Seaport Global Holdings LLC v. Petaquilla Minerals Ltd.

Background

Seaport Global Holdings LLC asked the court to confirm an arbitration award against Petaquilla Minerals Ltd. under the Federal Arbitration Act and the New York Convention, which provides rules for recognizing and enforcing certain international arbitration awards.

The parties had entered an engagement agreement under which Seaport’s predecessor would advise Petaquilla and act as its exclusive placement agent for a bond offering. The agreement required Petaquilla to reimburse expenses incurred in connection with those services, whether or not the bond sale closed. It also required disputes to be resolved through binding arbitration in New York City under American Arbitration Association rules.

Seaport began arbitration in 2015, alleging that Petaquilla had not reimbursed its expenses. The parties selected Steven Skulnik as the sole arbitrator. After an evidentiary hearing, the arbitrator issued a partial final award on January 4, 2019, denying all of Petaquilla’s counterclaims and awarding Seaport $759,956.28 and 64,263 Canadian dollars. In a final award issued April 22, 2019, the arbitrator awarded Seaport an additional $2,103,356.60 in attorney’s fees and expenses and $61,269.20 in administrative fees and expenses.

Seaport filed its petition to confirm the award on October 9, 2019. Petaquilla was served but did not answer. The court treated the unanswered petition as an unopposed motion for summary judgment, meaning the court still had to review the record and determine whether Seaport was legally entitled to judgment.

Confirmation of the Arbitration Award

The court conducted the limited review that applies to arbitration awards. It found that the arbitration agreement covered the dispute and that the arbitrator had determined, based on the evidence, that Seaport had used its best efforts, was not responsible for the failed bond offering, and was entitled to reimbursement of its expenses. The arbitrator had denied Petaquilla’s counterclaims because there was no credible evidence supporting them.

The court found no indication that the arbitrator acted arbitrarily, exceeded the authority granted by the agreement, or acted contrary to law. Because there was no disputed material fact and the award had at least a minimally plausible justification, the court confirmed it.

Attorney’s Fees, Costs, and Interest

The court agreed that an award of attorney’s fees and costs for the confirmation proceeding could be justified because Petaquilla had not followed the arbitration award and had not timely participated in the court case. However, Seaport had requested $5,010.35 without providing records supporting the amount. The court therefore denied that request without prejudice.

The court also denied without prejudice Seaport’s request for pre-judgment interest because Seaport provided neither supporting authority nor the interest rate it sought. The court granted post-judgment interest on the full judgment amount under 28 U.S.C. § 1961(a).

Disposition

The court’s motion was GRANTED in part and DENIED in part. The arbitration award was confirmed, and the Clerk was directed to enter judgment in Seaport’s favor for $2,972,833.31. The judgment would accrue post-judgment interest. The court allowed Seaport, within ten days after entry of the order, to submit supporting records for attorney’s fees and costs and a short letter explaining the amount and basis of any requested pre-judgment interest.