Tonight's Weird (but true) case asks the age old question - can one have a second bite of the Esrog?
In Schwartzman v. Harlap, 08 Cv 4990 (BMC), United States District Court Judge Cogan was faced with a controversy over esrogim. The facts in the unpublished decision indicate that Schwartzman was an Israeli esrog producer who sold esrogim to Harlap to distribute in the United States. Part of the agreement between Schwartman and Harlap was that Harlap would be the "exclusive" distributor of the esrogim.
In September 2006, a dispute arose when Harlap accused Schwartzman of violating the exclusivity provision. The parties submitted the dispute to beis din in Israel before a Rabbi Stern. After Rabbi Stern ruled for Schwartzman, the dispute was submitted to an Israeli court (J Cogan indicates that the record is unclear as to who submitted the dispute to the Israeli court). During the Israeli court proceeding, Harlap argued that Rabbi Stern could not decide the controversy as he was being paid by Schwartzman to be the Rav HaMachsir for the esrogim. Subsequently, the parties agreed to withdraw the Israeli court proceeding and the matter was resubmitted to Rabbi Stern for additional rulings. In the end, Rabbi Stern ruled for Schwartzman and awarded him $66,000 (Harlap had stopped paying when he challenged whether he was still the exclusive distributor).
Thereafter, Schwartzman commenced an action seeking to have the US District Court for the Eastern District of New York enforce the award under the Convention for the Recognition and Enforcement of Foreign Arbitral Awards. Unfortunately for Harlap, the Convention only contains limited means for challenging the award and specifically does not allow the US court to decide whether the award was correct.
However, Judge Cogan indicated that although the Convention did not reach the issue of the "non-disclosure" of Rabbi Stern's role with Schwartzman, United States law allows the court to consider whether the arbitrator (in this case Rabbi Stern) was impartial.
In the end, Harlap did not get a second bite of the esrog as Judge Cogan ruled that since the agreement between the parties indicated that there was a possibility that Rabbi Stern might be retained to be the Rav HaMachshir and the parties had resubmitted the dispute to him after Harlap had previously raised the question of Rabbi Stern's partiality in the Israeli court proceeding, the award could not be challenged.
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