Arbitration And Litigation In The Multijurisdictional Arena

Friday, April 1, 2005 - 00:00

Editor: Mr. Foster, please tell us how you came to Coudert Brothers.

Foster: I received my undergraduate education at the University of California, Berkeley, and went on to law school at UCLA. I joined Coudert as a summer associate while I was in law school.

Editor: Please describe your practice.

Foster: I work principally in international commercial arbitration and litigation. In recent years the majority of my cases have been in arbitration, mainly in the U.S. and Europe, but to a lesser extent in Asia. Although a majority of these cases are filed in arbitration, national courts often become involved at some point in the process, such as in seeking interim relief or in enforcing an arbitration award. Many of our cases have had to do with foreign investment, expropriation, energy matters, intellectual property, or entertainment, but they can involve any type of commercial dispute. Our cases often involve sovereign states as parties. I also teach a class on international business transactions at USC Law School.

Editor: What language is typically used in these arbitrations?

Foster: English is usually the language employed in international arbitrations. The parties can agree otherwise, and I had one arbitration in which it was agreed that one party would submit pleadings in English while the other would do so in French. Most of the time English is chosen because it is the language that the parties and/or the arbitrators have in common.

Editor: Would you tell us about your teaching responsibilities at USC Law School? How do you manage to combine these responsibilities with a busy law practice?

Foster: Fortunately USC is not far from my office in Los Angeles, so it is easy to get to campus on days when I lecture. Teaching is a good way to stay abreast of developments in my area of the law, and the students are always stimulating.

Editor: You are engaged in both arbitration and litigation. Would you tell us about the factors that point in one direction or another?

Foster: Many of the factors that were traditionally considered advantages of arbitration, such as speed and cost efficiency, are not necessarily applicable today. To me the main advantage of arbitration often consists in the fact that it provides a neutral forum for the resolution of disputes. This is critical where the parties are from different countries and legal systems, and neither wants the other to have a "home court" advantage. In addition, parties are often attracted to arbitration because they have an opportunity to participate in the selection of the decision makers; with litigation, they usually have to accept the judge who is assigned to the case. Also, arbitral awards are often easier to enforce abroad because of the New York Convention. There is no comparable treaty for the enforcement of court judgments.

Editor: You handle arbitrations under a number of different arbitration rules, including those of the International Chamber of Commerce, the American Arbitration Association, the Zurich Chamber of Commerce and UNCITRAL - the UN Commission on International Trade Law. In what way do these rules differ?

Foster: By way of example, the ICC rules give the supervising authority a very active role in the administration of the dispute and create an internal review mechanism so that the arbitrators' ruling is vetted by the ICC Court before it is released to the parties. There is nothing comparable under the rules of many other institutions, and under the UNCITRAL rules there is no supervising authority at all. Each institution has something of its own cultural orientation as well. Parties from China are often drawn to CIETAC, the China International Economic and Trade Arbitration Commission, while parties from the U.S. or Britain often prefer the American Arbitration Association or the London Court of International Arbitration because they find their procedures more familiar.

Editor: Please tell us about Coudert's global litigation practice. The practitioners here handle both arbitrations and litigations?

Foster: Yes. Some of our attorneys specialize more in one area than the other, but many do some of both. The skills and techniques are generally similar, although the approach must be adjusted: a lawyer's style before a jury is almost certainly going to differ from the one employed before a panel of arbitrators. I would also point out that arbitration has a number of unique features, and it often makes sense to involve a specialist in drafting arbitration agreements or handling a case in arbitration.

Editor: You also have experience with Coudert's office in Paris. How does that relate to what you are doing in Los Angeles?

Foster: I have a close relationship with the attorneys in Paris, and tend to work out of Paris when I have arbitral hearings or meetings in Europe. Much of the work I do requires consultation with attorneys in that office or other foreign offices on matters of local law.

Editor: Which brings us to the question of multijurisdictional litigation - where litigation on the same issue and involving the same parties is proceeding in a number of jurisdictions almost simultaneously. Is this something that you see with any frequency?

Foster: It comes up all the time. For example, in seeking to enforce an arbitration award it is typical to find that the party against whom the award was rendered has assets in a number of countries. Enforcing the award entails the coordination of simultaneous actions in several jurisdictions.

Editor: How do you go about handling such matters? The strategies are complex, and the coordination of a variety of teams - one team appearing in London, another in New York, perhaps a third in Shanghai - must be extremely difficult.

Foster: This does present challenges, but they are manageable, provided the work is coordinated by one attorney or by a small group of attorneys. It is crucial to have a central command monitoring developments in the various locations where the matter is proceeding.

Editor: And attempting to align civil code strategies with those of common law jurisdictions? Did you encounter this issue during your time at the Paris office?

Foster: An awareness of how these two systems can look at the same issue through different eyes is often an important strategic consideration. Arbitrators or judges tend to view an issue through the lens of the legal principles with which they are familiar, even if the governing law is different. The fact that we have attorneys trained in each system helps us craft our presentation appropriately.

Editor: The doctrine of forum non conveniens has an English common law origin. Does the doctrine - or the principles that underlie it - appear in other legal traditions?

Foster: I have not encountered a direct equivalent to the doctrine of forum non conveniens in civil law systems. As a practical matter, however, courts in civil law countries will often achieve the same result as those contemplated by the doctrine. While there are substantial differences between the two legal systems, both are designed to reach a just result.

Editor: Coudert Brothers has offices in 27 cities across the world. Please tell us about the ways in which you bring the firm's resources to bear in these multijurisdictional litigations.

Foster: Having a complement of attorneys who are truly local in each of those locations - not only admitted to practice but attuned to what is unique about that jurisdiction - gives us an effective advantage in many cases. Multijurisdictional cases bring together lawyers from different backgrounds and forge close relationships over time, which contributes to the quality of the work product.

Editor: Multijurisdictional litigation is becoming much more frequent with globalization. Can you tell us how this evolving? Are we in the process of developing a kind of global jurisprudence that will govern this activity in the future?

Foster: I think we are a long way from having a uniform legal system across borders. Nevertheless, there is an increasing reliance by arbitrators and judges on international standards such as the UNIDROIT principles for commercial contracts. These were developed by legal experts from every type of legal system for the purpose of identifying common principles governing commercial contracts. Where a contract does not specify the applicable law and no jurisdiction clearly has a closer connection to the contract than any other, increasingly parties or arbitrators will decide to apply the UNIDROIT principles. This is a step in the direction of a global jurisprudence. In addition, as more model laws are drafted and become adopted across a variety of jurisdictions, the differences among legal systems will become less pronounced.

Editor: Where do you see Coudert's global lititgation practice in, say, five years?

Foster: This is a practice area that is going to grow. I think there will be more of us who have matters pending in multiple jurisdictions and work on a daily basis with attorneys from across a range of offices. In particular, I expect to see growth in the area of investment treaty arbitration. Investors are only beginning to realize the advantages associated with such treaties, especially when they are doing business with states or state entities. Coudert is optimally positioned to handle that kind of case.