RMLFF Tracking the case at Jus Mundi
Rusoro Mining v. Venezuela
Rusoro Mining Ltd. v. Bolivarian Republic of Venezuela, ICSID Case No. ARB(AF)/12/5
Jus Mundi hasn't been updated yet to note the recent wriggle in the D.C. District Court finding... the jist of which addresses the D.C. courts' view of claims disputing rightful control over the defense of the case in D.C., with parallel legal processes occurring in Paris, and in Washington D.C.
Throw into the mix that the same dispute over proper control of legal process is joined in a separate case in the U.K., where the same parties are engaged in a dispute over who is the proper representative of Venezuela's interest, as the two parties file claims seeking to be declared the rightful owner of $1.4 billion in gold stored in the vaults at the BOE... as they are suing the BOE to have it be returned to them.
The link above has no relation to the dispute in the U.K., but only documents the legal history of Rusoro winning its arbitral award in Paris... and seeking to have it be enforced in the D.C. District Court.
In parallel with the effort to have the award be enforced in D.C., the Paris award itself has been disputed in France... but that issue was resolved, with some finality, in Rusoro's favor in March of 2021.
That outcome in Paris shifts the focus back to D.C., where not much of interest has been occurring.
Back in February of 2019 "interim President" Juan Guaido asked the D.C. District Court to "pause" its consideration of the enforcement proceeding... asking the court to stop considering Rusoro's petition (filed in May of 2018) to have the French courts prior (and now final) rulings on the arbitral award be enforced...
The news this week... is that after two and half years of thinking about it... the D.C. court this week finally said "no" to the request for a pause, and dismissed the Guaido teams "Motion of Stay" but did so without prejudice... so, the issue of legitimacy in representation is not resolved at all...
Considered in isolation... that outcome to a motion filed in early 2019 boils down to... watching paint dry...
It is perhaps made more interesting now... as a function of the same issue in the parallel dispute in the U.K. over who should and legitimately can exercise control over Venezuela's gold in the vaults of the BOE...
That dispute appears it may be a parallel to the D.C. District Court dust up... but it really isn't... as the D.C. District Court saying "no" to a request to pause a case being heard... in consequence of an arbitral award.. might not matter at all in other cases, or in other courts... or even in the D.C. court itself, as the denial of the motion as made has left it left open to future amendment... and re-hearing.
That the D.C. court's decisions (or others) might be made to matter in other venue is discussed here:
Representation of Venezuela in Investment Arbitration
But, the bottom line seems it is... a dispute over who is the legitimate representative of the losing side in an arbitration... is inconvenient (as it introduces conflict and "noise" as "sound and fury" with delay)... but it can, and should, do nothing to alter the outcome of an award that has already been granted, and quite correctly, to a wronged party.
That reduces the issue down to... two separate sets of putative government officials are wanting to engage in a dispute between themselves over which one of them should be the loser. Who the legitimate leader of the government is now... has nothing at all to do with any ability to modify the facts in the case, based on errors made by prior governments... which subject errors are what led to the court finding those wrongful actions should result in the plaintiff winning the award ? Both disputants are mere caretakers of that prior shameful legacy... where the court entertaining the dispute between them as a reason to delay justice, only commits a further injustice.
It may be true that differences between the competing defendants might alter outcomes that affect them, depending on who wins the disputes between them... but, all of those concerns are separate issues, perhaps rightly the subjects of cases filed by them, against each other, in some other court...
The courts obligation is not to advantage one disputant or another as the defendants quibble among themselves... or to advantage or prejudice the plaintiffs by choosing their defendants for them. Rather, it is the courts obligation to protect plaintiffs interest, and the courts own interest, from the defendants deflections, as they seek to mitigate the impacts of court rulings by imposing delays, distractions, and obfuscations in lieu of proper legal arguments.
In the D.C. court, their intent is made clear, even in the motion itself... that defendants seek to delay the justice being sought by the wronged party. And they have done that ... by manufacturing from whole cloth, whether the dispute between defendants are feigned or not, a claim that a legal dispute between alternative sets of defendants is a cause that should be taken as a reason to impose delay. The same ploy seeks to induce the court to decide issues that inherently prejudice the case, against the plaintiffs... when, in fact, the existence of that separate set of dispute between defendants is, or should be, of no consequence either to the case, or to the court...
The same is not exactly true of the case in the U.K., where the disputants are not arguing over which of them should be awarded the status of the loser to a third party... winning the right to be stripped of value, by the court, as it is awarded, in recognition of the legitimacy of the outcome of the arbitration, to the plaintiff.
That separate process, in the U.K., will have the courts there determine how to properly dispose of the gold in the BOE's vaults... with two claimants each making a case it should be them who takes the gold.
The U.K. court might resolve that dispute by choosing one or the other of the two claimants as legitimate... and give them the gold. After which, I assume, you would immediately see separate legal process occur to obstruct its distribution, and to attach that value, only once the proper owner of it was determined... ?
Or, the courts might resolve that dispute, instead... by not choosing which disputants are legitimate... only choosing to legitimize "Venezuela's interest"... and not the legitimacy of its representatives... That path enables choosing which of the courts it should be that makes the determination of the proper disposition of the property of the undivided, conjoined interest of the pairing of the disputants... in "Venezuela's interest"... given that the dispute between them over the legitimacy of representatives... is itself inconsequential relative to the interest represented. Both parties agree the gold belongs to Venezuela... they simply disagree over who represents Venezuela... while each seek to gain control of the gold, not for the benefit of Venezuela's account, but to advantage themselves. While the value in question is indisputably Venezuela's, that fact makes the value subject to the courts (or, as by treaty, other courts) findings relative to Venezuela's liabilities as well as its assets... which remains true, no matter who it is that represents them.
If you consider the likely outcome to be one that is all and only political... rather than a purely proper legal outcome ?
The court cannot decide to award the gold to Maduro's team... in the wake of illegitimate elections and the U.K. government's own determination Maduro is not the legitimate representative of the people of Venezuela.
They also cannot decide to simply award the gold to Guaido's team, instead... which would have the court adjudicating elections and/or imposing political outcomes that are not consistent with the law in relation to the facts on the ground as they exist...
But, as it is not the court's job to determine who "should" represent Venezuela... the fact of the dispute that exists, in itself, empowers the court to determine who "does" represent Venezuela's interest... while doing so without prejudicing any of the parties in the dispute...
The dispute, itself, is not relevant either to the interest or its representation... but only to winning control of the disposition of the value in the interest... as competing teams intend to dispose of it to their unique advantage... and not necessarily to the unique and undivided benefit of the owners of that interest.
The question the disputants care about is not "who should get the gold"... they will both answer "Venezuela"... but only "what is the gold going to be used to pay for" ?
The court has every right to ignore the first question... and answer the second... in a way that ensures the benefit inures to the indisputable advantage of the owners... by resolving their liabilities, directly, without that decision creating any opportunity for advantage sought by either party in the dispute.
Use the gold to pay Venezuela's unpaid bills... and let the political process work to answer the questions about the other concerns still the subject of unresolved political disputes...
The concern raised... that the court awarding the gold to one party or the other in the political disputes... will constitute a politically motivated taking of the monies left on deposit in the BOE... can only be avoided by not awarding the gold to control of either party... while both are seeking to avoid responsibility by taking the gold, and not meeting their obligations... |
