Case of the Day: Marker Völkl (International) GmbH v. Epic Sports International, Inc.

The case of the day is Marker Völkl (International) GmbH v. Epic Sports International, Inc. (S.D.N.Y. 2013). Marker Völkl, a Swiss corporation, had a license agreement with Epic, a Nevada corporation, under which Epic distributed Marker Völkl’s tennis equipment. In a separate agreement, Capstone Business Credit, LLC, a New York company, guaranteed Epic’s performance of its financial obligations to Marker Völkl. Both agreements had an arbitration agreement providing for arbitration under the Swiss Rules of International Arbitration.

In 2011, Marker Völkl terminated the license agreement and demanded payment of unpaid royalties. Epic and Capstone refused to pay, and Marker Völkl initiated an arbitration in Switzerland. Epic counterclaimed in the arbitration and filed an action in the New York Supreme Court, alleging that after Marker Völkl terminated the agreement, it misappropriated Epic’s intellectual property by continuing to sell tennis racquets manufactured from molds created by Epic. Epic later withdrew its counterclaims in the arbitration.

The arbitrator found in favor of Marker Völkl and awarded € 300,000 in damages. The New York court dismissed Epic’s action for lack of personal jurisdiction and insufficient service of process. Marker Völkl then petitioned for confirmation of the award. Epic reasserted its counterclaims and sought to stay confirmation pending resolution of the counterclaims. The court confirmed the award. Epic had not shown any of the exceptions to confirmation permitted by Article V of the New York Convention. The counterclaims were not related to any of the NYC exceptions and were irrelevant.

The decision is straightforward and seems plainly correct. Easy case.

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