Case of the Day: Bamberger Rosenheim v. OA Development

The case of the day is Bamberger Rosenheim, Ltd. v. OA Development, Inc. (11th Cir. 2017). Bamberger, or Profimex, is an Israeli real estate investment company. OA was a Georgia real estate development company. The two companies entered into a Solicitation Agreement, which included the following agreement to arbitrate:

Any disputes with respect to this Agreement or the performance of the parties hereunder shall be submitted to binding arbitration proceedings conducted in accordance with the rules of the International Chamber of Commerce. Any such proceedings shall take place in Tel Aviv, Israel, in the event the dispute is submitted by OAD, and in Atlanta, Georgia, in the event the dispute is submitted by Profimex.

Profimex commenced an arbitration against OA in Atlanta, alleging a breach of contract. OA brought a counterclaim for defamation against Profimex in the same arbitration. Profimex argued to the arbitrator that the counterclaim should be arbitrated in Tel Aviv, but the arbitrator disagreed, concluding that the “dispute” was the whole dispute, including the counterclaim, and that Profimex had submitted it. The arbitration ended with an award in favor of OA, which moved to confirm. Profimex moved to vacate. The district court confirmed the award, and Profimex appealed.

The main question was whether a question about the venue of an arbitration is itself arbitrable. The court, joining several other circuits, held that at least presumptively, the question is arbitrable. The question is not a question of arbitrability, which is presumptively for a court to decide, but rather a procedural question about where the arbitration is to take place. The court rejected the suggestion that the international character of the dispute made venue more like a question of arbitrability than it would be in a domestic dispute. With that in mind, and because it was clear that the arbitrator was attempting to construe the parties’ agreement, the court correctly held that Profimex’s argument had to fail even if it was right on the merits of what the parties had intended.

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