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What to Do When Your Latin American or Caribbean Investment Triggers a Need for Legal Action in Florida

Due in part to the nature of its geographic location and its culture, Miami has a strong connection with much of the Caribbean and Latin America. While business activities in other parts of the U.S. might spill across state lines, here in Florida, business activities (and their related legal actions) often cross national borders. If you find yourself needing to undertake a legal proceeding in Florida to enforce rights you acquired in another country, you need to be sure you have the right South Florida commercial litigation attorney on your side.

A recent court battle involving a Chilean wine company is a good illustration. A Chicago-based LLC had an investment in the wine company (it had purchased 4.24 million shares) and it also had a Shareholders’ Agreement that was created to protect its interest in the wine company. The agreement stated that, if certain breaches occurred, the LLC could demand that the majority shareholders of the wine company buy back the LLC’s shares at a premium price.

Eventually, a dispute erupted related to the agreement, which led to arbitration in Chile. The Chilean arbitrator ruled in favor of the LLC and awarded it $28 million.

If you’re in a position like this LLC, you should know that simply litigating your arbitration case successfully – and obtaining a large award – may not be the end. For example, in this case, the shareholder against whom the LLC won the arbitration award was located in Brazil. That meant that, among other things, the LLC had to serve the shareholder in Brazil in a manner that was sufficient under Brazilian law. The LLC also had to file an action in U.S. federal court to make the Chilean arbitration award enforceable in the U.S.

The investor’s previous success in a Brazilian court aided its Florida action

The LLC successfully cleared each of these hurdles. As the 11th Circuit Court of Appeals pointed out, a Brazilian court had already looked at the service the LLC completed on this shareholder and ruled it was compliant with Brazilian law. With that Brazilian decision on the books, the LLC was not required to re-litigate the sufficiency of its service in the District Court here. The legal concept of “comity” says that a U.S. court generally should avoid reviewing a foreign court’s ruling “regarding the interpretation and application of the foreign country’s own laws,” especially in situations like this.

The appeals court also upheld the lower court’s ruling declaring the award final and enforceable. The award, while not performing the purchase price calculations for the litigants, provided a detailed formula for calculation. That formula defeated the shareholder’s argument that the arbitration did not completely resolve the dispute over purchase price.

The LLC also defeated the shareholder’s argument that the award was non-final because it did not state a specific conversion date. The appeals court, in its ruling, explained that the omission of a conversion date does not automatically make an arbitration award like this one non-final.

So, as this case shows, your business may decide to invest in another business in one country, but a breach of that agreement could lead to arbitration, service of process and enforcement litigation in multiple other countries. If your business investment or other business activities have triggered a need for legal action in Florida — be it arbitration or litigation — make sure you have the right team on your side. The skilled South Florida commercial litigation attorneys at Stok Kon + Braverman have many years of handling these kinds of issues successfully and are equipped to get you the results you need, both in state and federal court.

Contact us online or by calling (954) 237-1777 to schedule your consultation.

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