Applying the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, a U.S. federal district court confirmed a Lebanese arbitration award in favor of Iraq Telecom Ltd. for $3 million against Intercontinental Bank of Lebanon S.A.L. (IBL).

IBL had argued that the court should refuse to confirm the award because it had brought an annulment action in Lebanon, which, according to IBL, had the effect of rendering the award “nonbinding on the parties” under the primary jurisdiction’s (Lebanese) law. The court found, however, that the Convention did not support IBL’s request because the terms of the underlying agreement between the parties made the award final and not subject to an appeal. The court also found that the award had not been set aside or suspended, and even if it could take into account the fact that the annulment action was pending, there was no showing that the annulment action had a likelihood of success.

After weighing certain factors used by the Second Circuit, the court also rejected IBL’s motion under Article VI of the Convention to stay the confirmation pending the resolution of IBL’s Lebanese annulment action. The court found, in pertinent part, that the award “was entered after three years of proceedings before the Tribunal and is supported by the Tribunal’s lengthy, detailed findings of fact and law. The twin goals of arbitration, ‘settling disputes efficiently and avoiding long and expensive litigation,’ favor expeditious execution of the Award.” The court then granted Iraq Telecom’s request for a declaratory judgment recognizing the findings made in the award.

Iraq Telecom Ltd. v. IBL Bank S.A.L., No. 1:21-cv-10940 (S.D.N.Y. Apr. 8, 2022).