## Facts

- InterGen N.V., a Netherlands-based energy developer, financed two U.K. power projects (Rocksavage and Coryton) structured through separate Cayman project companies (RPC and CEC) indirectly owned through InterGen’s corporate chain.
- The projects selected GT26 gas turbines associated with Alstom entities; turbine procurement for the projects was arranged through contracts and purchase orders between project-related entities/Bechtel entities and an Alstom affiliate.
- Those project contracts contained clauses requiring arbitration in London.
- InterGen was not a signatory to, and was not named as a party in, the contracts containing the arbitration clauses.
- InterGen alleged that defendants (Alstom-related entities and an Alstom negotiating agent) made misrepresentations about GT26 reliability and testing, and that performance problems later occurred.
- InterGen sued in Massachusetts state court asserting state-law tort and related claims, without pleading breach of contract or seeking to enforce rights under the turbine contracts.
- Defendants removed to federal court under the New York Convention and moved to compel arbitration in London; the district court ultimately denied the motion, reasoning it lacked authority to compel arbitration abroad.

## Issues

1. What legal standard governs motions to compel arbitration under FAA Chapter 2 implementing the New York Convention.
2. Whether a nonsignatory (InterGen) can be compelled to arbitrate under doctrines such as judicial estoppel, equitable estoppel, third-party beneficiary, agency, or alter ego/veil piercing.
3. Whether a federal court has authority under FAA Chapter 2 to compel arbitration seated outside the United States.

## Decision

- The First Circuit affirmed the denial of the motion to compel arbitration.
- The court held that, absent conflict with the Convention, FAA Chapter 1 standards apply to Chapter 2 cases, including ordinary contract principles governing who is bound to arbitrate.
- The court rejected defendants’ efforts to bind InterGen to the London arbitration clauses through judicial estoppel, equitable estoppel, third-party beneficiary status, agency, or alter ego.
- The court held the district court erred in concluding it lacked authority to compel arbitration in London, but the error was harmless because InterGen could not be compelled to arbitrate in any event.

## Legal Principles

- Arbitration is consensual; a party may not be forced to arbitrate absent agreement or a recognized legal basis that binds the party to the arbitration clause.
- In New York Convention cases brought under FAA Chapter 2, courts generally apply FAA Chapter 1 procedures and domestic contract doctrines unless inconsistent with the Convention.
- Judicial estoppel is discretionary and does not substitute for a missing contractual or equivalent basis to impose arbitration.
- Equitable estoppel may bind a nonsignatory only when the nonsignatory seeks to enforce contract benefits while avoiding the contract’s arbitration obligation; tort-based claims that do not rely on enforcing contract rights ordinarily do not satisfy this requirement.
- Third-party beneficiary status requires clear contracting-party intent to confer enforceable rights on the nonsignatory; absent such intent, beneficiary status cannot be used to impose arbitration.
- Agency requires proof of authority to bind the principal; corporate affiliation alone does not establish authority to commit a nonsignatory to arbitrate.
- Veil piercing/alter ego requires strong evidence of domination and misuse of the corporate form; routine project-company structures and ownership, without more, are insufficient.
- Federal courts may compel arbitration seated abroad when the Convention and FAA Chapter 2 apply.

## Conclusion

The First Circuit held that domestic FAA standards govern Convention motions to compel and refused to compel InterGen, a nonsignatory, to arbitrate because none of the asserted doctrines established consent or a legally sufficient basis to bind it to the London arbitration clauses, even though federal courts have authority to compel foreign-seated arbitration.


InterGen N.V. v. Grina, 344 F.3d 134 (1st Cir. 2003)