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GAR 100 - 10th Edition

Jones Day

09 March 2017

Pursuing claims against Kazakhstan and Panama at ICSID

People in Who’s Who Legal 3
Pending cases as counsel 105
Value of pending counsel work US$25 billion
Treaty cases 10
Current arbitrator appointments 55 (of which 29 are as sole or chair)
Lawyers sitting as arbitrator 21

Jones Day has its origins in the United States but is now just as well known for its arbitration offering in Europe. The Paris office in particular has long been regarded as a serious player in ICC work – partner Michael Bühler is co-author of a handbook on ICC arbitration and co-headed the drafting subcommittee for the revised ICC rules.

In Madrid, partner Mercedes Fernández, who cut her teeth at Bernardo Cremades’ firm, has a track record for investment treaty claims with a Spanish angle.

In the United States, the firm represented the claimant in the first ever investor-state arbitration against the US government under Chapter 11 of the North American Free Trade Agreement. It went on to act in important standard-setting cases under the same treaty, such as Loewen, which examined denial of justice as a breach of the treaty for the first time.

A restructuring in 2012 brought all of the firm’s lawyers with international arbitration experience together under a new global disputes group led by partner Tim Cullen in Washington, DC. The group embarked on a major hiring programme, adding big names such as Jean-Pierre Harb from Baker & McKenzie in Paris and Baiju Vasani from Crowell & Moring in Washington, DC.

DC-based partner Gregory Shumaker took over from Cullen as head of global disputes in 2015.

Network

The main offices for arbitration are London, Paris, Madrid, Washington, New York, Dubai, Singapore and Sydney – with other partners based in Amsterdam, Brussels, Düsseldorf, Frankfurt, Miami, Moscow, Munich, Dallas, Irvine, Los Angeles, Mexico City, Pittsburgh, San Francisco, Perth and Taipei.

Who uses it?

Investment treaty clients include Enersis (a Chilean subsidiary of Endesa) and Spanish water company Urbaser for claims against Argentina; Kazakh private equity group Visor for a claim against Uzbekistan; and Canada’s World Wide Minerals and Alhambra Resources for disputes with Kazakhstan (see below).

As for governments, it’s representing Kyrgyzstan in a pair of commercial arbitrations and is on the Chinese government’s panel of preferred counsel for investment treaty advice. It has advised Russia’s Gazprom Export, China’s Petrocom and the government of Laos.

Other clients include Chevron (in many aspects of its long-running US$9 billion dispute over liability for environmental pollution in the Ecuadorean Amazon), Siemens, Russian mining company AGD and US paint retailer Sherwin Williams. Mexican cement company Cemex has used the firm for arbitrations with a Spanish law or language element.

Track record

In 2015, a Paris team helped Egypt’s Orascom Construction Industries and a Lebanese partner win US$80 million plus interest and costs in a Cairo-seated case concerning a high-profile real estate venture in the Egyptian capital. 

It has helped Cemex win more than €40 million in damages and costs in an ICC claim against Austria’s largest construction group, Strabag. Bühler handled the case, with the award later upheld by an Austrian court.

The firm negotiated a favourable end to a dispute over a billion-dollar diamond find in Russia, on behalf of AGD. The client’s business partner, Archangel Diamond Corporation, had initiated arbitration in Stockholm.

In 2013, the firm advised regular client Gazprom Export in gas price review proceedings against the Czech arm of RWE Transgas. Arbitrators in Austria issued a “compromise” award, reworking the gas price formula in the two companies’ contracts, but rejecting all other claims by RWE. It marked the first gas price dispute against Gazprom Export that reached the award stage.

Going further back, the Madrid office scored a win for Técnicas Medioambientales against Mexico in 2003 in the first ICSID arbitration brought under the Spain-Mexico bilateral investment treaty. Referred to as the Tecmed case, the proceeding helped define the scope of the fair and equitable treatment standard.

In another case against Mexico concerning a hazardous waste landfill, the firm won US$47 million for French waste management company Veolia.

Recent events

The firm obtained a ground-breaking jurisdictional ruling on behalf of Canadian mining company World Wide Minerals in a claim against Kazakhstan over uranium investments. The UNCITRAL panel held that Kazakhstan was a legal successor to the Soviet Union’s commitments under a bilateral investment treaty with Canada – making it the first state apart from Russia to be bound under a Soviet treaty.

The firm is helping another Canadian investor, Alhambra Resources, in a US$100 million ICSID claim against Kazakhstan. It has also been instructed for an ICSID claim against Panama – brought by a Puerto Rican engineering firm and its CEO who say they have been unfairly targeted as part of an investigation of alleged corruption by Panamanian former president Ricardo Martinelli. 

The Madrid office saw an end to a long-running ICSID claim brought on behalf of Spanish water company Urbaser against Argentina. In late 2016, a tribunal declining to award any of the US$300 million damages claimed despite finding that the state had committed a limited treaty breach.

A Jones Day team in New York and Mexico City helped a manufacturing company to defeat a US$700 million ICC claim over the failed acquisition of a rival company.

A Los Angeles team helped the Gulf Cooperation Council – an alliance of six Arab states – in a successful challenge to the registration of the internet domain name “.persiangulf”, which was heard by an ICDR panel chaired by Lucy Reed.

On the people side, Sylvia Tonova in London and Marcus Quintanilla in San Francisco were promoted to the partnership.

Tonova and partner Baiju Vasani were also appointed to ICSID’s panel of arbitrators – by Bulgaria and Somalia respectively.

American Zachary Sharpe joined the international arbitration group as of counsel in Singapore after nearly four years as in-house counsel at Hyundai Heavy Industries in South Korea. In Frankfurt, Anna Masser joined as of counsel from Lalive.  

Client comment

Chevron senior counsel Arjun Agarwal is using a Jones Day team for a London-seated arbitration against a contractor related to a West Africa offshore oil and gas project. He said the team achieved a “very favourable result” and that San Francisco-based partner Stephen O’Neal “managed the preparation and execution effort very effectively “.

Michael McNicholas, general counsel of Kazakh private equity client Visor Holding, describes the team as “very responsive, attentive and highly motivated”. In particular, Baiju Vasani and Melissa Gorsline are “great tacticians and strategists” who show “exemplary leadership for their team”.