Leader Tech. v. MultiNational Resour CV-01-359-JD 12/03/04 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Leader Technology Co.

v. Civil No. 01-359-JD Opinion No.

MultiNational Resources, Inc.

O R D E R

Leader Technology Company brought suit in state court

against MultiNational Resources, Inc. ("MNR"), alleging breach of

contract and guantum meruit. MNR then removed the action to this

court based on diversity jurisdiction pursuant to

, and brought several counterclaims. MNR moved to remand the

case for arbitration under the Federal Arbitration Act ("FAA"),

, et seg., pursuant to the arbitration clause in the

parties' agreement. The court granted that part of MNR's motion

seeking arbitration. Order, Dec. 19, 2001, (doc. no. 11).

Background

The parties arbitrated their dispute before a three-

arbitrator panel of the American Arbitration Association ("AAA").

On August 16, 2004, the panel issued its decision to award Leader

$495,766.07, and the AAA issued the award on August 24, 2004. On

September 1, 2004, Leader filed a petition to confirm the

arbitration award pursuant to

and 13. MNR objected to the petition on the ground that it intended to file an

application, pursuant to the AAA Rules, to correct computational

errors in the award. The panel denied MNR's application on

September 28, 2004.

MNR then filed a second objection to Leader's motion to

confirm and a motion to stay the proceedings, seeking time to

file a motion to vacate the award. MNR cited the New Hampshire

Arbitration Act, New Hampshire Revised Statutes Annotated ("RSA")

§ 542:8, et seg., as the basis for its planned motion. Leader

objects to MNR's motion to stay the proceedings.

Discussion

Leader asserts that the arbitration panel's award should be

confirmed pursuant to

and 13, asking the court to

enter judgment confirming the award in its favor of $495,776.07.

MNR objects to Leader's motion on the ground that it intends to

file a motion to vacate the award and asks that the proceedings

be stayed until ninety days after September 28, 2004, by which

time MNR intends to file its motion. MNR asserts that New

Hampshire law governs the remaining issues in this case.

2 A. Governing Law

MNR contends that choice-of-law clause in the parties'

agreement directs that New Hampshire law, including the New

Hampshire Arbitration Act, governs the court's review of the

arbitration award. That clause provides that the "Agreement is

made under, and the validity, construction and performance of

this Agreement shall be governed and interpreted in accordance

with, the laws of the State of New Hampshire, United States of

America." Motion for Stay, Ex. A, 5 15 (doc. no. 18) . With

respect to arbitration, however, the same clause provides that

the parties' disputes "shall be finally settled by binding

arbitration to be conducted in the State of New Hampshire in

accordance with the Commercial Arbitration Rules of the American

Arbitration Association."

As is noted above, the parties have proceeded to this point

under the FAA. The court previously held that the FAA governed

the proceedings because the parties' agreement concerns

interstate commerce. Order, Dec. 19, 2001, at 5. MNR did not

challenge that decision and failed to mention it in its present

motion.

Even if this issue had not been resolved previously in this

case, MNR's argument that New Hampshire arbitration law governs

would not succeed. Parties may agree to arbitrate under state

3 law. See, e.g.. Ford v. NYLCare Health Plans of the Gulf Coast,

Inc.,

(5th Cir. 1998); Ekstrom v. Value

Health, Inc.,

(D.C. Cir. 1995); Int'1

Techs. Integration, Inc. v. Palestine Liberation Org.,

(D.D.C. 1999). If the parties intend that state

arbitration laws govern their proceedings, however, that intent

must be stated clearly to avoid the presumption that the FAA

governs arbitration. See, e.g., Mastrobuono v. Sherson Lehman

Hutton, Inc.,

(1995); Roadway Package Sys.,

Inc. v. Kayser,

(3d Cir. 2001); Paine Webber

Inc. v. Elahi,

(1st Cir. 1996); Calabria v.

Franklin Templeton Servs., Inc.,

, at *3 (N.D.

Cal. Sept. 26, 2001).

In this case, the choice-of-law clause states that the

agreement will be construed under New Hampshire law. At the same

time, however, the clause provides for arbitration under federal

law. Therefore, the FAA, rather than state law, applies to the

court's review of the arbitration proceeding. See Paine Webber,

.

4 B. Motion to Stay the Proceedings

MNR asks the court to stay the proceedings here for ninety

days after September 28, 2004, pursuant to Federal Rule of Civil

Procedure 8 1 (e). Although MNR asserts that it is entitled to

file a motion to vacate the award within one year, as provided by

RSA 542:8, it states that it intends to file its motion within

ninety days as provided under the FAA,

. MNR asks

the court not to consider Leader's motion to confirm the award

and to stay the proceedings until it files its motion to vacate.

Leader objects and asserts that under

, MNR would

have only three months after August 24, 2004, to file a motion to

vacate.

RSA 542:8 does not apply in this case. Under the FAA, a

party has ninety days to challenge the arbitrator's award.

; Prudential-Bache Securities, Inc. v. Tanner,

(1st Cir. 1995). The ninety-day period begins when the

award is "filed or delivered."

. As long as the

arbitral award resolves the parties' claims, it is final when it

is filed or delivered and the time under § 12 begins to run,

although the arbitrators may retain jurisdiction to consider

subsidiary matters or reguests for correction. Fradella v.

Petricca,

(1st Cir. 1999).

In this case, there is no dispute that the award issued on

5 August 24, 2004, addressed all of the parties' claims. MNR

contends that the award was received by its counsel on August 25,

2004. Therefore, counting ninety days from August 25, MNR had

until November 23, 2004, to challenge the arbitrators' award in

this proceeding. No such challenge has been filed. Therefore,

MNR's motion to say the proceedings until ninety days from

September 28, 2004, is denied as moot.

MNR filed a motion to vacate on December 2, 2004. Because

the deadline for a motion to vacate was November 23, 2004, that

motion is untimely and will not be considered.

C. Motion to Confirm

A motion to confirm an arbitrators' award may be brought in

this court.

. In the award, the arbitrators granted

Leader's claim for money past due in the amount of $495,776.07

with interest accruing from thirty days after the award was

transmitted to the parties and denied all of Leader's other

claims. The award reguires Leader to return MNR's tooling after

MNR pays the amounts awarded. The arbitrators denied MNR's

counterclaims.

MNR did not provide any substantive grounds in opposing

Leader's motion to confirm the award. Having reviewed the award

in light of the parties' filings here, other than the late-filed

6 motion to vacate, the court concludes that it should be

confirmed.

Conclusion

For the foregoing reasons, the plaintiff's petition to

confirm the arbitration award (document no. 12) is granted. The

defendant's motion for a stay of proceedings (document no. 18) is

denied.

The arbitration award is confirmed. The clerk of court

shall enter judgment accordingly when Leader files the papers

reguired by

, which shall be filed with the

judgment. After judgment is entered, the clerk of court shall

close the case.

SO ORDERED.

Joseph A. DiClerico, Jr. United States District Judge

December 3, 2004

cc: Ronald E. Cook, Esguire Edwinna C. Vanderzanden, Esguire

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