In this case, the predecessor of Outokumpu Stainless Steel, US subsidiary of Finish stainless steel producer, entered into a contract with an engineering company that called for fabrication and installation of cold rolling mill units. The agreement contained an arbitration clause. The agreement also contained a list of mandatory subcontractors to be used, including GE Power Conversion France SAS, a French subsidiary of General Electric (GE Energy). The subcontract between the engineering company and GE Energy did not contain an arbitration clause.
The rolling mills manufactured by GE Energy allegedly failed. Outokumpu Stainless sued GE Energy. In its decision, GE Energy Power Conversion France SAS, Corp. v. Outokumpu Stainless USA, LLC, the US Supreme court applying Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (the New York Convention) ruled that the GE Energy may invoke US state contract law principles (particularly, the common-law doctrine of equitable estoppel) to compel Outokumpu to arbitrate an international dispute arising under an agreement containing an an arbitration clause where Outokumpu must rely on the terms of that agreement in asserting claims against GE Energy.
Please note that this article does not constitute a legal advice. We simplified the law to outline the US Supreme court ruling on international arbitration. If you have an international dispute and would like to consider international arbitration, call our international attorney at 480-425-2009 or schedule your consultation online.