Dow Olefinverbund GmbH v. Trinseo Deutschland GmbH

Background

Dow Olefinverbund GmbH petitioned under Section 207 of the Federal Arbitration Act to confirm an arbitration award entered in its favor against Trinseo Deutschland GmbH, formerly known as Styron Deutschland GmbH. The court stated that both parties are foreign entities and that the dispute arose from a services agreement concerning operations at Dow’s petrochemical facility in Schkopau, Germany.

Dow initiated arbitration over Trinseo’s obligations under the agreement. After reviewing briefing, testimony, and documentary evidence, the arbitrator issued a partial final award on October 6, 2022. The arbitrator found that two replacement projects were required capital projects, that they provided required capital benefits to Trinseo, and that the parties’ disagreement over whether those benefits were substantially disproportionate to Trinseo’s share was arbitrable. The arbitrator directed the parties to negotiate that issue.

The parties later reached an agreement concerning the appropriate Trinseo share, arbitration costs, and attorneys’ fees. On February 16, 2023, the arbitrator issued a final award affirming that negotiated agreement and incorporating the findings from the partial final award.

Court’s Analysis

Trinseo waived service of the summons but did not respond or otherwise appear. Dow represented that Trinseo’s general counsel had said Trinseo had no objection to the petition and did not intend to appear. Because the petition remained unanswered after the response period expired, the court treated it as an unopposed motion for summary judgment.

The court explained that review of a petition to confirm an arbitration award is highly deferential. Confirmation is a summary process that turns an arbitration award into a court judgment, and the court will confirm the award when there is even a barely colorable justification for the arbitrator’s result.

The court found that the arbitrator had made thorough findings based on extensive evidence. It also noted that Trinseo did not seek correction or interpretation of the award within the time allowed by the applicable arbitration rules and did not respond in court. The court concluded that the award had a colorable justification.

Disposition

The court granted Dow’s petition and confirmed the underlying arbitration award. Judge Lewis A. Kaplan directed the clerk to enter the judgment filed with the memorandum order and close the case.