DLA Piper secures significant win for Rusoro Mining Limited
DLA Piper achieved a significant appellate victory for client Rusoro Mining Limited (Rusoro) in proceedings to enforce US$1 billion+ award against Republic of Venezuela arising out of Venezuela’s expropriation of Rusoro’s gold mining assets. The Third Circuit affirmed that Venezuala’s state-owned oil company is the country's alter ego and that its property may be executed in satisfaction of the Republic’s judgment debt.
A three-judge panel rejected Venezuela's argument that political turmoil in the country warranted a different outcome than the Third Circuit had reached back in 2019, when it concluded that the Republic controls its state-owned oil company, Petróleos de Venezuela, S.A. (“PDVSA”). The ruling re-affirms Delaware Federal Judge Leonard Stark’s ruling on the issue for the second time in five years.
The panel, comprised of Judges Stephanos Bibas, Paul Matey and Arianna Freeman stated: “Even accounting for those differences [regarding political turmoil], the district court correctly concluded that PDVSA remains the alter ego of Venezuela.” “…Reviewing PDVSA's other arguments would stretch the limited grant of our appellate jurisdiction well beyond the words written by Congress, we decline the invitation and will affirm the district court's judgment.”
Between the district court’s ruling and the Third Circuit’s decision, which affirm the alter ego findings against sovereigns, the decision represents a major development in the law relating to both sovereigns and judgment enforcement.
The DLA Piper team included partners James Berger and Charlene Sun (both in New York) and Craig Martin (Wilmington); senior attorney John Canoni (Dallas) and associates Joshua Wan and Charlotte Westbrook (both in New York).