Hotels.com v. Zuz Tourism

XXXI Y.B. Comm. Arb. 791 (2006) (Israeli S.Ct.)

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Hotels.com v. Zuz Tourism

Israel Supreme Court
XXXI Y.B. Comm. Arb. 791 (2006) (Israeli S.Ct.)

  • Written by Alexander Hager-DeMyer, JD

Facts

Zuz Tourism Ltd. (Zuz) (plaintiff), an Israeli entity, entered into an exclusive distributorship agreement with Hotels.com (defendant), a United States company. The agreement included an arbitration provision that would have disputes arbitrated in Texas and the proceedings governed by the American Arbitration Association rules. Hotels.com allegedly breached the distributorship by engaging Hotels Online Ltd. (defendant), another Israeli representative. Hotels Online was not party to Zuz and Hotels.com’s original agreement. Zuz filed sued against Hotels.com and Hotels Online in Jerusalem district court. Hotels.com moved to stay the proceedings, citing the arbitration provision of the distributorship agreement. The district court, applying local rules, denied the stay because otherwise Zuz would unjustly be required to seek its remedies against the parties in two different jurisdictions. The case was appealed to the Israel Supreme Court.

Rule of Law

Issue

Holding and Reasoning (Grunis, J.)

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