Free Confirm Arbitration Award - District Court of California - California

Case 3:07-cv-04495-SI

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LUCAS VALLEY LAW MARK K. de LANGIS (SBN 190083) 2110 Elderberry Lane San Rafael, California 94903 Telephone: (415) 472-3892 Facsimile: (415) 472-3977 [email protected] Attorneys for Petitioners AMERICAN PRESIDENT LINES, LTD. and APL CO. Pte., LTD.

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

In the Matter of the Arbitration between AMERICAN PRESIDENT LINES, LTD., and APL CO. Pte., LTD. Petitioners, v. UNICOM TRANS, INC., a corporation, Respondent.

No. C 07-04495 SI NOTICE OF MOTION AND MOTION TO CONFIRM ARBITRATION AWARD; MEMORANDUM OF POINTS AND AUTHORITIES [9 U.S.C. section 9] Hearing Date: November 30, 2007 Hearing Time: 9:00 a.m. Courtroom: 10, 19th Floor

The Honorable Susan Illston

NOTICE OF MOTION AND MOTION TO CONFIRM ARBITRATION AWARD

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I.

NOTICE OF MOTION

TO EACH PARTY AND ITS ATTORNEY OF RECORD: YOU ARE HEREBY NOTIFIED THAT on November 30, 2007, at 9:00 a.m., or as soon thereafter as the matter may be heard, in Courtroom 10, 19th Floor of this Court, located at 450 Golden Gate Avenue, San Francisco, California, Petitioners American President Lines, Ltd. and APL Co. Pte., Ltd. (collectively "APL") will and hereby do move this Court pursuant to 9 United States Code section 9, for an order confirming the arbitration award in favor of APL and against Respondent Unicom Trans, Inc. ("Unicom"). This motion is based on this Notice; the following Memorandum of Points and Authorities; the accompanying Declaration of Mark K. de Langis; the previously filed Petition for Order Confirming Award of Arbitrator and exhibits thereto; and all argument, oral testimony, and other information introduced at the hearing on this motion.

II.

RELIEF SOUGHT By this motion, APL requests that the Court enter an order confirming the Award of

Arbitrator, in the arbitration between APL and Unicom (A true and correct copy the arbitrator's Award is attached to APL's Petition for Order Confirming Award of Arbitrator as Exhibit C; filed with the Court on August 30, 2007.) After proper submittal of proof, the arbitration award was executed and served on all parties by the duly appointed arbitrator, Matthew J. Geyer, Esq., on June 8, 2007. Unicom has yet to pay any portion of the award. Accordingly, APL seeks an order confirming the arbitration award and also requests that a judgment be entered in conformity with the terms of the arbitration award.

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III.

POINTS AND AUTHORITIES A. Background

In November of 2003, a service contract1 was entered into between APL and Unicom (See Service Contract Number TA03/0262 ("Service Contract"), attached as Exhibit A to APL's Petition for Order Confirming Award of Arbitrator ("Petition"), filed on August 30, 2007.) Unicom desired to ship cargo in international commerce from the United States to Russia. (See Service Contract, Appendix C, ¶¶ 1-3, attached as Ex. A to Petition.) As might be expected, Unicom bargained for favorable ocean freight rates for its shipments. In return for providing favorable ocean freight rates on Unicom's shipments, APL demanded a "Minimum Volume Commitment" from Unicom, so that APL could make up in volume what it gave away in rates on any particular shipment. To this end, Unicom agreed to ship a minimum volume of 50 FEUs over the life of the contract, from November 3, 2003 through January 31, 2004. (See Service Contract, App. C, ¶¶ 4 and 8, attached as Ex. A to Petition.) As is common practice in the industry, and in particular, as is common practice by APL, a liquidated damages clause (dead freight) was included in the Service Contract to provide APL with protection, in the event that Unicom failed to ship the required number of FEUs. (See Service Contract, p. 3 of 8, § 3(b), attached as Ex. A to Petition.) In the Service Contract, Unicom agreed to pay $350 for each FEU "by which the Minimum Volume Commitment exceeds the volume actually tendered." (Service Contract, p. 3 of 8, § 3(b).)
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"`[S]ervice contract' means a written contract, other than a bill of lading or a receipt, between one or more shippers and an individual ocean common carrier or an agreement between or among ocean common carriers in which the shipper or shippers makes a commitment to provide a certain volume or portion of cargo over a fixed time period, and the ocean common carrier or the agreement commits to a certain rate or rate schedule and a defined service level, such as assured space, transit time, port rotation, or similar service features. The contract may also specify provisions in the event of nonperformance on the part of any party." 46 U.S.C. app. 1702(19).

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Over the course of the contract's term, Unicom shipped 4 FEUS, not the 50 FEUs as required under the Service Contract. (See Invoice Number COGMD3K479, dated July 21, 2004, attached as Ex. B to Petition.) Accordingly, Unicom became obligated to pay dead freight charges on 46 FEUs ($16,100), as per the Service Contract. (See id.) Unicom has paid nothing towards the dead freight owed.

B.

THE ARBITRATION

APL and Unicom agreed in the Service Contract, at section 4, to resolve any dispute arising under the contract by submitting the dispute to arbitration in San Francisco, California, before an arbitrator of the American Arbitration Association. In addition, APL and Unicom agreed that the decision of the arbitrator "shall be final, binding and not subject to further review." (See Service Contract, at p. 4 of 8, § 4(a), attached as Ex. A to Petition.) Pursuant to the arbitration agreement, as detailed in section 4 of the above-described Service Contract, APL initiated arbitration proceedings with the American Arbitration Association ("AAA"). Following due notice to APL and Unicom, including preliminary hearings by telephone, an arbitration was duly conducted by the AAA appointed arbitrator, Matthew J. Geyer, Esq., on or about May 18, 2007. On June 8, 2007, the arbitrator, Matthew J. Geyer, Esq., awarded APL the principal amount of $16,100, attorneys' fees of $1,800, and costs of $1,928.90, for a total award of $19,828.90. (See arbitrator's Award, dated June 8, 2007, attached as Ex. C to Petition.) Section 4 of the above-described contract further provides that the decision of the arbitrator may be enforced by any court, tribunal, or other forum as may properly assert jurisdiction, and that the parties expressly consent and agree that the United States District Court for the Northern District of California shall have personal jurisdiction over the parties to the contract. (See Service Contract, at p. 4 of 8, § 4(b), attached as Ex. A to Petition.)

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