23-144

Telecom Business Solution, LLC v. Terra Towers Corp. 

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

Rulings by summary order do not have precedential effect. Citation to a summary order 

filed on or after January 1, 2007, is permitted and is governed by Federal Rule of Appellate 

Procedure 32.1 and this court’s Local Rule 32.1.1. When citing a summary order in a 

document filed with this court, a party must cite either the Federal Appendix or an 

electronic database (with the notation “summary order”). A party citing a summary order 

must serve a copy of it on any party not represented by counsel.

At a stated term of the United States Court of Appeals for the Second Circuit, 

held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the 

City of New York, on the 6th day of February, two thousand twenty-four.

PRESENT: John M. Walker, Jr.,

Susan L. Carney,

Steven J. Menashi,

Circuit Judges.

____________________________________________

TELECOM BUSINESS SOLUTION, LLC, LATAM 

TOWERS, LLC, AMLQ HOLDINGS (CAY), LTD.,

Petitioners-Appellees,

v. No. 23-144

TERRA TOWERS CORP., TBS MANAGEMENT, 

S.A.,

Respondents-Appellants,

DT HOLDINGS, INC.,

Cross-Claimant-Appellant.

____________________________________________
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For Petitioners-Appellees 

Telecom Business Solution, 

LLC, LATAM Towers, LLC:

MICHAEL N. UNGAR (Katherine M. 

Poldneff, on the brief), Ulmer & Berne LLP, 

Cleveland, Ohio. 

For Petitioner-Appellee AMLQ 

Holdings (Cay), Ltd.:

GREGG L. WEINER, Ropes & Gray LLP, New 

York, New York (Andrew S. Todres, Ropes 

& Gray LLP, New York, New York, Daniel 

V. Ward, Ropes & Gray LLP, Boston, 

Massachusetts, on the brief). 

For Respondents-Appellants: JUAN J. RODRIGUEZ (Luke T. Jacobs, on the 

brief), Carey Rodriguez, LLP, Miami, 

Florida. 

Appeal from a judgment of the United States District Court for the Southern 

District of New York (Kaplan, J.).

Upon due consideration, it is hereby ORDERED, ADJUDGED, and 

DECREED that the judgment of the district court is AFFIRMED.

Respondents-Appellants Terra Towers Corp. (“Terra”) and TBS 

Management S.A. (“TBS”) are the majority shareholders in Continental Towers 

LATAM Holdings Limited (the “Company”), which owns and operates telecom 

towers in Latin America. Petitioners-Appellees Telecom Business Solution, LLC 

(“Telecom”), LATAM Towers, LLC (“Towers”), and AMLQ Holdings (Cay), Ltd. 

(“AMLQ”) are minority shareholders in the Company. The parties’ relationship is 

governed by a shareholders’ agreement (“SHA”) that, inter alia, allows the 

minority shareholders to force a sale of the Company after a period of five years

from the date of their initial investment. The SHA provides for binding arbitration 

of all disputes.
3

In February 2021, Telecom and Towers—later joined by AMLQ—initiated 

an arbitration proceeding, alleging that Terra had violated the SHA by blocking a 

proposed sale. The arbitration panel agreed and ordered specific performance of 

the SHA’s forced-sale provision. In the course of the arbitration proceeding, the 

panel also issued certain interim orders relating to Terra’s ongoing interference 

with the Company’s management team. Terra and its affiliates appeal from the 

district court’s decision of January 18, 2023, confirming the arbitration award. We 

assume the parties’ familiarity with the facts, procedural history, and issues on 

appeal. 

I

In 2015, Telecom, Towers, and AMLQ invested in the Company’s 

predecessor, which had been wholly owned by Terra, TBS, and their affiliates. 

Telecom and Towers are affiliates of Peppertree Capital (“Peppertree”), a private 

equity firm. AMLQ is an affiliate of Goldman Sachs. After the Peppertree entities 

and AMLQ invested in 2015, they owned roughly 45 percent of the Company 

while Terra and TBS owned roughly 55 percent. According to the arbitration 

panel, “the business model of the Company is to build telecom towers at suitable 

locations and then rent ‘space’ on the towers to mobile communications 

operators.” App’x 813. “The construction of towers ... is a revenue stream for an 

affiliate of the majority shareholders, DT Holdings (‘DTH’) ... [which] is paid by 

the Company for the construction.” Id. 

At the time of the minority shareholders’ investment, the parties entered 

into the SHA, which gives the minority shareholders the right to force a sale of the 

Company after five years. The SHA provides that once the minority shareholders 

give notice of a proposed sale to an unaffiliated third-party purchaser, the majority 

shareholders have 30 days to procure an opinion from an investment bank 

recommending against the transaction; otherwise, they must consent to the 

proposed sale. If the majority shareholders procure an unfavorable opinion, or if 

the minority shareholders do not identify a buyer when they give notice of their 
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sale request, the Company must within 30 days retain an investment bank to 

facilitate a sale, and the majority and minority shareholders each agree to consent 

to the sale arranged by the investment bank. 

The SHA also specifies governance arrangements for the Company. It 

allocates two board seats each to the majority and minority shareholders, with no 

procedure for breaking deadlocks. Section 4.04(a)(vi) gives the board authority 

over “the hiring or firing and compensation of members of the Management Team, 

including the Executive Team.” Id. at 474. 

Section 8.10 of the SHA provides that the agreement is governed by New 

York law. However, section 8.15 provides for mandatory arbitration in New York 

City, which will “be conducted in accordance with the Commercial Arbitration 

Rules of the American Arbitration Association in effect at the time of the 

arbitration.” Id. at 502. Finally, section 8.12 provides that if the SHA is breached, 

the non-breaching party is entitled to specific performance. 

The parties’ relationship during the initial five-year lockup period was 

fraught,1 and on November 4, 2020, the Peppertree entities gave notice pursuant 

to section 5.04(b) of their proposal to sell the Company to Torrecom Partners LP 

(“Torrecom”). Terra rejected the sale and procured an unfavorable opinion from 

an investment bank. The parties exchanged further communications over the next 

1 The arbitration panel attributed the tension between the parties to:

the divergent views of the majority and minority shareholders about what 

towers should be built and where, and the minority shareholders defend 

their having opposed certain tower construction, that the majority 

shareholders advocated, on the basis that the towers would not be 

profitable to operate. The majority shareholders, for their part, contend that 

the minority’s opposition to tower construction has had a different and 

allegedly improper motive: to depress the value of the Company so that an 

alleged affiliate of one of the minority shareholders could acquire the 

Company at an artificially low price. 

App’x 813. 
5

few weeks, but no board meeting was convened and no investment bank was 

retained. On January 19, 2021, the Peppertree entities sent another letter requesting 

the sale of the Company and demanding that the board retain an investment bank. 

The January 19 letter did not attach a purchase offer. In response, on January 27, 

2021, Terra sent a letter asserting that the deadline for retaining an investment 

bank pursuant to Section 5.04(b)(i) of the SHA had passed and offering to buy 

out the minority investors’ shares. 

Finally, on February 2, 2021, the Peppertree entities (later joined by AMLQ)

initiated arbitration proceedings, seeking damages and specific performance in the 

alternative. On August 12, 2021, the arbitration panel granted the minority 

shareholders’ request for expedited consideration of their specific performance 

claim in the first phase of a bifurcated proceeding. On August 20, 2021, the panel 

denied the majority shareholders’ request for discovery relating to affirmative 

defenses to the minority shareholders’ claim for specific performance. The panel 

clarified that “in Phase 1 ... the Tribunal intends only to make a determination of 

the legal sufficiency of pleaded affirmative defenses ... and as to those affirmative 

defenses found to be legally sufficient we will in turn decide what evidencegathering and hearing process is suitable.” Id. at 1014-15. Phase 1 of the arbitration 

proceeding took place between September 27, 2021, and December 9, 2021. On 

February 24, 2022, the panel issued the unanimous First Partial Final Award

(“FPFA”), which granted the minority shareholders’ request for specific 

performance and ordered the sale of the Company. 

On October 11, 2021, during the Phase 1 proceedings, independent counsel 

for the Company wrote to the panel to inform it that Jorge Hernandez, chairman 

of the Company’s board and a principal of DTH and Terra, and his “agents” were 

harassing the Company’s CEO, Jorge Gaitan, and his team—including Carol 

Echeverria, the Company’s COO—and interfering with their conduct of the 

Company’s affairs. In particular, the letter alleged that Hernandez and his agents 

had verbally attacked Gaitan and his team and “confiscated Mr. Gaitan’s and his 

team’s computers, searched their offices, disabled their email access, and 
6

conducted a search of Mr. Gaitan’s personal car.” Id. at 1130. Based on these 

allegations, testimony, and other supporting evidence, the panel found that “DTH 

acting through Jorge Hernandez and Kristha Pineda replaced Mr. Gaitan and Ms. 

Echeverria as CEO and COO of the Company in late September or early October 

2021,” that “the actions of DTH ... [were] attributable to ... Terra and TBS ... by 

reason of the affiliate relationships among them and DTH,” and that DTH’s actions 

breached sections 4.04(a)(vi) and 4.06(b) of the SHA. Id. at 1187. The panel issued 

an order on November 12 requiring that Gaitan and Echeverria be restored to their 

positions with the Company. On March 15, 2022, the panel found that Terra and 

DTH had failed to comply with the November 12 order and granted in part the 

minority shareholders’ motion to compel compliance. 

Telecom, Towers, and AMLQ petitioned the district court to confirm the 

FPFA. Terra and DTH argued that the FPFA should be vacated. The district court 

summarized the arguments of Terra and DTH as follows: 

First, Respondents claim that the Panel violated ‘fundamental 

fairness’ by refusing to provide them with ‘a fair opportunity to be 

heard.’ Second, Respondents argue that the panel acted in ‘manifest 

disregard of the law’ and in excess of its authority by granting specific 

performance to Petitioners. Third, Respondents claim that there was 

‘evident partiality’ by two of the three arbitrators on the Panel in favor 

of Petitioners. 

Telecom Bus. Sol., LLC v. Terra Towers Corp., No. 22-CV-1761, 2023 WL 257915, at *5 

(S.D.N.Y. Jan. 18, 2023) (footnotes omitted). Terra and DTH’s arguments focused 

on the panel’s denial of discovery in the Phase 1 proceeding and the panel’s 

decision to apply AAA Commercial Rule R-47(a)’s standard for granting specific 

performance rather than New York law. Rule R-47(a) states that “[t]he arbitrator 

may grant any remedy or relief that the arbitrator deems just and equitable and 

within the scope of the agreement of the parties, including, but not limited to, 

specific performance of a contract.” AAA Commercial Rule R-47(a). Terra and 
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DTH also asked the court to vacate the November 12 and March 15 orders. On 

January 18, 2023, the district court entered judgment confirming the FPFA. The 

district court also held that the November 12 and March 15 orders were not 

judicially reviewable. This appeal followed. 

II

“This Court reviews a district court’s decision to confirm or vacate an 

arbitration award de novo for questions of law. We review findings of fact for clear 

error.” Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Tr., 729 F.3d 99, 

103 (2d Cir. 2013). “We review de novo the district court’s application of the 

manifest disregard standard to an arbitration award.” Seneca Nation of Indians v. 

New York, 988 F.3d 618, 625 (2d Cir. 2021) (emphasis added). 

III

Terra and DTH raise several arguments on appeal. First, Terra and DTH 

argue that the arbitration panel manifestly disregarded the law by declining to 

apply New York’s standards for specific performance. Second, they claim that the 

arbitration procedure was fundamentally unfair because the district court denied 

them discovery on their affirmative defenses to specific performance and applied 

AAA Commercial Rule R-47(a) rather than New York law after the parties had 

briefed the specific performance issue on the assumption that New York law 

applied. Third, they argue that the November 12 and March 15 orders are 

judicially reviewable and should be vacated on the ground that those orders 

exceeded the arbitration panel’s authority. We address each argument in turn. 

A

The Federal Arbitration Act (“FAA”) provides that arbitration awards may 

be vacated when the arbitrators exhibit corruption, partiality, or misconduct or 

exceed their powers. See 9 U.S.C. § 10(a). In addition, “[w]e have held that ‘as 

judicial gloss on the[] specific grounds for vacatur of arbitration awards’ in the 

FAA, an arbitrator’s ‘manifest disregard’ of the law or of the terms of the 
8

arbitration agreement ‘remains a valid ground for vacating arbitration awards.’” 

Seneca Nation, 988 F.3d at 625 (quoting Schwartz v. Merrill Lynch & Co., 665 F.3d 444, 

451-52 (2d Cir. 2011)). “To succeed in challenging an award under the manifest 

disregard standard, a party must make ‘a showing that the arbitrators knew of the 

relevant legal principle, appreciated that this principle controlled the outcome of 

the disputed issue, and nonetheless willfully flouted the governing law by 

refusing to apply it.’” Id. at 626 (quoting Schwartz, 665 F.3d at 452). “In addition to 

this ‘subjective component,’ a finding of manifest disregard requires an objective 

determination that the disregarded legal principle was ‘well defined, explicit, and 

clearly applicable.’” Id. (quoting Westerbeke Corp. v. Daihatsu Motor Co., 304 F.3d 

200, 209 (2d Cir. 2002)). 

Terra and DTH cannot satisfy either component of the manifest disregard 

standard. With respect to the subjective component, the panel did not willfully 

flout law that it knew to be controlling. Rather, the panel considered—and 

rejected—Terra’s argument that New York law, rather than AAA Commercial 

Rule R-47(a), determined its power to award specific performance. Moreover, as 

the district court noted, the panel “concluded that even if New York law governed 

the availability of specific performance, Petitioners had satisfied its requirements.” 

Telecom Bus. Sol., 2023 WL 257915, at *6; see App’x 830, 835, 838-42. Far from 

flouting New York law, the panel explained (1) its decision that AAA Commercial 

Rule R-47(a) applied and (2) its view that the application of New York law on 

specific performance would yield the same outcome. 

With respect to the objective component, Terra and DTH cannot show that 

New York law clearly and explicitly prohibits parties from opting out of New 

York’s specific performance law in favor of another standard. On the contrary, the 

New York Court of Appeals has held that “a court may not vacate an award 

because the arbitrator has exceeded the power the court would have” outside an 

arbitration proceeding; instead, “[t]hose who have chosen arbitration as their 

forum should recognize that arbitration procedures and awards often differ from 

what may be expected in courts of law.” Rochester City Sch. Dist. v. Rochester 
9

Teachers Ass’n, 362 N.E.2d 977, 981 (N.Y. 1977). Similarly, we have recognized that,

“[l]ike federal law, New York law gives arbitrators substantial power to fashion 

remedies that they believe will do justice between the parties,” including 

“fashion[ing] relief that a court might not properly grant.” Benihana, Inc. v. 

Benihana of Tokyo, LLC, 784 F.3d 887, 902 (2d Cir. 2015) (internal quotation marks 

omitted). In general, “[w]here an arbitration clause is broad, ... arbitrators have 

the discretion to order remedies they determine appropriate, so long as they do 

not exceed the power granted to them by the contract itself.” Banca de Seguros del 

Estado v. Mut. Marine Office, Inc., 344 F.3d 255, 262 (2d Cir. 2003). For these reasons, 

the district court correctly rejected Terra and DTH’s claim that the arbitration 

panel displayed manifest disregard of the law. 

B

Terra and DTH also argue that the arbitration procedure was fundamentally 

unfair. See Tempo Shain Corp. v. Bertek, Inc., 120 F.3d 16, 20 (2d Cir. 1997) (“Federal 

courts do not superintend arbitration proceedings. Our review is restricted to 

determining whether the procedure was fundamentally unfair.”) (quoting 

Teamsters, Local Union 657 v. Stanley Structures, Inc., 735 F.2d 903, 906 (5th Cir. 

1984)). It was fundamentally unfair, they suggest, because the panel did not apply 

New York law after “the entire proceeding was conducted with the understanding 

that the question of specific performance and associated defenses were governed 

by New York law.” Appellants’ Br. 19. Terra and DTH also assert that it was 

fundamentally unfair for the panel to make “findings of disputed fact in favor of 

Peppertree and AMLQ without affording Terra and DTH discovery to substantiate 

their affirmative defenses.” Id. 

Both arguments fail. Beginning with what Terra and DTH describe as the 

panel’s “last-minute switch” from New York law to AAA Commercial Rule R47(a), fundamental fairness requires only that the arbitrator “give each of the 

parties to the dispute an adequate opportunity to present its evidence and 

argument.” Tempo Shain, 120 F.3d at 20 (quoting Hoteles Condado Beach v. Union de 
10

Tronquistas Local 901, 763 F.2d 34, 39 (1st Cir. 1985)). Terra and DTH were on notice 

that the arbitration would be conducted in accordance with the AAA rules because 

the SHA provided as much. While the parties’ initial briefing and the panel’s 

orders may have focused on New York law, it was not unfair to expect the parties 

to be prepared to address Rule R-47(a) at argument. Moreover, as the minority 

shareholders observe, Terra and DTH “submitted two post-hearing briefs that 

addressed Phase 1 issues, one on December 9, 2021, and one on January 13, 2022,” 

and thus “had multiple opportunities to address” the panel’s suggestion that Rule 

R-47(a) rather than New York law might control. Appellees’ Br. 28 (emphasis 

omitted). In addition, even after the panel adverted to Rule R-47(a) at oral 

argument, Terra and DTH continued to argue that New York law, not the AAA 

Commercial Rules, controlled; indeed, they still maintain this position on appeal. 

Terra and DTH were not prejudiced by the alleged “last-minute switch” because 

their litigation posture remained unchanged. And, as previously noted, the panel 

analyzed the specific performance issue under New York law in the alternative 

and arrived at the same conclusion. 

The panel’s decision to deny Terra and DTH discovery on their proffered 

affirmative defenses of unclean hands and waiver likewise did not render the 

procedure fundamentally unfair. The panel determined that discovery was 

unnecessary because Terra and DTH’s factual allegations, even if substantiated, 

would not establish these affirmative defenses as a matter of law. With respect to 

waiver, the panel decided that the minority shareholders’ failure to propose a 

resolution to the board to engage an investment bank within 30 days of the 

Proposed Sale Notice could not have been a waiver of its right to insist on a sale 

because the SHA did not require the minority shareholders to propose such a 

resolution. With respect to unclean hands, the panel decided that the text of the 

SHA “makes clear that the Parties intended that allegations of misconduct such as 

those made by Terra against the Peppertree Claimants would not and could not 

be invoked to prevent the ... sale process from moving forward.” App’x 844. The 

district court correctly deferred to the panel’s interpretation of the parties’ 
11

contract. See Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 569 (2013) (“An arbitral 

decision even arguably construing or applying the contract must stand, regardless 

of a court’s view of its (de)merits.”) (quoting Eastern Associated Coal Corp. v. Mine 

Workers, 531 U.S. 57, 62 (2000)). Based on that interpretation, Terra and DTH could 

not prevail on their proposed affirmative defenses even assuming that evidence 

substantiated those defenses.

C

The district court correctly concluded that the November 12 and March 15 

orders were not judicially reviewable. “Under the Federal Arbitration Act, a 

district court does not have the power to review an interlocutory ruling by an 

arbitration panel.” Michaels v. Mariforum Shipping, S.A., 624 F.2d 411, 414 (2d Cir. 

1980). An interim order of an arbitration panel is final—and thus open to judicial 

review—only if it “finally and definitely disposes of a separate independent 

claim.” Metallgesellschaft A.G. v. M/V Capitan Constante, 790 F.2d 280, 283 (2d Cir. 

1986). The November 12 and March 15 orders—which were expressly designated 

as “interim relief,” see App’x 1185, 1686—did not conclusively resolve the issues 

raised by DTH’s actions with respect to Gaitan and Echeverria. The November 12 

order expressly contemplated “further proceedings on the sufficiency of 

compliance with this Order, or the consequences of any non-compliance,” and 

stated that the panel was “choosing not to prescribe the manner of compliance 

with this Order in greater detail at this time.” Id. at 1188. The March 15 order 

likewise contemplated “additional proceedings concerning compliance with the 

Order of November 12, 2021 or with this Order.” Id. at 1694. Indeed, in its motion 

for reconsideration of the November 12 order, Terra and DTH described the 

panel’s conclusions as “preliminary finding[s]” and asserted that “[t]he interim 

order is certainly not a final award which has any binding impact on the final 

[Phase 1] hearing.” Id. at 1192 & n.2 (emphasis added). At the time of the 

proceedings before the district court, “[i]ssues related to Respondents’ noncompliance with the March 15 Order remain[ed] pending before the Panel and 

therefore [were] not final and reviewable.” Telecom Bus. Sol., 2023 WL 257915, at 
12

*7. We note that AMLQ’s counsel represented at oral argument that Terra and 

DTH are challenging the interim orders in their petition to vacate the panel’s 

Second Partial Final Award. For these reasons, the district court correctly declined 

to review the panel’s interim orders. 

* * *

We have considered the appellants’ remaining arguments, which we 

conclude are without merit. For the foregoing reasons, we affirm the judgment of 

the district court.

FOR THE COURT:

Catherine O’Hagan Wolfe, Clerk of Court