Replies to post #124599 on InterDigital Inc (IDCC)

[spencer]

What a effing joke. What "punitive damages" is Nokia talking about? The arb panel ruled that S-E is a trigger. Then they ruled that Nokia deserves a volume discount. How exactly is that "punitive"? That is actually the EXACT OPPOSITE of punitive. The arb panel gave Nokia a break when there was no reason for it. The license with S-E has no mention of volume discounts (otherwise HG would not have stated such high numbers right after the ERICY/S-E settlement). If S-E's handset sales were the same as Nokia's, S-E would not have received a volume discount, so Nokia does not deserve a volume discount. The arb panel made stuff up out of thin air. If anyone needs to make a claim about something "punitive", it is IDCC, not Nokia.

[osoesq]

In their public announcement of the arbitration win, IDCC did not make any mention of punitive damages, interest or penalties. They could have very well cited Mastrobuono as a case that the Court should look at in considering how extreme NOK has been in their efforts to avoid payment of their just obligations to IDCC. If it was mentioned, Mastrobuono would have shown up in the index of the brief. JMHO-Oso

[mschere]

In the arbitration proceedings, respondents argued that the arbitrators had no authority to award punitive damages. Nevertheless, the panel's award included punitive damages of $400,000, in addition to compensatory damages of $159,327. Respondents paid the compensatory portion of the award but filed a motion in the District Court to vacate the award of punitive damages. The District Court granted the motion, 812 F. Supp. 845 (ND Ill. 1993), and the Court of Appeals for the Seventh Circuit affirmed. 20 F. 3d 713 (1994). Both courts relied on the choice of law provision in Paragraph 13 of the parties' agreement, which specifies that the contract shall be governed by New York law. Because the New York Court of Appeals has decided that in New York the power to award punitive damages is limited to judicial tribunals and may not be exercised by arbitrators, Garrity v. Lyle Stuart, Inc., 40 N. Y. 2d 354, 353 N. E. 2d 793 (1976), the District Court and the Seventh Circuit held that the panel of arbitrators had no power to award punitive damages in this case.

AND THE U.S. Supreme Court RULED

We hold that the Court of Appeals misinterpreted the parties' agreement. The arbitral award should have been enforced as within the scope of the contract. The judgment of the Court of Appeals is, therefore, reversed.

It is so ordered.