West Virginia recently passed legislation aimed at shielding an in-state hospital merger from antitrust review by the Federal Trade Commission, and if the West Virginia Health Care Authority and West Virginia Attorney General approve the merger, other states could follow suit. Recent developments, including the FTC’s reaction to West Virginia’s proposed legislation, preview how future battles between the FTC and other states may unfold as the FTC continues to oppose state action grants of immunity from federal antitrust laws.
Alyse F. Stach
Hague Court Finds Arbitration Panel Has No Jurisdiction Against Russia Pursuant to Unratified Treaty
The District Court of the Hague overturned a record $50 billion in damages awards issued by the Permanent Court of Arbitration (“PCA”), to the former controlling shareholders of the Yukos Oil Company on the grounds that Russia had not submitted itself to the PCA’s jurisdiction.
In 2014, the PCA awarded the former Yukos Oil Company shareholders damages, unanimously finding that Russia had breached its international obligations under the Energy Charter Treaty by destroying Yukos Oil Company, expropriating its assets for political reasons and transferring its assets to the state-owned oil company Rosneft.
First Department Finds Forum Selection Clause in Earlier Agreement Valid Despite Later Agreement Providing for Arbitration
In a 3-2 split decision, a New York appellate court determined that a forum selection clause providing for litigation in New York courts had not been explicitly terminated and thus trumped agreements to submit to arbitration in London provided in later contracts that cancelled the previous one. Thus, the appellate panel for the First Department in New York reversed a lower court decision and directed the parties in Garthon Business, Inc., et al. v. Stein, et al., to proceed with their claims in court as opposed to arbitration in London.
Proposed Legislation Would Set Back Corporations’ Use of Arbitration Clauses
The Restoring Statutory Rights Act of 2016, sponsored by Democratic Senator Patrick Leahy, was sent to congressional committee on February 4, 2016 for consideration.
The bill would place restrictions on companies’ use of arbitration clauses in agreements with consumers. Mandatory arbitration clauses have become a common — and controversial — feature of many consumer contracts. In signing agreements with banks, credit card companies, and cellular service providers, consumers frequently agree that they will arbitrate disputes, rather than sue in court.