In this case, one party sought attachment of assets pursuant to an arbitration award while the award was under appeal and while a second arbitration was pending.
On September 21, 2021, Telecom Limited (Telecom) won an arbitration award including declaratory relief finding fraud and $3 million in attorney’s fees jointly and severally against IBL, Bank S.A.L. (IBL), Korek Telecom Company LLC (Korek), and International Holdings Limited (IHL).
On December 13, 2021, Telecom brought a second arbitration against IBL seeking $97 million in damages resulting from the fraud.
On December 21, 2021 Telecom filed a motion in federal district court for the Southern District of New York for confirmation of the First Arbitration Award and for an order of attachment of all IBL’s property located in the Southern District of New York.
The Second Circuit noted attachment is available in federal court “under the law of the state where the court is located” citing Fed.R.Civ.P. 64.
Analyzing the attachment issue under New York law, the Second Circuit sustained the District Judge’s findings that Telecom had shown a probability of success on the merits as to the $3 million in costs and fees awarded in the First Arbitration, that it was likely to receive an award of $5.92 million in the second arbitration and therefore satisfied all the New York statutory requirements for attachment in aid of arbitration of assets up to $8.92 million dollars. Iraq Telecom Ltd. V. IBL Bank S.A.L., No. 22-832 (2nd Cir. Apt. 17, 2023).
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