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Precision Castparts Corp. v. Schultz Holding GmbH & Co. KG

Court Confirms 643 Million Euro Arbitral Award for Fraudulent Inducement, Contract Breach

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OPINION AND ORDER Petitioners Precision Castparts Corp. and PCC Germany Holdings GmbH (together “Petitioners”) move to confirm an arbitration award pursuant to Section 207 of the Federal Arbitration Act (the “FAA”), 9 U.S.C. §207, and the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, June 10, 1958, 21 U.S.T. 2517 (the “New York Convention”). Respondents Schultz Holding GmbH & Co. KG, Schultz Extruded Products Beteiligungs GmbH & Co. KG, and Schultz Extruded Products Verwaltungs GmbH (together, “Respondents”) oppose that motion. Respondents cross-move to vacate or modify the Award pursuant to Section 10(a) of the FAA, 9 U.S.C. §10(a)(4). For the following reasons, the Award is confirmed, and Respondents’ motion to vacate is denied. BACKGROUND A. Factual Background The underlying dispute giving rise to the Award concerns the purchase of a business pursuant to a Securities Purchase Agreement between Petitioners and Respondents. In February 2017, Petitioners acquired from Respondents companies with manufacturing facilities in the United States and Germany for a price of €800,000,000.¹ After the sale closed, Petitioners discovered that, prior to the acquisition, Respondents had manipulated financial documents of the acquired companies to show that they were “high margin” and “high cash flow” businesses. In fact, the acquired companies were “functionally insolvent.” Dkt. No. 1-1 (“Award”)

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