Romanian Tennis Star Must Arbitrate Defamation Claims
Legal translation services are often needed in defamation cases. Non-lawyers and lawyers alike often wonder if arbitration agreements are really legally binding, particularly when the agreement involves foreign parties. In WTA Tour, Inc. v. Super Slaim Ltd., the respondents filed three lawsuits against the petitioners in Cyprus, Romania, and Spain after the petitioner made an allegedly defamatory statement against a Romanian tennis star. At issue was whether the parties were required to arbitrate the dispute in New York and whether the respondents’ foreign lawsuits could be pursued in light of the agreement.
The petitioner, “WTA,” is a non-profit membership corporation based in New York that arranged international women’s tennis tournaments. Its members consist of female tennis players as well as the companies that own and operate the various tennis tournaments. The corporation’s CEO is also a co-petitioner. Respondent “Super Slam” is a company located in Cyprus. It is owned by a professional tennis player and businessman. Mr. Tiriac, who resides in Monaco, is also a retired Romanian tennis star.
Basis for Lawsuits
In 2012, Respondent Super Slam entered into an agreement by which it had the right to organize a WTA tournament in Madrid, Spain known as the Madrid Open. According to the agreement, any disputes arising out of the agreement were required to be arbitrated under New York state law according to the rules of the American Arbitration Association. Super Slam then assigned the right to organize the Madrid Open to a Dutch Company, which then contracted with a Spanish company to promote the tournament.
In April of 2017, another Romanian tennis star- who was not a party to the dispute- served as the captain of the Federation Cup, a tennis event organized by the International Tennis Federation. At the tournament, the Romanian star was ejected from the court for swearing at game officials and players and exhibiting “unsportsmanlike” conduct. The tennis star also insulted some WTA members, and the WTA placed him on a “no credential list” preventing him from accessing restricted areas.
The following month, the WTA learned that the same Romanian tennis star was scheduled to present the trophy at the Madrid Open. The petitioner sent an email to the tournament director warning him that they would be sanctioned if the tournament allowed the disgraced tennis star to present the tournament trophy. Nevertheless, respondent Tiriac allowed him to present the trophy.
After the tournament, the WTA’s CEO posted a statement on WTA’s website and Twitter account saying that a “shadow” was cast on the day as a result of the tennis star’s participation, that he had no place on the court, that he was under a provisional suspension, and that it was irresponsible of the Madrid Open to allow him to participate in the event.
Foreign Lawsuits Filed
As a result of this statement, respondent Tiriac and his company Super Slam filed two lawsuits against the WTA and its CEO for defamation. One lawsuit was filed in Cyprus, and the other lawsuit was filed in Romania. In addition, non-party Madrid Trophy Promotion filed its own lawsuit in Spain claiming that the WTA engaged in anti-competitive practices by requiring tournament owners to award prize money to male and female winners equally.
Motion to Compel Arbitration
As a result of these lawsuits, the petitioners filed a motion in the U.S. District court of New York asking the court to compel the respondents to arbitrate their claims and prevent the respondents from prosecuting their foreign lawsuits. The petitioners also requested relief in regards to discovery in the Spanish lawsuit. The respondents argued that the arbitration clause did not apply to the dispute and that non-parties like Tiriac and others could not be bound to the arbitration agreement when they were not signatories.
Court Grants Motion to Compel Arbitration
After hearing oral argument, the court granted the petitioner to compel arbitration, granted the petitioner’s request for limited discovery regarding the Spanish lawsuit, granted the motion for an anti-suit injunction for the Cyprus lawsuit, and denied the motion for an anti-suit injunction for the Romanian and Spanish lawsuits.
The court held that respondent Super Slam was clearly bound by the language of the arbitration agreement. The court further held that the petitioners had submitted ample evidence that even though Tiriac was not a signatory to the arbitration agreement, he benefited from the membership agreement in that his company ran a prestigious tennis tournament which bestowed a trophy in his honor to the winner. The court held that Tiriac clearly benefited from Super Slam’s ownership of the tournament, which came about from the membership agreement.
Court Allows Romanian and Spanish Lawsuits to Proceed
The court also held that the petitioners had met their burden of proving their entitlement to an anti-suit injunction for the lawsuit in Cyprus, but not for the lawsuits in Romania or Spain. The court reasoned that Cyprus did not have a stronger interest in deciding the dispute than an arbitration forum in New York. However, the court held that the petitioners were allowed to pursue lawsuits in Spain and Romania. The court reasoned that the petitioners would suffer “irreparable harm” should they be forced to litigate in lieu of arbitrating the dispute. In addition, the court reasoned that enforcing the arbitration clause served the public interest by supporting the federal policy favoring arbitration.
The case is: WTA Tour, Inc. and Steve Simon v. Super Slam Limited and Ion Tiriac, Court No. 18-CV-5601, decided on October 17, 2018 in the United States District Court for the Southern District of New York.
*****This legal translation blog article should not be construed as legal advice. You should always consult an attorney regarding your specific legal needs.***
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