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Ninth Circuit Rejects 's Defense in $562.5M Award
The has affirmed the confirmation of a $562.5 million international against , India’s state-owned space company, rejecting arguments that the case should be dismissed for or that U.S. courts lacked jurisdiction.
In a wide-ranging opinion written by Circuit Judge Lucy H. Koh, the panel held that the doctrine of does not apply to actions to confirm foreign arbitral awards under the . The court also concluded that existed under the Foreign Sovereign Immunities Act’s (FSIA) and that the exercise of over Antrix comported with the .
The Dispute Over S-Band Spectrum
The case originates from a agreement between and Ltd., a corporation wholly owned by the . Under the terms, Antrix agreed to build, launch, and operate two satellites and lease 70 MHz of India’s S-band spectrum to Devas in exchange for construction and leasing fees.
In , Antrix informed Devas that it was terminating the agreement, citing a policy decision by the Indian government not to provide an S-band orbital slot for commercial activities. Devas rejected the termination and commenced arbitration before the in .
In , a three-member ICC tribunal ruled that Antrix had wrongfully repudiated the agreement and awarded Devas $562.5 million plus interest. Devas later sought confirmation of the award in the under the , which both the United States and India have signed.
From District Court to the and Back
The district court confirmed the award, prompting Antrix’s appeal. In an initial decision, the Ninth Circuit applied then-controlling precedent and held that the FSIA’s provision required a traditional analysis—and that Antrix lacked sufficient contacts with the United States. The court reversed the confirmation.
The , however, reversed the Ninth Circuit’s decision in in , holding that the FSIA does not require plaintiffs to establish “” beyond the contacts already required by the statute’s enumerated exceptions to foreign . The case was remanded for the court of appeals to address Antrix’s alternative arguments.
Arguments Before the Panel
On remand, Antrix raised three main challenges: that the FSIA’s did not supply because the dispute lacked a commercial nexus to the United States; that the exercise of violated the ’s Clause; and that the action should be dismissed under the doctrine of in favor of litigation in India.
Devas and the intervening shareholders—three Mauritian entities and —countered that the required no such nexus, that was reasonable, and that was incompatible with the mandatory regime of the .
Key Legal Holdings
Rejecting Antrix’s argument that the FSIA’s requires a connection to U.S. commerce, the panel observed that the statute “contains no requirement that the underlying commerce that is the subject of the arbitration have a nexus with the United States.” The court noted that Congress knew how to impose such a limitation—as it did in the separate —but chose not to do so in the .
The panel further reasoned that because the award is governed by the and covered by the Convention’s implementing legislation, it concerns a subject matter “capable of settlement by arbitration under the laws of the United States” as required by .
Assuming without deciding that Antrix qualifies as a “person” entitled to protections, the court found that the exercise of was reasonable. It weighed three factors: the strong U.S. interest in enforcing treaty obligations; the absence of on Antrix, a sophisticated entity backed by the Indian government; and Devas’ substantial interest in obtaining relief, given that only U.S. courts can attach Antrix’s commercial assets located in the United States.
In a holding with broad implications for international arbitration , the circuit panel ruled that does not apply to actions to confirm foreign arbitral awards under the . The court emphasized that the Convention makes and of covered awards mandatory, listing only limited defenses—none of which includes .
“A discretionary, forum-by-forum defense to that would let each signatory state decline on convenience grounds is irreconcilable with the design of the Convention.”
The panel also noted that India would not be an because only U.S. courts can located in the United States.
Key Observations from the Bench
The court highlighted the mandatory nature of the : “The Convention makes the and of a covered award mandatory: Article III provides that each contracting state ‘shall recognize arbitral awards as binding and enforce them.’”
On , the panel stated: “the exercise of over Antrix is reasonable and therefore comports with the ,” pointing to Antrix’s sophistication and the lack of given that India is a signatory to the Convention.
The Decision and What Comes Next
The Ninth Circuit affirmed the district court’s judgment on , , and . In a concurrently filed memorandum disposition, the court also affirmed the confirmation of the award and the registration of the judgment as to , but reversed and vacated the registration as to the shareholder intervenors, who lacked to register the judgment.
The panel remanded the case to the district court to address, in the first instance, the effect of subsequent proceedings in Indian courts that the arbitration award. This leaves a lingering question: whether the Indian will ultimately block of the U.S. judgment—a matter that the district court must now decide.
