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GAR 100 - 13th Edition

Von Wobeser y Sierra SC

22 April 2020

The firm lost its co-founder, but welcomed a former Mexican Supreme Court judge

People in Who's Who Legal 2
People in Future Leaders 2
Pending cases as counsel 16
Value of pending counsel work US$1.65 billion
Treaty cases 1
Third-party funded cases 0
Current arbitrator appointments 14 (5 as chair or sole)
Lawyers sitting as arbitrator 4

Von Wobeser y Sierra’s international arbitration practice is one of the best options in Mexico – thanks partly to the impressive international profile of the firm’s founder, Claus von Wobeser.

On top of multiple bar association roles, von Wobeser is a former vice president of the ICC Court and is regularly seen arbitrating commercial and investor-state disputes. He has lately been on ICSID panels hearing claims against Mozambique, Hungary, Guatemala, Peru, and Venezuela. In addition, he has sat alone in a rare ICSID conciliation proceeding filed by Equatorial Guinea against CMS Energy Corporation.

The arbitration and litigation practice had been headed by one of the firm’s founders, Marco Tulio Venegas. However in 2019 he left to establish his own disputes boutique, leaving the practice in the hands of von Wobeser.

Partners Adrian Magallanes, Fernando Moreno, Diego Sierra and Montserrat Manzano, and of counsel Guillermo Ortiz Mayagoitia, are the other names to know.

Who uses it?

Around 70% of its clients are from the US, Germany and Asia (especially Japan). Foreign companies often retain the firm as counsel or Mexican law experts in major disputes involving Mexico’s national oil company Pemex, electricity utility CFE and other state entities.

It has advised construction companies ICA and KBR and other clients including BMW, Siemens, Mitsui Group, Mitsubishi and the Coca-Cola Company. British American Tobacco instructed the firm for a US$300 million dispute with a Japanese joint venture partner. Meanwhile, Anheuser-Busch InBev used it in a substantial case brought by Mexico’s Grupo Modelo.

Track record

Anheuser-Busch won the arbitration with Grupo Modelo – prompting the boss to take the team on a night out. “When I received the award, I was compelled to find the arbitration team and celebrate,” von Wobeser says.

The firm secured a win for Mexican client ICA in a multimillion-dollar claim regarding the construction of a hydroelectric project. It also helped ICA to settle an ICC arbitration worth US$450 million over the alleged wrongful termination of a contract for the construction of a port terminal on Mexico’s Pacific coast.

In 2015, the firm helped Siemens and South Korea’s SK Engineering & Construction settle a bitter dispute with Pemex over a refinery upgrade, with the state entity agreeing to pay US$295 million. The dispute had given rise to a decade-long ICC arbitration and a final award worth almost US$600 million, which Von Wobeser y Sierra helped to defend from attacks in the Mexican courts.

Claus von Wobeser provided expert testimony on Mexican law on behalf of KBR in another long-running dispute with Pemex over the construction of two offshore gas platforms. He gave evidence in the arbitration, which ended in a US$300 million award in KBR’s favour in 2009, and in New York enforcement proceedings – generating a precedent on the ability of US courts to enforce annulled awards. Pemex finally paid US$435 million to satisfy the award in 2017.

Von Wobeser continues to be one of the most in-demand arbitrators in Latin America. He chaired an UNCITRAL panel sitting in The Hague which awarded a former subsidiary of Petrobras and its partners US$515 million in a dispute with Ecuador over two nationalised oil projects in the Amazon. The award was issued in early 2018.

The firm obtained a favourable award in ICC proceedings for an independent energy producer in a dispute with CFE over the termination of a power purchase agreement. The client obtained 88% of the amount claimed in damages and lost profits, and the termination was revoked.

In 2015, it helped a group of shareholders in Mexican insurer Seguros Argos win emergency relief against Dutch insurance group Aegon at the ICC, requiring it to comply with certain shareholder obligations – before leading the clients to victory in the ensuing arbitration.

In another ICC case, involving a claim of over US$100 million, it helped IEnova (a joint venture between California’s Sempra Energy and Pemex) settle a dispute with Italian-Argentine engineering group Techint over the construction of a 220-kilometre ethane pipeline in southern Mexico.

Recent events

Venegas left von Wobeser y Sierra after 25 years to establish a disputes boutique, Litredi. Two other lawyers left to join him at partners at the new firm, Margarita Gárate and Michelle Carrillo.

However, in January 2020 the firm hired Judge Margarita Luna Ramos, a former justice of the country’s Supreme Court, as of counsel in its litigation and arbitration department. She will focus on counsel work in arbitration and will also accept arbitrator appointments.

The firm was again instructed by IEnova, this time for an arbitration launched by Mexican state power CFE utility to amend the terms of a deal to build a US$2.5 billion natural gas pipeline between Mexico and the US.

The case was one of several filed against gas pipeline operators by CFE. However, in August 2019 Mexican president Andrés Manuel López Obrador and the and the head of the CFE announced they had reached a deal with the operators concerning the cost of transporting natural gas for electricity generation.

Alongside Alston & Bird, it is representing a US tile manufacturer in a NAFTA dispute with Mexico over an alleged denial of justice, after a local court enjoined it from pursuing a Houston-seated ICC arbitration against its Mexican joint venture partner – a ruling that prompted an outcry from practitioners for its reported reliance on the Calvo doctrine.

It helped Siemens to obtain an injunction from a Mexico City court in support of an ICC Arbitration, preventing counterparty Arancia from enforcing a US$7 million letter of credit. The parties have now settled their dispute.

Client comment

Mark Lowes, litigation vice president at Houston-based at KBR, praised von Wobeser as “a very good and reliable counsel and expert.”

“They were 100% involved in the case,” a senior executive at one of Mexico’s largest infrastructure companies has previously said of the firm. “They rapidly absorbed key information, such as dates, the actors involved and even technical aspects related to civil engineering and ports operation. My impression is that they were totally committed.”

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