Challenging and enforcing international arbitral awards in U.S. Federal Courts: an empirical study

Conventional wisdom is that international commercial arbitration is the preferred method of resolving transnational business disputes. One of the primary reasons why transnational actors prefer international arbitration over international litigation is that they anticipate that international arbitral awards, if not voluntarily complied with, are highly likely to be enforced by national courts, especially U.S. federal courts. Historically, many have estimated that national courts give effect to about 90% of all awards. When scholars set out to test empirically this estimated 90% rate, they reported finding lower rates at which courts give effect to awards. These empirical studies, however, all suffer from methodological shortcomings, which distorted their results. The primary methodological deficiency of these studies was their reliance on commercial databases, such as Westlaw or kluwerarbitration.com. This Article, by contrast, reports on U.S. federal court treatment of international arbitral awards based on an original dataset compiled from U.S. federal court docket sheets. We find that other empirical studies understate, sometimes dramatically, the rates at which U.S. federal courts give effect to awards. Based on this original dataset of 9601 petitions to confirm, enforce, or vacate international arbitral awards that were filed in cases docketed in U.S. federal courts between 2011 and 2019, our central findings are that (1) federal courts vacated or denied confirmation or enforcement of only 5.7% of contested petitions and only 3.3% of allcombined petitions (contested and uncontested) and (2) when petitions dismissed on procedural grounds are included, courts vacated or denied or dismissed confirmation or enforcement of 14.6% of contested petitions and 8.0% of allcombined petitions. In other words, the rates at which U.S. federal courts give effect to international arbitral awards are significantly higher than reported to date. These findings differ substantially from prior studies and provide a foundation for a more complete and accurate understanding of post-award actions in U.S. federal courts. In addition to these findings, we also identify several other interesting trends that merit further study.