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GAR 100 - 5th Edition

Milbank Tweed Hadley & McCloy

05 March 2012

The firm has scored some impressive wins for Fraport and Mongolia recently.

Pending cases as counsel:
20
Value of pending counsel work:
US$8 billion
Treaty cases:
7
Current arbitrator appointments:
2 (of which 1 is as sole or chair)
No. of lawyers sitting as arbitrator:
2

Milbank Tweed’s international arbitration practice grew from the Wall Street firm’s long-standing project finance prowess, which has expanded globally; it regularly wins awards for its work in Asia. In one of the firm’s first forays into international arbitration, name partner John McCloy acted for the US multinational oil companies on the arbitrations that followed the nationalisations in Libya. Since then, the firm has continued to appear regularly in the commercial arbitration world – often on project matters – and has also acquired expertise in investment law work. The practice appears happy keeping a relatively low profile.

Washington, DC-based partner Michael Nolan sits on the board of the American Arbitration Association.

Network

In the US, the practice is focused in Washington, DC, New York and Los Angeles. More recently, it’s set up in London with some lateral hires from DLA Piper.

Who uses it?

On the commercial side, Milbank has advised Cerberus Capital Management in an M&A dispute (a US fund); Chubu Electric Power Company (in a nuclear power-related arbitration); India’s Essar Group (in various matters in the steel industry); and satellite television company DirecTV. It has also represented Atlantic LNG in a major gas-pricing arbitration and related court actions.

On the investment side, it is working for German airport operator Fraport on an ICSID claim against the Philippines, and for Mongolia on several high-stakes cases (see below).

Track record

Not at all bad. The firm scored one of 2010’s most eye-catching wins when – with various other firms (including K&L Gates and King & Spalding) – it persuaded an ICSID ad hoc committee to annul an award that was blocking their client Fraport from proceeding with a claim (against the Philippines). The committee found that Fraport had been denied the right to address key evidence submitted by the Philippines (who used White & Case) and annulled the jurisdictional award. Fraport has now resubmitted its original claim to ICSID. The annulment was shortlisted for “Win of the Year” at the inaugural GAR Awards in 2011.

Milbank also defeated a US$1 billion claim on behalf of Mongolia over a windfall profit tax in 2011. In April, an UNCITRAL tribunal chaired by Canadian arbitrator Marc Lalonde said the tax didn’t qualify as a treaty breach. Although the panel did uphold a less substantial claim by the Russian mining investors, the investors decided to abandon the case all the same. The matter was included in the top 10 defence wins in American Lawyer’s Arbitration Scorecard.

The firm also helped Mongolia settle an Energy Charter Treaty claim back in 2006.

Recently, though, it came out second best on an ICSID case (see below).

Recent events

Unfortunately, 2011 also included a defeat for one client in a case against Venezuela. The client, US telecoms investor Brandes, found out in August that an ICSID panel had ruled against it; the arbitrators said an ambiguous provision in Venezuela’s 1999 investment law could not be read as a free-standing consent to ICSID jurisdiction. Curtis Mallet-Prevost Colt & Mosle were counsel on the other side.

Client comment

The Mongolian government’s treatment of the firm speaks volumes. Milbank lawyers were awarded official proclamations of gratitude by the Mongolian justice minister in May 2011 in a surprise ceremony in Ulan Bator, even as they continued work on a second UNCITRAL claim by Chinese investors. One participant in the case told the team, “I prayed to the mountain every day that you will win for us. Now I thank the mountain every day that you have.”

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