US Supreme Court Ruling on Antrix-Devas Legal Battle

In a significant legal development, the US Supreme Court has overturned a previous decision by a US appeals court concerning a compensation claim of $1.2 billion filed by Devas Multimedia. This case involves a failed satellite deal from 2005 with Antrix Corporation, a commercial arm of the Indian Space Research Organisation (ISRO).

Background and Legal Context

• The dispute originates from a 2005 satellite deal between Antrix and Devas Multimedia, which was annulled by the Indian government in 2011 for security reasons.
• The International Chamber of Commerce awarded $1.2 billion to Devas Multimedia on September 14, 2015, which was confirmed by a US court for the Western District of Washington on October 27, 2020.

US Supreme Court's Decision

• On June 5, the US Supreme Court ruled that US courts can exercise jurisdiction over foreign entities without them having a business presence in the US, provided an immunity exception applies and proper service is conducted.
• This reverses the August 2023 decision by the US Court of Appeals for the Ninth Circuit, which had found in favor of Antrix, suggesting there must be some business presence in the US under the Foreign Sovereign Immunities Act (FSIA).

Reactions and Implications

• The US Supreme Court has instructed the Ninth Circuit to reconsider the case, without addressing Antrix’s alternative arguments concerning Fifth Amendment rights and the FSIA's arbitration exception.
• The Government of India emphasized the importance of respecting its legal decisions, while Antrix's counsel argued the case should be handled by Indian courts, as it concerns an agreement voided by the Indian Supreme Court.

Support for Devas Multimedia

• The US Department of Justice and several US business bodies support Devas Multimedia's stance that international arbitration awards do not require the entity to have US business interests for enforcement in federal courts.

Broader Context and Developments

• The original agreement involved ISRO leasing two communication satellites to Devas Multimedia for 12 years, which was intended to provide multimedia services through S-band transponders.
• Following the annulment of the deal, Devas Multimedia and its investors, including Deutsche Telekom and Mauritius-based investors, sought compensation through various international tribunals, securing significant awards.
• The National Company Law Tribunal (NCLT) in India ordered the liquidation of Devas Multimedia in May 2021 due to fraud concerns, a decision upheld by the Indian Supreme Court.

This case underscores the complexities of international arbitration involving sovereign entities and the balance between national legal systems and global business interests.