## Facts

- In the early 1970s, S.A. Mineracao da Trinidade-Samitri (Samitri), a Brazilian corporation, and several related corporate defendants (including Utah International, Inc.) negotiated a joint venture to mine iron ore in Brazil, later called the Samarco Project.
- The parties formed a jointly owned operating company, Samarco Mineracao S.A., with Samitri holding 51% and the defendants holding 49% under a shareholders’ arrangement.
- In 1974, the parties executed a series of agreements governing the venture (the “1974 Agreements”).
- The 1974 Agreements included arbitration language providing that whenever a “question or dispute shall arise or occur under” the agreement, it would be finally settled by arbitration in Paris, France.
- The parties later entered additional agreements related to the project; the district court treated these later instruments as supplements to the 1974 Agreements.
- Samitri sued in the Southern District of New York asserting that defendants fraudulently induced it to enter the venture and pleaded 17 claims under Brazilian and U.S. law, including two counts under the Racketeer Influenced and Corrupt Organizations Act (RICO).
- Defendants moved under the Federal Arbitration Act and the New York Convention to stay the federal action and compel arbitration; Samitri cross-moved to enjoin arbitration.
- The district court compelled arbitration of all claims except the two RICO counts, and stayed the RICO counts pending completion of the arbitration.
- Samitri took an interlocutory appeal (certified under 28 U.S.C. § 1292(b)) challenging (a) arbitrability of the fraud-based claims, (b) application of the 1974 arbitration clauses to disputes tied to later agreements, and (c) the stay of the RICO counts.

## Issues

1. Whether an arbitration clause requiring arbitration of disputes “arise or occur under” the parties’ 1974 Agreements covers claims that the agreements (and the venture) were fraudulently induced.  
2. Whether the arbitration clauses in the 1974 Agreements apply to disputes arising from later agreements that the district court found to be supplemental to the 1974 Agreements.  
3. Whether the district court properly stayed Samitri’s two RICO claims pending arbitration of the related, contract-based and fraud-based claims.

## Decision

- The Second Circuit affirmed the order compelling arbitration of Samitri’s non-RICO claims.
- The court held the arbitration provisions were broad enough to reach Samitri’s fraud-in-the-inducement claims aimed at the agreements and venture as a whole, rather than at the arbitration clauses specifically.
- The court agreed that disputes tied to later agreements were subject to arbitration because those agreements functioned as supplements within the same continuing project relationship governed by the 1974 Agreements.
- The court affirmed the stay of the two RICO claims pending arbitration, concluding the district court acted within its discretion to manage overlapping issues and avoid duplicative litigation while arbitration proceeded.

## Legal Principles

- Under the Federal Arbitration Act and the New York Convention, federal law favors enforcement of arbitration agreements; ambiguities about the scope of arbitrable issues are generally resolved in favor of arbitration.
- Under *Prima Paint Corp. v. Flood & Conklin Mfg. Co.*, a claim that a contract was fraudulently induced is ordinarily for the arbitrator when the arbitration clause is valid and the alleged fraud is directed at the contract generally; a court decides only challenges aimed specifically at the arbitration clause itself.
- The Second Circuit treated *In re Kinoshita & Co.* as limited to its specific wording and circumstances and declined to extend a narrow reading of “arising under” language where the broader federal policy and the parties’ commercial arrangement supported arbitration.
- When later agreements are part of the same overall transaction or operate as supplements to earlier agreements containing arbitration provisions, disputes arising from the later agreements may be sent to arbitration consistent with the parties’ contractual structure and intent.
- A federal court may stay nonarbitrable federal statutory claims (including RICO counts) pending arbitration of related claims when doing so is a reasonable exercise of docket control, particularly where the arbitrable and nonarbitrable claims share common factual questions.

## Conclusion

*S.A. Mineracao da Trinidade-Samitri v. Utah Int’l, Inc.* affirmed an SDNY order enforcing Paris arbitration clauses in a set of 1974 mining-venture agreements, sending fraud-based claims to arbitration under federal arbitration law (including *Prima Paint*), treating later project agreements as covered supplements, and allowing the district court to stay related RICO counts while arbitration proceeded.


S.A. Mineracao da Trinidade-Samitri v. Utah Int'l, Inc., 745 F.2d 190 (1984)