Jack Rubenstein CT, LLC v. Naturalena Brands, Inc.

Background

Jack Rubenstein CT, LLC (JRC) petitioned under the Federal Arbitration Act, a federal law governing arbitration, to confirm an arbitration award against Naturalena Brands, Inc. The parties had agreed to source personal protective equipment from China and sell it in the United States. In January 2021, JRC ordered 24 million gloves and prepaid Naturalena more than $3 million. Naturalena delivered about 20 percent of the order and refused to refund the remaining money, asserting that JRC owed Naturalena at least that amount from earlier transactions.

JRC had previously sued Naturalena in the U.S. District Court for the District of Connecticut. After Naturalena sought to compel arbitration under the parties’ written agreement, JRC dismissed that action without prejudice and began arbitration before the International Chamber of Commerce. Naturalena and its affiliate consented to the arbitrator’s jurisdiction and participated in the arbitration before Richard F. Ziegler.

The arbitrator issued an award in July 2024 holding Naturalena and its affiliate jointly and severally responsible for $2,512,379.40 in compensatory damages, $795,701.34 in pre-award interest, post-award interest of $688.32 per day, and $367,197.81 in legal fees and costs. Naturalena did not appear in the federal confirmation proceeding.

Court’s analysis

The court explained that arbitration awards are not automatically enforceable as court judgments. Under the Federal Arbitration Act, a court generally must confirm an award unless statutory grounds exist to vacate or modify it, such as fraud, arbitrator bias, prejudicial misconduct, an arbitrator exceeding the arbitrator’s authority, or an evident mathematical or descriptive error.

Because Naturalena did not answer the petition, the court treated the petition as an unopposed motion for summary judgment. Summary judgment is a ruling entered when the record shows no genuine dispute over a material fact and the moving party is entitled to judgment under the law. Even though Naturalena did not appear, the court still reviewed JRC’s submissions to determine whether JRC met its burden.

The court found that JRC had shown there was no genuine dispute about the arbitration’s validity. It determined that the arbitrator provided more than the minimal justification required for confirmation, that the parties’ agreement authorized arbitration of disputes arising from their business relationship, and that none of the statutory grounds for vacating or modifying the award applied.

Ruling

The petition to confirm the arbitration award was GRANTED. The court confirmed an award totaling $3,675,278.50 in compensatory damages, legal fees and costs, and pre-award interest, plus post-award interest of $688.32 per day accruing from August 1, 2024, through the date judgment was entered.

The court also held that JRC was entitled to post-judgment interest at the statutory rate under 28 U.S.C. § 1961. The Clerk of Court was directed to enter judgment against Naturalena in the specified amount, add the applicable interest, terminate the motion at ECF No. 8, and close the case.