A single AAA arbitrator denied all claims for relief against Fonu2, Inc., a publicly-held company headquartered in Fort Lauderdale, Florida. Summit Trading, Ltd., a Bahamian company owned by the Weast Family Trust, filed an arbitration related to a Consulting Agreement entered into by Summit and Cygnus Internet, Inc. (“Cygnus”). Fonu2 purchased the majority of Cygnus’ assets in March 2012. In the arbitration, Summit demanded the value of 10 percent of the issued and outstanding shares of FONU2, as well as punitive damages, interest and any other appropriate relief. Marc Dobin represented Fonu2 in the arbitration. Jon Lieber was involved in the pre-trial issues and did most of the briefing.
In its Answer, Fonu2 alleged that Summit was required to be registered as a business broker pursuant to Fla. Stat. 475.41. Because the payment under the subject contract was only required if a transaction occurred, we argued that the contract was illegal and unenforceable. The arbitrator agreed. A Florida lawyer was not involved in the drafting of the contract. Would this have changed the outcome? Maybe. We won’t know.
When the testimony concluded, the parties agreed to waive oral closing and make written submissions after receiving a list of questions from the arbitrator. This way, the parties were able to clear up any issues that the arbitrator believed to be outstanding. The briefs were submitted just over two weeks after the arbitration concluded and the award was issued on September 26, 2014.
This case did demonstrate some of the efficiencies of arbitration. There were no depositions. Interrogatories and Document Requests were limited in number. The case was completed in less than one year from start to finish. This likely kept the legal fees down from what a full-blown jury trial in court would have cost.
That’s the view of one lawyer from Jupiter, Palm Beach County, Florida. I’m Marc Dobin.