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US Fifth Circuit compels arbitration under non-exclusive DIFC-LCIA clause; remand to consider DIAC, LCIA or Saudi Arabia fora; questions whether rule-selection implies forum-selection

Published on: 24 February 2025

Published by a LexisNexis Arbitration expert
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Baker Hughes Saudi Arabia Company Ltd v Dynamic Industries, Incorporated & others Case 23-30827, US Court of Appeals for the Fifth Circuit

What are the practical implications of this case?

Central to the dispute is whether choosing a set of arbitral rules in an arbitration clause should be read as selecting a forum when no venue is expressly named. The Second, Fourth, and Eleventh Circuits have concluded that picking rules signals forum selection, invoking the canon expressio unius est exclusio alterius, whereas the Ninth Circuit has, without deciding the point, questioned that premise. The Fifth Circuit, likewise, declined to resolve the matter and voiced comparable reservations. Consequently, the court suggested that a split among circuits may ultimately crystallise if a circuit court squarely determines that adopting arbitral rules does not amount to choosing a forum. Turning to the discontinued DIFC-LCIA regime, the court noted that DIAC’s architecture is, in material respects, functionally on a par with DIFC-LCIA, yet stopped short of a firm holding. Notwithstanding Dubai’s Decree No 34 and the LCIA’s 2022 press release, international practice remains divided on whether DIAC is an adequate replacement...

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