Dow Chemical France et al. v. Isovers-Saint Gobain

In 1981 Dow Chemical Company (United States Dow), along with its subsidiaries, Dow Chemical France (France Dow), Dow Chemical A.G. of Zurich (Zurich Dow), and Dow Chemical (Europe) S.A. (Europe Dow) (plaintiffs), all filed a claim for breach of contract against Isovers-Saint Gobain (ISG) (defendant). Years earlier, Zurich Dow and Europe Dow had entered into contracts with ISG to license ISG to sell Dow products in France. Both of these contracts contained arbitration clauses. ISG asked the arbitral tribunal to declare itself without jurisdiction over the claims filed by United States Dow and France Dow because neither was a party to the contracts at issue. In response, United States Dow and France Dow showed that in the negotiations leading up to the contracts, Zurich Dow and France Dow had worked as a team and no one had questioned France Dow’s involvement. In the performance of the contracts, France Dow—not Zurich Dow or Europe Dow—provided all of the merchandise. It was apparent that United States Dow, the parent company, exercised total control over all of its subsidiaries and that the contracts could have been easily performed equally by any of the Dow entities. Further, ISG was required to use United States Dow’s trademarks for the merchandise sold under the agreements. Finally, France Dow—not signatories Zurich Dow or Europe Dow—was the actual entity to communicate the end of the contract to ISG.