## Facts

- Apollo Computer, Inc. entered a 1984 distribution agreement with Dicoscan Distributed Computing Scandinavia AB (Dico) for distribution of Apollo computers in Scandinavia.
- The agreement provided for arbitration under the Rules of Arbitration of the International Chamber of Commerce (ICC), selected Massachusetts law, and barred assignment by Dico without Apollo’s written consent.
- After disputes over financing, Apollo terminated the agreement in September 1984.
- Dico sought protection under Swedish bankruptcy law, entered liquidation, and a trustee assigned Dico’s damages claims against Apollo to Dico officers Helge Berg and Lars Arvid Skoog.
- In 1988, Berg and Skoog initiated an ICC arbitration against Apollo based on the distribution agreement.
- Apollo refused to arbitrate, contending there was no arbitration agreement with Berg and Skoog and that any arbitration right was nonassignable.
- The ICC Court of Arbitration directed the parties to proceed, indicating that arbitrability should be resolved by the arbitrator under ICC procedures.
- Apollo filed an independent diversity action in federal district court seeking a permanent stay of the ICC arbitration under Massachusetts arbitration law; the district court denied the stay, reasoning that arbitrability had been committed to the arbitrator via the ICC Rules.

## Issues

1. Whether the district court’s order denying a permanent stay of arbitration in an independent action was a final, appealable order under 28 U.S.C. § 1291.
2. Whether incorporation of the ICC Rules constituted an agreement that the arbitrator, not the court, would decide arbitrability, including disputes over survival of the arbitration clause after termination and its enforceability by assignees despite a non-assignment provision.

## Decision

- The First Circuit held the order denying a permanent stay was final and appealable because the action was an independent proceeding whose sole object was to obtain a stay.
- The First Circuit affirmed the denial of a permanent stay.
- The court held that by agreeing to ICC arbitration “in accordance with” ICC Rules, the parties agreed that the arbitrator would decide arbitrability once a prima facie arbitration agreement was shown.
- Questions concerning survival of the arbitration clause and assignability to Berg and Skoog were left for the arbitrator to resolve in the ICC arbitration.

## Legal Principles

- An order denying a stay (or compelling arbitration) is final for purposes of § 1291 when entered in an independent action that resolves the only dispute presented—whether arbitration will proceed.
- Contractual incorporation of institutional arbitration rules authorizing arbitrators to decide their own jurisdiction can constitute a delegation of arbitrability to the arbitrator.
- When such a delegation applies and a prima facie agreement to arbitrate exists, courts should not decide substantive arbitrability disputes (including termination and assignment arguments); those issues are for the arbitrator.

## Conclusion

The First Circuit exercised appellate jurisdiction because the stand-alone stay action ended with the denial order, and it affirmed because the arbitration clause’s adoption of ICC Rules delegated arbitrability—including disputes about termination and assignment—to the arbitrator rather than the court.


Apollo Computer, Inc. v. Berg, 886 F.2d 469 (1st Cir. 1989)