Litigation Researchers Believe - Dutch Court Ruling - Big Blow to Petrobras’ Arbitration Strategy
Battea Global Litigation Research, Inc. believes today was a big milestone win for a large group of international investors supporting a coalition of law firms and the Dutch Stichting Petrobras Compensation Foundation (“SPCF” or “Foundation”) in the Netherlands, in their litigation over losses relating to the Petrobras “Lavo Jato” or “Operation Car Wash” scandal.
The Rotterdam District Court ruled on whether the Foundation representing investors, who purchased securities outside of the United States, has the right to sue Petrobras in Dutch courts.
Petrobras has been fighting investors both in the U.S. and internationally and has sought to drag investors to arbitration in Brazil. However, on January 3, 2018, Petrobras announced that in connection with the losses investors suffered from the “Lavo Jato” bribery scandal, it had agreed to a USD $3 billion settlement with investors who purchased ADRs (American Depository Receipts/American Depository Shares) and USD denominated bonds in the U.S.
The U.S. litigation and settlement left investors that purchased primary shares of Petrobras traded in Brazil and via linked markets in Europe and bonds bought outside the U.S., without any compensation for their investment losses in those securities and subject to Petrobras’ continued claims of innocence and calls for any dispute to be resolved via arbitration in Brazil.
Today, the Dutch court ruled that the Company’s own articles calling for arbitration, did not meet the standard for which Dutch courts determine to be valid ground to deny the investors and the Foundation constitutional access to bring litigation and claims against Petrobras in the Netherlands. It is important to note that Petrobras has multiple subsidiaries, including Petrobras Global Finance B.V., which are headquartered in the Netherlands and the impact of the briberies and other fraud related acts extends to the Netherlands and involves Dutch companies and provides a strong nexus for jurisdiction for international investors to demand litigation and ultimately restitution there.
The ruling is a big step toward investors’ outlook for recovery of some of the billions lost, whether losses incurred in U.S. dollars, Euros, Brazilian Reals (Real) or other currencies. The arbitration requirement has been much touted by Petrobras and reflected in the media. In the opinion of Battea Global Litigation Research, Inc., today’s ruling is definitely a big blow to Petrobras’ arbitration strategy.
Petrobras’ controversial statements of innocence is in stark contrast to its agreement to a USD $3 billion settlement for securities traded in the U.S. alone. Strong and growing skepticism to any meaningful outcome resulting from Petrobras’ calls for arbitration at the Brazilian stock exchange, have prompted institutional investors from around the world to rally for proper objective court litigation and a fair resolution in the Netherlands.
Peter Hansen, Chairman of Battea Global Litigation Research, commented: “We have been following the U.S. Petrobras settlement, as well as the litigation efforts taking place outside of the U.S., very closely. Pricing of Petrobras securities, whether traded in Brazil, the U.S. or elsewhere, are very closely linked in real-time markets. In fact, the Petrobras fraud impacted investors, on a global scale, with the same relative ratio of losses.” Hansen continued, “It would be absurd, if Petrobras was able to get away with paying only holders of U.S. ADR shares and U.S. issued bonds and it would be nothing short of inequitable, to use $3 billion in company funds to make a “special distribution”, to only a select group of shareholders and investors, and conversely, have the remaining group of international shareholders and investors pay for it!”. Hansen concluded that “the Dutch ruling, restores normalcy in shareholders avenues for recourse and expectation of equal treatment”.
On a more technical level, the Dutch courts today in summary ruled for granting jurisdiction in the Netherlands as follows:
The court accepted jurisdiction in respect of the Dutch defendant PETROBRAS GLOBAL FINANCE B.V., for below allegations:
1. The initiation and maintenance of the large-scale fraud;
2. The unlawful concealment of fraud;
3. The publication of inaccurate, incomplete and/or misleading financial information;
4. The issuance of Petrobras securities (shares and bonds) based on inaccurate, incomplete and/or misleading information;
5. The issue of Petrobras securities during the fraud period (i.e. knowing that the funds obtained would be misused);
6. Consciously inspiring the confidence of investors during the fraud period (i.e. saying that the company was highly transparent, had a proper whistle blower arrangement in place, etc.);
7. Acting in violation of (other) applicable regulations (i.e. breaching various (mainly) Brazilian governance and other legal obligations).
The court also accepted jurisdiction in respect of allegations against the special purpose vehicles PETROBRAS OIL & GAS B.V and PETROBRAS INTERNATIONAL BRASPETRO B.V. for their role in the fraudulent scheme, notably certain specified projects.
In respect of PETRÓLEO BRASILEIRO S.A. - PETROBRAS (Petrobras Brazil), Gabrielli, Foster and the other Brazilian defendants, the court accepted jurisdiction for below allegations:
1. The unlawful concealment of fraud;
2. The publication of inaccurate, incomplete and/or misleading financial information;
3. The issuance of Petrobras securities (shares and bonds) based on inaccurate, incomplete and/or misleading information;
4. The issue of Petrobras securities during the fraud period (i.e. knowing that the funds obtained would be misused);
5. Consciously inspiring the confidence of investors during the fraud period (i.e. saying that the company was highly transparent, had a proper whistle blower arrangement in place, etc.)
Next Steps in the Dutch Litigation
With the favorable ruling announced on September 19, 2018, the District Court schedule in Rotterdam is as follows:
- October 18, 2018: Petrobras to file a skeleton argument-statement listing the various defenses Petrobras intends to present on both the merits and the standing of the Foundation;
- November 14, 2018: The Foundation can respond to that statement;
- December 18, 2018: A potential case management hearing will take place. Confirmation of the date of when this hearing will be decided by the court after November 14, 2018.
The coalition and Foundation leading the litigation, have significant support from institutional investors from around the world including investors in the U.S., UK, Brazil, Netherlands, France, Germany, Spain, Italy, Nordic countries, South Korea, Japan and others. Individual institutional investor losses range in the millions, tens of millions and in some instances close to 100 million Euros.
International, including U.S. investors, who purchased shares of Petrobras purchased in Brazil on the Brasil Bolsa Balcão S.A. or B3 - Brazil (formerly BM&FBOVESPA) and linked markets in Europe and also bought primarily non U.S. dollar denominated bonds outside the U.S. and believe they were damaged by losses related to the “Lavo Jato” or “Operation Car Wash” scandal, should contact the coalition’s administrator, or the Dutch counsel representing the Foundation. For you convenience, we have included their contact information below.
INVESTOR PARTICIPANT ADMINISTRATION
For administration purposes, the Dutch Foundation has appointed International Securities Associations & Foundations Management Company (ISAF) to coordinate all administration with investors, including contingency success fee based funding of all investor litigation cost. www.isafmanagement.com.
ISAF Management, Adam Foulke, +1-203-252-3378
BATTEA GLOBAL LITIGATION RESEARCH, INC. (“BGLR”)
Battea Global Litigation Research, Inc., Peter Hansen, +1-203-987-4949
Battea Global Litigation Research, Inc. is comprised of the world’s foremost corporate research analysts providing research and litigation support relating to business valuation and complex securities litigations. BGLR’s experience in the United States and Internationally, combined with our industry knowledge and expertise in economics, finance and complex business litigation research make us uniquely qualified to assist international investors in evaluating litigation events, coalitions and participation procedures.
Battea Global Litigation Research, Inc.
Peter Hansen, +1-203-987-4949
For more than 50 years, Business Wire has been the global leader in press release distribution and regulatory disclosure.
Tilaa tiedotteet sähköpostiisi
Haluatko tietää asioista ensimmäisten joukossa? Kun tilaat mediatiedotteemme, saat ne sähköpostiisi välittömästi julkaisuhetkellä. Tilauksen voit halutessasi perua milloin tahansa.
Lue lisää julkaisijalta Business Wire
Moldova Citizenship-by-Investment Program Completes First Successful Application21.5.2019 12:07:00 EEST | Tiedote
As concessionaire of the Moldova Citizenship-by-Investment (MCBI) program, Henley & Partners is pleased to note the successful completion of the first citizenship-by-investment application in the country. Henley & Partners has over 20 years of experience in strategic consulting, working with sovereign states around the globe in the design, set-up, and operation of the world’s most respected investment migration programs. The completion of the first citizenship-by-investment application process in Moldova clearly illustrates the features that are at the core of the MCBI program: impressive efficiency and a firm commitment to best practice. Within a three-month window, applicants are thoroughly screened in a multi-stage due diligence process that ensures only highly credible international investors are granted Moldovan citizenship. There are currently over 30 applications in process, which is a testament to the international investment community’s growing appreciation of the value of the
comforte AG Launches New Payments Industry Data Security Solution21.5.2019 11:50:00 EEST | Tiedote
comforte AG today announced its Data Security Solution and Practice for the Payments Industry. The solution is making its debut at Card Forum 2019, the annual gathering of card and payment executives from the industry’s leading issuers, networks, retailers and innovators. Card Forum 2019 is being held this week in New Orleans. comforte AG has over a decade of history working with payment service providers (PSPs) to achieve compliance with data security regulations, in particular PCI DSS, as well as with more recent legislation such as the EU's General Data Protection Regulation (GDPR) or the upcoming California Consumer Privacy Act (CCPA). Our new solution will provide PSPs with enterprise-grade data security that not only fulfills key requirements of existing regulations, but will also help them to prepare for PSD2, which comes into effect in September of this year. PSD2 and open banking offer PSPs numerous opportunities to generate additional revenue, reduce costs, and increase marke
Lion/Gem Luxembourg 3 S.a.r.l. Announce Second Quarter Results for FY 201921.5.2019 11:00:00 EEST | Tiedote
The Second Quarter Results for FY19 (to 30 September 2019) for Lion/Gem Luxembourg 3 S.a.r.l. (associated with Young’s Seafood Limited) will be made available on our Investor Relations website on May 21, 2019. The Second Quarter Results for FY19 call for investors that accompanies this information is scheduled to take place at 13:00 BST on May 21, 2019. The Second Quarter covers the quarter to 30 March 2019; the financial year end for Lion/Gem Luxembourg 3 S.a.r.l. is September 30, 2019. For further information: If you are an investor or a potential investor in the 8¼%/ 9% Senior PIK Notes due 2019, of Lion/Gem Luxembourg 3 S.a.r.l., and would like access to this information, please register your interest on our Investor Relations website: https://youngsseafood.co.uk/investors/. If you have any questions about the registration process or need further information, please do not hesitate to contact Nicholas Donnelly, Communications Manager at Young’s Seafood: nicholas.donnelly@youngsseaf
Arthur D. Little: Nord Stream 2 Provides Economic Benefits, Generates Innovation and Helps to Develop Contractors’ Businesses21.5.2019 11:00:00 EEST | Tiedote
The second part of a recent report from Arthur D. Little (ADL) – “Nord Stream 2 economic impact in the construction phase” – analyzes the economic effects (job creation and GDP) of the ongoing project to build two new gas pipelines from Russia to Germany. The report, which is a follow-up to an earlier report created in 2017, analyzes the current status of project investment and concludes that the total economic benefit to the European Union (EU) represents €9.9 billion for building the pipelines. In comparison to the first report (2017), which was carried out in the procurement phase, more than twice as much CAPEX has now been committed and spent in several EU and non-EU countries now that the project is in the middle of construction. More than 1,000 contractors from all over Europe and Russia are contributing to the realization of the project. This includes both large international firms providing materials or construction services and small enterprises providing expert services. Furt
1 In 10 Banks Will Disappear over the Next 5 Years, According to A.T. Kearney21.5.2019 11:00:00 EEST | Tiedote
A ten-year study from global management consultancy A.T. Kearney has found that the profit of European retail banks/divisions is at an all-time high, driven by a positive economic environment and lower risks (risk costs relative to total income at lowest level 5% compared to 12% in 2008). Yet, the topline stagnates at (+ 1% in western Europe). A.T. Kearney’s ‘Retail Banking Radar 2019’ analyzes data from 92 banks across Europe and found that despite continued strong growth in volumes, income remains weak with a dramatic drop in income per client (-1.1% 2018 vs 2017; -11% 2018 vs 2008). Meanwhile, a quarter (24.6%) of bank branches across Europe has closed since 2008. The study shows that the industry faces a critical transformation amidst rising consumer demand for digital banking and the growing possibilities of open banking, revealing four key areas: Redefine target operating models, accelerate cost reduction and introduce new agile ways of working Rebalance the organization both in
EURid Q1 2019 Progress Report Now Available21.5.2019 11:00:00 EEST | Tiedote
Today EURid released its Q1 2019 Progress Report, sharing its quarterly statistics and developments. Highlights include: The quarter posted a renewal rate of 78.2%; The top country for growth for the quarter is Ireland, followed by Sweden and Portugal, which remains in the TOP 3 after leading in Q4 2018; The top ten countries with the most .eu registrations are Germany (984 311), the Netherlands (475 514), France (328 863), Poland (265 807), Italy (265 060), the United Kingdom (188 505), Czech Republic (157 804), Belgium (142 756), and Spain (120 189); Developments throughout the quarter also included: Further support to the Uganda Borehole project; The continuation of the Co-funded Marketing Programme for .eu accredited registrars until 2022, following an in-depth assessment by an external party and the introduction of several procedural refinements. View EURid’s Q1 2019 Progress Report About EURid EURid is the not-for-profit organisation that operates the .eu and .ею top-level domain
Uutishuoneessa voit lukea tiedotteitamme ja muuta julkaisemaamme materiaalia. Löydät sieltä niin yhteyshenkilöidemme tiedot kuin vapaasti julkaistavissa olevia kuvia ja videoita. Uutishuoneessa voit nähdä myös sosiaalisen median sisältöjä. Kaikki STT Infossa julkaistu materiaali on vapaasti median käytettävissä.Tutustu uutishuoneeseemme