So, You Thought Your Arbitration Agreement Was Bulletproof: Beware Of Traps That Can Render Arbitration Agreements Unenforceable

In a recent federal court case, Baker Hughes v. Dynamic Industries, the court decided even though the parties agreed to arbitrate, the agreement was unenforceable because the arbitration agency was "abolished." In that case, the U.S. District Court for the Eastern District of Louisiana denied a motion to compel arbitration where the Dubai-based arbitration agency designated to administer it no longer existed. However, the record showed when Dubai decreed the designated agency was "abolished," it transferred the assets, rights, and obligations of the dissolved agency to another Dubai entity. Also, the language of the transfer stated "DIFC-LCIA arbitration agreements entered into before the effective date of [the decree] are deemed valid."