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GAR 100 - 5th Edition

Foley Hoag

05 March 2012

The group opened in Paris 2011 and received several new instructions

People in Who’s Who:
2
Pending cases as counsel:
17
Value of pending counsel work:
US$58 billion*
Treaty cases:
10
Current arbitrator appointments:
3 (of which 0 is as sole or chair)
No. of lawyers sitting as arbitrator:
2
* includes several state-state disputes

Foley Hoag’s international arbitration practice used to consist of the occasional investor-state work, often on behalf of left-wing Latin American governments that arose from its work in the public international law arena. Practice co-head Paul Reichler was Nicaragua’s advocate in the ICJ case in the 1980s over US support of Contra guerillas.

Recently, however, the firm has expanded its practice greatly, bringing in additional partners known for investment treaty work – notably, Ronald Goodman, formerly of White & Case and Winston & Strawn; and Mark Clodfelter, for many years the United States’ NAFTA claims supremo at the Department of State. The DC team also includes Nicaraguan-born investment and trade lawyer Mélida Hodgson and of counsel Alberto Wray, a former Ecuadorean Supreme Court judge.

More recently, the firm set up an office in Paris – its first outside the US – with a five-strong team poached from Winston & Strawn. That is led by Bruno Leurent (a former commissioner at the United Nations Compensation Commission, the body charged with assessing Iraq’s liabilities following the invasion of Kuwait). As this edition of GAR 100 went to press, news broke of two more arrivals in Paris, including a former senior legal adviser to the United Nations Conference on Trade and Development, or UNCTAD.

Network

Besides the seven lawyers now in Paris, the bulk of the practice is in Washington, DC, with a small contingent in Boston.

Who uses it?

A long list of governments in Latin America, Asia and Africa; including Bangladesh, Georgia, Mauritius, Nicaragua, Slovakia, Uruguay and Venezuela.

Brazilian state-owned power utility UEG Araucária also recently used the firm for an ICC case and related litigation.

Track record

The firm has had strong results over the years, including a number of late for Latin American states. In October 2010, it helped Venezuela see off a US$180 million UNCITRAL claim initiated by Canada’s Nova Scotia Power. The tribunal not only dismissed the claim on jurisdictional grounds, but awarded the state US$1 million in costs in October 2010. (The company has since refiled at ICSID.)

It has produced significant outcomes for Ecuador. In December 2010, an ICSID panel threw out Murphy Oil’s claim concerning a tax on windfall oil profits. Murphy, it transpired, had failed to observe the six-month “cooling off” period prescribed in the BIT before initiating arbitration.

In another claim brought by Chevron, the case ended with a significantly smaller award against Ecuador than the company had hoped for (more on this in “Recent events”, below).

Foley Hoag was co-counsel with Winston & Strawn in all of those cases.

The firm also did good work for Uruguay in its four-year environmental dispute with Argentina over a pulp mill on the banks of a river between the two countries. The ICJ found no evidence of the ecological damage alleged by Argentina.

Uruguay has since tapped the firm for another case – to defend it against Phillip Morris’ controversial ICSID claim concerning the state’s tobacco packaging laws.

Recent events

The practice has seen unprecedented expansion in the past 18 months. In June 2011, a new Paris office opened, staffed by ex-Winston & Strawn partners Bruno Leurent and Thomas Bevilacqua, with one counsel and two associates. They bring expertise in investment treaty and commercial arbitration work, as well as PIL matters.

Then in early 2012, the Paris team was augmented with two further hires – partner Anna Joubin-Bret, who spent 15 years at UNCTAD advising on investment, technology and enterprise development; and special counsel Pierre d’Argent, a professor of public international law at the University of Louvain in Belgium and a former member of the ICJ’s secretariat in The Hague.

In Washington, DC, the firm promoted counsel Mélida Hodgson to the partnership. She spent seven years as associate general counsel at the United States Trade Representative, where she took part in revisions to the US model BIT and assorted FTA negotiations. She’s also on the roster of arbitrators for NAFTA anti-dumping disputes and WTO claims.

Chevron won a US$96 million award against Foley’s client, Ecuador, concerning the failure of its courts to resolve various contractual disputes over oil payments (the case is unrelated to the US$18 billion environmental litigation dominating the headlines). This wasn’t quite the victory for Chevron that it might first appear – the company had been demanding closer to US$700 million.

In a spin-off from that case, the firm is now advising Ecuador in a rare state-to-state dispute with the US to clarify whether delays of justice qualify as a breach of the US-Ecuador BIT. Awkwardly (given Ecuador’s withdrawal from the ICSID Convention in 2009), the ICSID secretary general has to appoint the tribunal president.

The firm picked up some new instructions from Venezuela, defending the state on new ICSID claims by gold investors Vannessa Ventures, Gold Reserve and Crystallex, as well as the refiled Nova Scotia Power case.

And Foley lawyers in Boston and Washington, DC, have also helped Brazilian state power utility UEG Araucária lift a stay on an arbitration it is pursuing against US engineering group Bechtel for alleged breach of contract, negligence and fraud concerning a turnkey power project. In April 2011, an appeal court in New York ruled it was for the arbitrators to decide whether the claim was time-barred, reversing a 2009 decision in Bechtel’s favour.

Paul Reichler was instructed by Mauritius for an arbitration against the UK over control of the Chagos Islands. His client recently lost its bid to disqualify panellist and ICJ judge Christopher Greenwood QC because of his long-standing counsel work for the UK government.

In July 2011, Reichler also took part in a seminar in The Hague to mark the 25th anniversary of the ICJ’s verdict in the Nicaragua v US case, which held that US efforts to topple the Sandinista government were illegal. Other speakers at the event included Bruno Simma, James Crawford, Philippe Sands and Brigitte Stern. Speaking to GAR’s sister publication Latin Lawyer after the event, Reichler called the court’s decision “a historic moment in international relations” that helped strengthen the ICJ and develop a democratic and pro-business climate in Nicaragua.

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