Pestalozzi

Successfully defended a billion-dollar award in the Swiss courts

Though the firm dates back a century, Pestalozzi’s arbitration practice was established around 25 years ago, flourishing under the care of respected arbitrator Pierre Karrer.

He left the firm some years ago to establish his own boutique, but the team has continued to boast one of the largest arbitration practices in Switzerland, with approaching 40 fee earners in the practice.

The practice co-heads are Michael Kramer in Zurich and Thomas Legler in Geneva. Kramer is a member of the Arbitration Court of the Swiss Chambers’ Arbitration Institution and Legler is a member of the ICC Swiss national committee and also features on the World Trade Organization’s arbitrator list.

Other names to know include Zurich arbitration group leader Laurent Killias, a co-founder of the Swiss Arbitration Academy and a member of the ICC Commission on Arbitration.

Who uses it?

The firm has a long-standing relationship with Glencore, which often uses it for disputes work. Other clients include Johnson & Johnson, insurer Swiss Life, retail group Coop Cooperative, German engineering group Bosch and France’s Bouygues Construction, as well as various Swiss and international financial institutions.

It has also paired with White & Case to defend Thailand-based latex glove producer Siam Sempermed in a Swiss arbitration brought by one of its shareholders, Austria’s Semperit.

Track record

In 2020, a German engineering company represented by Pestalozzi and Herbert Smith Freehills defeated a US$123 million ICC claim brought by a Turkish manufacturer over alleged defects in three production lines for glass-coated lemonade bottles.

The firm has acted for the claimant in one of the largest cases before the Swiss Chambers’ Arbitration Institution, worth more than US$1.5 billion. As part of that dispute, it won a rare set-aside decision from the Swiss Federal Supreme Court.

It has obtained annulments for Glencore in another case concerning a Georgian mining project, which marked the first time the Swiss Federal Tribunal has set aside two awards in the same dispute. One award was annulled in 2014 and the other in 2016, after the court found that the arbitrators had ignored its guidance and merely affirmed their earlier findings.

Pestalozzi represented the Indian government in a challenge before the Swiss Federal Tribunal to an investment treaty award in favour of Deutsche Telekom. The high-profile case saw the court conduct a rare public deliberation before upholding the award by a three-to-two majority in 2018.

Recent events

Pestalozzi secured a win for Turkmengaz in the Swiss Federal Tribunal, which upheld a €1.5 billion ICC award the Turkmenistan state entity had won against the National Iranian Gas Company. The court dismissed arguments from the Iranian party that US sanctions made payment of the award impossible.

Client Glencore ran out of luck in front of the Swiss courts, which at the third time of asking upheld an award against the company issued in its dispute with a former partner in a Georgian mining project. The third award against the company, for US$18 million, was, however, for less than half the value of the first award and less than a fifth of the original claim value.

Pestalozzi promoted Lukas Rusch to partner and Christine Möhler to counsel.

Client comment

Gerrit Dekker of Aspetix Health Services in Netherlands says he has had one of the best experiences with legal advice in litigation with Pestalozzi. Legler is commended for being hands-on, practical and efficient.

Having retained the firm in a breach of contract dispute against a Swiss corporation, the client says Legler provided “clear” and “well-motivated” advice on litigation strategy.