Monday, January 31, 2022

Air India moves US court to prevent Devas demand for recovery of $1.2 billion arbitration awards

Air India has recently appealed in a US court against Devas Multimedia, arguing that a recent change in ownership of the airline prevents demands for recovery of arbitration awards ($1.2 billion) given to the Indian startup by international courts over the cancellation of a satellite deal with Isro’s commercial arm Antrix.

According to an agency report, Air India filed the appeal in the US court on Thursday, the same day the Tata Group took over the management of the airline. A source in the civil aviation ministry, on condition of anonymity, confirmed the development without elaborating further. Tata Sons has, however, not responded to an email query from TOI on the airline moving the US court.

The district court in New York can dismiss and dispose of the Devas case entirely based on Air India’s request or it can identify remaining issues in the case if the demand is denied, according to a filing by the airline. Devas Multimedia, which is now under the control of a liquidator, is currently facing liquidation proceedings after the Supreme Court order. on January 17, upheld the National Company Law Appellate Tribunal ruling to wind up the Bengaluru-based company.

Devas, which is seeking $1.2 billion from the government of India, will continue to confiscate cash generated from some ticket sales overseas by Air India, said Matthew McGill, a partner at Gibson, Dunn & Crutcher that represents several Devas shareholders. The firm has already seized assets worth more than $30 million owned by Air India, he claimed.

In fact, soon after the Supreme Court ordered on January 17 to wind up the company, Devas counsel Matthew D McGill said, “The decision by the Supreme Court does not change anything. The Modi government and the Indian courts cannot rewrite the facts. Their flimsy allegations of fraud will never stand up in courts outside of India”. He had, however, said, “A better approach for the Modi government would be to return to the negotiating table, and continue with settlement talks.”

31/01/22 Surendra Singh/Times of India

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