Reinsurance Focus

In 1990, Anthony LaPine, founder of a California disk drive company called LaPine Technology Corporation (“LTC”), filed an arbitration proceeding against Kyocera, a Japanese corporation, and Prudential accusing them of destroying the value of LTC. The arbitration was stayed pending the resolution of a related arbitration. Shortly after the arbitration resumed in 2007, the arbitration panel dismissed all of LaPine’s claims, concluding that his fraud claims were barred by the statute of limitations, he lacked standing to raise the contract and corporate mismanagement claims, and, as an additional basis for dismissal, that his claims were barred by the doctrines of waiver and estoppel. LaPine brought this action against Kyocera asking the court to vacate the arbitration award.

The Court denied LaPine’s request and confirmed the arbitration award. Having concluded that the arbitration agreement and arbitral award fell under the New York Convention, the Court addressed the heart of the parties’ dispute, namely whether the grounds for review enumerated in Article V of the Convention were exclusive, or whether the award could also be reviewed under the standards set forth in the FAA. The court concluded (in the absence of guidance from the Ninth Circuit) that the appropriate standard of review was under both Article V of the Convention and the FAA. The court analyzed LaPine’s arguments under both sets of rules, but found no grounds to overturn the panel’s award. LaPine v. Kyocera Corp., No. C 07-06132 (USDC N.D. Cal. May 23, 2008).

This post written by Lynn Hawkins.