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Baker Botts Secures Ruling that Arbitral Tribunal in Yukos-Related Case Lacked Jurisdiction

Release
LONDON, January 25, 2016 - Baker Botts L.L.P., a leading international law firm, announced today that its client, the Russian Federation, obtained a declaration from the Swedish courts that Group Menatep-supported ADR-holders in Yukos Oil Company had wrongly brought expropriation claims against the Federation in international arbitration proceedings. The Court also ordered reimbursement of all of the Russian Federation’s legal expenses in obtaining vindication.

This is one of the many high-stakes arbitrations and cross-border litigations in which Baker Botts acts to protect its clients' rights. 

On January 18, 2016, the Svea Court of Appeal ruled that, “the arbitral tribunal has no jurisdiction to adjudicate the claim.” With regard to the Russian Federation’s legal expenses, the Court ruled that, “The outcome of the case may also be assumed to be important for the Federation outside the current proceedings [and] the costs incurred appear justified for safeguarding the rights of the Federation in this case.” 

“The Swedish court’s careful policing of the boundaries of arbitral jurisdiction in a cross-border investment treaty should give some comfort to the growing number of critics concerned with using arbitration clauses in agreements like the Trans-Atlantic Trade and Investment Partnership (“TTIP”) and the Trans-Pacific Partnership (“TPP”),” said Jay Alexander, Partner in the firm’s London office and Co-Chair of the International Arbitration and Dispute Resolution group. 

"The improper usurpation of jurisdiction is an issue in wide debate today, due not just to the wasted costs and fees, but also to the inherent problems associated with premature reliance on the arbitral decision prior to its reversal. We were and are pleased to work so seamlessly with our colleagues at Lindahl to forcefully address these issues,” said Michael Goldberg, Partner in the firm’s Houston and New York offices and Co-Chair of the International Arbitration and Dispute Resolution group. 

“The judgment of the Svea Court of Appeal provides a sound restatement of the rules on the interpretation of treaties, which are essential to all international agreements between sovereigns, such as Russia and Spain in this case. I am extremely pleased that the Baker Botts International Disputes group was a part of this important result,” said London Partner, Alejandro Escobar

Baker Botts team members include: Jay Alexander (Partner, London), Alejandro Escobar (Partner, London), Michael Goldberg (Partner, Houston and New York), Izabella Sarkisyan (Associate, Moscow), Ernesto Féliz De Jesús (Associate, London).

 

ABOUT BAKER BOTTS L.L.P.
Baker Botts is an international law firm of approximately 700 lawyers practicing throughout a network of 12 offices around the globe. Based on our experience and knowledge of our clients' industries, we are recognized as a leading firm in the energy, technology, and life sciences sectors. Since 1840, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit bakerbotts.com.

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