Contract analysis

I. INTRODUCTION Petitioner Halcyon Semiconductor AG ("Halcyon" or "Petitioner") respectfully submits this Memorandum of Points and Authorities in opposition to the cross-motion filed by Respondents Meridian Dynamics Inc. ("Meridian") and Derek Calloway ("Calloway") (collectively, "Respondents") seeking to vacate the Final Award dated August 22, 2025 (the "Award"), rendered by a unanimous three-member panel of the Ame

II. STATEMENT OF FACTS A. The Parties and the Distribution Agreement Petitioner Halcyon Semiconductor AG ("Halcyon") is a German Aktiengesellschaft registered under HRB 241873 at the Amtsgericht München, with its registered headquarters at Leopoldstraße 180, 80804 Munich, Germany. Halcyon is listed on the SIX Swiss Exchange under the ticker symbol HSAG (ISIN: DE000A2QRFX7). Halcyon is a leading manufacturer of high-p

Section 3.2 (Annual Minimum Purchase Commitments). Section 3.2 established escalating annual minimum purchase commitments for each year of the ten-year term. These commitments began at $28,000,000 in Year 1 (2017) and escalated to $72,000,000 by Year 8 (2024), reflecting the parties' shared expectation that Halcyon's market penetration in North America would grow significantly over the contract period. Ex. A, § 3.2;

Section 4.6 (Prohibition on Unauthorized Distribution Channels). Section 4.6 prohibited Meridian from selling, distributing, transferring, or otherwise making available Halcyon products to any person or entity other than end-users or authorized channel partners expressly approved in writing by Halcyon. This provision was critical to protecting the integrity of Halcyon's pricing architecture and brand reputation in th

Section 7.2 (Non-Compete Clause). Section 7.2 provided that, during the term of the Distribution Agreement, Meridian would not directly or indirectly distribute, market, or promote any product that competed with Halcyon's PMIC or SiC product lines without Halcyon's prior written consent. The non-compete provision was a fundamental element of the bargain: Halcyon granted Meridian the valuable right of exclusivity in t

Section 12.4 (Personal Guaranty of Derek Calloway). Respondent Derek Calloway, as Meridian's founder and controlling shareholder, personally guaranteed Meridian's obligations under the Distribution Agreement, subject to an aggregate cap of $10,000,000. Ex. A, § 12.4; Reinhardt Decl. ¶ 15.

Section 14.1 (Governing Law). The Distribution Agreement is governed by and construed in accordance with the laws of the State of California, without regard to its conflicts-of-law principles. Ex. A, § 14.1.

Section 14.3 (Arbitration Clause). Section 14.3 provided that "any dispute, controversy, or claim arising out of or relating to this Agreement or the breach, termination, or validity thereof" would be resolved by binding arbitration under the AAA/ICDR International Arbitration Rules, with the arbitration seated in Los Angeles, California. The clause called for a three-member tribunal, with each party appointing one a

Section 14.5 (Prevailing-Party Fee Shifting). The Distribution Agreement further provided that the prevailing party in any dispute arising under or related to the Agreement would be entitled to recover its reasonable attorneys' fees and costs from the non-prevailing party. Ex. A, § 14.5. B. Meridian's Breaches and Termination In approximately May 2023, during the second quarter of fiscal year 2023, Halcyon discovered

III. LEGAL STANDARD A. The Federal Arbitration Act's Strong Policy Favoring Arbitration The Federal Arbitration Act ("FAA"), 9 U.S.C. §§ 1–16, embodies a strong federal policy favoring arbitration as an efficient, economical, and final method of dispute resolution. The FAA "establishes that, as a matter of federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration." M

Section 10 of the FAA provides four exclusive grounds on which a court may vacate an arbitration award: (1) where the award was procured by corruption, fraud, or undue means, 9 U.S.C. § 10(a)(1); (2) where there was evident partiality or corruption in the arbitrators, or either of them, 9 U.S.C. § 10(a)(2); (3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause

Section 10(a)(2) of the FAA permits vacatur "where there was evident partiality or corruption in the arbitrators, or either of them." 9 U.S.C. § 10(a)(2). The Ninth Circuit applies an objective standard: evident partiality exists only where "'a reasonable person would have to conclude that an arbitrator was partial to one party to the arbitration.'" Monster Energy Co. v. City Beverages, LLC, 940 F.3d 1130, 1137 (9th

Section 10(a)(4) permits vacatur where "the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made." 9 U.S.C. § 10(a)(4). This ground is exceedingly narrow. An arbitral award may be vacated for excess of powers "only where the arbitrators acted in 'manifest disregard' of the contractual limitations on their authority,"

IV. ARGUMENT A. Respondents' Evident Partiality Claim Under § 10(a)(2) Fails Respondents seek vacatur of the Award on the ground that Presiding Arbitrator Hon. Gerald M. Osterhaus (Ret.) was evidently partial under 9 U.S.C. § 10(a)(2) because of an alleged "undisclosed prior professional relationship" with Dr. Elias Falkenberg of Falkenberg & Strauss GmbH, Halcyon's German counsel in the arbitration. This claim is wi

1. The Alleged Relationship Between Presiding Arbitrator Osterhaus and Dr. Falkenberg Is Trivial and Non-Disqualifying. Respondents' cross-motion describes in dramatic terms what it characterizes as an "undisclosed prior professional relationship" between Presiding Arbitrator Osterhaus and Dr. Falkenberg. However, when the rhetoric is stripped away, the actual facts are remarkably thin. As set forth in the Declaratio

2. Presiding Arbitrator Osterhaus Made Adequate Disclosures. Respondents' evident partiality argument relies heavily on the characterization of the CLE panel co-appearance as "undisclosed." Even accepting for the sake of argument that the contact could have been included in Presiding Arbitrator Osterhaus's disclosure statement — a proposition Halcyon does not concede — nondisclosure of a trivial contact does not inde

3. The Award Was Unanimous, Further Undermining Any Inference of Partiality. The Final Award was issued unanimously by all three members of the tribunal: Presiding Arbitrator Osterhaus, Claimant's party-appointed arbitrator Prof. Diane K. Sørensen, and Respondent's own party-appointed arbitrator Victor R. Taniguchi, Esq. Ex. C at 73. No dissent or partial dissent was filed. This fact is highly significant in evaluati

4. Respondents Have Not Demonstrated Any Actual Bias or Prejudice. Beyond the single CLE panel co-appearance, Respondents have failed to identify any substantive evidence that Presiding Arbitrator Osterhaus harbored any bias, prejudice, or favoritism toward Halcyon or its counsel. Respondents' cross-motion contains no allegation that: • Presiding Arbitrator Osterhaus had any financial interest in the outcome of the a

1. The Distribution Agreement Authorized the Tribunal to Award Full Contractual Damages, Including Lost Profits for the Unexpired Term. The starting point for the excess-of-powers analysis is the scope of the arbitrators' authority as defined by the parties' agreement. Here, Section 14.3 of the Distribution Agreement provides, in relevant part: "Any dispute, controversy, or claim arising out of or relating to this Ag

2. The $31,800,000 Lost-Profits Award Was Rationally Derived from the Evidence and Dr. Moss's Damages Model. Respondents' cross-motion characterizes the $31,800,000 lost-profits award as "speculative" and "excessive." But this characterization ignores the evidentiary record and the rigorous methodology underlying the award. The tribunal did not pluck the $31,800,000 figure from thin air. It adopted the damages calcul

3. Awarding Lost Profits for the Full Unexpired Term Is a Standard Remedy Under California Law. Respondents suggest that the tribunal acted beyond its authority by awarding lost profits for the full remaining 2.8-year term of the Distribution Agreement, as if such an award were inherently improper or unprecedented. It is neither. Under California law — the governing law specified in Section 14.1 of the Distribution A

4. The "Barely Colorable" Standard Forecloses Vacatur. The Supreme Court and the Ninth Circuit have consistently held that an arbitral award must be confirmed so long as the arbitrators' interpretation of the parties' contract is "even arguably" or "barely colorable." In Oxford Health Plans LLC v. Sutter, 569 U.S. 564 (2013), the Supreme Court explained: "The sole question for us is whether the arbitrator (even argua