Latest News
UNITED STATES: Bartlit Beck LLP v. Okada, No. 19-cv-08508 (N.D. Ill. Mar. 12, 2021)
UNITED STATES: Bartlit Beck LLP v. Okada, No. 19-cv-08508 (N.D. Ill. Mar. 12, 2021)
BACKGROUND
Kazuo Okada, Founder of UEC, holds an ample amount of shares in UEC, and UEC owns plenty of WRL stocks, and with that, Kazuo Okada held a seat on the WRL board of directors. WRL, without the consent of UEC, redeemed its shares of WRL at a lower price than the market price by over $700 million less price and removed Okada from the board of directors of WRL. WRL took all these actions from an investigation carried out by former FBI director WRL found that Okada violated the foreign corrupt practices act. Later on, WRL declared that its action of redemptions of shares was relevant. Then it sued Okada and UEC for breach of fiduciary duty where is UEC Cross claimed difference value of market and redemption price of shares.
FACTS OF THE CASE
- Okada approached Bartlit Beck LLP (law firm) when losing in the dispute with WRL. Okada and Bartlit Beck agreed on the fee that is a monthly fee of $600,000 with one-third of the share in the differential amount of stocks with $50 million and an arbitration clause regarding the agreement. Bartlit settled with enough to earn $50 million, but Okada refused to pay the fees then Bartlit Beck invoked arbitration.
- During arbitration proceedings, Okada defended himself for eight months; however, three days before the final hearing. Okada announced that he wouldn’t appear through his counsel. The arbitration tribunal warned Okada of Conflict Preventive and Resolution (CPR) rule 16, which clearly states that the defaulting party's presence is not required, and the tribunal can declare award when the non-defaulting party presents reasonable arguments and evidence. To which Okada replied that he could not travel to the U.S. as he was ill. He also said that the agreement between Bartlit Beck and him was invalid. He doesn’t recognize its validity, so he would not attend the hearing when the tribunal requested how to address the nonappearance of the Okada.
- Tribunal allowed Bartlit Beck to present its final brief as per CPR rule 16 and denied any such brief to Okada as he voluntarily waived off his right to present a defense. Soon after that, the tribunal declared the ward in favor of Bartlit Beck.
- When Bartlit Beck went to execute the award in the northern district of Illinois there Okada argued that the award is annulled as the arbitral hearing was not fair as per New York convention article V (1) (b)
COURT ANALYSIS
The court rejected Okada's argument based on the precedents that deferring awards can be done on reasonable grounds. It further stated that the arbitrators’ panel is not denied Okada a fair hearing. The tribunal was appropriate in its decision as Okada got ill only when threatening was done to the defaulting party. Okada failed to reschedule the hearing, and he also instructed his counsel not to appear in the proceeding as he does not consider the agreement with Bartlit Beck valid. Further, Bartlit Beck was able to present the evidence that during that hearing, Okada was weightlifting at the gym, where Okada failed to present any evidence of his illness.
The court stated that the tribunal's decision to proceed with further hearings without him was reasonable and complied with CPR rule 16 as Okada by himself denied appearing for hearings numerous times. Court confirmed the award that was delivered by the arbitral tribunal in favor of Bartlit Beck. With this. It stated that his voluntary decision not to participate in the arbitration did not establish a deprivation of fundamentally fair hearing.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre shall not be responsible for any errors caused due to human error or otherwise.
- BACKGROUNG
- FACTS OF THE CASE
- COURT ANALYSIS
