The case, which involves a dispute between the government of Laos and a Thailand-based company (TLL) over mining contracts, presented a novel issue for the U.S. Court of Appeals for the Second Circuit, namely how a court should approach a motion to vacate its own confirmation of an arbitration award after foreign courts with jurisdiction over the arbitration panel later sets aside the award. In the early 1990s, TLL entered into agreements with the Laotian government to mine lignite in the Hongsa region of northern Laos near the Thai border. In 1994, TLL and Laos entered into an additional contract under which Laos granted TLL the right to build at its own expense and to manage a plant to be located near the mines, that would use the mine's coal production to generate electrical power to be sold to Thailand. However, during the Asian Financial Crisis (1997 - 2000), funding negotiations and resources for the project dried up and negotiations concerning the project fell apart. In 2006, when TLL’s attempts to obtain additional funding for the project failed, Laos terminated the project development agreement that it had previously brokered with the company regarding the power plant, as well as the mining contracts. Efforts to settle the matter failed and in June 2007, TLL initiated arbitral proceedings in Malaysia. In late 2009, the arbitral panel found Laos in breach for failing to properly terminate the contracts and awarded TLL approximately $57 million as compensation for losses, interest and costs. After the period for challenging the Award in Malaysia expired, TLL began enforcement actions against Laos in the United States, the United Kingdom, and France under New York Convention. TLL’s enforcement efforts succeeded in the United States and the United Kingdom, resulting first in an August 2011 judgment in
the United States District Court for the Southern District of New York and, later, a November 2012 judgment in the High Court of Justice of England and Wales. In October 2010, almost one year after the Award was issued and nine months after a challenge was due, Laos moved in Malaysia for an extension of time within which to file its application to set aside the award. The Malaysian courts eventually granted Laos' motion and then, in 2012, set aside the award. Returning to the United States with the Malaysian judgment in hand, Laos moved under Federal Rule of Civil Procedure 60(b)(5) to vacate the District Court's August 2011 judgment enforcing the Award. In 2011, Southern District Judge Kimba Wood confirmed the award and the Second Circuit affirmed that decision. The District Court concluded that the New York Convention left it with exceedingly limited discretion. In essence, the Court held that it was bound to give effect to the Malaysian annulment unless doing so would offend basic standards of justice in the United States. Finding that neither Laos' conduct nor anything in the Malaysian court’s reasoning so tainted the Malaysian order such that vacatur would offend fundamental standards of justice, the District Court granted Laos’ motion. In related rulings, the District Court also denied TLL's later application to enforce the English judgment, on grounds that the English judgment conflicted with the presumptively dominant Malaysian judgment, and it rejected TLL’s request for security from