Deutsche Telekom petitions US court to enforce $1.2 billion arbitration award against Antrix

Deutsche Telekom has petitioned a US court asking it to enforce a $1.2 billion compensation award against Antrix Corp, the commercial arm of India’s space agency, for cancelling a satellite contract with Devas Multimedia, in which the German telecom company is a strategic shareholder.

Deutsche Telekom has sought that India pay its share of $135 million in damages in the case where the US federal court for the western district of Washington had last October upheld the International Chamber of Commerce’s arbitration award of over $1.2 billion ($562 million plus interest) in 2015.

In November, the Supreme Court stayed the execution of the award till a case on the same issue in the Delhi high court had been decided. In January, the National Company Law Tribunal (NCLT) admitted a petition for winding up Devas Multimedia.

“Since the issuance of the Final Award, Devas began the process of being wound up by the Indian government and there is no chance of any of its shareholders ever recovering any amount from the award in the ICC Arbitration,” Deutsche Telekom said in its petition filed in the District Court of Columbia, Washington, DC. “(The) petitioner’s only avenue for recovering the losses it sustained from India’s misconduct is through the enforcement of the Final Award.”

ET has reviewed the court filings made on April 19.

The telecom company has argued that India had never challenged the final award by Geneva-based ICC and the deadline for it to do so under Swiss law has passed. It also argued that India does not get immunity in a US court as it is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the New York Convention.

Deutsche Telekom had invested $97.2 million in two tranches in 2008 and 2009 to pick up a 19.2% stake in Devas Multimedia.

Deutsche Telekom and Antrix Corp, the commercial unit of the Indian Space Research Organisation, did not reply to emails seeking comment till press time Tuesday.

In 2005, Antrix signed a deal with Devas to build two communication satellites, which were to use the S-band spectrum and offer hybrid satellite and terrestrial communication services throughout India.

The deal soon became caught up in a political storm after allegations that the S-band spectrum was offered at a throwaway price, resulting in the government cancelling it in 2011 citing national security issues. Devas went in for arbitration, with Antrix losing its case.

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