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GAR 100 - 10th Edition

Paul Hastings

09 March 2017

Defending Rwanda against an ICC claim

Pending cases as counsel 20
Value of pending counsel work US$4 billion
Treaty cases 2
Current arbitrator appointments 2 (of which 2 are as sole or chair)
Lawyers sitting as arbitrator 2

Like many US firms, Paul Hastings’ international arbitration-related work has several legs: commercial disputes, investor-state arbitration and enforcement of awards. Unlike most, it also advises on political risk insurance and trade credit insurance. The firm is thought to have had a background role in several treaty claims against Latin American states on behalf of the claimants’ insurers.

The West Coast firm’s arbitration practice began to take off in 2003 with the hire of Christopher Dugan from Jones Day. Dugan was a pioneer in NAFTA work, representing Canadian claimants Methanex and the Loewen Group in a pair of groundbreaking cases against the US government. He headed the practice at Paul Hastings until his untimely death in 2012.

The practice expanded with the 2006 takeover of Dickinson Landmeier, a well-regarded DC boutique with a name in public international law. Today, those attorneys form the core of the practice.

Names to know in the Washington, DC, office include Joseph Profaizer and younger partner Igor Timofeyev (promoted in 2013). A more recent arrival in New York is Camilo Cardozo, former co-chair of the US international arbitration group at DLA Piper, who joined in 2016.

Network

The practice is centred in DC, but it also has partners in New York and Houston, as well as in Milan, London and Paris. In addition, there are boots on the ground in Los Angeles, Chicago and Shanghai.

Who uses it?

Financial services clients of note include GE Capital, AIG, Société Générale and ACE Insurance. The US government’s political risk insurance arm, OPIC, and the World Bank’s Multilateral Investment Guarantee Agency have also turned to the firm for advice in the past couple of years.

The firm also acts for Telecom Italia, the US’s Pacific Steel Projects and Global Gaming Asset Management, and Mexican steelmakers ADM and Grupo Simec.

Asia is an increasing source of work, including for Japan’s Marubeni Corporation, Mitsui Ocean Development & Engineering Co and Kobe Steel, Indonesia’s Cirebon Electric and South Korean chemicals group Lotte. Indian billionaire brothers Malvinder and Shivinder Mohan Singh have used the firm for a post-M&A dispute with a Japanese partner heard in Singapore.

The firm has been advising the Philippines in a US$2.6 billion dispute over a contract to build a light rail network in Manila, and Rwanda in an an ICC claim over a methane extraction plant (see ‘Recent events’).

Track record

A few years back, Paul Hastings helped French bank Société Générale and two US subsidiaries pursue three interlocking arbitrations against the Dominican Republic over the privatisation of an electricity distributor. The dispute included one of the earliest DR-CAFTA cases, heard under UNCITRAL rules in The Hague, as well as an LCIA case under the Dominican Republic’s BIT with France. After one of the claims cleared the jurisdictional stage, the state paid US$26 million to settle the case in 2009.

From 2003 to 2010, the firm also coordinated multi-jurisdictional efforts to enforce a US$261 million award in favour of energy joint venture Karaha Bodas against Pertamina, Indonesia’s state-owned oil and gas company. A team led by Chris Dugan eventually recovered some US$320 million for its client – the entire award plus accrued interest. Pertamina continues to appeal the decisions in Canada.

The firm helped South Korea’s Honam Petrochemical secure a US court order to compel ICC arbitration in Seoul – after which the claimants dropped their case without initiating an arbitration.

The firm has settled a number of cases for its political risk and trade credit insurance clients in the past two years, resolving claims relating to Belizean sovereign bond defaults, political violence in Libyan oil fields, expropriations in Venezuela and financial defaults in Mexico, the Dominican Republic and St. Kitts and Nevis. 

Recent events

Acting alongside Hughes Hubbard & Reed, the firm helped Las Vegas casino operator Global Gaming Asset Management prevail in a claim against the owner of a premier gaming resort in Manila under a management agreement.

After joining the firm from DLA Piper in early 2016, Camilo Cardozo helped mining client CCX – owned by troubled Brazilian magnate Eike Batista – settle a US$125 million arbitration with Turkey’s Yildirim Holdings over the sale of coal assets in Colombia.  

Together with Drew & Napier, the firm defended the Singh brothers, former majority shareholders in India’s Ranbaxy Laboratories, in a post-M&A dispute with Japanese drugmaker Daiichi Sankyo. The ICC arbitration, heard in Singapore, concerned allegations that the brothers had misled Daiichi about a drug safety probe. The brothers’ companies were ordered to pay US$525 million in an award in April 2016.

The firm continues to defend Rwanda against an ICC claim by Scotland’s Dane Associates concerning a gas extraction and power generation project on Lake Kivu. A large portion of Dane’s €100 million claim was knocked out at the liability phase in 2014. An award on quantum is awaited.

Paul Hastings lawyers have also provided training on a pro bono basis to Rwandan government officials on how to negotiate project agreements and deal with disputes arising from them.

Client comment

Yasushi Okubo of Kobe Steel says Profaizer and his team were “excellent” in their preparation and in hearings. The final award they secured gave Kobe 100 per cent of what it wanted.