May 12, 2015 Articles

Incorporation of Arbitration Agreement and Corporate Waiver of Right to Arbitrate

By Monique Sasson

Al Rushaid Parker Drilling Ltd. (ARPD), as buyer, entered into separate contracts with National Oilwell Varco Norway AS (NOV Norway) and some of its affiliates for the purchase of equipment for oil rigs. The NOV Norway contract was formed in January 2006 when NOV Norway issued a price quotation to ARPD. Section 3.1 of the quotation stated, "Terms and conditions are based on the general conditions stated in the enclosed ORGALIME S2000." ORGALIME S2000 provided that all disputes arising out of or in connection with the contract shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce (ICC). Al Rushaid v. Nat'l Oilwell Varco, Inc., 757 F.3d 416 (5th Cir. 2014).

In 2011, ARPD and its affiliates filed suit in Texas state court against National Oilwell Varco LP, National Oilwell Varco Inc., NOV Norway, and NOV Oilfield Services Inc., as well as Grant Prideco LP and Grant Prideco Holdings LLC (collectively the defendants). ARPD alleged that the defendants bribed and fraudulently induced to enter into overpriced contracts and pay inflated invoices and operated ARPD for the defendants' benefit.

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