Venezuela’s state-run iron ore producer CVG Ferrominera Orinoco (FMO) is closer to dismissing a $350 million dispute with Commodities & Minerals Enterprise (CME), a law firm said.
According to law firm Diaz, Reus & Targ, United States District judge Andrew Carter of the Southern District of New York ruled recently that FMO is an "agency or instrumentality" of the Venezuelan government, and as such, it is immune from pre-judgment attachment under the Foreign Sovereign Immunities Act (FSIA).
“The court's determination could potentially derail a $350 million global arbitration and litigation assault on FMO brought by CME,” Diaz Reus said in a press release.
According to law firm, the ruling stems from a complaint initiated by CME earlier this year in which it sought and then obtained an ex parte order of maritime attachment for “hundreds of millions of dollars.”
The law firm argued the judge’s decision has “far-reaching implications not only in the case before him, but in the arbitrations pending in Switzerland, the UK, and the US.”
“FMO is one significant step closer to obtaining a dismissal of the proceeding in its entirety,” the attorneys said.
Diaz Reus said the court scheduled a mid-October deadline for CME to brief the court to the extent it claims that an exception to the FSIA applies.