Second Circuit Confirms that State-Owned Entities Are Not Alter Egos of Their Sovereigns, Absent Exceptional Showing

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Second Circuit Confirms that State-Owned Entities Are Not Alter Egos of Their Sovereigns, Absent Exceptional Showing

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September 2015 – In a recent decision arising out of the Argentina bondholder litigations, the U.S. Court of Appeals for the Second Circuit confirmed the doctrine, established by the U.S. Supreme Court more than 20 years ago, that foreign state-owned agencies or instrumentalities will not be considered an “alter ego” of the state absent a significant showing.  In EM Ltd. v. Banco Central de la República Argentina, No. 13-3819-cv (2d Cir. Aug. 31, 2015), the Second Circuit elaborated on the two prongs necessary to overcome the presumption that instrumentalities and their sovereigns are distinct entities:  (1) the plaintiff must show that the instrumentality is so extensively controlled by its owner that a relationship of principal and agent is created; or (2) the plaintiff must establish that recognition of an instrumentality’s separate legal status would work a fraud or injustice.  Applying these tests to the facts at hand, the Second Circuit declined to find that the Central Bank of Argentina was an alter ego of Argentina.  The decision confirms the limitations on the ability of judgment creditors to hold a state-owned entity or instrumentality liable for the debts of the state itself, or to subject it to suit in the United States based on a waiver of immunity by the sovereign.

For more information about the decision, please click here to see the English and Spanish versions of our case note.

Global Arbitration Review Quotes Aníbal Sabater

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August 2015 – The Global Arbitration Review quoted Chaffetz Lindsey partner Aníbal Sabater in an article published on Friday, August 21st titled “ICC award survives constitutional challenge in Bogotá.”  The article discusses a recent decision by Colombia’s Constitutional Court to rejected an unprecedented challenge to an ICC award in favor of an international consortium, two years after the award was satisfied.

To view the article in its entirety, please click here (note: a subscription to GAR is required to view the full article).

 

ICDR arbitration–The Lawyers’ Perspective: A Q&A with Aníbal Sabater

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June 2015 –  The International Centre for Dispute Resolution (ICDR) was established almost twenty years ago as the international arm of the American Arbitration Association (AAA).  In this article, “ICDR arbitration–the lawyers’ perspective” (published by LexisPSL), Aníbal Sabater, international arbitration specialist and partner at Chaffetz Lindsey in New York, and Edward Kehoe, co-head of King & Spalding’s international arbitration practice, also in New York, share their experiences of ICDR arbitration.

Aníbal is an international arbitration specialist with over 17 years of experience, representing clients from around the world and industries as diverse as construction, energy, mining, shipping, technology, and telecommunications, in arbitrations under all major international arbitration rules, including AAA/ICDR, ICC, LCIA, and UNCITRAL. He has also acted in several investment arbitration cases under the UNCITRAL Rules and the ICSID Convention/Rules, as well as in commercial disputes involving states and state-owned entities. Licensed in several US jurisdictions, England and Wales (solicitor), and Spain, Aníbal has represented clients in disputes governed by the laws of more than 20 nations across Latin America, North America, Europe, North Africa, and the Middle East.

NYIAC Publishes International Arbitration Pre-Hearing Checklist by Aníbal Sabater

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July 2015 – Preparing for an international arbitration is no easy task. In addition to the substantive of the case, there are many organizational points to consider. NYIAC’s Program Committee Chair and Chaffetz Lindsey Partner Aníbal Sabater addresses these points in this checklist designed to aid counsel and parties as they prepare for an international arbitration hearing.  Please click here to view the International Arbitration Pre-Hearing checklist.

Chaffetz Lindsey’s Drew Poplinger Recaps Judge Preska’s Keynote Speech from Global Law Week

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June 2015 – The Hon. Loretta Preska, Chief Judge of the SDNY, gave the keynote speech at the New York Bar Association’s Global Law Week, titled “The Elements of Commerce in the Twenty-First Century: How Commercial Courts Enhance a City’s Position as a Financial, Commercial, and Legal Hub.”

Andrew Poplinger, Associate at Chaffetz Lindsey, has recapped Judge Preska’s speech for the “Legal Developments and Analysis” section of the NYIAC (New York International Arbitration Center) website. Chaffetz Lindsey is a Board Member of NYIAC, which Judge Preska referenced in her address. Click here to read the full text of Andrew’s review.

Second Circuit Affirms FSIA Dismissal of Claims Against Chaffetz Lindsey Client in Picasso Ownership Dispute

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May 2015 – A Chaffetz Lindsey team led by partner Andy Frischknecht and including partner James Hosking and senior associate Andrew Poplinger have won an affirmance in the Second Circuit of a June 2014 decision in the Southern District of New York dismissing all claims against our client, the Free State of Bavaria, in a dispute over ownership of a well-known painting by Pablo Picasso titled “Madame Soler.”  See Schoeps et al. v. Freistaat Bayern or Free State of Bavaria, No. 14-2739, Dkt. # 96-1 (2d Cir. May 22, 2015)

At issue were claims by the heirs of a former owner of the painting against Bavaria, which acquired “Madame Soler” in the 1960s.  The heirs claimed superior title to the painting (which they valued at up to $100 million) based on the circumstances of a prior sale in the 1930s.

The Second Circuit’s affirmance of the District Court’s decision granting Bavaria’s motion to dismiss the complaint for lack of jurisdiction under the Foreign Sovereign Immunities Act noted the extensive proceedings in the District Court that led to the dismissal of all claims against Bavaria, including “a three-day evidentiary hearing, multiple rounds of briefing, and oral arguments.”

Yasmine Lahlou Moderates IBA’s Young International Arbitration Practitioner Workshop

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October 2014 – Yasmine Lahlou was a moderator at this year’s Young International Arbitration Practitioner Workshop that took place ahead of the IBA’s Annual Meeting in Tokyo, Japan. This year’s Workshop focused on witness testimony and Yasmine moderated the first workshop with Swee Yen Koh of WongPartnership that explored different approaches to cross-examining a witness.

Yasmine is Counsel with Chaffetz Lindsey and has been recognized for her experience in the area of international arbitration by Chambers USA and Legal 500 USA. She holds various leadership roles in industry organizations, including Regional Coordinator of the ICC Young Arbitrator Forum and Co-Chair of the American Bar Association’s International Litigation Committee. Please click here to learn more about Yasmine’s experience.

Gretta Walters Presents on Investor-State Arbitrations at the SCC

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October 2014 – Associate Gretta Walters co-coached the New York University team at this year’s FDI Moot, which took place at Pepperdine University School of Law in Malibu in late October. Forty-one teams (with 189 students and coaches) competed in the competition, with a further 18 participating in the additional regional rounds in Seoul and New Delhi. Gretta coached the team, which came in second, with Christian Alberti from the ICDR, and with the assistance of Professor Jose Alvarez, the faculty sponsor at NYU.

In addition to her coaching responsibilities, Gretta gave a presentation to all the participating students, coaches, and arbitrators on investor-state arbitrations at the Stockholm Chamber of Commerce (SCC). Behind ICSID, the SCC is the arbitral institution that has administered the most investor-state arbitrations. Before joining Chaffetz Lindsey, Gretta was Legal Counsel at the SCC.

Peter Chaffetz Speaks at IBA Annual Meeting in Tokyo

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October 2014 – Peter Chaffetz was a panelist at this year’s Annual IBA Meeting in Tokyo. Peter, who is a member of the IBA’s Litigation Committee, was part of an international panel that explored the challenges posed by alcohol and substance abuse in the profession, and the options available to law firm management when dealing with these and related issues. The session considered the impact of stress on the profession and the impact of alcohol and substance abuse on law firms. The panelists discussed a series of case studies and the potential approaches that could be taken to the various management issues that arise in these contexts, including depression, employee relations, sexual harrasment, and firm reputation.

The IBA Annual Meeting is the largest global conference for members of the legal profession and attracts participants from around the world. Peter Chaffetz formed Chaffetz Lindsey with four other partners from the New York office of Clifford Chance in 2009. He had previously been the Global Head of that firm’s Litigation & Dispute Resolution practice and a member of the firm’s management committee.

Andy Frischknecht Presents on Developments in Sovereign Litigation

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October 2014 – Partner Andy Frischknecht was part of a panel organized by the Knowledge Group that explored the application of the Foreign Sovereign Immunities Act, which establishes limitations on suits in U.S. federal or state courts against foreign sovereign nations and institutions. The panel took a practical look at the Act and how it affects the execution of judgments against foreign governments and their instrumentalities. They discussed who can be sued and in which courts, what constitutes a “foreign state”, the presumptions of immunity and their exceptions, and liabilities, damages, and enforcement proceedings.

Andy has been a partner since 2013 and has experience representing sovereigns and sovereign instrumentalities in high profile litigation in the U.S. Please click here to learn more about Andy’s experience.

Chaffetz Lindsey’s Latin American Experience Recognized by Chambers Latin America

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September 2014 – Chaffetz Lindsey has been recognized once again in Chambers Latin America as a leading law firm for disputes involving the region. Partners David Lindsey, James Hosking and Jennifer Permesly were all individually recognized for their experience with disputes involving companies based in and investing in Latin America. David, who has been recognized in every edition of the guide since its inception, was described as being “valued by sources for his strategy and experience, which ‘allows him to anticipate the moves the other party might make.'” James was highlighted for his “fantastic client service and…judgement”, while clients interviewed appreciated Jennifer’s “research, interpersonal skills and ability to negotiate.”

For more details, please go to www.chambersandpartners.com.

James Hosking Part of Faculty for Italian Course in International Arbitration

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September 2014 – James Hosking was a lecturer for the newly offered certificate program in International Commercial and Investment Arbitration Theory and Practice run at Roma Tre Universita Degli Studi, and sponsored by the International Chamber of Commerce, Italian Arbitration Association, and Milan Chamber of Arbitration, from September 15 -19, 2014. The week-long course was attended by a mix of law students, practitioners and in-house counsel, and is intended as an intense introduction to international commercial and investment arbitration. The course was run in partnership with Cleary Gottlieb, NCTM Studio Legale Associato, arbit (the Italian Forum for Arbitration and ADR), and the Italian Ministry of Justice, and included faculty from the world’s leading international arbitration practices and institutions, and leading academics in the area. James spoke on extending the arbitration agreement to non-signatories.

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