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The investment demonstrates a common willingness to pursue a strong development strategy for the private higher education Group, expanding both in France and internationally.
Goodwin, PwC Société d'avocats, Mayer Brown, Delsol, Allen & Overy, Gomel Avocats and Ayache Salama advised on the transaction.
Goodwin advised IK Investment with Thomas Maitrejean and Mathieu Terrisse.
PwC Société d'Avocats advised IK Investment with Marc-Olivier Roux, Stanislas Bocquet (Tax), Jérôme Gertler, Eric Hickel, Mathilde Duchamp, Olga Rudeanu (Corporate DD), Bernard Borrely and Sophie Desvallées (Employment).
Mayer Brown advised Quilvest Capital Partners with Olivier Aubouin, Patrick Loiseau Renan Lombard-Platet, Alexandre de Puysegur (M&A), Patrick Teboul, Marion Minard, Julien Léris (Finance), Elodie Deschamps and Pauline Barbier (Tax).
Delsol advised Quilvest Capital Partners with Henri-Louis Delsol, Alexandre Zitoune (M&A), Julien Monsenego, Margot Lasserre (Tax), Delphine Bretagnolle, Jessica Neufville, Céline Coelho (Employment), Benoît Boussier and Cérine Chaieb (Real Estate).
Allen & Overy advised CIC Private Debt and Idinvest (Private Lenders) with Jean-Christophe David and Thomas Roy.
Gomel Avocats advised Amin Khiari with Arnaud Gomel (M&A)
Ayache Salama advised Amin Khiari with Bruno Erard (Tax).
As a result of the deal, the city, which was advised by Hladky Legal and the Kroupahelan Law Firm, became the majority owner of the park.
As reported by Cee Legal Matters, according to Clifford Chance, “Brno owns[ed] half of its shares from the beginning, the other half belonged to the Dubai-based P&O company, [and] one share is held by the University of Technology in Brno.”
Hladky Legal's team, who we speak to below, included Partners Lucie Hladka and Jan Hladky, Senior Associate Nikola Chalupska, and Junior Associate Pavla Stojaspalova.
Clifford Chance's team was led by Partner Emil Holub and included Senior Associate Aneta Disman and Junior Lawyer Ondrej Dolensky.
The Kroupahelan Law Firm's team included Managing Partner Jiri Helan and Attorneys Matus Svanda and Maros Sovak.
Interview with the team at Hladky Legal
Please share more about your involvement in the deal
Sale of the shares of P&O in the Technology Park Brno has been discussed for a long time, but there were no realistic options how to navigate a quagmire of relations with the other shareholders, City of Brno and Brno Technical University. We were at first approached by one of our clients, South-Moravian Innovation Centre, to help devise a coherent strategy to strengthen up an innovative ecosystem; the acquisition of the Technology Park Brno by the local government quickly became a priority. We worked on the deal subsequently for both South Moravian Regional Authority and the City of Brno.
Why is this a good deal for all involved?
The deal closes some 20 years of cooperation between P&O and local authorities in creating South-Moravia a technological powerhouse in Central Europe. Instead of having to cope with real estate developers with relatively short term interests, local authorities can focus on long-term goals in providing innovative start-ups and technology companies such as IBM and Red Hat office space and easy access to innovative potential created by three universities in Brno. P&O exited from a project started in the ’90s originally by Bovis Lend Lease, which was not easily saleable due to a complicated set of option rights, for a price that reflects optimistic real estate market in Brno.
What challenges arose? How did you navigate them?
More than in other deals, we had to focus on all parties being present at the table and not to walk away in critical moments. We were lucky to have colleagues from Clifford Chance working for P&O, with whom we have very long term and good working relations, as mutual trust was essential in a common push to finalise a deal that nobody was able to negotiate and complete in years.
Kochhar & Co advised Ginni Systems Limited, operating as Ginesys, led by a team consisting of Partner Sarika Raichur and Associate Shivika Upadhyay.
Interview with Sarika Raichur, Partner, Kochhar & Co.
What due diligence must be done in such an investment?
Hitherto, Ginesys was largely relying on its revenues to sustain and expand. A company which hasn’t undertaken conventional rounds of equity funding up until the growth stage, especially in the Indian context, must review its own position in terms of compliance and identify potential liabilities for the investor, company, as well as management. Due diligence was considered essential to enable the company to wade through the negotiations effectively. This was also important from the perspective of mitigation of potential liabilities. In transactions such as these, involving business surrounding the sale of Point-of-Sales (POS) and Enterprise Resource Planning (ERP) software and services, typical issues are around ownership of intellectual property rights and customer contracts, besides the regular labour and employment and corporate compliance matters. We assisted Ginesys with exactly this.
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What challenges arose when working with Ginesys?
A company, which hasn’t been through the conventional rounds of equity funding up until its growth stage, requires deep engagement with its legal counsel at all stages of the transaction, perhaps, as much as an entrepreneur embarking on a new journey on their venture. Naturally, Ginesys required to conduct a thorough analysis of the legal documentation and its implications for the company and its management. As a result, negotiations were intense.
This investment is expected to enable Ginesys to invest in technology, organisation building and make strategic acquisitions. On the verge of becoming a PE-backed growth-stage business, Ginesys needed to use this opportunity to restructure its organisation.
How did you navigate these issues?
Given the unique nature of the transaction involving a quasi-strategic investment by a private equity fund at such an advanced stage in the company’s journey, it was extremely crucial for Ginesys, their management and their advisers, to be on the same page prior to negotiations. We made sure the management and advisers huddled on all key issues arising out of the legal documentation and the diligence in order to have clarity during negotiations.
Aside from the above, we comprehensively advised Ginesys on structuring its organisation and corporate governance matters, in order to be fully aligned on the transaction with the investor as well as meet best practices.
According to DLK Legal, “Digital Virgo is a multinational group present in more than 40 countries worldwide. Digital Virgo provides Direct Carrier Billing solutions, which allow customers to pay for their purchases via their mobile subscription as part of their monthly bill or as prepaid cards. The e-money institution license will allow the group to expand its service range.”
The DLK team was led by Partner Krzysztof Korus and included Lawyers Szymon Zych, Mikolaj Cegłowski, and Aleksandra Ksiezak. Below, we speak to them about this transaction.
What are the steps involved behind obtaining an e-money licence?
Szymon Zych: “The process can be divided into two stages: prior to, and after the submission of an application for an e-money institution (EMI) licence. The former requires the provider to carefully examine the services it intends to provide and ensure it meets all regulatory requirements. An experienced legal adviser is crucial at this stage. After the submission, competent authorities usually initiate a dialogue with the provider and request additional documents and information, trying to understand the business and regulatory model of the services.”
What challenges may arise when trying to obtain a licence?
Szymon Zych: “The more prepared the client is in the first stage, the smoother the communication is with the competent authority. Our goal is to predict the questions and doubts of the regulator in order to ensure a consistent regulatory model and reduce the total time of the procedure.
“Two issues are particularly important: a collection of documents about shareholders and managers (especially where companies with complex ownership structures are concerned) and an accurate description of the payment services.”
How do you work around these issues?
Krzysztof Korus: “Obtaining the licence requires a great deal of effort and responsibility on the part of the regulator, provider, and legal counsel, as well. Our participation in the project usually begins with providing support in designing business models. It usually requires a good understanding of technical processes, IT environment and business architecture.
“Subsequently, we assist the provider in preparation of all the documents required to apply for a licence. The process continues down to submitting an application and then providing support in answering the inquiries of the regulator. The key issue is the proper flow of information between all interested parties.”
Can you share more about the benefits behind obtaining an e-money licence (EMI)?
Krzysztof Korus: “The EMI licence opens the opportunity to provide services in each and every country in the European Economic Area. EMI can issue e-money and provide both traditional payment services (i.e. online wallets, acquiring, issuing of payment cards), as well as the ones regulated under PSD2 (payment initiation services, account information services). It is the broadest licence on the payment services market, next to banks. Obtaining a bank licence, however, takes much more time and efforts, while most of the modern business models may be successfully implemented through EMI.”
As a result, Stadler has acquired an initial buyer for the company’s newly developed tram model within a very short time. The contract is valued at approx. 62 million euros.
Those advising HEAG Mobilo were FPS Fritze Wicke Seelig (Frankfurt), led by Dr Annette Rosenkötter (procurement law) and Florian Wiesner (contract law), with associate: Ahdia Waezi (procurement law)
Interview with Dr Annette Rosenkötter
What complications can arise when a contract is of high value as this deal?
One challenge is the market, which is limited for technical reasons: There are not very many manufacturers who are able to produce vehicles that meet German standards and the specific requirements of the infrastructure.
For this reason, the requirements had to be formulated as precisely as possible on the one hand, but on the other hand, they had to be formulated so openly that no individual technical solution from any one supplier was excluded within the scope of the leeway.
Trams are not off-the-shelf products, due to the different infrastructure in each municipality, a tailor-made design is required in every tender; there is only limited use of standard models.
Due to the considerable effort involved in participating in the procedure for the bidders, there is a considerable risk that the losing bidder will challenge the decision.
How do you mitigate any chances of these complications from occurring?
On the one hand, the sound internal preparation of the procedure is decisive. It must be determined exactly which requirements are sufficiently marketable and realistic within the cost framework. From our point of view, it is also crucial to be able to discuss the possible need for adjustment of the service description in a phase of indicative offers. Otherwise, there is a considerable risk of having to exclude offers due to minor formal violations.
Further, the risk of complaints was reduced by an extremely transparent system of award criteria; "soft" criteria, such as the evaluation of implementation concepts, were not included. The qualitative evaluation was based on purely objective standards.
What important procurement regulations came into play in this deal?
The tender procedure fell within the scope of the “Sektorenverordnung” which implements the Utilities Directive.
The asset, with its 26,700 gross sqm, will become one of the most visible and modern luxury hotels in the capital.
According to Auraree, Antirion Ceo Ofer Arbib commented: “This investment follows our strategy of geographical diversification with a long-term perspective. The assets we acquired are leased to high-profile tenants and are located in one of the most liquid and appealing areas of the Capital.
Studio PR/LAW and Chiomenti provided assistance to the parties in the transaction.
The PR/LAW Firm assisted the Antirion Global Fund - Hotel sector, managed by Antirion SGR SpA, in the acquisition with a team led by the founding and managing partner Pietro Rovati, assisted by lawyer Pietro Toniolo.
Chiomenti has supported BNL in the sale of the property, with a team made up of Luca Fossati, Luca Liistro and Arnaldo Cremona.
Interview with Mr Pietro Rovati, founding and managing partner of PR/LAW
How does this deal currently represent the investment scene in the hospitality industry in Italy?
This transaction confirms the strategic relevance of the hospitality sector in Italy, which has continued to grow and adapt in the last years, thanks to the ever-increasing demand for quality structures. We were proud to assist Antirion SGR in this project, which aims at covering the “niche” market of high luxury hotel structures in downtown Rome, which is not as well developed as one might expect.
From a lawyer’s perspective, this deal serves to demonstrate how smaller law firms with a “boutique” approach like ours are able to assist key market players and international investors in important transactions just as well as, if not better than, full-service law firms, by playing to our unique strengths (i.e. fast response time, tailored approach to the needs of the Client and full attention to every single project).
Why was this a good deal for all parties involved?
As mentioned, the acquisition of a structure with such historical significance in downtown Rome is a strategic move for Antirion SGR, who will be able to strengthen its presence in the Rome market with the addition of a high luxury hotel structure. Moreover, both parties actually requested to close the deal within the end of 2019 (starting from the first half of November 2019), which gave us a very short timeframe for both the due diligence and negotiation phases. Being able to accomplish our task in such little time, maintaining our high-quality standards and with the full satisfaction of our Client is a matter of pride for us.
How did your team ensure all parties involved in this transaction were happy with the concluding deal?
Here at PR/LAW we always strive to provide the best legal assistance on all matters pertaining to real estate transactions, such as administrative, regulatory, planning & building and tax matters. I strongly believe that, aside from the positive outcome of the deal, which is, of course, one of the main reasons of satisfaction for all the parties involved, putting the requests of the Client at centre stage in any phase of the process and showing our commitment to perform high-quality work under all circumstances is what distinguishes us.
Companies (Compromises, Arrangements and Amalgamations) Amendment Rules, 2020
On 3 February 2020, the Central Government notified the provisions of Section 230(11) and (12) of the Companies Act, 2013 which has come into force from 3 February 2020. The provisions enable takeover of a company by way of a scheme of arrangement or raise grievances in this relation, pursuant to an application being made to the National Company Law Tribunal (NCLT). In relation to this, the following notifications have also been issued, with respect to the procedural aspects for making the application(s) under Section 230(11) and (12):
Further, in terms of sections 230(11) and 230(12) of the Companies Act, 2013 (now notified), the majority shareholders of a company have another option in addition to options already available (such as reduction of share capital under Section 66 of the Companies Act and purchase of minority shareholding under Section 236 of the Companies Act) to achieve the exit of minority shareholders.
Common Application Form (CAF) for Foreign Portfolio Investors
On 4 February 2020, the Securities and Exchange Board of India (“SEBI”) issued a notification that the applicants seeking Foreign Portfolio Investors (FPIs) registration shall be required to duly fill CAF and ‘Annexure to CAF’ and provide supporting documents with the applicable fees for SEBI registration and issuance of Permanent Account Number (PAN). Further, designated depository participants (DDP) may accept in-transit FPI registration applications, for a period of 60 days from 4 February 2020 as per the form as prescribed in operational guidelines issued on 5 November 2019. This notification was issued in furtherance of the Government of India’s (GoI) earlier notification dated 27 January 2020 notifying the Common Application Form (CAF) for the purpose of:
Micro, Small and Medium Enterprises (MSME) Sector – Restructuring of Advances
On 11 February 2020, the Reserve Bank of India (“RBI”) extended the timeline for a one-time restructuring of existing loans granted to MSMEs classified as ‘standard’, without a downgrade in the asset classification, subject to the following certain conditions:
Companies (Registration Offices and Fees) Amendment Rules, 2020
On 18 February 2020, the MCA, notified the Companies (Registration Offices and Fees) Amendment Rules, 2020 which amends the Companies (Registration Offices and Fees) Rules, 2014, pursuant to which the existing Form GNL-2 (i.e. the form to be filed for submission of documents with the Registrar of Companies, for which no e-form is prescribed under the various rules under the Companies Act, 2013) has been substituted with a revised Form GNL-2.
Companies (Incorporation) Amendment Rules, 2020
The MCA, on 18 February 2020, notified the Companies (Incorporation) Amendment Rules, 2020 (“Incorporation Amendment Rules”) to amend the Companies (Incorporation) Rules, 2020. With effect from 23 February 2020, the Incorporation Amendment Rules has inter alia introduced the following amendments:
Companies (Auditor's Report) Order, 2020
On 25 February 2020, the MCA notified the Companies (Auditor's Report) Order, 2020 (“Order”) in supersession of the Companies (Auditor's Report) Order, 2016. The Order provides that every report made by the auditor under section 143 of the Companies Act, 2013 on the accounts of every company audited by him, for the financial years commencing on or after 1 April 2019, shall additionally contain the matters specified under this Order. The key matters to be included in the auditors’ report are mentioned below:
Companies (Appointment and Qualification of Directors) Amendment Rules, 2020
On 28 February 2020, the MCA notified the Companies (Appointment and Qualification of Directors) Amendment Rules, 2020 (“Appointment Amendment Rules”) which amends the Companies (Appointment and Qualification of Directors) Rules, 2014 (“Appointment Rules”). The Appointment
Amendment Rules have introduced the following key amendments:
However, the Appointment Amendment Rules have introduced an additional exception for individuals who have served as directors or key managerial personnel for a minimum period 10 years, as on the date of inclusion of their names in the Databank, in body corporates listed on a recognized stock exchange. Further, it has been clarified that individuals acting as directors or key managerial personnel in two or more companies or bodies corporate (as opposed to only companies, as provided earlier) at the same time will be counted only once for the purpose of determination of the aforesaid 10 year period.
Clarification on prosecutions filed or internal adjudication proceedings initiated against independent directors, non-promoters and non-KMP/ non-executive directors
On 2 March 2020, the MCA issued a circular clarifying the aspects with respect to the initiation of prosecution against directors of Indian companies, which inter alia provides for the following:
(a) Whole-time director (WTD) and key managerial personnel (KMP) associated with the day to day functioning of the company shall ordinarily be liable for the defaults of the company. In absence of WTD/ KMP, such director or directors who have expressly given their consent for incurring liability (by filing intimation in e-form GNL-3 with the MCA) would be liable for defaults of the company. However, in a case wherein the penal provisions under the Companies Act, 2013 (Act) provides that a specific director, or officer, or any other person would be accountable for the default, in such case prosecution would be initiated by the Registrar of Companies (“ROC”) only against the concerned director, or officer, or any other person accountable for the default and not against the other directors/ officers.
(b) Independent directors or non-executive directors shall not be arrayed in any civil or criminal proceedings under the Act, unless the default has occurred with their knowledge, attributable through board process, and with their consent or connivance or where they had not acted diligently as per the provisions of the Act.
(c) All the instances of filing of information/records with the registry, maintenance of statutory registers or minutes of the meetings, or compliance with the orders issued by the statutory authorities (including NCLT), are not the responsibility of independent directors or non-executive directors. Accordingly, independent directors and non-executive directors would not be ordinarily liable for the default of the company, unless any specific requirement is provided in the Act or in the orders of any statutory authority. However, where there are no WTDs and KMPs in the company, non-executive directors may be liable for the defaults of the company.
At the time of serving notices to the company during an investigation, inquiry, or an adjudication proceeding, necessary documents may be sought by the ROC so as to ascertain the involvement of the concerned officers of the company. In case the lapses are attributable to decisions taken by the board or its committees, all care would need to be taken by the ROC so as to ensure that any proceedings are not unnecessarily initiated against the independent directors or non-executive directors, except in cases where sufficient evidence exists to the contrary.
Cabinet approves the Foreign Direct Investment policy on Civil Aviation
On 2 March 2020, the Union Cabinet approved to amend the extant Foreign Direct Investment (FDI) Policy to permit foreign investment(s) in M/s Air India Ltd by non-resident Indians (NRIs), who are Indian Nationals, up to 100% under the automatic route. As per the present FDI Policy, 100% FDI is permitted in scheduled Air Transport Service/Domestic Scheduled Passenger Airline (up to 49% under automatic route and Government route beyond 49%). However, for NRIs, 100% FDI is permitted under automatic route in Scheduled Air Transport Service/Domestic Scheduled Passenger Airline.
The amendment in FDI policy will permit foreign investment in M/s Air India Ltd at par with other Scheduled Airline Operators i.e. up to 100% in M/s Air India Ltd by those NRIs, who are Indian Nationals. Further, this amendment to the FDI Policy is meant to liberalize and simplify the FDI policy to provide ease of doing business in the country leading to largest FDI inflows and thereby contributing to the growth of investment, income and employment.
From, ‘Which jurisdiction will my dispute fall under?’, to ‘Is it easier to opt for traditional litigation?’, Kiran succinctly briefs us on the process behind international disputes, honing in on foreign laws, and the advantages of opting for arbitration over litigation.
How do you decide where to file a case arising from an international dispute?
Choosing where and how to pursue a claim is a highly specific inquiry that requires careful consideration. Often times, the first step is figuring out if the case belongs before a commercial arbitration tribunal. If the parties have a contract that includes an arbitration agreement, then we assess whether that clause covers the dispute and whether it is binding.
If the parties do not have a contractual relationship, or their contract does not include an arbitration agreement, this opens up a number of possibilities. We often first assess whether there is a jurisdictional nexus between the dispute and the United States. If that nexus exists, we can pursue appropriate claims in US courts. Otherwise, we have great connections abroad and we draw upon our trusted relationships with other lawyers and law firms to pursue litigation in other more appropriate jurisdictions.
Finally, we always consider whether a dispute involves violation of a bilateral or multilateral investment treaty. Our clients often invest in foreign jurisdictions and it is quite possible that their investments might benefit from treaty protection. Where this is the case, investment arbitration can be an effective forum for asserting claims and damages caused by improper State action.
None of these options are mutually exclusive and it may be appropriate to pursue more than one approach at the same time.
Parties remain free to take an à la carte or ad hoc approach, but generally, selecting an arbitration institution to administer an arbitration means that the institution’s procedural rules will also guide dispute resolution.
What are some of the benefits of resolving a dispute through international arbitration rather than traditional litigation?
Many parties include arbitration agreements in their international contracts because they wish to confidentially and efficiently resolve disputes that may arise out of that contract. Among the several other advantages of arbitration over traditional litigation are:
There are dozens of international arbitration institutions located around the world, each marketing its defining features. Does it really matter which one is selected in an arbitration agreement?
Thoughtful contract negotiators often seek guidance from experienced international arbitration counsel before selecting an arbitration institution for inclusion in an arbitration agreement because this truly is an important decision. Parties remain free to take an à la carte or ad hoc approach, but generally, selecting an arbitration institution to administer an arbitration means that the institution’s procedural rules will also guide dispute resolution.
These procedural rules are key to the efficient and effective resolution of the dispute. Just to provide a few key examples: At the beginning, the rules explain how to initiate a claim and how to appoint the tribunal. Throughout, the rules guide the timetable of the arbitration and how the parties may present their case and make submissions to the tribunal. Finally, the rules provide the timetable for issuing an arbitral award. Perhaps most importantly, the rules often set out the costs and fees associated with the arbitration’s administration.
A party should make an informed decision that aligns with its anticipated dispute resolution style and strategy to ensure that there are no unhappy surprises later on when a dispute does arise.
Do you only work on international disputes involving the application of US law? How do you navigate cases where foreign law might apply?
International business disputes are often found at the intersection of international trade, commerce, and development and they are not immune to changes in policy.
As a New York-trained litigator, I am most at home working on disputes involving US law, but the legal challenges involved in international disputes drew me into specialising in this field. In international commercial arbitration, the governing law is selected by the parties while negotiating the contract. Similarly, even if a case is litigated in US court, it is possible that foreign law might apply. As a result, I have worked on commercial disputes involving the laws of a variety of jurisdictions, ranging from Ghana and Venezuela to France and Brazil. I enjoy learning about other legal systems and collaborating with local law experts. I always feel enriched, rather than hindered, by my US legal education. It helps me take a comparative approach and identify similarities and differences among divergent legal systems and I can efficiently parse through and challenge the legal arguments presented by both sides to a dispute.
Does politics or international policy ever play a role in international dispute resolution?
International business disputes are often found at the intersection of international trade, commerce, and development and they are not immune to changes in policy. A great example is provided by the track record of the Trump Administration over the past few years. In at least three areas, President Trump’s “America First” approach to foreign policy has significantly impacted the ways in which international business disputes arise and may be resolved, such as:
Over time, I have learned that the best advocacy involves telling a really great story.
Each of these developments is a direct result of the Trump Adminsitration’s foreign policy agenda. At the same time, each carries tangible commercial impact and will likely lead to increased international litigation or arbitration among commercial parties who either face increased compliance risks, or find themselves in business disputes because their pre-existing deals are either no longer viable or no longer as fruitful.
When advocating in an international dispute what tools best support your efforts?
Over time, I have learned that the best advocacy involves telling a really great story. It is important to learn to use words effectively and accurately. A great story, especially one steeped with nuance and detail, must be clear and compelling. The story also must be tailored to its audience, with room for adaptation and improvisation in case the unexpected comes up, or there are queries that derail the storytelling process. To tell this kind of story effectively, it is important to know the story inside and out. I always aim to question and resolve concerns about every fact and document before an opposing counsel, judge, or arbitrator has the chance to do so. The goal is to never be caught off guard and be so well-informed that I can manage even if left surprised.
A related element involves simply having better information than the other side. Our Firm’s creed is “whoever has the best information wins.” We oftentimes work with top former intelligence officers from numerous international and domestic agencies to obtain highly confidential information essential not only to obtain, but also to collect, favourable judgments and arbitral awards.
Finally, without a doubt, international advocacy is challenging work. In order to succeed it is important to always maintain good humour, respect (for both the process and others), and above all, humanity.
In your opinion, what is a key “hot” topic in international dispute resolution practice today?
I have already described why I think “information” can be the most powerful tool in international advocacy. This same idea is currently at the centre of a hot debate in international dispute resolution practice. In the US, 28 U.S.C. Section 1782 is a statutory provision which permits a US federal district court to order testimony or produce documents in aid of a proceeding before a “foreign or international tribunal.” There is currently a deeply entrenched circuit split over the interpretation of the quoted language. Specifically, whether an international commercial arbitration qualifies, given that it is a private (and not public) tribunal.
To briefly summarise: During 2019 alone, a New York federal district court judge allowed such discovery in aid of an LCIA arbitration, but another New York federal district court judge declined such discovery in aid of a CIETAC arbitration; the federal district court in the District of Columbia denied a request for production of documents, while allowing a request for written answers by way of interrogatories in aid of an ICSID investment arbitration, and the Sixth Circuit allowed discovery in aid of a DIFC-LCIA arbitration.
Guidance of the US Supreme Court is not only welcome, but necessary. In particular given the interaction of the US approach, which very much focuses on providing access to information, with more global views of disclosure and privacy, including the French blocking statute and GDPR compliance.
Kiran Nasir Gore
Counsel
Law Offices of Charles H. Camp, P.C.
1055 Thomas Jefferson Street, NW
Washington, DC 20007
Office: +1 202.417.8000
Email: kgore@charlescamplaw.com
LinkedIn: https://www.linkedin.com/in/kiran-n-gore/
Firm Website: https://www.charlescamplaw.com/
I focus my practice on international dispute resolution and serve as Counsel in The Law Offices of Charles H. Camp, PC in Washington, DC. At the Firm, we build upon Charles’ more than 35 years of legal expertise representing clients from around the world to solve complex international disputes through international litigation, arbitration, and debt recovery.
I came to the Firm following nearly a decade of practice with global law firms in New York and Washington, DC. I started as a litigator in the New York City office of DLA Piper LLP, where I represented foreign and domestic clients in diverse disputes before US courts and international tribunals. Even in those early days, my cases consistently involved some international element and I enjoyed their unpredictability and complexity.
After several years, I transitioned my practice to focus exclusively on international commercial and investment arbitration and joined the Washington, DC office of Three Crowns LLP when the firm first launched. Three Crowns set out to become the first global firm specialised in international arbitration and I was inspired by the firm’s innovative approach. I learned from and worked alongside some of the world’s leading advocates on high-profile and high-value international arbitrations. As I matured in my practice, I became more responsive to and attuned with client needs. I wanted to provide more personalised and interdisciplinary solutions to my clients’ legal disputes, with the ultimate goal of helping them manage risks and gain commercial success.
I began working with Charles at his Firm last year and am lucky to have found a kindred spirit. We are both comfortable advocating in courts and before international tribunals and we work together to devise effective and creative solutions to our clients’ international disputes.
Alongside my legal practice, I am active in both academic and scholarly activities. I am an adjunct professor at The George Washington University Law School, where I primarily teach foreign-trained lawyers. I also am a part-time lecturer at New York University’s Global Study Center in Washington, D.C. I serve as Associate Editor of ICSID Review – Foreign Investment Law Journal and Associate Editor of the Kluwer Arbitration Blog. Each of these roles supports my practice by immersing me in emerging ideas and challenging my skills and expertise.
Weinstein was later fired from his production company and the Los Angeles Police Department began their criminal investigation into the alleged rape, as well as the New York and London police departments investigating other sexual assault allegations.
In May 2018 Weinstein was arrested; he was convicted by a jury of two of five criminal charges: one count of criminal sexual assault in the first degree and one count of rape in the third degree on 24 February 2020. On 11 March, he was sentenced to 23 years in prison.
What did we all learn from this? A man often referred to as a ‘mogul’ in the Hollywood film industry was not above law. The #MeToo movement started a dialogue for those in the workplace that may have previously been suppressed and also brought to light the importance of effective procedures if sexual harassment cases have the potential to arise. Employment law has never been so vital to follow.
Below we catch up with Jesse Weinstein, Litigation Associate at the law firm of Phillips & Associates. He discusses the impact of Harvey Weinstein’s recent conviction and what employment lawyers and employers can learn from this landmark case.
What kind of an impact do you think Weinstein's recent conviction will have on future sexual harassment cases?
I believe Harvey Weinstein’s recent conviction will have a two-fold effect on future sexual harassment cases. First, given the publicity surrounding Weinstein’s legal woes, “all eyes” are on employers now, especially with respect to sexual harassment claims. Employers now know that none of their employees, especially executives, supervisors and managers, are above the law. Conceivably, few people expected to see Weinstein’s career crumble so quickly despite the many allegations, given his “powerhouse” persona in the entertainment industry. His descent, at a minimum, should keep employers “on their toes” when it comes to hiring, training and retaining their employees.
Some local statutes provide even broader protections than the EEOC.
This is especially true, given the existing protections that employees have under federal and local statutes. For example, the United States Equal Employment Opportunity Commission (“EEOC”) holds employers legally accountable their employees’ sexually harassing behavior when that behavior creates a hostile work environment. They are also liable when they knew of the harassment but failed to immediately address it and/or prevent future harassment. Some local statutes provide even broader protections than the EEOC. For example, whereas the EEOC requires “severe and pervasive” behavior to establish a claim of a hostile work environment, the New York State Human Rights Law (“NYSHRL”) requires only a “slight and petty annoyance.” Thus, because Weinstein’s conviction has put a spotlight on sexual harassment cases, and many local jurisdictions have lowered the standards necessary to prevail on legal claims, employers will have every reason, now more than ever, to stay vigilant.
The employer’s counsel typically drafts settlement and non-disclosure agreements.
Second, we will likely see a spike in legal claims. Presumptively, many people question whether the legal system “works” in their favor. This concern often deters people from pursuing claims. However, Weinstein’s conviction illustrates what happens when the legal system works for the community. In the civil legal system, Weinstein paid millions of dollars in monetary damages to numerous claimants. Similarly, in the criminal legal system, he was convicted by a jury - arguably the most fundamental method of justice in our country. However, Weinstein’s legal troubles are far from over. He now faces further criminal charges in California, and many other claimants continue to pursue civil claims against him. Accordingly, civil attorneys representing those claimants can now potentially access evidence from his criminal trial as they negotiate for their clients. This phenomenon will surely reveal itself in other “hybrid” civil sexual harassment cases with criminal components. Moreover, the number of these “hybrid” cases will likely increase, as criminal prosecutors will face further scrutiny when deciding whether to pursue sexual assault cases that occur in the employment context. As such, look for many individuals, who were once reluctant to speak out, to now feel emboldened to pursue both civil and criminal claims.
What do settlement agreements and non-disclosure agreements usually contain and how do they impact sexual harassment cases?
The employer’s counsel typically drafts settlement and non-disclosure agreements. A “bare bones” settlement and non-disclosure agreement will generally include the names of the parties, the agreed upon monetary amount that will resolve the claims, a general release, the method in which the monetary amount will be paid, and a confidentiality provision. However, these agreements tend to be much more nuanced, as claimants are commonly concerned with protecting their reputations and securing future employment. Thus, a typical settlement agreement goes through numerous drafts between both sides’ counsel. During this process, claimants’ attorneys often negotiate for additional clauses, the absence of which can “make or break” a settlement.
For example, most, if not all, claimants worry that they will be unable to list their former employer on their resumes or as a reference after their cases settle. This is particularly prevalent where the claimant worked for the employer for a significant amount of time. Attorneys address these concerns by incorporating “neutral reference” clauses, which generally provide that if a claimant’s prospective employer contacts the former employer for a reference, the former employer will provide the dates claimant was employed, the positions claimant held, and explain that it is its policy only to provide such information.
Additionally, parties to a settlement agreement frequently seek some reassurances that the other party will not disparage them after the case is resolved. Typically, earlier drafts of settlement agreements will include “non-disparagement” clauses, which bind the parties from disparaging each other. Basically, the parties agree to not disparage, talk unfavorably, or criticize the other party, or take any actions that could cause harm to the other party’s reputation.
The non-disclosure portion of settlement agreements is more straightforward. Whether it is a clause within a settlement agreement, or it is a separate agreement attached to a settlement agreement, the language focuses on confidentiality, and generally provides that claimants will not discuss anything about their case, including the settlement, with anyone except their lawyers, accountants, and in certain circumstances, immediate family.
What we have learned is that no one is above the law.
Employers also routinely insist that certain clauses be included in settlement agreements, which can create barriers to settlement. For instance, nearly every agreement drafted by an employer’s counsel will include a “no admission of wrongdoing” clause, which effectively says “I will pay you, but I am not admitting I did anything to you.” Because these clauses are technically legal, claimants must accept that there is no legal accountability specified in these agreements. These clauses often make the process inherently transactional, which can leave claimants feeling devalued. However, given that many claimants also find themselves in precarious financial circumstances due to the harassment, they often reluctantly agree to this term, in order to preserve the monetary payment. We saw this play out with many of Weinstein’s claimants who were bound to broadly restrictive settlement and non-disclosure agreements. Because he was such a big player in the entertainment industry, many of his claimants (who were also part of the industry) reluctantly signed these contracts to avoid “career suicide.”
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Nevertheless, state legislatures have codified protections for claimants against oppressive agreements. For instance, in New York, the NYSHRL mandates that in sexual harassment cases, where the parties have reached an informal agreement to settle, claimants must first be given a twenty-one-day waiting period to contemplate releasing any legal claims against their employer. If after that period the claimant wishes to proceed, he or she may execute the agreement and can revoke that agreement within seven days of signing. These laws ensure claimants every opportunity to sign these agreements without absolute certainty.
What can we all learn from this case? Will workplaces now take sexual harassment more seriously than before?
To take major strides in ending workplace harassment, companies will have to create a movement of their own.
What we have learned is that no one is above the law. Where we have previously seen marginalized populations struggle within the confines of the legal system, Weinstein’s conviction presents a different reality. His misdeeds created the #MeToo movement, and his conviction fueled it more than ever. Whereas for the last several decades, society had tolerated sexual harassment and misogynistic behavior as a “part of business,” today, we have learned from Weinstein that such behavior will carry legal consequences. We now know that rich, powerful, and influential people, cannot just walk the earth as if it is their own, without any accountability for their actions.
Whether workplaces take sexual harassment cases more seriously moving forward remains to be seen. While Weinstein’s case was certainly a revelation, sexual harassment and sexual assault in the workplace existed long before the #MeToo movement and are still occurring today. To take major strides in ending workplace harassment, companies will have to create a movement of their own. One where they preemptively examine who their leaders are, how they are trained, and how they treat other employees. More importantly, employers will need to act swiftly when employees complain about discrimination and harassment. Until this happens, we can expect that other “Harvey Weinstein” types will continue to harass others. However, now many people will likely feel more comfortable and willing to come forward, and plaintiff’s attorneys will be more prepared than ever to proceed.
Jesse S. Weinstein
Phone: (212) 248-7431
45 Broadway #620
New York, New York 10006
www.newyorkcitydiscriminationlawyer.com
Jesse Weinstein is a Litigation Associate at the law firm of Phillips & Associates. Mr Weinstein worked as an Assistant District Attorney at the Bronx County District Attorney's Office prior to joining our firm. As a prosecutor, he gained substantial trial experience as first-chair counsel in several jury and bench trials. He also led complex investigations and conducted dozens of hearings and grand jury presentations.
Such choice of law happens relatively often in international commercial contracts for various reasons.
With contractual limitations on damages being critically important in commercial contracts, allowing parties to better assess and control business risks arising from a commercial transaction, Andrea Haefeli touches here on the contractual limitation on damages under Swiss law, i.e. what liabilities cannot be excluded or limited.
Why Limit Liability in Commercial Contracts?
Limitation of liability clauses can take a number of forms.
Every commercial transaction involves risks for which the parties may be liable, for instance, project delays or non-conformity of the delivered products. In the absence of an effective limitation of liability clause, there is – excluding legal limits under statutory law – no financial cap on the damages that could be recovered. It is, therefore, critical to ensure that commercial contracts contain some form of limitation and that these limitations are effective.
Limitation of liability clauses can take a number of forms. Some clauses seek to exclude liability altogether. Others put a limit on liability, for example, by capping the amount payable in damages, excluding certain types of damages such as consequential or indirect loss, restricting warranties and specific remedies, or imposing brief time bars on claims.
Contractual limitations on damages that exceed the statutory limits are not effective.
Which limitations of liability are accepted under Swiss Law?
Swiss contract law is strongly based on the principle of freedom of contract and there is considerable scope for contractual limitation (including exclusion) of liability. However, limitations of liability are not permitted without restriction.
Taking the example of the limitation of liability in terms of maximum amounts (financial caps), the following statutory restrictions apply from a Swiss law perspective:
Narrower restrictions exist for consumer contracts and general terms and conditions.
What are the consequences of limitations of liability exceeding the statutory limits?
Contractual limitations on damages that exceed the statutory limits are not effective. From a Swiss law perspective, clauses exceeding the statutory limits can be reduced to the extent permitted, provided that the clause in question affects a part of the contract which is not essential to the whole contract (so-called partial ineffectiveness or severability). However, with a view to avoid creating incentives for parties to include excessive limitation clauses, there are more and more voices arguing for full ineffectiveness, in particular regarding consumers and general terms and conditions.
What else must be taken into account when drafting limitations of liability?
Limitations of liability are never one-size-fits-all. Each agreement is highly dependent on the facts of the parties’ relationship (the parties’ roles, industry, the value of the deal, importance of the deal, etc.), the risks associated with the transaction (scope, likelihood, costs, etc.) as well as the other terms in the agreement. Limitations of liability often interact with other key provisions (e.g. warranties, indemnification, etc.) and cannot be read or negotiated in isolation.
A party intending to include a limitation clause in a contract should therefore carefully analyse the transaction at hand, read the entire contract and check the statutory limits and fate of clauses exceeding the statutory limits under the applicable law.
Contact details:
Andrea Haefeli
lic.iur., LL.M., Attorney at Law
Counsel
Direct phone: +41 58 658 56 71
andrea.haefeli@walderwyss.com
Walder Wyss Ltd.
Seefeldstrasse 123
P.O. Box, 8034 Zurich
Switzerland
Phone: +41 58 658 58 58
Fax: +41 58 658 59 59
Andrea Haefeli is a counsel at Walder Wyss Ltd., one of the leading Swiss commercial law firms. She advises clients in all areas of contract, commercial and corporate law. Andrea has a particular interest and legal expertise in sale and distribution law, general terms and conditions (GTC) as well as in IT contracts. She advises on such projects from the conceptual and negotiation phase to dispute settlement.
