Delhi High Court Appoints Sole Arbitrator To Resolve Adidas-Inspire Sports Dispute Over Unpaid Dues

The Delhi High Court has appointed a sole arbitrator to resolve a dispute between Adidas India Marketing Private Limited and Inspire Sports and Lifestyle over alleged non-payment of dues under a distribution agreement.

Justice Om Prakash Shukla appointed advocate Iram Majid as the sole arbitrator after both sides agreed to refer the dispute to arbitration. The court observed that the existence of a valid arbitration clause was undisputed.

“There is no dispute with regard to the existence of a valid arbitration clause between the parties,” the court observed. It added, “In the aforesaid circumstances, this Court finds no impediment in appointing a Sole Arbitrator”.

The dispute arose from an April 19, 2018 distribution agreement, under which Adidas granted Inspire Sports a non-exclusive right to market, distribute and sell its products. The agreement was extended from time to time through various addenda and remained in force until March 31, 2026.

Adidas alleged that payments due under the agreement had not been made. It invoked the arbitration clause and issued a notice dated April 22, 2026, under Section 21 of the Arbitration and Conciliation Act, 1996.

Adidas subsequently approached the Court under Section 11(6) of the Act, seeking the appointment of an arbitrator.

At the hearing culminating in the November 5 order, counsel for both sides agreed that the dispute could be referred to arbitration.

The Court also recorded that the existence of a valid arbitration clause was undisputed.

Clause M of the distribution agreement required disputes arising from or connected with the agreement to be finally resolved by a sole arbitrator nominated by Adidas' Managing Director.

It designated New Delhi as the place of arbitration and English as the language of proceedings, while providing for Indian law and the exclusive jurisdiction of courts at New Delhi.

The Court reiterated that its inquiry under Section 11 was confined to examining the prima facie existence of an arbitration agreement.

"It is well settled that while exercising jurisdiction under Section 11 of the Act, the scope of enquiry is confined to examining the prima facie existence of an arbitration agreement", it said.

On this basis, it proceeded with Majid's appointment.

Majid was directed to enter upon the reference within three weeks of the order and furnish the requisite disclosures under Section 12(2) within three weeks of entering the reference.

The arbitration will proceed under the rules and aegis of the Delhi International Arbitration Centre, with fees governed by its schedule.

Disposing of the petition, the Court left all pleas open, including objections concerning jurisdiction, arbitrability and the addition of parties.

It directed the arbitrator to decide the dispute independently on its merits, uninfluenced by observations in the appointment order.

For Petitioner (Adidas India Marketing Private Limited): Advocates Niraj Singh, Aishani Mohan, Vishesh Prakash Srivastava.

For Respondent (Inspire Sports and Lifestyle & Anr.): Advocates Sumit V. Rastogi.