International Arbitration And Litigation

International Arbitration and LitigationCRAIG C. MARTINJASON J. GREEN

JENNER & BLOCK LLPAUTHOR INFORMATION CRAIG C. MARTINPartnerTel:312 923-2776Fax:312 840-7776E-Mail: cmartin@jenner.com JASON J. GREEN1Associate General CounselCC Industries, Inc.Tel:312 750-6717E-Mail:jgreen@crown-chicago.comCRAIG C. MARTIN is Co-Chair of Jenner & Block’s Litigation Department. He representscorporations in international arbitrations, cross-border disputes and investigations. He also serves aslead trial and appellate counsel in litigation matters in the state and federal courts throughout theUnited States. In addition to his litigation and disputes practice, Mr. Martin counsels boards andboard committees of public and private companies. Mr. Martin is AV Peer Review Rated, MartindaleHubbell’s highest peer recognition for ethical standards and legal ability. In 2009, members of theLeading Lawyers Network named him one of the “Top 100 Business Lawyers in Illinois.” In 2011, hereceived the Judge Learned Hand Human Relations Award from the American Jewish Committee, forhis extraordinary professional accomplishments and dedication to philanthropic and civic endeavors.Mr. Martin is a member of the Commercial Club of Chicago, the Economic Club of Chicago, amember of the board of directors of the Lyric Opera of Chicago and its Executive Committee, and theChairman of the Board of Directors of the Boys and Girls Clubs of Chicago. He is a member of theAmerican Bar Association and its Section of Litigation, where he has served in various leadershippositions, and co-chaired the 2012 annual meeting in Chicago. Mr. Martin attended the University ofNotre Dame, receiving his B.A. Magna Cum Laude in 1985, and Harvard Law School, receiving hisJ.D. in 1988.JASON J. GREEN is the Associate General Counsel at CC Industries, Inc., a holding andmanagement company operated by the prominent, Chicago-based Crown family. Mr. Green waspreviously a partner at Jenner & Block, where he focused his practice primarily on the areas ofcomplex commercial litigation, including breach of contract, fraud, and other business torts,bankruptcy litigation, and technology litigation. Mr. Green has represented Fortune 500 clients in stateand federal courts, before arbitration panels, and in cross-border disputes around the world. He hasbeen recognized by Illinois Super Lawyers as a “Rising Star” in business litigation in 2010, 2011,2012, and 2013. In 2003, Mr. Green was recognized with the 2003 Albert E. Jenner, Jr. Pro BonoAward for his work in successfully defending death row inmates from challenges to the clemencyorders they had been issued by former Illinois Governor George Ryan. Mr. Green attended theUniversity of Illinois, Urbana-Champaign, receiving his B.S. in Civil Engineering in 1999 and The JohnMarshall Law School, receiving his J.D. in 2002.1Mr. Green previously was a Partner at Jenner & Block LLP 2014 Jenner & Block LLP. This publication is not intended to provide legal advice but to provide generalinformation on legal matters. Transmission is not intended to create and receipt does not establish an attorneyclient relationship. Readers should seek specific legal advice before taking any action with respect to mattersmentioned in this publication. The attorney responsible for this publication is Craig C. Martin. ATTORNEYADVERTISING

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TABLE OF CONTENTSI.CHAPTER 1: INTRODUCTION TO INTERNATIONAL ARBITRATION .1A.B.C.D.The History of International Arbitration .1Other Forms of International Alternative Dispute Resolution.3Power and Discretion of Arbitral Panel .5Reasons for Preferring International Arbitration .51.2.3.4.5.6.7.8.E.F.G.II.Neutral Forum .5Discovery .6Confidentiality .7Non-Precedential Judgment .7Flexibility .7Finality .9Speed .11Cost .11Ad-Hoc Arbitration .12Discussion of the Major Institutional Arbitral Regimes .13Other Arbitral Organizations .16CHAPTER 2: ROLE OF NATIONAL LAW .17A.Substantive Rules Of Arbitration v. Procedural Rules Of Arbitration .171.Substantive Rules of Arbitration .17a.b.2.B.C.Choice of Law Provisions .17Determining Whether the FAA or State Law Applies .18Procedural Rules of Arbitration .20The New York Convention’s Treatment Of National Law .21National Arbitration Statutes .221.United States .22a.b.2.3.Federal Arbitration Act .22Relevant State Laws Governing Arbitration .23Other Relevant National Law .25U.S. Adoption of UNCITRAL Model Law .26i

III.CHAPTER 3: DRAFTING THE AGREEMENT TO ARBITRATE .26A.B.Introduction .26Where Arbitral Clauses Appear .271.2.C.Best Practices for Drafting .271.2.3.4.5.D.Commercial Contracts .27Post-Dispute Agreements.27Scope of Arbitration .28Exclusivity of Arbitration .29Finality of Arbitration .29Recommended Elements for Arbitral Clauses .30Sample Provisions from Various Arbitral Regimes.31Important Considerations in Drafting Arbitral Clauses .331.2.Confidentiality .33Choice of Law .35a.b.c.3.4.Place of Arbitration .38Arbitral Awards .42a.b.c.d.5.6.7.8.9.10.11.12.IV.Law governing the arbitration agreement. .35Procedural law. .36Substantive law. .37Allowable Damages. .42Currency. .43Interest.43Costs and Attorneys’ Fees. .45Interim Relief .46Discovery .46Split Clauses, Stepped Clauses, and Conditions Precedent .47Arbitrator Selection and Qualifications .47Waiver of Sovereign Immunity .49Summary Disposition.49Consent to Entry of Judgment.50Kompetenz/Kompetenz Doctrine.51CHAPTER 4: VALIDITY OF AN AGREEMENT TO ARBITRATE .52A.New York Convention .521.The Agreement Form: Must be in writing .53ii

2.3.B.Panama Convention .581.2.3.V.Eligible Disputes: Existing or future disputes, often limited tothose of a commercial nature, that are capable of settlement byarbitration, were intended to be submitted to arbitration, andare not purely domestic .54Exceptions to Recognition: Null and void, inoperative, orincapable of being performed .57The Agreement Form: Must be in Writing.58Eligible Disputes: Existing or future disputes, arising withrespect to a commercial transaction, intended to be submittedto arbitration, and not purely domestic .59Exceptions to Recognition: None.60CHAPTER 5: CHOICE OF LAW .60A.Choice of Law Governing Validity of Arbitration Agreement .601.2.B.C.D.Arbitral Law Regarding Validity of Agreement to Arbitrate .61National Law Regarding Validity of Agreement to Arbitrate .62Choice of Procedural Law .63Choice of Substantive Law .66Choice of Law Governing Enforcement of Arbitral Awards.681.2.Arbitral Regime .68National Law .68a.VI.Examination of National Arbitration Laws.70CHAPTER 6: COMPOSITION OF ARBITRATION PANEL AND LOCATION OFARBITRATION .71A.Composition of Arbitral Panel .721.2.3.4.5.B.The Number of Arbitrator(s) .72Selecting the Arbitrator(s).73Selection and Examination of Available Arbitrators .74Challenging Selection of an Arbitrator .74Determination of Arbitrator’s Fees .76Seat of Arbitration (Location) .761.2.Default Location of Various Arbitral Regimes .77Party Selected Location .77a.Arbitrating in Different States .77iii

b.VII.CHAPTER 7: CONSOLIDATION AND MULTIPARTY ARBITRATION .79A.Consolidation of Multiple Arbitrations .791.2.B.C.VIII.Third Parties in International Arbitration .83Basis for Third Party Joinder .85Filing the Notice of Arbitration .87Service of Process .88Administrative Issues .88Statement of Claim .89Costs of Commencing Arbitration .89Jurisdiction .91Potential Interim Relief .911.2.H.Use of National Courts to Obtain Interim Relief .93Enforcement of Interim Arbitration Awards.94Appointment of the Arbitral Panel .95CHAPTER 9: RESPONSE TO FILING OF ARBITRATION.95A.B.C.D.E.Response to Notice of Arbitration or Statement of Defense.95Counterclaims .96Failure to Reply.97Anti-Suit Injunctions.98Challenges to Jurisdiction .991.2.F.X.Existence of Multiple Disputes .79Consent Requirement .80CHAPTER 8: COMMENCING ARBITRATION .87A.B.C.D.E.F.G.IX.UNCITRAL Model Law .78Challenges Before the Arbitration Panel .99Challenges in National Courts .101Sovereign Immunity.103CHAPTER 10: DISCOVERY IN ARBITRATION .104A.Discovery in Litigation vs. Arbitration .1041.2.B.Civil Law Systems .105Common Law Systems .105Rules of Leading Arbitral Authorities Relevant to DocumentProduction .106iv

1.2.3.4.5.6.7.8.9.10.11.12.C.International Chamber of Commerce Rules of Arbitration: .106UNCITRAL Arbitration Rules: .106London Court of International Arbitration Arbitration Rules: .107American Arbitration Association Commercial ArbitrationRules and Mediation Procedures: .107China International Economic & Trade ArbitrationCommission Rules: .108Japan Commercial Arbitration Association Rules: .108World Intellectual Property Organization Arbitration Rules: .109ICDR – Guidelines for Arbitrators Concerning Exchanges ofInformation : .109AAA-ICDR International Arbitration Rules:.110International Bar Association Rules on the Taking of Evidencein International Arbitration: .110International Institute for Conflict Prevention & ResolutionProtocol on Disclosure of Documents and Presentation ofWitnesses in Commercial Arbitration:.111Singapore International Arbitration Centre Arbitration Rules: .112Drafting Discovery Requests .1131.IBA Rules on the Taking of Evidence in InternationalArbitration: .113a.b.c.d.D.Electronic Discovery .1131.2.E.A Developing Issue .113Sample Guidelines: .114Discovery Disputes .1151.2.F.Specificity . .113Materiality .113Lack of Availability to the Requesting Party andRelative Financial Burden of the Parties .113Basis for Belief that the Responding Party Has theRequested Information. .113ICDR Guidelines for Arbitrators Concerning Exchanges ofInformation: .115IBA Rules on the Taking of Evidence in InternationalArbitration: .115Compelling 3rd Party Evidence or Witnesses .1171.2.Lack of Enforcement Power by the Panel.117Assistance of National Courts .118v

a.United States .1181)2)b.Europe .1211)2)G.ICDR Guidelines for Arbitrators Concerning Exchanges ofInformation: .122CHAPTER 11: PRE-HEARING CONFERENCES .122A.B.C.D.Timing of Pre-Hearing Conferences .122Preparing for the Pre-Hearing Conference .123Attendance of Senior Representatives of the Parties .123Matters for Discussion .1231.2.E.XII.England .121Switzerland .121Depositions .1211.XI.28 U.S.C. § 1782 .118Relevant Case Law .118Determination of Procedural Matters, including SubsequentHearings and Discovery. .123Role of Arbitral Panel in Facilitating Settlement .127After the Pre-hearing Conference .127CHAPTER 12: RULES OF EVIDENCE .127A.B.Rules of Leading Arbitral Authorities Relevant to the Taking ofEvidence .127International Bar Association Rules on the Taking of Evidence .1291.2.3.4.5.6.Scope of the IBA Rules of Evidence .129Agreement of the Parties .130Inspection .130Relevance .131Hearsay .131Attorney Client Privilege .132a.b.7.8.9.Overview of the Attorney Client Privilege .132Attorney Client Privilege in International Arbitration .132Confidentiality .133Oral Testimony at the Evidentiary Hearing .133Discretion of Panel .134vi