GEM Global Yield LLC SCS v. Auto Services Group Limited

Background

GEM Global Yield LLC SCS ("GEM Global") and GEM Yield Bahamas Limited ("GYBL") petitioned to enforce a final arbitration award against Auto Services Group Limited ("ASGL"). They relied on the Convention on the Recognition and Enforcement of Foreign Arbitral Awards and its implementing statute, 9 U.S.C. § 201 et seq.

ASGL was served at its registered office in the Cayman Islands on May 28, 2025. It did not respond to the petition or seek more time to respond. GEM Global and GYBL then moved for a default judgment.

The dispute arose from a Share Purchase Agreement under which GEM Global agreed, after ASGL’s public listing and upon a qualifying request, to purchase up to $125 million of ASGL’s common shares. The agreement also required ASGL to pay GYBL a $2.5 million commitment fee, whether or not ASGL made such a request. After ASGL’s shares were listed on Nasdaq, the parties disputed when the commitment fee had to be paid.

The agreement required final and binding arbitration. ASGL commenced arbitration, seeking a declaration that no part of the commitment fee was yet due. GEM Global and GYBL asserted counterclaims, alleging that ASGL failed to pay $1.25 million by May 17, 2024, and another $1.25 million by November 17, 2024. Because ASGL did not pay the arbitration tribunal’s fee, only the counterclaims proceeded to a decision. ASGL defended against those counterclaims through briefing, documentary evidence, and oral argument.

Arbitration Award and Court’s Analysis

On April 28, 2025, the arbitrator issued a 16-page final award finding that ASGL breached the agreement by failing to make both payments. The award included $2.5 million in damages, $106,644.12 in pre-award interest on the first $1.25 million payment, $49,931.64 in pre-award interest on the second payment, and $154,221.20 in attorneys’ fees under the agreement. It also provided for nine-percent annual interest on those amounts beginning 30 days after the award and continuing until payment.

The court explained that confirmation of an arbitration award is generally treated like summary judgment, meaning the court reviews the parties’ submissions to determine whether there is a genuine factual dispute and whether the award should be enforced. Under the Convention, the party seeking enforcement must provide certified copies of the award and arbitration agreement. GEM Global and GYBL met that requirement. ASGL did not raise any of the Convention’s defenses.

The court also found that the dispute was capable of arbitration, the arbitration was based on a written agreement, ASGL received notice and an opportunity to be heard, the proceedings complied with the Convention, and the award did not violate public policy. The court concluded that the award was supported by law and fact and should be confirmed.

Ruling

Judge Castel granted GEM Global’s and GYBL’s petition to confirm the final award. The court directed the Clerk to enter judgment in their favor for $2,810,796.96, plus prejudgment interest at nine percent per year calculated from 30 days after April 28, 2025, through the date judgment is entered. The court stated that post-judgment interest is available as a matter of law.

The court did not determine the petitioners’ separate request for attorneys’ fees and costs incurred in filing the petition. Instead, it directed GEM Global and GYBL to submit, within 14 days, a declaration from counsel describing the fees and costs they seek.