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US court allows Devas shareholders to register arbitration award

Shareholders of Devas Multimedia can enforce the $1.3 billion International Chamber of Commerce (ICC) award in any jurisdiction in US if they can provide evidence of assets owned by Antrix Corporation, ruled a US District Court.

The United States District Court in the Western District of Washington noted that there is a good cause to register the award in one additional American jurisdiction, the Eastern District of Virginia where the US company Intelsat Service Equipment LLC owes Antrix, $146,457.47, currently pending bankruptcy payments in the Eastern District of Virginia.

“Based on Judge Zilly’s ruling Devas shareholders are now free to enforce the ICC judgment in any jurisdiction in US where Antrix’s assets are found, starting with, but not limited to, the Eastern District of Virginia,” spokesperson for Devas explained.

When contacted, Chinmoy Roy, Junior Legal Officer, Antrix Corporation Limited, told BusinessLine that Antrix is in consultation with its counsels and evaluating its options of instituting an appeal against the order.

“It is very relevant to note that NCLT has ordered Devas to be wound up on grounds of being fraudulent, which has also been upheld by NCLAT. NCLAT has also held the Antrix-Devas agreement to be illegal. The Hon’ble Supreme Court of India has heard Devas ex-management and others concerned at length in appeal and its order is awaited. Antrix has also filed a petition to set aside the ICC award which is currently under adjudication before the Delhi High Court,” Roy added.

Devas shareholders have been pursuing recognition and enforcement of the payment awarded to them by international tribunals such as ICC and the United Nations Commission on International Trade Law. These were awarded to Devas and its shareholders and payable by Indian government for wrongfully terminating their contact with Antrix in 2011.

A spokesperson for Devas said the company will continue the efforts until Indian government fulfills its obligations.

“Until the Modi government returns to the negotiating table, we have no alternative but to enforce against India’s assets, and we are very grateful for the very prompt and close attention the Montreal court is devoting to our case. This is just the beginning of our global enforcement campaign and it will continue until India fulfills its obligations. The disruption India now is suffering—and will continue to experience—is regrettable but it is solely the fault of the Modi government and its brazen defiance of India’s international treaty obligation to accord fair and equitable treatment to its foreign investors.”

Canada litigation
In a related case in Canada, a court in Quebec has reserved a decision on the motions to quash seizure orders against the Airports Authority of India (AAI)and Air India. Recently, a Canadian court granted Devas shareholders the right to seize assets belonging to AAI in Montreal to enforce a $111-million award given by United Nations Commission on International Trade Law.

In its petition, AAI reasoned that overflight fees are not commercial revenues and should be presumptively immune from execution. It has also argued that allegations of fraud against Devas have been upheld by the courts and the Devas’ case should be suspended until India is served a notice since it is clearly a necessary party.

On the other hand, Devas shareholders argued that India is well aware of the action and its absence at the hearing was entirely purposeful and strategic.

The multiple cases have been triggered after India, in 2011, cancelled an agreement between Antrix and Devas to build broadband satellites. The Hindu BusinessLine

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