Devas Multimedia seizes $87,457 in cash in United States in dispute with Antrix Corporation



Devas Multimedia seized $87,457.47 in cash that ISRO’s trading arm, Antrix Corporation, was holding in the United States as it sought to enforce $1.2 billion in compensation it won for a canceled satellite contract, his attorney said Wednesday.

Devas Multimedia America Inc had requested the seizure of USD 145,000 but the actual recovery was USD 87,457.47 (just under Rs 70 lakh). It came after securing a favorable order from the court for the Eastern District of Virginia, Matthew D McGrill said.

The company originally said it seized $145,000 in cash, but later clarified that the actual seizure was less than that amount.

“The original amount of the claim was approximately $145,000 but was reduced through bankruptcy proceedings (normal bankruptcy proceedings),” he said.

The satellite company has been embroiled in a tussle with the Indian government since a contract it had to develop wireless broadband in the country was canceled in 2011.

It was awarded $1.2 billion in international arbitration awards, but the government refused to pay, alleging the original 2005 contract award was mired in fraud.

Devas shareholders, which include US investment groups Columbia Capital and Telecom Ventures as well as Deutsche Telekom, have since been targeting Indian state assets overseas to collect money they believe India owes to the company.

“The seizure of Antrix assets sends a clear message: despite the … (actions) of the Modi government and the transnational crackdown on Mr. Viswanathan, Devas shareholders will not give up on their quest to recover what is rightfully owed to them by the Indian government,” said McGill, a partner at Gibson, Dunn & Crutcher and lead shareholder counsel for Devas.

The seizure of the assets comes at a time when the Indian government is calling for the arrest and prosecution of Devas co-founder Ramachandran Viswanathan.

Devas shareholders previously obtained a French court order to freeze Indian properties in Paris and obtained partial rights to funds maintained by Indian funds in Canada.

The ICC order of September 14, 2015 was upheld by the US court on October 27, 2020. The Mauritian investors themselves were awarded $111 million in compensation by an arbitral tribunal, while Deutsche Telekom was awarded $101 million of dollars.

The Ministry of Finance did not respond to an email sent seeking comment.

In January of this year, Devas shareholders petitioned U.S. District Judge Thomas S Zilly of the Western District of Washington, who granted Devas shareholders the right to sue assets held by Antrix in any jurisdiction. American.

This move was used to target Antrix assets in the Eastern District of Virginia.

Judge Zilly’s decision gave Devas shareholders the right to enforce the ICC judgment against Intelsat Serving Equipment LLC, which owed more than $145,000 to Antrix.

Devas investors have targeted funds from US satellite company Intelsat Service and Equipment LLC, which has outstanding dues to pay to Antrix in a proceeding in US federal court for the Eastern District of Virginia.

Antrix Corp told court earlier this year that Intelsat, which is in bankruptcy proceedings in the Eastern District of Virginia, owed $146,457 and said it was the only asset of the company in the United States.

This is the asset that has been seized now.

Devas in US courts, Devas shareholders also argued that the Indian Space Research Organization (ISRO) and its new business arm NewSpace India Ltd are alter egos of Antrix and therefore should be required to pay for the arbitration award.

Antrix had an agreement with US space launch services company Spaceflight Inc. Spaceflight uses ISRO rockets, among other things, to provide launch services to global customers.

As part of the failed 2005 deal, Antrix Corporation, the government-owned commercial arm of the Indian Space Research Organization (ISRO), signed an agreement with Bengaluru-based Devas Multimedia for a lease of 12 years of 90% transponder space on two satellites, G-SAT6 and G-SAT6A which had not yet been launched.

Of the 150 MHz of space that ISRO had in the S-band spectrum, Devas was allowed to use 70 MHz to launch satellite applications on mobile devices.

Devas, which had a few former ISRO scientists in its leadership, was supposed to pay $300 million to Antrix over a 12-year period. The start-up was to provide multimedia services to mobile platforms in India using space band or S-band transponders on ISRO’s GSAT 6 and 6A satellites built at a cost of Rs 766 crore by the space agency Indian.

But the deal was canceled by the UPA government in February 2011, when the 2G spectrum allocation scam hit the headlines, citing the requirement for S-band spectrum for network security purposes. country. There were allegations that the deal was a quid pro quo “love deal”.

In 2014, the CBI and the Enforcement Directorate were asked to investigate the deal.

Devas Multimedia has initiated arbitration against the cancellation of the 2005 agreement with the International Chambers of Commerce (ICC).

Two separate arbitrations have also been initiated under the bilateral investment treaty (BIT) by the Mauritian investors of Devas Multimedia (under the India-Mauritius BIT) and by Deutsche Telekom, a German company, under the BIT. India-Germany. India lost all three disputes.

The trade terminal award was for a total of USD 1 billion, while India was awarded USD 93.3 million plus costs and interest as part of the India-Germany BIT arbitration . About $111.2 million plus costs and interest was awarded in the India-Mauritius BIT arbitration.

Devas shareholders had indeed previously seized a property in the 16th arrondissement of Paris, after obtaining an asset freezing order from a Paris court allowing it to register a mortgage on the property. The building previously served as the residence of the Indian Embassy’s Deputy Head of Mission.

(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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