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New York Grape Farming Co-Op Reaps Bumper Crop in $1.5M Arbitration Award

Case Study

New York Grape Farming Co-Op Reaps Bumper Crop in $1.5M Arbitration Award

April 17, 2018
Christopher P. Maugans

A New York State grape farmers’ cooperative retained Goldberg Segalla to handle complex commercial litigation and arbitration involving breach of contract and a dispute over the fair market price for grapes. The parties were subject to a 25-year output contract where our client was to sell all of its grapes to a leading international juice processor, and in return be paid the “Market Price” as determined jointly by the parties each year at the end of the annual grape harvest. The contract called for arbitration if the parties were unable to agree on the market price. The dispute was over the market price for two of the contract years.

The litigation lasted nearly a year and involved extensive submissions to the tribunal, including an initial expert report, a rebuttal to the buyer’s expert report, a pre-hearing brief, a post hearing brief, and a supplemental expert report.

The arbitration itself lasted more than three and half days. Associate Christopher P. Maugans handled much of the arbitration hearing, and he and partner Kristin Klein Wheaton handled the post-hearing briefs and oral argument.

Our client attempted to settle the dispute with an offer of $1.5 million, while the buyer’s last offer to settle was $500,000. Ultimately the arbitrator issued an award of $1,549,738.70, including interest, to our client. The award reflected a market price that was 41% and 64% higher than the prices the buyer paid to our client for the respective years in dispute. In addition to the outstanding monetary award, the decision contains favorable language that our client will be able to utilize when negotiating the market price for the remaining seven years of the contract.