US Court of Appeals for the Second Circuit upholds decision of Southern District Court and confirms arbitral award against Pemex that was set aside at its seat

The US Court of Appeals for the Second Circuit (the Court of Appeals) has upheld the decision of District Judge Hellerstein in Corporación Mexicana de Mantenimiento Integral, S. De R.L de C.V v. Pemex-Exploración y Producción, No. 10 Civ. 206 (AKH), 2013 WL 4517225, (S.D.N.Y. Aug. 27, 2013), confirming an arbitration award in favour of COMISSA and against PEMEX. The award was affirmed and enforced even though it had been set aside by a court at the seat of arbitration in Mexico. In the opinion of the US Court of Appeals, Judge Dennis Jacobs, joined by Judge Raggi, found that to hold otherwise would be contrary to US public policy and "repugnant to fundamental notions of what is decent and just in this country."

The opinion is interesting for the Court of Appeals' careful consideration of the case's "truly unusual procedural history" and its relevance when considering the grounds for refusing to enforce an arbitral award under the Panama Convention (textually identical to Article V of the New York Convention). It is also interesting to consider this decision in light of the reasoning and rationale being adopted by other national courts which have also grappled with applications to enforce awards set aside at their seat.

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