Valentino S.P.A. v. Mrinalini, Inc.

24-810 Valentino S.p.A. v. Mrinalini, Inc.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUM- MARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FED- ERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

1 At a stated term of the United States Court of Appeals for the Second Circuit, held at the 2 Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 3 30th day of January, two thousand twenty-five. 4 5 Present: 6 DEBRA ANN LIVINGSTON, 7 Chief Judge, 8 WILLIAM J. NARDINI, 9 STEVEN J. MENASHI, 10 Circuit Judges, 11 _____________________________________ 12 13 VALENTINO S.P.A., AN ITALIAN CORPORATION, 14 15 Plaintiff-Appellee, 16 17 v. 24-810 18 19 MRINALINI INC, A DELAWARE CORPORATION, 20 21 Defendant-Appellant. 22 _____________________________________ 23 24 For Defendant-Appellant: JON ROBERT STEIGER (Andrew M. Grove, on the brief), 25 Howard & Howard Attorneys PLLC, Royal Oak, MI. 26 27 For Defendants-Appellees: NAOMI BIRBACH (Jordan Bock, Alexandra Valenti, Aa- 28 ron Shawn Thompson, Jenevieve N. Nutovits, on the 29 brief), Goodwin Proctor LLP, New York, NY. 30 31 Appeal from a judgment of the United States District Court for the Southern District of

1 New York (Vyskocil, J.). 2 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND 3 DECREED that the judgment of the district court is AFFIRMED. 4 Defendant-Appellant Mrinalini, Inc., appeals from a judgment entered by the United States 5 District Court for the Southern District of New York (Vyskocil, J.) on February 26, 2024, con-6 firming a foreign arbitral award pursuant to Article V of the United Nations Convention on the 7 Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) and refusing 8 to stay enforcement of the award. We assume the parties’ familiarity with the underlying facts, 9 procedural history, and issues on appeal, which we reference only as necessary to explain our 10 decision to AFFIRM. 11 We review a district court’s decision to confirm an arbitration award de novo when it rests 12 on legal questions and for clear error where it rests on factual findings. Telenor Mobile 13 Commc’ns AS v. Storm LLC, 584 F.3d 396, 408 (2d Cir. 2009); VRG Linhas Aereas S.A. v. Mat-14 linPatterson Glob. Opportunities Partners II L.P., 717 F.3d 322, 325 (2d Cir. 2013). On appeal, 15 Mrinalini contends that the district court erred in confirming the award because it has a pending 16 appeal before the Milan Court of Appeals and because the arbitral award addressed matters beyond 17 the scope of the terms of submission to arbitration. We disagree. 18 Our review of arbitration awards is limited “to avoid undermining the twin goals of arbi-19 tration, namely, settling disputes efficiently and avoiding long and expensive litigation.” Com-20 modities & Mins. Enter. Ltd. v. CVG Ferrominera Orinoco, C.A., 49 F.4th 802, 809 (2d Cir. 2022) 21 (quoting Yusuf Ahmed Alghanim & Sons v. Toys “R” Us, Inc., 126 F.3d 15, 23 (2d Cir. 1997)), 22 cert. denied, 143 S. Ct. 786, 215 L. Ed. 2d 52 (2023); Encyclopaedia Universalis S.A. v. Encyclo-23 paedia Britannica, Inc., 403 F.3d 85, 90 (2d Cir. 2005). Accordingly, we will enforce an arbitral

1 award unless one of the grounds of refusal in Article V of the New York Convention is met. 9 2 U.S.C. § 207; Encyclopaedia, 403 F.3d at 90. As relevant here, we may refuse to enforce an 3 award where it “has not yet become binding on the parties, or has been set aside or suspended by 4 a competent authority of the country in which, or under the law of which, that award was made.” 5 New York Convention art. V(1)(e), June 10, 1958, 330 U.N.T.S. 3, implemented by 9 U.S.C. § 201 6 et seq. We may also refuse confirmation where “[t]he award deals with a difference not contem-7 plated by or not falling within the terms of the submission to arbitration, or it contains decisions 8 on matters beyond the scope of the submission to arbitration.” Id. art. V(1)(c). The party op-9 posing arbitration carries the heavy burden of proving a defense applies. Encyclopaedia, 403 10 F.3d at 90. 11 I. Effect of Pending Appeal Under Article V(1)(e) 12 The district properly rejected Mrinalini’s challenge to enforcement under Article V(1)(e) 13 of the New York Convention. The award issued by the arbitrator in Milan was final, resolving 14 the contractual, copyright, and other intellectual property claims between Mrinalini and Valentino. 15 That Mrinalini’s appeal is still pending before the Milan Court of Appeals does not render the 16 award unenforceable or negate its binding effect. See Europcar Italia, S.p.A. v. Maiellano Tours, 17 Inc., 156 F.3d 310, 316–17 (2d Cir. 1998); Iraq Telecom Ltd. v. IBL Bank S.A.L., No. 22-832, 2023 18 WL 2961739, at *1 (2d Cir. Apr. 17, 2023) (summary order) (affirming confirmation of award 19 despite pending appeal). The Milan Court of Appeals explicitly confirmed the enforceability of 20 the award by refusing to provisionally suspend its effect pending its decision. Mrinalini therefore 21 has not met the heavy burden of proving the Article V(1)(e) defense applies. 1

Even though the award was binding on the parties, the district court had discretion to stay en- 1

forcement of the award pending the outcome of the appeal. New York Convention art. VI (explaining a

1 II. Terms of Submission to Arbitration 2 In challenging the award as beyond the terms of submission to arbitration, Mrinalini chal-3 lenges the district court’s determination that the parties delegated arbitrability to the arbitrator.2 4 We agree with the district court that the parties’ contract designated questions of arbitrability to 5 the arbitrator in Milan. See Metro. Life Ins. Co. v. Bucsek, 919 F.3d 184, 191 (2d Cir. 2019); 6 First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995). Mrinalini and Valentino’s 7 Agreement provided that “[a]ny dispute that may arise connected to the Agreement as well as 8 associated or connected to its . . . interpretation” would be sent to arbitration, governed by the 9 “Rules of the Milan Chamber of Arbitration.” J.S.A. 162. Based on our caselaw interpreting 10 nearly identical language, we conclude that this text delegated arbitrability to the arbitrator. See, 11 e.g., PaineWebber Inc. v. Bybyk, 81 F.3d 1193, 1199 (2d Cir. 1996) (“The words ‘any and all’ are 12 elastic enough to encompass disputes over . . . whether a claim is within the scope of arbitration.”); 13 Bell v. Cendant Corp., 293 F.3d 563, 565, 568 (2d Cir. 2002) (finding language requiring

court “may, if it considers it proper, adjourn the decision on the enforcement of the award” where “an application for the setting aside or suspension of the award has been made” to the country which created the arbitral award); Europcar, 156 F.3d at 316–17. The district court incorrectly concluded that Mrinalini’s arguments for adjournment were “mooted” by the refusal of the Milan Court of Appeals to suspend the award pending the underlying appeal. Valentino S.p.A. v. Mrinalini, Inc., No. 23-CV-2319, 2024 WL 779339, at *6 (S.D.N.Y. Feb. 26, 2024). It seemingly ignored the fact that Mrinalini’s motion to set aside the award is still pending before the Milan Court of Appeals. The pendency of that appeal may still warrant a stay under Article VI even if it does not qualify as a defense to confirmation under Article V(1)(e). Nevertheless, Mrinalini has forfeited any challenge to this error. Its brief on appeal references arguments it made to the district court but does not provide further analysis, and “[i]t is a ‘settled appellate rule that issues adverted to in a perfunctory manner, unaccompanied by some effort at developed argumentation, are deemed waived.’” Tolbert v. Queens Coll., 242 F.3d 58, 75 (2d Cir. 2001) (citation omitted). 2 Mrinalini did not characterize this objection under any provision of Article V. This is a “serious lapse.” Commodities, 49 F.4th at 815. When faced with this same briefing deficiency at the district court, Judge Vyskocil construed this argument as falling within Article V(1)(c), a choice that Mrinalini does not contest on appeal. We thus analyze it assuming arguendo it falls under that enumerated defense. See id.

1 arbitration for “[a]ny controversy arising in connection with or relating to this Agreement” “clearly 2 and unmistakably evidences the parties’ intention to have the arbitrator determine” the scope of 3 the arbitration clause); DDK Hotels, LLC v. Williams-Sonoma, Inc., 6 F.4th 308, 318 (2d Cir. 2021) 4 (concluding incorporation of procedural rules of arbitration “may serve ‘as clear and unmistakable 5 evidence of the parties’ intent to delegate arbitrability to an arbitrator.’” (quoting Contec Corp. v. 6 Remote Sol. Co., 398 F.3d 205, 208 (2d Cir. 2005)). 7 Because the parties assigned arbitrability to the arbitrator, our review of the award is “ex-8 tremely deferential.” Olin Holdings Ltd. v. State of Libya, 73 F.4th 92, 108 (2d Cir. 2023) (quot-9 ing Commodities, 49 F.4th at 809). “Regarding Article V(1)(c) challenges specifically, we have 10 recognized that the defense ‘does not sanction second-guessing the arbitrator’s construction of the 11 parties’ agreement.’” Id. (quoting Parsons & Whittemore Overseas Co. v. Societe Generale De 12 L'Industrie Du Papier (RAKTA), 508 F.2d 969, 977 (2d Cir. 1974)). We accordingly will affirm 13 the award where there is a “barely colorable justification for the outcome reached.” Id. (quoting 14 Banco de Seguros del Estado v. Mut. Marine Office, Inc., 344 F.3d 255, 260 (2d Cir. 2003)). 15 Upon review, there is more than the requisite “barely colorable justification” for the out-16 come the arbitrator reached. Banco, 344 F.3d at 260. In ruling on the scope of arbitration, the 17 arbitrator outlined the parties’ submissions, detailed relevant Italian law, and made conclusions 18 based on a rational application of law to facts. Its extensive reasoning was more than sufficient 19 to confirm the award as addressing a matter “within the terms of the submission to arbitration.” 20 New York Convention art. V(1)(c); Olin, 73 F.4th at 109 (affirming rejection of Article V(1)(c) 21 objection because the arbitrator analyzed the meaning of the contract, reviewed the facts of the 22 dispute, and made judgment calls evincing a rational interpretation of contract language). 23 * * * *6 1 We have considered Mrinalini’s remaining arguments and find them to be without merit. 3 2 Accordingly, we AFFIRM the judgment of the district court.

3 FOR THE COURT: 4 Catherine O’Hagan Wolfe, Clerk of Court

3 We decline to consider Mrinalini’s contractual challenges to the validity of Agreement, as it failed to cite to the relevant legal authority governing the agreement, Italian law. See Generali Espana de Seguros y Reaseguros, S.A. v. Speedier Shipping, Inc., No. 22-1150, 2023 WL 3362839, at *2 (2d Cir. May 11, 2023) (summary order).