Republic of Kazakhstan v. Anatolie Stati, et al.

Exercising a right guaranteed to it by the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the Republic of Kazakhstan (“Kazakhstan”) sought to raise in the district court the defense that a $498 million foreign arbitral award against it was obtained by fraud and therefore its recognition and enforcement by the district court would violate United States public policy. Even though Kazakhstan, a foreign sovereign, raised that defense nearly two years before any ruling on the confirmation petition, the district court deemed it forfeited and refused to address it. The court of appeals, agreeing with the finding of forfeiture, affirmed. The effect of those decisions is to transform the award into a final judgment of the United States courts, and to make the courts of the United States an instrument of the fraud. The question presented is: Whether a district court may confirm a foreign arbitral award that violates the long-established public policy of the United States, merely because the district court concludes after the fact that a fraudbased public policy defense should have been raised earlier in the confirmation proceeding. (i)