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GAR 100 - 12th Edition

GST

05 April 2019

The Miami boutique counts Venezuela and Pakistan among its clients in investor-state disputes

Pending cases as counsel 17
Value of pending counsel work US$25 billion
Treaty cases 13
Current arbitrator appointments 19 (11 as chair or sole)
Lawyers sitting as arbitrator 3

GST was set up in 2009, when Florida-based lawyer Quinn Smith joined forces with Brazilian practitioner Mauricio Gomm Santos – then a consultant at US firm Buchanan Ingersoll & Rooney and law professor at the University of Miami.

Starting life as Smith International Legal Services, the firm wanted to carve a niche as an adviser to Brazilian individuals and businesses expanding internationally, as well as US companies doing business in Latin America. Its early work saw it involved in an ICC dispute and litigation between the United States’ Bechtel and a Brazilian state power company.

The practice really began to take off in 2012 with the arrival of Diego Gosis, an Argentine lawyer who has acted as external counsel to his government in more than 20 investment arbitrations since 2006. Gosis also sits as arbitrator.

In 2013, Gomm Santos became a full partner of the firm, leading to a rebrand as Gomm & Smith. An additional partner came on board in 2016 – Ignacio Torterola, the Argentine government’s former ICSID liaison officer. That hire led to the firm’s latest rebrand as GST, also giving it a presence in Washington, DC for the first time.

Torterola spent nine years at Argentina’s treasury attorney general’s office defending the state against investment treaty claims, and has also worked at Foley Hoag and Brown Rudnick.

Smith, who lectures on arbitration at a Brazilian university, holds roles in various young practitioners’ groups at the ICDR and ICC, while Gomm Santos is a founding member and former director of the Brazilian Arbitration Committee and sits on its advisory council.

Gosis and other members of GST have previously collaborated with Argentine firm Guglielmino & Asociados on certain investor-state matters but the two firms have recently parted ways.

Network

In addition to its Miami office, the boutique has addresses in London and Washington, DC.

Who uses it?

Pakistan, Venezuela and Bolivia have instructed the firm on a number of treaty and commercial matters. Governments often bring the firm in at a late stage in cases that haven’t been going their way. In one ICSID matter, Bolivia retained it as replacement counsel only five weeks before the final hearing.

Other engagements have come from a sovereign instrumentality of Argentina, several Brazilian manufacturers and families, and an investment bank in Africa. A South American state-owned bank instructed the firm to assist in recouping US$60 million in funds stolen by a bank official. It’s also acted for US investors in a US court challenge to a DR-CAFTA award in favour of Costa Rica.

Track record

In their former roles advising the Argentine government, Gosis and Torterola had a hand in some landmark wins at ICSID, including the annulment of awards against the state in the Vivendi IEnron and CMS cases.

More recently, Gosis has helped to obtain some spectacular results for Venezuela at ICSID in collaboration with Guglielmino & Asociados. The team defeated a billion-dollar claim by subsidiaries of a US bottlemaker, with the tribunal ruling for the first time that claims filed after Venezuela’s denunciation of the ICSID Convention are inadmissible.

The same team helped to knock out a US$400 million claim relating to a hotel and cable car investment – with the tribunal concluding that the claimant was not a protected investor because as a trustee it did not own the disputed assets.

Even where the state client has been on the losing side, the team has succeeded in significantly reducing the size of the damages. Its defence of Venezuela in a US$150 million claim over a Caribbean island airport led to a final award against the state worth US$34 million.

For Bolivia, GST reduced a US$285 million ICSID claim by Chilean mining company Quiborax to an award of US$48 million. GST also helped Bolivian state mining entity Empresa Siderúrgica del Mutún overturn a US$22.5 million award in favour of India’s Jindal Steel in the Bolivian courts in 2015.

Recent events

Gosis helped Venezuela’s ministry of defence reduce a US$370 million claim to a net award worth US$129 million in favour of US shipbuilder Huntington Ingalls, with the ministry prevailing on part of its counterclaim. The 15-year dispute concerns repairs to two naval frigates and has also spawned US court proceedings.

GST continues to defend Venezuela in a series of investment treaty claims, including parallel ICSID and UNCITRAL claims brought by Spanish businessman Luis García Armas and members of his family over the expropriation of their food distribution business. In that dispute, GST obtained a rare ruling requiring the third-party funded claimants to post US$1.5 million in security.

The state has also retained the firm to defend it in ICSID claims brought by a Caribbean oil services company and a Spanish agricultural conglomerate.

GST has also been advising Venezuela in ICSID annulment proceedings, where the state has sought to annul a US$409 million award won by companies controlled by prominent US businessmen Charles and David Koch; two awards in favour of Luxembourg-based steelmaker Tenaris; and an award in favour of a coffee producer.

Venezuela has also turned to the firm to defend it in various US court actions commenced by arbitral creditors, including US bottlemaker Owens-Illinois and Canadian mining company Crystallex.

Meanwhile GST is advising Venezuela’s national oil and gas company PDVSA in a US$500 million LCIA dispute concerning an offshore drilling rig.

Pakistan brought in GST to replace its previous counsel Allen & Overy in an US$9 billion ICSID dispute with Australia’s Tethyan Copper Mining, after the state was declared liable for refusing a mining lease application. The case is now at the damages phase, the firm having failed in a bid to have all three arbitrators disqualified. 

In another ICSID case for Pakistan, GST is seeking to annul a US$800 million award compensating a Turkish company for the detention of power generation vessels during an energy crisis in Karachi. The firm has also lodged parallel revision proceedings, arguing that new evidence has come to light to support its allegations that the underlying investment was tainted by corruption.

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