Service of Process in Accordance with Arbitration Rules Deemed Good Service

Plaintiff and a China-based manufacturer and its Georgia-based subsidiary executed an NDA to develop a specialty LED light bulb. The parties ended up going their own way with each developing their own LED bulb.

Plaintiff thereafter alleged that the Chinese company and its subsidiary had breached the NDA and, pursuant to the terms of the parties’ NDA, commenced an arbitration before the AAA in North Carolina. In 2019, the AAA panel awarded plaintiff some $3 million. Plaintiff filed a petition to confirm the award, serving the Petition by email and Federal Express, upon counsel and the subsidiary’s registered agent.

Defendants moved to dismiss the Petition, arguing they were not properly served under the Federal Rules of Procedure, the Federal Arbitration Act (the “FAA”), or the Hague Convention. Plaintiff responded by noting that in the NDA the parties had agreed to comply with the rules of the AAA, and that those rules permitted service as made by plaintiff—by email and upon a representative. Plaintiff also argued that defendants had actual notice of the Petition which, under the FAA, was a critical issue in determining whether service would be upheld.

The court agreed with plaintiff and decided that it was “abundantly clear” that service was valid. The court noted that under the FAA “any method of service that provides for the adverse party to have actual notice of an action to confirm the arbitration award is sufficiently complaint with the terms of the statute” even as service may have been done in another form.

TVL International, LLC v. Zhejiang Shenghui Lighting Co., Ltd.

Contact Information