US Court Confirms $562.5 Million Devas Arbitration Award Against ISRO's Antrix

The US Court of Appeals for the Ninth Circuit has affirmed the US district court's confirmation of a $562.5 million international arbitral award in the Devas Multimedia-Antrix dispute. Antrix is the commercial arm of the Department of Space and the Indian Space Research Organisation (ISRO).

A three-judge bench comprising Judges Eric D. Miller, Lucy H. Koh and District Judge Donald W. Molloy affirmed the district court on subject matter jurisdiction, personal jurisdiction, and forum non conveniens.

The court held that the Foreign Sovereign Immunities Act's arbitration exception applies even where the underlying dispute has no US commercial nexus.

It also ruled that forum non conveniens does not apply to proceedings seeking confirmation of a foreign arbitral award under the New York Convention.

“We hold that the FSIA's arbitration exception to foreign sovereign immunity supplies subject matter jurisdiction. We further hold that, even assuming Antrix is a 'person' entitled to the protections of the Fifth Amendment and assuming that a reasonableness assessment is required under the Fifth Amendment, the exercise of personal jurisdiction over Antrix is reasonable and therefore comports with the Fifth Amendment. Finally, we hold that forum non conveniens does not apply in an action to confirm a foreign arbitral award under the New York Convention and, in any event, did not require dismissal here.”, it ruled.

A bench comprising Circuit Judge Eric D. Miller, Circuit Judge Lucy H. Koh and District Judge Donald W. Molloy, sitting by designation, heard Antrix's challenge. The case returned to the Ninth Circuit after the US Supreme Court reversed its earlier decision requiring a traditional minimum-contacts analysis for exercising personal jurisdiction over a foreign state

The dispute arose from a January 28, 2005 agreement under which Antrix agreed to build, launch and operate two satellites and lease 70 MHz of India's S-band spectrum to Devas. On February 25, 2011, Antrix informed Devas that it was terminating the agreement, citing a Government of India policy decision not to provide an orbital slot in S-band for commercial activities.

Devas commenced ICC arbitration on July 1, 2011. On September 14, 2015, a three-member ICC tribunal held that Antrix had wrongfully repudiated the agreement and awarded Devas $562.5 million.

In 2018, Devas petitioned the US District Court for the Western District of Washington to confirm the award. The district court confirmed it and rejected Antrix's motion to dismiss on jurisdictional and forum non conveniens grounds.

Antrix appealed, arguing that the dispute concerned purely foreign commerce and lacked a sufficient connection with the US. It also argued that the proceedings should instead be pursued in India.

The Ninth Circuit rejected Antrix's argument that the dispute needed a US commercial connection for the FSIA arbitration exception to apply. The court held that the exception covers actions to confirm awards where the agreement or award is governed by a treaty requiring recognition and enforcement of arbitral awards.

Since the New York Convention meets that requirement, the exception applied. “The arbitration exception contains no comparable language requiring a commercial nexus with the United States, and we will not supply it,” the court observed.

The court also rejected Antrix's personal jurisdiction challenge. It found the exercise of jurisdiction reasonable, noting the US interest in enforcing treaty obligations and Antrix's failure to claim any undue hardship from litigating in the US. Devas had a substantial interest in obtaining relief because it had no alternative forum outside the US in which it could execute against property Antrix might own there. The court also noted that Antrix had agreed that an arbitral award could be entered in any court of competent jurisdiction.

The court rejected the forum non conveniens argument as well. It held that the doctrine does not apply to an action seeking confirmation of a foreign arbitral award under the New York Convention because the Convention requires recognition and enforcement subject only to specified grounds for refusal.

“That list does not include the inconvenience of the forum. To allow a court to decline enforcement on a ground the Convention does not recognize would add a defense the treaty does not envision,” the court observed.

The court further held that India could not provide an adequate alternative forum because only a US court could attach Antrix's commercial assets located in the US. “We therefore hold that forum non conveniens does not apply to an action to confirm a foreign arbitral award under the New York Convention,” the court ruled.

The court also noted that the Indian courts subsequently set aside the arbitral award after the US district court had confirmed it. The Ninth Circuit did not decide what effect that set-aside should have in the US proceedings. Instead, it remanded the issue to the district court for consideration in the first instance.

In a memorandum disposition filed alongside the opinion, the court affirmed the district court's confirmation of the award and registration of the resulting judgment as to Devas Multimedia America Inc.

It reversed and vacated in part the ruling concerning the shareholder intervenors' standing to register the judgment, while remanding the effect of the Indian set-aside proceedings to the district court.