A Hardy Case Makes Bad Law
This Article is the first ever to analyze a direct clash between the inherent power of US courts regarding the enforcement of judgments and the obligations of the United States as one of the 163 member countries of the 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States, commonly known as the “ICSID Convention.” The ICSID Convention includes a self-enforcement mechanism whereby the courts of the member countries are obligated to enforce the pecuniary obligations in multi-million (and sometimes over one billion) dollar ICSID arbitration awards as though they were court judgments of the domestic courts of that state, which includes domestic procedures for recognition and enforcement of domestic court judgments. Neither Congress nor the United States Supreme Court has addressed or resolved conflicts between US domestic law regarding enforcing court judgments and US obligations under the ICSID treaty. A recent draft of the forthcoming Restatement (Third) of the U.S. Law of International Commercial and Investor-State Arbitration also notes that no cases have yet addressed this issue. However, this issue arose recently in the DC District Court case, Hardy Exploration & Production (India) Inc v. Government of India, Ministry of Petroleum & Natural Gas, 314 F.Supp.3d 95 (D.D.C. 2018). The appeal of the DC District Court decision was withdrawn by the appellant before any briefs were filed in the DC Circuit; thus, this still remains a lacuna in US law.
This Article invents and analyzes two hypothetical case studies involving ICSID arbitration awards based on past cases in which a US court applied domestic law or domestic public policy to an investment treaty arbitration award enforced under the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the “New York Convention” with 159 member countries. This Article guides US judges regarding the appropriate way to handle investment arbitration awards by using two New York Convention New York Convention arbitral awards as examples. This Article provides guidance regarding how US judges should handle those two awards had they instead been rendered under the ICSID Convention instead, in light of the self-enforcement obligations described above. The theoretical exercise presented in this Article provides future US courts with options to balance their obligations under the ICSID treaty with their inherent power over the enforcement of court judgments.
Recommended Citation: Victoria Shannon Sahani, A Hardy Case Makes Bad Law, 43 Fordham Int'l L.J. 363 (2019).