9 U.S.C. § 207’s Three-Year Deadline Is Mandatory, Not “Permissive” — and Foreign Judgment Recognition Remains an Alternative Route

1. Introduction

This published decision from the United States Court of Appeals for the Fourth Circuit arises from efforts to collect on a foreign arbitral award issued in the Netherlands. The petitioners, J. Robert van Faassen, LLM and Eleonora L. Zetteler, LLM, act as insolvency practitioners (trustees) for the insolvent Dutch life insurer Nederlandsche Algemeene Maatschappij van Levensverzekering “CONSERVATRIX” N.V.. The respondents include Greg Evan Lindberg and affiliated entities that owned Conservatrix and allegedly failed to maintain a required solvency capital ratio.

After Conservatrix obtained (1) an NAI summary arbitration award and (2) a Dutch court judgment granting leave to enforce that award, it sought U.S. enforcement in the Middle District of North Carolina based on Lindberg’s North Carolina residency. Petitioners pursued two parallel enforcement pathways:

  • Federal route: confirmation of the arbitral award under the Federal Arbitration Act (FAA), Chapter 2 (New York Convention), 9 U.S.C. § 207.
  • State-law route: recognition and enforcement of the Dutch court judgment under the North Carolina Uniform Foreign-Country Money Judgments Recognition Act, N.C. Gen. Stat. § 1C-1850 et seq.

The district court confirmed the arbitral award under the FAA despite the petition being filed beyond § 207’s three-year period, reasoning that the limitations language was “permissive.” On appeal, the Fourth Circuit confronted two central issues:

  • Whether § 207’s “within three years … may apply” language creates a mandatory statute of limitations or merely a “permissive” window.
  • Whether the Dutch court order granting leave to enforce the arbitral award qualifies as a foreign-country money judgment recognizable under North Carolina’s Act.

2. Summary of the Opinion

The Fourth Circuit reversed the district court’s confirmation of the arbitral award under the FAA, holding that the three-year statute of limitations in 9 U.S.C. § 207 is mandatory and bars untimely confirmation petitions. However, the court agreed with the district court that the Dutch court judgment confirming (i.e., granting leave to enforce) the arbitral award is a foreign-country judgment within the scope of North Carolina’s recognition statute. The case was remanded for further proceedings on Petitioners’ motion to enforce the Dutch judgment under North Carolina law.

The panel also noted (without deciding) that it would not address whether § 207 is subject to equitable tolling because Petitioners did not pursue that theory below and expressly declined to raise it on appeal.

3. Analysis

3.1. Precedents Cited

The court’s analysis is text-centered but guided by several interpretive decisions and arbitration-enforcement precedents:

Statutory interpretation of “may” and limits on discretion

  • Bouarfa v. Mayorkas, 145 S. Ct. 24 (2024): Cited for the proposition that “may” connotes discretion, but Congress may also prescribe how that discretion must be exercised. The Fourth Circuit uses this to explain that a permissive grant (“may apply”) can still be bounded by a mandatory condition (“within three years”).
  • United States v. Rodgers, 461 U.S. 677 (1983): Supports the general linguistic baseline that “may” usually implies discretion.
  • Biden v. Texas, 142 S. Ct. 2528 (2022): Used to clarify that “may” establishes authority but not a duty—helping the court distinguish between optional invocation of a remedy and mandatory limits on when it can be invoked.
  • Pulsifer v. United States, 144 S. Ct. 718 (2024), and Scalia & Garner, Reading Law: Invoked for the anti-surplusage canon—courts should avoid interpretations that render statutory language meaningless. This is central to rejecting the “permissive limitations period” view.
  • Stanley v. City of Sanford, 145 S. Ct. 2058 (2025): Quoted to reject “purpose overrides text” reasoning. The court emphasizes that textual limits are part of the statute’s purpose, not obstacles to it.

FAA confirmation timing: distinguishing Chapter 1 from Chapter 2

  • Sverdrup Corp. v. WHC Constructors, Inc., 989 F.2d 148 (4th Cir. 1993): A key point of dispute. There, the Fourth Circuit read 9 U.S.C. § 9 (Chapter 1; domestic arbitration) as “permissive,” allowing confirmation beyond one year. The panel here sharply limits Sverdrup’s reach, holding it does not control interpretation of § 207 (Chapter 2; New York Convention).
  • Cortez Byrd Chips, Inc. v. Harbert Constr. Co., 529 U.S. 193 (2000): Cited to caution against deriving meaning by comparing phraseology across different FAA provisions, undermining the argument that Sverdrup’s reading of § 9 should be transplanted to § 207.
  • GE Energy Power Conversion France SAS, Corp. v. Outokumpu Stainless USA, LLC, 140 S. Ct. 1639 (2020): Cited in discussing 9 U.S.C. § 208 and the principle that Chapter 1 applies to Chapter 2 only when not in conflict with the Convention/Chapter 2 text. This supports the conclusion that Chapter 2’s own limitations rule controls.
  • Seetransport Wiking Trader Schiffarhtsgesellschaft MBH & Co., Kommanditgesellschaft v. Navimpex Centrala Navala, 989 F.2d 572 (2d Cir. 1993), and Univ. of Notre Dame (USA) v. TJAC Waterloo, LLC, 49 F.4th 13 (1st Cir. 2022): Cited for the baseline understanding of when an award is “made” and for treating § 207 as an enforceable limitations period. The Fourth Circuit also notes the absence of any circuit-level authority adopting Petitioners’ “permissive” reading of § 207.
  • Comm'ns Imp. Exp. S.A. v. Republic of the Congo, 757 F.3d 321 (D.C. Cir. 2014): Used to bolster the idea that international arbitration’s goals are not undermined by “parallel enforcement mechanisms” outside the FAA—supporting the court’s view that a firm § 207 time bar is not self-defeating.

North Carolina judgment recognition framework

  • Savage v. Zelent, 777 S.E.2d 801 (N.C. Ct. App. 2015): Used for the definition of “judgment” and for reliance on the Act’s official commentary.
  • Poole v. Miller, 464 S.E.2d 409 (N.C. 1995): Ultimately quoted (via Savage) for what constitutes a “final decision” resolving rights and obligations.

Procedural and ancillary citations

  • First Kuwaiti Gen. Trading & Contracting W.L.L. v. Kellog Brown & Root Int'l, Inc., 141 F.4th 522 (4th Cir. 2025): Cited for de novo review and for distinguishing domestic vs. international arbitration contexts.
  • Britt v. DeJoy, 45 F.4th 790 (4th Cir. 2022) (en banc): Cited on appellate jurisdiction.
  • Europcar Italia v. Maiellano Tours, Inc., 156 F.3d 310 (2d Cir. 1998): Mentioned in a footnote regarding discretionary adjournment/stay factors under the Convention; not pursued on appeal.
  • District court decisions: Van Andel v. Lindberg, 732 F. Supp. 3d 476 (M.D.N.C. 2024) and Van Andel v. Lindberg, No. 1:23-cv-879, 2024 WL 3718168 (M.D.N.C. Aug. 8, 2024), which the Fourth Circuit reverses in part.

3.2. Legal Reasoning

(a) Why § 207’s deadline is mandatory despite “may apply”

The court’s core interpretive move is grammatical and structural: § 207 confers a discretionary right to seek confirmation (“may apply”) but simultaneously imposes a mandatory condition on exercising that right (“[w]ithin three years after … is made”). In the panel’s framing, the “may” answers whether a party must seek confirmation (it need not), while “within three years” answers when the party is authorized to do so (only within that period).

The court rejects the “permissive window” interpretation primarily because it would make the phrase “within three years” do no operative work. If parties may apply “whenever,” the time phrase becomes surplusage—an outcome disfavored by the interpretive principles reflected in Pulsifer v. United States.

(b) Purpose arguments cannot override clear time limits

Petitioners urged that treating § 207 as non-mandatory would better serve arbitration’s efficiency goals; otherwise, winners might sue at common law or use slower methods. The court responds (via Stanley v. City of Sanford) that statutory purpose does not license courts to erase express textual limits. Congress may have intended efficiency, but it also chose a three-year boundary for the Convention confirmation mechanism.

(c) Why Sverdrup does not control § 207

The opinion draws a firm line between Chapter 1 and Chapter 2 of the FAA:

  • Different statutory text, context, and subject matter: § 9 governs domestic awards; § 207 governs foreign awards under the New York Convention.
  • Different enactments: the provisions were enacted by different Congresses decades apart.
  • Supreme Court caution: Cortez Byrd Chips, Inc. v. Harbert Constr. Co. warns against meaning-by-comparison across FAA provisions.

Importantly, the panel also rejects the argument that 9 U.S.C. § 208 imports Chapter 1’s § 9 regime (and Sverdrup’s gloss on it) into Chapter 2. Because Chapter 2 includes its own limitations rule (§ 207), applying § 9 would “conflict” with Chapter 2, so § 208 does not incorporate it.

(d) International arbitration has parallel enforcement routes

The court further distinguishes Sverdrup on practical grounds: even if domestic arbitration winners might be forced into inefficient alternatives absent summary confirmation, international award creditors often have additional streamlined options—particularly, converting an award into a foreign court judgment and then pursuing judgment recognition. The opinion cites Comm'ns Imp. Exp. S.A. v. Republic of the Congo and also points to New York Convention, art. VII, which preserves parties’ ability to rely on awards through other mechanisms allowed by local law.

(e) North Carolina recognition: a judgment confirming an award is not the award itself

On remand, the case proceeds on Petitioners’ alternative theory: recognition of the Dutch judgment. The Fourth Circuit agrees that North Carolina’s Act does not cover “foreign arbitral awards” as such, but does cover a “judgment of a foreign court confirming … an arbitral award” (as stated in the Act’s commentary).

The Dutch order “grants leave for the enforcement of the attached arbitral award,” and the award includes monetary obligations (a €150,000,000 penalty upon noncompliance, plus specified costs and fees). The judgment was affirmed through the Dutch appellate chain, making it “final, conclusive, and enforceable” under N.C. Gen. Stat. § 1C-1852(a)(2).

The court also rejects Respondents’ argument that the Dutch judgment must “explicitly adopt” the award’s monetary terms within the four corners of the judgment. Attaching and identifying the award suffices, and the Act’s commentary notes that the foreign-country judgment “need not take a particular form.”

3.3. Impact

Federal enforcement strategy: § 207 is a hard gatekeeper in the Fourth Circuit

The most immediate consequence is that parties seeking FAA/New York Convention confirmation in federal court within the Fourth Circuit must treat § 207 as a true statute of limitations. A petition filed after three years is not merely disfavored—it is unauthorized under the statute as interpreted here.

Forum and mechanism selection: increased importance of “award-to-judgment” pathways

The decision highlights a practical enforcement lesson: when § 207 is missed, creditors may still pursue enforcement by reducing the award to a foreign judgment and then using state judgment-recognition statutes (where available). The Fourth Circuit effectively validates that approach here, at least as a pleading-stage matter under North Carolina law.

Doctrinal stability: avoiding a new circuit split on § 207

The panel expressly notes that, unlike the disagreement over § 9, there is no comparable circuit split on § 207 and that other circuits treat it as a real time bar. The Fourth Circuit’s alignment with those circuits promotes uniformity in Convention-award confirmation timing.

Open questions preserved

The opinion explicitly does not decide whether § 207 is subject to equitable tolling, leaving future litigants to develop that issue if properly raised and preserved.

4. Complex Concepts Simplified

  • “Confirmation” of an arbitral award (FAA/New York Convention): A court order converting an arbitral award into a domestic judgment that can be enforced using standard collection tools. Under 9 U.S.C. § 207, this special confirmation procedure is available only if sought within three years of when the award is “made.”
  • “May” (permissive) vs. mandatory conditions: A statute can make an action optional (“you may file”) while still strictly limiting the time or manner (“but only within X years”). Optional does not mean limitless.
  • FAA Chapter 1 vs. Chapter 2: Chapter 1 generally governs domestic arbitration; Chapter 2 implements the New York Convention for international awards. Rules from Chapter 1 apply to Chapter 2 only when they do not conflict, under 9 U.S.C. § 208.
  • Recognition of a foreign-country judgment (North Carolina Act): A state-law process that treats a qualifying foreign judgment as recognizable/enforceable in the state, subject to statutory requirements and defenses. Importantly, while an arbitral award is not a “judgment,” a foreign court’s judgment confirming (or granting leave to enforce) that award can qualify.

5. Conclusion

The Fourth Circuit establishes a clear rule for Convention-award enforcement in federal court: the three-year period in 9 U.S.C. § 207 is a mandatory filing deadline, and the word “may” does not transform that deadline into a nonbinding suggestion. At the same time, the court underscores that international award creditors are not necessarily left without remedies after § 207 expires; they may be able to proceed through foreign judgment recognition, as exemplified by North Carolina’s recognition of a Dutch court judgment granting leave to enforce the arbitral award.

In broader context, the decision reinforces text-driven statutory interpretation in arbitration enforcement, narrows the reach of Sverdrup Corp. v. WHC Constructors, Inc. to its domestic-arbitration setting, and signals that careful procedural timing—paired with thoughtful selection of enforcement mechanisms—can be outcome-determinative in cross-border disputes.