Polska Fundacja Narodowa v. Athlete Benefits Group, LLC

Background

Polska Fundacja Narodowa (PFN) petitioned to confirm an arbitration award issued on October 20, 2021, and amended by an addendum dated January 19, 2022. Athlete Benefits Group, LLC (ABG) and Lamar D. Williams opposed confirmation and cross-petitioned to vacate the award. The opinion states that Williams was proceeding without a lawyer.

PFN and ABG entered an agreement under which ABG agreed to bring Shaquille O’Neal to Warsaw, Poland, for events honoring the 100th anniversary of Poland’s independence. PFN paid ABG a deposit, but the parties could not agree on travel arrangements, and O’Neal did not appear. PFN then sought the deposit’s return.

PFN began arbitration before the International Court of Arbitration of the International Chamber of Commerce in December 2020. The arbitrator found ABG and Williams liable for the deposit, accrued interest, arbitration costs, and part of PFN’s legal costs. The later addendum clarified that ABG and Williams were jointly and severally liable, meaning PFN could seek the full amount from either respondent, subject to the rules governing such liability.

Legal standards

PFN sought confirmation under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, commonly called the New York Convention, as applied through the Federal Arbitration Act. Under that framework, a court generally must confirm an arbitration award unless the party opposing enforcement proves one of the Convention’s limited defenses. The court’s review is highly deferential and is not a broad reconsideration of the arbitrator’s factual or legal decisions.

The court also explained that, under Second Circuit law, an award may be vacated for “manifest disregard of the law” only in unusually serious circumstances—when the arbitrator knew a clearly applicable legal rule but deliberately refused to apply it or ignored it.

Court’s analysis

Service and personal jurisdiction. The respondents argued that they had not been properly served. The court rejected that challenge, finding that PFN had shown traditional service was impracticable and had properly served the respondents by certified mail and email. The email addresses had previously been used by the respondents in communications with PFN and the arbitrator, making the service reasonably likely to notify them of the proceeding.

Confirmation of the award. The respondents raised five objections. First, they alleged that signatures on the agreement had been altered, but provided no supporting proof. Second, they argued that PFN’s court proceeding was untimely. The court held that PFN filed within the three-year period allowed for seeking confirmation, measuring from both the award and the addendum.

Third, the respondents relied on an alleged settlement and release. The arbitrator had considered the alleged agreement, testimony, emails, and the document itself, and found the agreement inauthentic. The court held that this authenticity question was properly decided by the arbitrator and that the arbitrator provided more than the minimal justification needed to uphold the award. The court also noted that, even if the signature had been authentic, PFN’s governance rules required two Management Board signatures to bind PFN.

Fourth, the respondents argued that the arbitrator lacked sports or celebrity-appearance experience and was not impartial. The court noted that PFN had requested an arbitrator who would not be associated with the sports community, and the respondents provided no evidence that the arbitrator was unqualified, that the International Chamber of Commerce failed to follow its appointment rules, or that the arbitrator was impartial. Fifth, the respondents argued that the COVID-19 pandemic created service problems and prevented them from presenting their case. The record showed that they received the arbitration request, submitted an answer and exhibits, sent another objection, and participated in a process where the hearings were held remotely. The court rejected this defense.

Vacatur request. The respondents argued that the arbitrator acted in manifest disregard of the law by treating ABG as an alter ego of Williams and imposing joint and several liability. The arbitrator had applied Delaware’s corporate veil-piercing doctrine and discussed liability at length. The court found no intentional defiance of clearly established law and held that the arbitrator had provided more than the required minimal justification. The court also found the respondents’ reliance on a Supreme Court decision about class arbitration misplaced because the parties had expressly agreed to arbitrate disputes connected to the agreement.

Disposition

The Petition to confirm the arbitration award was GRANTED. The respondents’ cross-petition to vacate the award was DENIED. The Clerk of Court was directed to enter judgment for PFN and close the case.