Ninth Circuit Upholds Confirmation of $30M Arbitral Award for Shenzhen Zehuijin Investment Center

The U.S. Court of Appeals for the Ninth Circuit affirmed a Hughes Hubbard victory for Shenzhen Zehuijin Investment Center (SZIC), upholding a district court judgment confirming an approximately $30 million arbitral award against Chinese businessman Liu Yingkui.

On Aug. 3, following an appellate brief submitted on behalf of SZIC, the Ninth Circuit rejected Liu’s challenge to personal jurisdiction and affirmed the U.S. District Court for the Southern District of California's confirmation of the award. Holden Fitzgerald assisted in writing the appellate brief.

The court held that a defendant's physical presence in a forum state is sufficient to establish personal jurisdiction, even when service is completed through alternative methods that provide actual notice rather than personal delivery. The Ninth Circuit also held that Liu waived his separate challenge to the sufficiency of service by failing to raise it properly before the district court.

The dispute arose from a 2017 loan agreement between SZIC and Sinowel Communication Technology and its founder, Liu, under which SZIC loaned CN¥160 million to repurchase and release Sinowel's variable interest entity structure.

After Liu failed to repay the loan, SZIC commenced arbitration before the Beijing Arbitration Commission, which ruled in SZIC's favor and awarded approximately $30 million.

Following unsuccessful efforts to challenge the award in Singapore and China, Liu opposed SZIC's enforcement petition in the U.S. District Court for the Southern District of California. In September 2024, the court denied Liu's motion to dismiss and confirmed the award.

Law360 reported on the Ninth Circuit’s decision.