealthLine.com Inc. v. Modern Industrial Investment Holding Group Co. Ltd. & Pharmaniaga Berhad, ICC Case No. 20125/RD (the "Arbitration"), in which EHL was the claimant and Pharmaniaga and Modern Industrial Investment Holding Group Co. Ltd. ("Modern") were the respondents. A three-member arbitral tribunal (the "Tribunal") presided over the Arbitration.

The procedural history of the Arbitration involved:

• Significant document productions by all parties;
• Extensive pre-hearing pleadings (with evidentiary exhibits and written fact and expert testimony) by all parties throughout 2014-2016;
• A five-day hearing (with opening and closing statements, live witness testimony, and cross-examination) in April 2016;
• Post-hearing submissions by all parties on the merits in May 2016; and
• Post-hearing submissions by all parties on the allocation of the Arbitration's costs.

The Arbitration concluded on November 2, 2016, when the Tribunal issued its unanimous, 174-page "Final Award," which is included as an exhibit to Pharmaniaga's Motion to Confirm. ECF No. 1-2. In the Final Award, the Tribunal rejected all of EHL's claims, finding that Pharmaniaga and Modern succeeded on all "material issues addressed by the Tribunal" and EHL "ha[d] not succeeded upon any of the Tribunal's Principal Issues[.]" Id. at 170.

During the Arbitration, "[a]ll three Parties [were] agreed" that the Tribunal's decision on the allocation of costs "should reflect the Parties' relative success and failure in the [A]rbitration." Id. at 169. Applying this standard after rejecting EHL's claims, the Tribunal ordered EHL to pay for the costs of the Arbitration (including the parties' legal fees) for a total of £2,000,000.00 (at a post-award interest rate of 4% per annum) and $872,953.00 (at a post-award interest rate of 3% per annum). Id. at 172. Although the Final Award awarded part of that total to Pharmaniaga and part to Modern, Modern assigned Pharmaniaga its interest in the Final Award pursuant to an Assignment of Rights Agreement dated November 5, 2017. See ECF No. 1-5 ("Assignment Agreement") at ¶ 5(a).

Throughout 2016 and 2017, Pharmaniaga asked (through counsel) for EHL to pay the amounts ordered by the Final Award, but EHL refused. See ECF No. 1-1 ("First Harrison Affidavit") at ¶¶ 7-8. On December 21, 2017, Pharmaniaga initiated this action to enforce the Final Award. See ECF No. 1. On February 2, 2018 and February 8, 2018, respectively, EHL filed its Motion to Dismiss and Cross-Motion to Vacate. On March 19, 2018, Pharmaniaga filed its Attachment Motion.

ANALYSIS

A. The Final Award Is Confirmed

Pharmaniaga's Motion to Confirm, and EHL's Motion to Dismiss and Cross-Motion to Vacate, all address the question of whether the Final Award should be confirmed. For the reasons stated below, the Court finds that the Final Award should be confirmed, and hereby GRANTS Pharmaniaga's Motion to Confirm and DENIES EHL's Motion to Dismiss and Cross-Motion to Vacate.

1. The New York Convention Governs Confirmation of the Final Award

The confirmation of the Final Award is governed by the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 (the "New *1141York Convention"). See Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 1114, 1120 (9th Cir. 2002) (holding the New York "Convention governs [an] action to confirm [an] arbitration award" where "the award was obtained in the United Kingdom (London)[.]"); see also 21 U.S.T. 2517 (the New York Convention), Art. I(1) ("This Convention shall apply to the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of such awards are sought[.]"). Indeed, the parties to this proceeding agree to the foregoing. See, e.g., ECF No. 16 at ¶ 2; ECF No. 26-1 at pp. 7:28-8:2.

2. Pharmaniaga Has Met Its Burden To Confirm The Final Award

A petitioner seeking the confirmation of a foreign arbitral award satisfies its burden by submitting copies of (1) the award and (2) the agreement to arbitrate. 21 U.S.T. 2517, Art. IV. Pharmaniaga has met this burden by submitting the Final Award and the agreement to arbitrate found in the Memorandum of Collaboration ("MOC"), which is the same agreement to arbitrate that EHL invoked in submitting its claims to arbitration in the first place. ECF No. 1-2 at p. 10.

3. There Is No Basis To Refuse Confirmation Under the New York Convention

Federal law implementing the New York Convention provides that a court "shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in the [New York] Convention." 9 U.S.C. § 207. Article V(2) of the New York Convention sets forth two grounds for non-enforcement; Article V(1) sets forth five affirmative defenses to be pleaded and proved by the responding party. See 21 U.S.T. 2517, Art. V(1) ("enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party furnishes ... proof[.]") (emphasis added); see also, e.g., Ministry of Defense and Support for the Armed Forces of the Islamic Republic of Iran v. Cubic Defense Systems, Inc., 665 F.3d 1091, 1096 (9th Cir. 2011) ("[T]he party opposing recognition or enforcement bears the burden of establishing that a defense applies").

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344 F. Supp. 3d 1136, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pharmaniaga-berhad-v-ehealthlinecom-inc-caed-2018.