Tianjin Port Free Trade Zone International Trade Service Co., Ltd. v. Tiancheng Chempharm, Inc. USA

At a glance

Parties

Tianjin Port Free Trade Zone International Trade Service Co., Ltd. (China), petitioner-appellee, v. Tiancheng Chempharm, Inc. USA (New York), respondent-appellant

Case no.

U.S. Court of Appeals, Second Circuit, No. 18-1918-cv (District Court docket 17-cv-4130, E.D.N.Y.)

Court

U.S. Court of Appeals for the Second Circuit; Circuit Judges Gerard E. Lynch and Raymond J. Lohier, Jr., and District Judge Brian M. Cogan (sitting by designation)

Underlying award(s)

CIETAC award in an arbitration started in China in March 2015

Treaty

New York Convention (9 U.S.C. § 201 et seq.), Article V(1)(b)

Sector

Dietary supplements; sale of goods

Outcome

Summary order of 4 June 2019 affirming the District Court's judgment confirming the CIETAC award.

Amount

Contract price: USD 480,000. CIETAC awarded the price of the goods plus interest and arbitration fees.

The dispute

Tianjin, a Chinese seller of dietary supplements, contracted to sell supplements to Tiancheng, a New York company, for $480,000. Tianjin delivered the goods, but Tiancheng never paid. In March 2015 Tianjin started arbitration before CIETAC in China. Tiancheng did not appear, and CIETAC awarded Tianjin the price of the goods with interest and arbitration fees. Tianjin then petitioned the U.S. District Court for the Eastern District of New York to confirm the award under the New York Convention. Tiancheng resisted on the grounds that it had no notice of the arbitration and that the contract was a forgery.

Key holdings

1. Tiancheng had adequate notice of the arbitration. Under Article V(1)(b), the court applies the forum's standards of due process, which require only notice reasonably calculated to inform the party. CIETAC first mailed the materials to the Farmingdale address listed in the contract. When some were returned, it sent them to Tiancheng's Great Neck address on file with the New York Department of State and to a Bayside address, and those mailings were not returned. p. 4
2. Notice mailed directly to an entity is enough for due process. Tiancheng's declaration that it never received notice did not meet the heavy burden on a party resisting enforcement under the Convention. p. 5
3. Tiancheng forfeited its argument that the contract was fraudulent because it did not raise that defence in the arbitration itself. p. 5
4. Tiancheng argued before the District Court that Tianjin had not tried to settle the dispute amicably before arbitrating, as the contract required. Because its appellate brief mentioned this in only one sentence, the court deemed the argument abandoned. p. 3, n. 1
5. Tiancheng's remaining arguments were without merit, and the judgment confirming the award was affirmed. p. 5

Procedural history

1. March 2015Tianjin starts CIETAC arbitration in China. Tiancheng does not appear, and CIETAC awards Tianjin the price of the goods, interest and arbitration fees.
2. The District Court for the Eastern District of New York (Judge Joanna Seybert) confirms the award under the New York Convention and denies Tiancheng's motion to dismiss (docket 17-cv-4130).
3. 4 June 2019The Second Circuit affirms by summary order.

Tribunal, counsel and experts

Decided by

• Gerard E. Lynch Judge, U.S. Court of Appeals for the Second Circuit
• Jr. Raymond J. Lohier Judge, U.S. Court of Appeals for the Second Circuit
• Brian M. Cogan Judge, U.S. Court of Appeals for the Second Circuit (District Judge (E.D.N.Y.) sitting by designation)

For the claimant

White and Williams LLP

For the respondent

Hui Chen & Associates, PLLC

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Keywords

• New York Convention
• Article V(1)(b)
• lack of notice
• due process
• CIETAC
• recognition and enforcement
• confirmation of award
• default award
• forgery
• waiver of defences
• forfeiture
• dietary supplements
• sale of goods
• Second Circuit
• service by mail

Summary generated with AI from the published documents — refer to the award for the authoritative text.