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PCA CASE N° 2013-09

IN THE MATTER OF AN ARBITRATION ARISING UNDER THE
AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF
MAURITIUS AND THE GOVERNMENT OF THE REPUBLIC OF INDIA FOR
THE PROMOTION AND THE PROTECTION OF INVESTMENTS ENTERING
INTO FORCE JUNE 20, 2000 AND THE ARBITRATION RULES OF THE
UNITED NATIONS COMMISSION ON INTERNATIONAL TRADE LAW (1976)

Between:

CC/DEVAS (MAURITIUS) LTD.
DEVAS EMPLOYEES MAURITIUS PRIVATE LIMITED and
TELCOM DEVAS MAURITIUS LIMITED

Claimants,

and

THE REPUBLIC OF INDIA

Respondent.

CLAIMANTS' STATEMENT OF CLAIM

Claimants' legal representatives

July 1, 2013

[Page i]

[Page 1]

Pursuant to the agreed procedural timetable and Article 18 of the Arbitration
Rules of the United Nations Commission on International Trade Law (1976)
("UNCITRAL Rules 1976"), Claimants CC/Devas (Mauritius) Ltd. ("CC/Devas"), Devas
Employees Mauritius Private Limited ("DEMPL") and Telcom Devas Mauritius Limited
("Telcom Devas") (collectively, "Claimants") submit this Statement of Claim on
Jurisdiction and Liability against the Republic of India ("Respondent" or "India") for
breach of the September 4, 1998 Agreement Between the Government of the Republic of
Mauritius and the Government of the Republic of India for the Promotion and Protection
of Investments, entered into force June 20, 2000 ("Mauritius-India BIT" or "Treaty").¹

I.
INTRODUCTION

1. This arbitration results from the Indian government's expropriation of
Claimants' investments in India, which occurred in February 2011 and was not
accompanied by payment of fair and equitable compensation, as the Treaty requires.

2. Claimants' investments in India were made through an Indian company,
Devas Multimedia Private Limited ("Devas"), in which Claimants hold shares. In
January 2005, Devas had secured access to 70 MHz of S-band spectrum through a lease
agreement that Devas had entered into with Antrix Corporation Limited ("Antrix"), a
corporation wholly owned by the Indian government and operating under the

¹ (Ex. C-1.) This Memorial also refers to the accompanying: (1) exhibits ("Ex. C- ↩
_") and legal authorities ("Ex. CL-_"); (2) Witness Statements of Lawrence Babbio
("Babbio ¶ _"), Arun Gupta ("Gupta ¶¶ _"), Gary Parsons ("Parsons ¶ _"), Rajendra Singh
("Singh ¶ _") and Ramachandran Viswanathan ("Viswanathan ¶ _"); and (3) Expert
Report of John Lewis ("Lewis ¶ _"). Per the agreed schedule, this Memorial addresses
only jurisdiction and liability; quantum is expressly reserved.

[Page 2]

administrative control of the Indian Space Research Organization ("ISRO") and the
Department of Space ("DOS").

3. Pursuant to the lease agreement (hereafter, the "Devas Agreement"),
Antrix had agreed to lease to Devas space segment capacity in the "S-band" (2500-2690
MHz), a part of the electromagnetic spectrum that India had coordinated with other
nations at the International Telecommunications Union ("ITU"), the United Nations
specialized agency responsible for coordinating the use of spectrum internationally. In
India, the S-band had been assigned to DOS to be used for the development of satellite
communications networks.

4. When it was entered into in 2005, the Devas Agreement was seen by the
Indian government and by Devas as a win-win for all parties. DOS secured a productive
use for the S-band spectrum that had been allocated to it by the Indian government but
which had lain fallow for years while DOS struggled to find a use for it; ISRO and Antrix
were able to partner with a private operator to develop India's space program and
capabilities, as was their stated mission; and Devas obtained the space segment capacity
necessary for delivery of the Devas services throughout India. In this regard, Devas
planned to offer two main services to customers in India: broadband wireless access
("BWA") and audio-video ("AV") services (together, "Devas Services"). The Devas
integrated satellite system also provided a cost-effective means of servicing rural areas
within India.²

² There was and still is no other application on the Indian market capable of ↩
providing a comparable portfolio of services.

[Page 3]

5. Over the course of the next five years, Devas assembled a world class
team of experts in the satellite-terrestrial communications industry, raised over $130
million in capital, including approximately $100 million from Deutsche Telekom, a
leader in terrestrial communications networks, and validated its proprietary integrated
satellite-terrestrial communications system architecture, described more fully below (the
"Devas System"), through experimental trials conducted in India, Germany and China.
As a report commissioned by the Indian Government (the Chaturvedi Report, described
below) would later recognize, Devas was "a state-of-the-art communication
infrastructure" that would enable Devas to provide Devas Services throughout India (see
infra ¶ 32).

6. During that same five year period, the Government of India gave its
vociferous backing to Devas and to the Devas Agreement. Among other things, in 2007,
the Indian government secured an exemption at the ITU enabling the satellites to operate
at a higher power flux density than was otherwise permissible for satellite
communications systems operating around the world. And DOS fully supported
Antrix/ISRO and Devas's combined efforts to bring the Devas system into being,
including by arranging for experimental trials in India in September 2009 that validated
the functionality of the system. As a result of the success of those trials and the other
accomplishments referred to herein, Devas was poised to become a major force in the
Indian BWA and AV markets as soon as the satellites were launched and brought into
operation.

7. The spirit of cooperation (which had been the hallmark of the Devas
project from its inception) came to an end, however, when, in October 2009, Dr. K.R.

[Page 4]

Radhakrishnan succeeded Dr. Madhavan Nair as Chairman of ISRO, Antrix and the
Space Commission³ and Secretary of DOS. Although outwardly, in meetings with Devas,
Dr. Radhakrishnan pretended that it was business as usual and that the only reason the
satellites had not been launched was due to technical issues, it has since come to light that
– for reasons that have never been explained to Claimants – Dr. Radhakrishnan secretly
began to target the Devas Agreement almost immediately upon his succession to the post
of Chairman Antrix/ISRO/Space Commission and Secretary of DOS. These targeted
actions culminated in the cancellation of the Devas Agreement in February 2011.

8. It has now been revealed that, as one of his first actions as the new
Secretary of DOS and Chairman Antrix/ISRO, on December 8, 2009, Dr. Radhakrishnan
secretly commissioned Dr. B.N. Suresh – Director of the Indian Institute of Space and
Technology – to "review" all aspects of the Devas Agreement. Neither Devas nor
Claimants were notified of this comprehensive "review" nor were their views or
understandings solicited by the Suresh Committee.

9. When the Suresh Committee reported in June 2010, it found no
wrongdoing by Devas and did not recommend termination of the Devas Agreement.⁴
Nonetheless, in July 2010, Dr. Radhakrishnan sought and obtained a decision by the
Indian Space Commission authorizing the annulment of the Devas Agreement. Neither

³ The Space Commission is an inter-ministerial body of the Indian Government that ↩
includes representatives of the Prime Minister.

⁴ Pursuant to a request under India's Right to Information Act 2005, in June 2012, ↩
ISRO provided Devas with a partial copy of Dr. B.N. Suresh's "Report on GSAT-6"
(dated May 2010) (the "Suresh Rep."). The copy provided to Devas has substantial
redactions that the government claims "as per Section 10(1) of RTI Act . . . [are] strategic
in nature and the disclosure of the same is exempted under Section 8(1)(a) of [the] RTI
Act 2005." (Suresh Rep. at 2 (Ex. C-94).)

[Page 5]

Devas nor Claimants were notified by DOS/ISRO/Antrix or any other governmental
department of this July 2010 decision by the Space Commission, nor were their views or
understandings solicited by the Space Commission prior to it secretly authorizing the
annulment of the Devas Agreement.

10. Dr. Radhakrishnan then obtained the opinion of the Additional Solicitor-
General of India, Mr. Mohan Parasaran, as to how, with minimal damage and
embarrassment to India, the Devas Agreement "[could] be annulled by invoking any of
[its] provisions. . . ."⁵ According to the Additional Solicitor-General's opinion, which
was later made public by The Hindu newspaper on February 11, 2011, the purpose of the
proposed annulment was in order "to (i) preserve precious S band spectrum for strategic
requirements of the nation, and (ii) to ensure a level playing field for other service
providers using terrestrial spectrum."⁶

11. In July 2010, the Additional Solicitor-General advised that the Devas
Agreement was valid and binding and that it was not possible for Antrix to terminate the
contract according to its termination provisions. The Additional Solicitor-General,
however, suggested a possible pathway for Antrix to suspend performance under the
Devas Agreement based upon an engineered "force majeure" event.

12. Specifically, the Additional Solicitor-General suggested that if the
government were to make a "policy" decision, with the "seal and approval" of the Cabinet,

⁵ Opinion of Additional Solicitor-General Mohan Parasaran (July 12, 2010) in The ↩
Hindu, Additional Solicitor-General's opinion on Antrix-Devas deal (Feb. 11, 2011)
(emphasis omitted) (Ex. C-131) ("ASG Opinion").

⁶ Id. ↩

[Page 6]

reserving the S-band for "national needs,"⁷ then based on this policy decision, Antrix
could cancel the Devas Agreement relying on the agreement's force majeure provisions.
In turn, this would leave Devas with no satellites, no S-band spectrum in which to operate
its integrated satellite system, and hence, among other things, no BWA or AV business.

13. At the time that these clandestine reviews and opinions were being
undertaken by DOS in the summer of 2010, Devas also had become a victim of a series
of negative and highly erroneous reports in the Indian press that tried to link the Devas
Agreement to other scandals that were then besetting the government.⁸ Although the
Devas Agreement bore no relationship whatsoever to these other scandals, the media
frenzy created political pressure on the Indian government to extricate itself from its
commitments to Devas.

14. That pressure reached a boiling point in early 2011 and on February 8,
2011, Dr. Radhakrishnan hastily convened a press conference (televised on multiple
channels, including CNN-IBN) to announce that the government had already decided to
terminate the Devas Agreement. At the press conference, Dr. Radhakrishnan revealed for
the first time the Space Commission's decision in July 2010 to cancel the Devas
Agreement and explained what had happened inside the Indian government after that
decision had been taken. Dr. Radhakrishnan said:

⁷ During the initial conference, Respondent's counsel indicated that it would be ↩
relying on what it described as the "essential security" provision of the Treaty as a
defense to liability. See Mauritius-India BIT, art. 11(3) (Ex. C-1). Respondent's counsel
did not, however, articulate a basis upon which Article 11(3) might excuse Respondent's
conduct in this case – and the facts as related herein readily dispel any notion that the
decision to annul the Devas Agreement, and the resulting expropriation of Claimants'
investment, was bona fide, much less that it could fall within Article 11(3)'s ambit.

⁸ Viswanathan ¶ 165; see infra ¶ 86. ↩

[Page 7]

Subsequent to the decisions taken by the Space Commission [in July
2010], . . . we started necessary actions for terminating the contract which
required extensive consultations with the concerned agencies in the
government. Department of Telecommunication, Department of Law and
Justice, all included. The idea is to ensure that a . . . contract that has
been entered into has to be now terminated without causing much of
embarrassment and damage and financial loss to the government.⁹

15. Two days after this press conference, on February 10, 2011, an article
appeared on ISRO's website predicting that Antrix soon would be able to announce a
force majeure event enabling it to exit the Devas Agreement:

the Government in exercise of its sovereign power and function may take
a policy decision to the effect that due to strategic requirements, it would
not be able to provide orbit slot in S-band for operating PS-1 to ANTRIX
for commercial activities. In that event, ANTRIX in terms of Article 7(c)
read with Article 11 dealing [sic] with Force Majeure may terminate the
Agreement and inform Devas accordingly.¹⁰

16. Seven days later, on February 17, 2011, the Indian Cabinet Committee on
Security ("CCS") announced that it had taken a "policy decision" to revoke the orbital
slot in S-band previously assigned to DOS for commercial activities and that, as a direct
consequence, the Devas Agreement should be annulled.

17. Right on cue, on February 25, 2011, Antrix issued a notice to Devas
terminating the Devas Agreement on grounds of "force majeure" based on the CCS's so-
called "policy decision."¹¹ This series of events followed almost verbatim the
recommendations of the Additional Solicitor-General written back in July 2010.

⁹ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN- ↩
IBN at 4 (Feb. 8, 2011) (Ex. C-125).

¹⁰ Background Note on Agreement between M/s. ANTRIX Corporation and M/s. ↩
DEVAS Multimedia Pvt. Ltd. regarding lease of space segment capacity in S-Band
spectrum on ISRO's satellites GSAT-6 and GSAT-6A (Feb. 10, 2011) (Ex. C-193).

¹¹ Remarkably, Antrix also invoked section 7(c) of the Devas Agreement as a ↩
grounds for termination even though the Additional Solicitor-General had expressly
(cont'd)

[Page 8]

18. Adding insult to injury, even though the Additional Solicitor-General had
expressly advised that Section 7(c) was not available to terminate the Agreement, on
April 15, 2011, Antrix, purporting to act pursuant to Section 7(c), tendered USD $13
million to Devas as a termination fee.¹² Devas returned that check and warned Antrix
that it was in clear breach of the Devas Agreement.¹³

19. In response, Antrix failed to engage in senior management discussions and
then frustrated Devas's effort to resolve its dispute through arbitration. In an obviously
coordinated fashion, the Indian government also began to harass Devas through various
bogus state actions, including (i) threatening Devas personnel with investigation by the
Indian Enforcement Directorate, (ii) threatening to cancel Devas's corporate charter, and
(iii) seeking to levy exorbitant and wholly unjustified taxes on Devas.

20. As a direct result of the Indian government's annulment of the Devas
Agreement, Devas's business has been destroyed and with it the value of Claimants'
investments.

21. Because Respondent has failed to provide compensation to Claimants at
fair market value as required by Articles 6 and 7 of the Treaty, and because the

(cont'd from previous page)
advised that such provision could not be used to terminate the agreement. Of course, it
was precisely because of the unavailability of section 7(c)'s "Termination for
Convenience" provision that the Additional Solicitor-General recommended the
concoction of a force majeure event in the first place. If section 7(c) had been available
(which it was not), there would have been no need for the elaborate machinations
engaged in by the Indian government in annulling the Devas Agreement.

¹² Letter from Antrix (Madhusudhan) to Devas (Apr. 15, 2011) (Ex. C-138). ↩

¹³ Letter from Devas (Viswanathan) to Antrix (Madhusudhan) (Apr. 18, 2011) (Ex. ↩
C-140).

[Page 9]

expropriation was unlawful in numerous other respects, Claimants are entitled to an
award declaring Respondent liable to make reparation.

22. Claimants furthermore are entitled to a declaration that Respondent has
breached Article 4(1) of the Treaty (guaranteeing "fair and equitable treatment" and
barring "unreasonable or discriminatory measures"), as well as the "most favored nation
clause" in Articles 4(2) and 4(3) of the Treaty, including denial of full security and
protection to Claimants' investment.¹⁴

II.
STATEMENT OF FACTS

23. This Statement of Facts is drawn from the witness statements of (i)
Ramachandran Viswanathan, the CEO of Devas; (ii) Dr. Rajendra Singh, the founder of
Telcom Ventures and a Devas Board member; (iii) Arun Gupta, a partner of Columbia
Capital and a Devas Board member; (iv) Larry Babbio, the former Vice-Chairman of
Verizon Communications and a Devas Board member and current Chairman of DEMPL;
and (v) Gary Parsons, a pioneer in hybrid satellite-terrestrial systems and a Devas board
member; as well as the report of John Lewis, an expert on ITU coordination and satellite
communication systems. These witnesses give evidence based on their personal
knowledge of and involvement in the Devas project and, in Mr. Lewis' case, his
experience at the ITU and with satellite communication systems. Their evidence is
confirmed by certain statements made in the Suresh Committee Report ("Suresh Report"

¹⁴ In accordance with the agreed schedule, a further hearing in which damages can ↩
be quantified should then be conducted.

[Page 10]

or "Suresh Rep.", Ex. C-94), and the Chaturvedi Report ("Chaturvedi Report" or
"Chaturvedi Rep.", Ex. C-137),¹⁵ both of which are referenced herein.¹⁶

A. The Parties

1. The Claimants

24. Each of the Claimants is incorporated in Mauritius, a Contracting State to
the applicable BIT.¹⁷ The address of all three Claimants is 608 James Court St Denis
Street, Port Louis, Mauritius.

25. The First Claimant, CC/Devas, was formed in 2006 and has its registered
office in Port Louis, Mauritius. It is affiliated with Columbia Capital LLC ("Columbia
Capital"), a venture capital firm based in Alexandria, Virginia.

26. The Second Claimant, DEMPL, was formed in 2009 and has its registered
office in Port Louis, Mauritius. It is a subsidiary of Devas Employees Fund US, LLC, a
Delaware limited liability company with membership units owned by certain non-Indian
Devas employees pursuant to an Equity Incentive Plan.

27. The Third Claimant, Telcom Devas, was formed in 2006 and has its
registered office in Port Louis, Mauritius. It is affiliated with Telcom Ventures LLC

¹⁵ In all other respects, Claimants do not accept the assertions made in these Reports, ↩
which are the result of investigative processes in which Claimants and Devas were
neither involved nor consulted or heard.

¹⁶ As noted earlier, the Indian Government disclosed a copy of the Suresh Report, ↩
after heavy redaction, in response to a request by Devas under the Right to Information
Act. (See supra n.4.) By contrast, the Indian government affirmatively made public
parts of the Chaturvedi Report on February 4, 2012, after the annulment of the Devas
Agreement, in an apparent effort to justify that action.

¹⁷ See Exs. C-25, C-27 & C-91 (Claimants' respective certificates of incorporation); ↩
Exs. C-26, C-28 & C-92 (Claimants' Constitutions).

[Page 11]

("Telcom Ventures"), a United States venture capital firm owned by Dr. Rajendra Singh,
a pioneer in the field of hybrid satellite-terrestrial communications systems.¹⁸

2. The Respondent

28. Respondent is the Republic of India. The various emanations of the
Indian state at issue in this case include:

(a) The Prime Minister of India, who is the head of the Union
Government, head of the executive branch, and the chief advisor to
the President (who is the head of state). The Prime Minister is also
the Minister of Space. The current Prime Minister is Dr.
Manmohan Singh, member of the Congress Party and leader of the
current government (of which the Congress Party is the senior
coalition partner), who has held this office since 2004.

(b) The Office of the Prime Minister of India ("PMO"), which
includes the Prime Minister's staff.

(c) The Union Cabinet, or the Union Council of Ministers, a core
decision-making body of the Indian government that is comprised
of 35 ministers.

(d) The Indian Cabinet Committee on Security ("CCS"), a select
Cabinet committee that, among other matters, "deal[s] with all
Defence related issues", "issues relating to law and order, and
internal security" and "economic and political issues impinging on
national security."¹⁹ It is composed of the Prime Minister, the
Minister of Home Affairs, the Minister of External Affairs, the
Minister of Finance, and the Minister of Defense.²⁰

¹⁸ Dr. Rajendra Singh, an inventor, developer, entrepreneur and investor, is well- ↩
known within the wireless communications field. He is an expert in integrated satellite
systems and has been heavily involved in the development of ATC/CGC and interference
cancellation technology. Telcom Ventures has invested in numerous wireless and
satellite communications companies, including XM Satellite Radio and Aether Systems.
See Singh ¶¶ 2-19.

¹⁹ Composition and Functions of the Cabinet Committees (as on 30.08.2011) at 7-8, ↩
available at http://cabsec.nic.in/archive.php (viewed June 12, 2013) (Ex. C-148).

²⁰ (Id. at 7.) During 2011, the members of the CCS were Prime Minister Manmohan ↩
Singh, Minister of Finance Mr. Pranab Mukherjee, Minister of Defense Mr. A.K. Antony,
(cont'd)

[Page 12]

(e) The Indian Space Commission (the "Space Commission"), which
"formulates the policies and oversees the implementation of the
Indian space programme to promote the development and
application of space science and technology for the socio-
economic benefit of the country."²¹ The Space Commission is
composed of appointees from across the Indian government,
including the Minister of State, the National Security Advisor (who
reports to the Prime Minister), the Cabinet Secretary, the Principal
Secretary to the Prime Minister, the Secretary for Economic
Affairs in the Ministry of Finance, the Secretary Department of
Expenditure, Secretary to the Government of India, and senior
directors of ISRO centers.

(f) The Department of Space ("DOS"), the government department
responsible for the development of India's space policy and the
implementation of the decisions of the Space Commission. Since
its establishment in 1972 under Prime Minister Indira Ghandi,
DOS has formed part of the Prime Minister's portfolio and has
reported to the PMO.²²

(g) The Indian Space Research Organization ("ISRO"), a body of the
Indian Government under the direction of DOS and the Space
Commission that engages in research and testing in order to
encourage the "rapid development of activities connected with
space science, space technology and space applications" with
"responsibility in the entire field of science and technology of
outer space."²³ ISRO builds, launches, operates and leases
satellites for various uses, including telecommunications,
television and radio broadcasting.²⁴

(h) Antrix, a corporation wholly owned by the Indian government²⁵
that is under the administrative control of DOS that purports to

(cont'd from previous page)
Minister of Home Affairs Mr. P. Chidambaram and Minister of External Affairs Mr. S. M.
Krishna. (Id.)

²¹ ISRO Website, "Introduction, About ISRO, Indian Space Research Organization," ↩
available at http://www.isro.gov.in/isrocentres/bangalore_departmentofspace.aspx
(viewed June 12, 2013) (Ex. C-190).

²² See Prime Minister's Website, "PM's Team, Prime Minister of India," available at ↩
http://pmindia.nic.in/pmsteam.php (viewed June 12, 2013) (Ex. C-189).

²³ See Chaturvedi Rep. at 2-3 ¶¶ 1.4-1.5 (Ex. C-137). ↩

²⁴ Id. at 17-19 ¶¶ 2.16-2.18.1. ↩

²⁵ See Antrix Corp. Ltd., Articles of Association (Ex. C-2). ↩

[Page 13]

operate as the commercial marketing arm of ISRO and DOS.
Antrix was created to promote the commercial exploitation of
India's space program. Antrix is expected to seek out "[v]enture
capital funding" from private partners and to promote the transfer
of technology from such commercial entities to ISRO²⁶ in order to
develop India's space-related, industrial capabilities.²⁷ Among
other things, Antrix leases transponder capacity on its satellites to
companies that provide satellite communications and broadcasting
services.²⁸

(i) The Additional Solicitor-General, one of the law officers of the
Republic of India who represents the Government in the Supreme
Court and provides it with legal advice. The highest legal officer
in India is the Attorney General, who holds a constitutional post.
By statute, the Attorney General is assisted by the Solicitor-
General of India (the second highest law officer in India), who in
turn is assisted by Additional Solicitors-General. In 2010,
Additional Solicitor-General Mohan Parasaran issued the legal
opinion suggesting that DOS/ISRO/Antrix manufacture a force
majeure event in an effort to justify termination of the Devas
Agreement. (See infra ¶¶ 91, 95-101.) Mr. Parasaran has since
been promoted to Solicitor-General.²⁹

29. The relationship among certain of these emanations within the Indian state
is depicted in the graphic below, which has been reproduced from the ISRO website:³⁰

²⁶ See Chaturvedi Rep. at 7-8 ¶¶ 1.11-1.13 (Ex. C-137). ↩

²⁷ Antrix Corp. Ltd., Company Brochure at 9 (Ex. C-192). ↩

²⁸ Id. at 5. ↩

²⁹ See Ministry of Law and Justice, "List of Law Officers," ↩
http://lawmin.nic.in/la/lawofficers.htm (viewed June 24, 2013) (Ex. C-181).

³⁰ Ex. C-190 (http://www.isro.org/scripts/Aboutus.aspx; "Click here for ↩
Organisation Chart").

[Page 14]

Figure 1³¹

[Image of an organizational chart]

Prime Minister
Space Commission
Department of Space

PRL NARL NE-SAC SCL IIST

ISRO

ANTRIX

VSSC LPSC SDSC-SHAR ISAC NRSC SAC
IISU DECU MCF ISTRAC LEOS IIRS

NRSC: National Remote Sensing Centre PRL: Physical Research Laboratory
NARL: National Atmospheric Research Laboratory NE-SAC: North Eastern Space
Applications Centre SCL: Semi-Conductor Laboratory ISRO: Indian Space Research
Organisation Antrix: Antrix Corporation Limited VSSC: Vikram Sarabhai Space Centre
LPSC: Liquid Propulsion Systems Centre SDSC: Satish Dhawan Space Centre ISAC: ISRO
Satellite Centre SAC: Space Applications Centre IISU: ISRO Inertial Systems Unit
DECU: Development and Educational Communication Unit MCF: Master Control Facility
ISTRAC: ISRO Telemetry, Tracking and Command Network LEOS: Laboratory for
Electro-optic Systems IIST: Indian Institute of Space Science and Technology IIRS: Indian
Institute of Remote Sensing

30. At all times relevant to this dispute, the Space Commission, DOS, ISRO
and Antrix operated in an integrated manner, with the same person serving as the
Chairman of the Space Commission, Secretary of DOS, Chairman of ISRO, and
Chairman of Antrix. Specifically, Dr. K. Kasturirangan served in these positions until
August 2003; he was succeeded by Dr. G. Madhavan Nair, who served in these positions
from September 2003 to October 2009; and from November 2009 until around July 2011,
these positions have been held by Dr. K.R. Radhakrishnan, who worked closely with Dr.
Nair prior to assuming these roles.

³¹ The Prime Minister thus maintains direct control over, and is kept apprised of ↩
activities and developments related to, the whole space program. This structure also
ensures that Antrix has access to all ISRO technologies and information about its
commercial capabilities. (See Chaturvedi Rep. at 43 ¶ 4.3 (Ex. C-137).)

[Page 15]

31. As discussed further below, Dr. Radhakrishnan figures prominently both
in the inducement of and the ultimate destruction of Claimants' investments.

B. Overview of Claimants' Investments in India

32. As noted above, this case concerns Claimants' investments in India, made
through their equity investments in Devas, an Indian company.³² As the Chaturvedi
Report recognized, Devas was a "state-of-the-art communication infrastructure."³³ It was
designed to enable Devas to provide audio-visual broadcast and broadband wireless
access services to users throughout India using an integrated system of satellites and
terrestrial networks.

33. In order to bring the Devas venture to fruition, Devas sought partners that
could provide both capital and expertise in satellite and terrestrial communications
systems. CC/Devas and Telcom Devas, as affiliates of Columbia Capital and Telcom
Ventures, respectively, both had valuable experience investing in and operating satellite
and telecommunications ventures.³⁴ Indeed, Devas's proposed hybrid satellite-terrestrial
system utilized technological innovations pioneered by Dr. Rajendra Singh, one of
Telcom Devas's representatives on the Devas board and a founder of Telcom Ventures.

³² Devas was incorporated in Karnataka, Bangalore, India on December 17, 2004, ↩
with its registered office at 2nd Floor, Prema Gardenia, 357/6, 1st Cross, I Block,
Jayanagar, Bangalore, India. Devas Multimedia Private Limited, Certificate of
Incorporation (Ex. C-14).

³³ Chaturvedi Rep. at 22 ¶ 3.1.2 (Ex. C-137). ↩

³⁴ Another shareholder in Devas is Deutsche Telekom Asia Pte. Ltd. ("DT Asia"), a ↩
subsidiary of German telecom company Deutsche Telekom AG ("DT"). We understand
that DT has sent the Government of India a request for amicable settlement, a potential
pre-cursor to UNCITRAL arbitration under the Germany-India bilateral investment treaty.

[Page 16]

34. In addition to their expertise, Claimants invested significant amounts of
capital in Devas. The cash infusions from the "Series A" and "Series B" investments
made by CC/Devas and Telcom Devas in 2006 and 2007 enabled Devas to make its
upfront capacity reservation fee payments to Antrix for the building of the satellites under
the Devas Agreement.³⁵ DEMPL acquired its stakes beginning in 2009.³⁶

35. As of today's date, July 1, 2013, Claimants' respective shareholdings in
Devas are:

(a) CC/Devas holds 15,730 Class A Rs. 10/- Equity Shares, 11,978
Class B Rs. 10/- Equity Shares, 525 Class C Rs. 10/- Equity Shares
and 3,116 Class D Rs. 10/- Equity Shares in Devas, representing
17.06% of issued share capital as at 2011 and today;

(b) DEMPL holds 6,402 Class D Rs. 10/- Equity Shares in Devas,
currently representing 3.48% of issued share capital as at 2011 and
today; and

(c) Telcom Devas holds 15,730 Class A Rs. 10/- Equity Shares,
11,978 Class B Rs. 10/- Equity Shares, 525 Class C Rs. 10/-
Equity Shares and 3,116 Class D Rs. 10/- Equity Shares in Devas,
currently representing 17.06% of issued share capital as at 2011
and today.

36. Claimants' investments were duly approved by the Foreign Investment
Promotion Board ("FIPB") of India.³⁷

³⁵ See also infra ¶ 65. ↩

³⁶ See infra ¶ 74. ↩

³⁷ See Submission for Issuance and Allotment of Shares at 3 (June 11, 2009) (chart ↩
setting forth FIPB approval history) (attachment to Letter from Ministry of Finance, FIPB
Unit (Saxena) to Devas (Sept. 29, 2009)) (Ex. C-82); see also Exs. C-33, C-49, C-51, C-
55 & C-78 (various approval letters from FIPB).

[Page 17]

C. The Establishment of Devas's Business

1. Overview of the Devas System

37. As noted above, Devas's business involved the establishment of an
integrated satellite-terrestrial communications system³⁸ that would enable Devas to
deliver video, multimedia and information services across India to mobile users. A
hybrid satellite-terrestrial system provides advantages over a satellite-only
communications system because, with the latter, the "end-user" on the surface of the earth
must have a direct line of sight to the satellite in order to send and receive radio signals.
When a direct line of sight is not possible, such as in urban and developed areas where
most mobile users are located, or in hilly or mountainous areas, the radio signal will be
blocked or degraded.³⁹

38. Beginning in the 1990s, technology pioneered by Dr. Rajendra Singh and
others was developed to use "satellite transmission . . . augmented by terrestrial
transmission so as to reuse [satellite] signals seamlessly."⁴⁰ Terrestrial transmission was
accomplished by building a series of Complementary Ground Component ("CGCs")⁴¹ on
the surface of the earth, often towers, that use the same frequencies as the satellites and
transmit, receive, and augment such signals between the satellite and the end-user and
vice versa. As the Suresh Report acknowledged, the Devas Agreement was a "significant

³⁸ (See Suresh Rep. at 8 § 5; id. at 15 § 14(i); id. at 16 § 15; see also id. at 10 § 8; 16 ↩
§ 15 (Ex. C-94).) The Devas Agreement contemplated bringing this cutting edge,
"evolving" technology into India. (See Chaturvedi Rep. at ii ¶ 5; see also id. at 29 ¶¶
3.2.7.1-3.2.8; id. at 41 ¶ 3.7.2 (Ex. C-137).)

³⁹ Viswanathan ¶¶ 30-31. ↩

⁴⁰ Suresh Rep. at 8 § 5 (Ex. C-94); accord Singh ¶ 16. ↩

⁴¹ In the United States, these are referred to as Ancillary Terrestrial Components ↩
("ATC"). (See Parsons ¶ 8.)

[Page 18]

step for bringing a new satellite based service to India."⁴² Under the Devas Agreement,
ISRO was responsible for developing the satellite segment (by building and launching the
two satellites), and Devas was responsible for developing the terrestrial segment by,
among other things, building out the CGC elements of the network.⁴³

39. As noted above, Devas was positioned through this plan to offer two main
services: BWA and AV.⁴⁴ Devas planned to offer BWA service in all urban areas with
populations greater than 200,000 people. The AV service was to be offered nationwide,
including in rural areas where users would have direct line-of-sight to the satellite(s).

40. Prior to launching service in any city, Devas planned to build a terrestrial
network. This would entail building a network of AV towers (also called "repeaters"),
sufficient to cover the geographic area of the city, that would receive content from the
satellites for a fixed number of AV channels and re-transmit it to users' mobile terminals.
The BWA network similarly would consist of a network of towers sufficient to cover the
geographic area of the city, with additional towers added over time to support a growing
subscriber base. Data centers/hubs would transmit internet content to the BWA towers,

⁴² Suresh Rep. at 16 § 15 (Ex. C-94). ↩

⁴³ See Chaturvedi Rep. at 23 ¶ 3.1.4.1 (confirming that, on the recommendation of ↩
the Shankara Committee, "it was only appropriate that ISRO confines itself to leasing of
transponders rather than getting involved in a full-fledged Joint Venture.") (Ex. C-137).

⁴⁴ DVB-SH stands for "Digital Video Broadcasting - Satellite to Handheld," and is a ↩
system architecture specifically developed for transmitting content to mobile devices in
hybrid satellite-terrestrial systems. (See Parsons ¶ 20.)

[Page 19]

which would then communicate the internet content to subscribers. The towers and hubs
would be physically connected via fiber (or microwave links) to the internet.⁴⁵

41. As a practical matter, no other operator could use the S-band spectrum that
had been allocated to Devas under the Devas Agreement while it was being used by
Devas.⁴⁶ This is because uncoordinated use of the same spectrum by another operator
could cause significant interference or "static" leading to degraded system performance or
the total unavailability of the service. The interference could be in either direction, from
terrestrial transmitters into receivers seeking to capture the signal from the satellite, or
from the satellite transmitter into terrestrial receivers seeking to capture signals from
terrestrial transmitters.⁴⁷

42. Owing much to Claimants' significant injections of capital and assistance
in designing and building Devas's hybrid satellite-terrestrial system, Devas was in a
position by January 2010 to begin to deliver⁴⁸ – as soon as ISRO launched PS1 – its
Devas Services throughout India, thereby meeting the growing untapped demand in India
for mobile media, entertainment, interactive and data services.

2. The Devas Agreement

43. The Devas Agreement, formed in January 2005, was the foundation of the
Devas project and central to Claimants' investments in India.

⁴⁵ By the time Antrix purported to terminate the Devas Agreement, in February ↩
2011, technology had advanced such that Devas would not have had to build separate AV
towers, but could have used the BWA towers alone. (See Parsons ¶ 21.)

⁴⁶ See Lewis ¶¶ 18, 77; Viswanathan ¶ 34. ↩

⁴⁷ Lewis ¶¶ 18, 77; accord Chaturvedi Rep. at iii ¶ 7 ("Any other MSS use in the band ↩
would not be as efficient due to interference of signals.") (Ex. C-137). On its own, this
was an extremely valuable aspect of the Devas Agreement.

⁴⁸ See Viswanathan ¶¶ 144-147. ↩

[Page 20]

44. Under the Devas Agreement, which was signed by Antrix as the
"marketing arm" of ISRO, Devas received a lease of 70 MHz of space segment capacity
in the S-band ("Leased Capacity"), on two Indian satellites to be built, launched and
operated by ISRO ("PS1" and "PS2"). Antrix/ISRO had two primary obligations: (1) to
manufacture/build, launch and operate a primary and secondary satellite system (PS1 and
PS2) that would be the basis for a hybrid satellite-terrestrial Devas System; and (2) lease
transponder capacity in the S-band on these satellites to Devas for the same purpose.⁴⁹

45. It was also agreed that 90% of the total bandwidth on the satellites was
allocated to Devas, and the other 10% was allocated to DOS.⁵⁰

46. Under the Devas Agreement, Devas was required to pay Antrix an upfront
capacity reservation fee of the INR equivalent of USD 20 million to reserve transponder
capacity on the first satellite.⁵¹ Within 30 months of payment of the first installment of
that fee (with a 6-month grace period), ISRO was required to deliver a fully operational
and ready PS1.⁵² This deadline included in-orbit testing and verification by Devas.⁵³
Under the agreement, Devas had the option (which it exercised) to lease S-band capacity
on a second satellite (PS2) that was also to be built and launched by ISRO.⁵⁴ Devas had
to pay an upfront capacity reservation fee of the INR equivalent of USD 20 million to

⁴⁹ Devas Agreement at 2 § 2 & 9-10 § 12 (Ex. C-16). ↩

⁵⁰ See Viswanathan ¶ 196; accord Chaturvedi Rep. at ii ¶ 5 (noting that "Devas ↩
Agreement" provided for transponder leasing to Devas for 90% of the satellite
transponder capacity in S-band) (Ex. C-137).

⁵¹ Devas Agreement at 2 § 3(b) & Ex. B (Ex. C-16). ↩

⁵² Id. at 2 § 3(b); see also id. at 9-10 §§ 12(a)(ii), 12(a)(iii). ↩

⁵³ Id. ↩

⁵⁴ Id. at 4-5 § 4 & Ex. B. ↩

[Page 21]

reserve transponder capacity on the second satellite as well. In addition to these upfront
fees, Devas also was required to pay Antrix an ongoing annual lease fee for the
transponders of the INR equivalent of USD 9 million, rising to the INR equivalent of
USD 11.25 million once Devas became cash flow positive.⁵⁵

47. Antrix was obligated to acquire "all necessary Governmental and
Regulatory Approvals relating to orbital slot and frequency clearances, and funding for
the satellite to facilitate DEVAS services."⁵⁶ Antrix further undertook "through
ISRO/DOS" to obtain clearances of all relevant international and national agencies,
including the WPC and the ITU, for the orbital slot and frequency resources required to
support the Leased Capacity,⁵⁷ and to "provide appropriate technical assistance to Devas
on a best effort basis for obtaining required operating licenses and Regulatory Approvals
from various ministries so as to deliver DEVAS services via satellite and terrestrial
networks."⁵⁸

48. The Devas Agreement provided that the "Leased Capacity" would be a
"Non-Preemptible service, except as specifically provided for in Article 7,"⁵⁹ a condition
that precluded the space segment capacity from being used or repurposed for use by
another party during the life of the satellite (unless Devas was in default of its

⁵⁵ Id. at 4 § 4, & Ex. B; see also Chaturvedi Rep. at 35 ¶ 3.5.5 (noting that Devas ↩
was expected to become cash positive around the sixth year of operation) (Ex. C-137).

⁵⁶ Devas Agreement at 2 § 3(c) (Ex. C-16). ↩

⁵⁷ Id. at 9 § 12(a)(ii). ↩

⁵⁸ Id. at 2 § 3(c). ↩

⁵⁹ Article 7 of the Devas Agreement relates to termination of the Devas Agreement. ↩

[Page 22]

obligations).⁶⁰ The Devas Agreement thus gave Devas the exclusive right to the Leased
Capacity.

49. The parties to the contract were required "to discharge their obligations in
utmost good faith."⁶¹

50. Devas could assign the Leased Capacity at its sole discretion upon sixty
days advance notice to Antrix.⁶² This enabled Devas to undertake a range of transactions
with investors, from a simple stock sale to a joint venture, at any time during the life of
the contract, without forfeiture of the Leased Capacity. From an investment perspective,
this right was viewed as important by the Claimants.⁶³

51. Upon expiration of the Lease Term of 12 years, the lease would be "put up
for renewal . . . for another twelve (12) years, at Lease Fees to be mutually agreed
upon."⁶⁴ Devas and Antrix later agreed by amendment that such fees would be
"reasonable."⁶⁵

52. The Devas Agreement provided for "Delay Damages" of USD 416,666
monthly (for a cap of USD 5 million after 12 months of delay) if Antrix failed to deliver
PS1 within three years of the first upfront capacity reservation payment. It also provided

⁶⁰ Devas Agreement at 2 § 2 (Ex. C-16). ↩

⁶¹ Id. at 15 § 21. ↩

⁶² Id. at 14 § 17. ↩

⁶³ Singh ¶ 30; Gupta ¶ 15. ↩

⁶⁴ Devas Agreement at 4 § 3(1) (Ex. C-16). ↩

⁶⁵ Amendment No. 1 to Agreement No. ANTX/203/DEVAS/2005 (July 27, 2006) ↩
(Ex. C-37).

[Page 23]

that the failure to deliver PS1 within one more year, i.e. four years from the first payment,
would be a material breach of the agreement.⁶⁶

53. Article 11 of the Devas Agreement provides that neither Devas nor Antrix
was "liable for any failure or delay in performance of its obligations" in the event of a
"Force Majeure." As specified in the Agreement, a force majeure event was limited to
matters "beyond the reasonable control of the party affected" and that prevented
performance "despite all efforts of the Affected Party to prevent it or mitigate its
effects."⁶⁷ As discussed further below, the eventual declaration of force majeure by
Antrix (premised upon a February 2011 Union Cabinet "policy decision") was improper
because it was purposefully procured by Antrix/ISRO/DOS in an effort to extricate
Antrix from the Devas Agreement. (See infra ¶¶ 178-184.)

D. The Devas Project Is Fully Endorsed by Indian Officials

54. The Devas project was fully endorsed by the Indian government from its
inception. Indeed, the history of the investment shows that the Devas Agreement was
carefully considered prior to the execution of the contract, and approved after officials

⁶⁶ Devas Agreement, Ex. B at B3 § 2.1.2.2 (Ex. C-16); see also Chaturvedi Rep. at ↩
35 ¶ 3.5.3 (Ex. C-137).

⁶⁷ Devas Agreement at 8-9 § 11(b) (Ex. C-16). ↩

[Page 24]

concluded it represented a technically sound⁶⁸ telecommunications system useful for the
Indian market.⁶⁹

55. Negotiations for what was to become the Devas Agreement originated in
talks between Antrix and Forge Advisors LLC ("Forge Advisors"), a U.S. company
headed by Mr. Viswanathan. While these negotiations were underway, in May 2004, at
the direction of the Chairman of ISRO, a High Power Committee was constituted to
review the "technical feasibility, risk mitigation, time schedule, financial and
organisational aspects of this project,"⁷⁰ including "alternate uses for space segment."⁷¹
The Committee was chaired by Dr. K.N. Shankara (the "Shankara Committee"), the then-
Director of the Space Application Center in Ahmedabad, India. The Shankara
Committee "had several detailed discussions" with Forge Advisors concerning the
technology and its viability.⁷² Based on its review, the Shankara Committee concluded
that the contemplated system of "satellite transmission . . . augmented by terrestrial
transmission so as to reuse the signals seamlessly in Indian environment" was not only
"technically sound and reliable" but also "quite attractive."⁷³

⁶⁸ See Suresh Rep. at 15 § 14(i) ("There is absolutely no doubt on the technical ↩
soundness of the digital multimedia services as proposed in this hybrid satellite and
terrestrial system.") (Ex. C-94); see also id. at 8 § 5 ("The [Shankara] committee has
concluded that the concept is technically sound and reliable.").

⁶⁹ See id. at 8 ¶ 5 (noting that the "[Shankara] [c]ommittee also noted that this ↩
proposal of utilising a relatively small spacecraft enabled by innovative collaboration of
space and ground equipment is quite attractive.").

⁷⁰ Id. at 6 ¶ 4; see also Chaturvedi Rep. at 22 ¶ 3.1.3 (Ex. C-137). ↩

⁷¹ Chaturvedi Rep. at 22 ¶ 3.13 (Ex. C-137). ↩

⁷² Id. ↩

⁷³ See Suresh Rep. at 8 § 5 (Ex. C-94). ↩

[Page 25]

56. Based on the recommendations of the Shankara Committee, the Antrix
Board of Directors accepted "in principle" in June/July 2004 a venture to utilize the S-
band for communications across India. Then, in December 2004, after further
discussions with and presentations by Mr. Viswanathan, and discussions within the space
hierarchy, the Antrix Board "approved the draft agreement negotiated with Devas [and
recommended by the Shankara Committee.]"⁷⁴ In December 2004, the Antrix Board
included Dr. Nair, who, as noted above, was at that time the Chairman of ISRO/Space
Commission/Antrix and the Secretary of DOS, as well as Ratan Tata and Jamshyd Godrej,
who were private businessmen and two of three "External" board members.

57. The operative version of the Devas Agreement was signed in January
2005.⁷⁵ Dr. Radhakrishnan has publicly stated that when the Devas Agreement was
signed, it was "putting [the S-band] to the best use at that time."⁷⁶

E. The Indian Cabinet Gives the Go-Ahead for the Satellites,
and the Devas Agreement Becomes Fully Operative

58. Right after the Devas Agreement was signed in January 2005, Devas
formed its core management team, including Dr. M.G. Chandrasekhar, an ISRO veteran
with over 40 years of experience, as chairman of the Board, and established a company
infrastructure, including an office in Bangalore.⁷⁷ In total, the Devas team came to

⁷⁴ Id. at 7 ¶ 4. ↩

⁷⁵ Id. ↩

⁷⁶ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN- ↩
IBN at 15 (Feb. 8, 2011) (Ex. C-125).

⁷⁷ See Viswanathan ¶ 68. ↩

[Page 26]

include individuals with over 450 combined years of experience in the satellite industry
that had launched or operated over 60 satellite systems.⁷⁸

59. Even when announcing the annulment of the Devas Agreement, a senior
Antrix official, Dr. Kasturirangan, gave the highest praise to the Devas team, stating that
the Devas System

is the outcome of a consortium of top designers of communication systems
across the world. Don't think that this is something which is done in the
Indian laboratory. It is a very unique technology which has been
contributed to by some of the best peers in the field. So, that part of it we
have no doubt that [Devas] coordinated itself into creating that system to
provide the best of the technology for this mission.⁷⁹

60. The construction of the satellites specified in the Devas Agreement was
approved by the Union Cabinet. Specifically, in late November 2005, DOS briefed the
full Union Cabinet on its proposal to design, develop and launch GSAT-6/INSAT4-E, a
multi-media mobile satellite system that would be "parked" in the orbital slot 83° E.⁸⁰
This was to be the satellite that would be known as PS1.

61. Following that briefing, on December 1, 2005, the Indian government's
Press Information Bureau formally announced that the Union Cabinet had given its
approval to undertake the design, development and launch of PS1.⁸¹ The Union Cabinet's

⁷⁸ Id. ↩

⁷⁹ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN- ↩
IBN at 15 (Feb. 8, 2011) (Ex. C-125).

⁸⁰ See Modified Coordination Filing for S-band (Ex. C-21). ↩

⁸¹ (Press Information Bureau, Government of India, Cabinet, Multimedia mobile s- ↩
band satellite mission (GSAT-6/INSAT 4-E) (Dec. 1, 2005) (Ex. C-19).) Although media
reports (and certain government officials) have suggested that the Union Cabinet was
misled about the Devas Agreement because the Devas Agreement was not specifically
identified by DOS in the Cabinet Note concerning GSAT-6, the government's own
reports acknowledge that it is official practice not to identify the commercial end-user of
(cont'd)

[Page 27]

approval of this satellite was fully in line with the stated objectives of the Indian
government. For at least five years, the official policy of the Indian government had been
that DOS/ISRO/Antrix would seek partnerships with private industry, in order to bring
financial and intellectual capital into the space industry and the country.⁸²

62. By its terms, Devas Agreement became effective once Antrix notified
Devas that Antrix was in receipt of all required approvals for the Devas System.⁸³ This
happened on February 2, 2006, when Antrix issued a letter informing Devas that it had
obtained the necessary frequencies and orbital slots for satellite operations:

Antrix Corporation is pleased to inform you that it has received the
necessary approval for building, launching, and leasing the capacity of
S-band satellite, henceforth officially designed as INSAT-4E.

As per the Agreement signed with Devas, Antrix is responsible for
getting the national and international frequency coordination for the
operation of INSAT-4E satellite at the designated orbital slot. In this
connection it may please be noted that the S-band frequencies of the
INSAT-4E satellite are within the spectrum in use for satellite
applications in India by DOS/ISRO, for which we had completed the
necessary ITU level co-ordination and registration. DOS/ISRO have
taken the necessary additional steps to enable registration of
applicable parameters for INSAT-4E operation.

Antrix is now in a position to go ahead with the building and launch of
the INSAT-4E spacecraft and lease the capacity on the same to Devas
Multimedia Pvt. Ltd., as per Agreement No.
Antrix/2003/DEVAS/2005 dated 28 January 2005.⁸⁴

(cont'd from previous page)
satellite spectrum in such Cabinet notes. (See Suresh Rep. at 8 § 6 (Ex. C-94);
Chaturvedi Rep. at 39 ¶ 3.6.1(a) (Ex. C-137).) As was later reported, the Space
Commission approved the building of GSAT-6A (or the PS2 satellite in the Devas
Agreement) in October 2009. (Id. at 27 ¶ 3.1.12.)

⁸² See Viswanathan ¶ 28. ↩

⁸³ Devas Agreement at 17 § 27 (Ex. C-16). ↩

⁸⁴ Letter from Antrix (Murthi) to Devas (Viswanathan) (Feb. 2, 2006) (Ex. C-24). ↩

[Page 28]

63. The Devas Agreement thus became "effective" as of February 2, 2006.⁸⁵
This also provided confirmation to Devas and its prospective foreign investors, namely
Claimants, that the Indian government was fully behind the Devas Agreement.

64. After the Devas Agreement became effective, the Indian government
worked continuously to protect the rights in the 83°E orbital slot at meetings at the ITU,
including at a meeting of the ITU in 2007, in which India secured a "grandfathered" right
to use higher allowable amounts of power in a satellite beam operating in the S-band than
could be used by other countries in the world.⁸⁶ The enhanced power was a feature of the
Devas System architecture, and thus this act demonstrated India's commitment to the
launch of the Devas System.⁸⁷

F. Devas Raises Capital from Claimants and Deutsche Telekom
and Further Develops Its Hybrid Satellite-Terrestrial System

65. Claimants CC/Devas and Telcom Devas made a first round investment of
approximately USD 7.5 million each in May 2006,⁸⁸ which Devas used to pay the first
installment of the upfront capacity reservation fee for PS1 under the Devas Agreement.⁸⁹
In June 2007, Claimants CC/Devas and Telcom Devas each made a second round

⁸⁵ Chaturvedi Rep. at 26 ¶ 3.1.11.1 ("The contract, thus, became effective from [2^nd ↩
February 2006].") (Ex. C-137); Suresh Rep. at 7 (similar observation) (Ex. C-94).

⁸⁶ See Lewis ¶ 68. ↩

⁸⁷ Viswanathan ¶¶ 94-95. ↩

⁸⁸ Share Subscription Agreement (Mar. 16, 2006) (Ex. C-31); Devas Multimedia ↩
Private Limited, Minutes of the 13th Meeting of the Board of Directors (May 19, 2006)
(Ex. C-34).

⁸⁹ Letter from Devas to Antrix, with enclosed check (June 21, 2006) (Ex. C-35). ↩

[Page 29]

investment of approximately the same amount, which Devas used to pay the first
installment of the upfront capacity reservation fee for PS2.⁹⁰

66. In April 2007, Devas obtained a pre-existing "internet service provider"
("ISP") license by acquiring Manipal Software Pvt. Ltd.⁹¹ Devas subsequently was
granted an ISP license in its own right in August 2008, which permitted it to deliver
internet and related services throughout India.

67. In March 2008, after a period of due diligence, DT Asia signed a Share
Subscription Agreement.⁹² The investment by DT Asia, which closed in August 2008,
gave Devas approximately USD 75 million of additional capital as well as access to DT
experts in building terrestrial telecommunications networks, as well as to DT's preferred
suppliers and pricing.⁹³

68. In April 2008, Devas and Antrix officials and personnel, including, in
certain instances, Mr. Gary Parsons and Mr. Larry Babbio of Devas and Mr. K.R.
Sridhara Murthi ("Mr. Murthi") of Antrix, attended the first Design Review of GSAT-6.⁹⁴
During these meetings the technical specifications and progress on the GSAT-6 satellite
were discussed. After April 2008, eight more design reviews were held (with the last in
August 2010).⁹⁵

⁹⁰ Share Subscription Agreement (June 11, 2007) (Ex. C-39); Letter from Devas to ↩
Antrix, enclosing check (June 18, 2007) (Ex. C-40); Singh ¶¶ 39-40; Gupta ¶¶ 20-21.

⁹¹ Viswanathan ¶ 97. ↩

⁹² Share Subscription Agreement (March 19, 2008) (Ex. C-45); Babbio ¶ 23. ↩

⁹³ Viswanathan ¶ 108; Singh ¶ 50. ↩

⁹⁴ Design Review: GSAT-6 (Apr. 16, 2008) (Ex. C-46). ↩

⁹⁵ See Parsons ¶ 39. ↩

[Page 30]

69. In August 2008, Devas secured licenses from various Indian government
ministries to conduct experimental trials.⁹⁶ Having secured such licenses, Devas
conducted successful trials in September 2009 that demonstrated the technological
feasibility of its proposed communications system.⁹⁷ Dr. Radhakrishnan, who would
succeed Dr. Nair as Chairman of ISRO, Secretary of DOS and Chairman of Antrix, was
present at the September 2009 trials.⁹⁸ After the trials, Devas had a celebratory ceremony
at its new office in Bangalore. Both Dr. Nair and Dr. Radhakrishnan were present. Dr.
Radhakrishnan acknowledged the progress of the Devas project and stated that he looked
forward to future collaborations with Devas and Claimants.⁹⁹

G. In 2009, ISRO/Antrix Announces
Delays in Delivery of the Satellites

70. Under the Devas Agreement, Antrix was obligated to launch PS1/GSAT-6
by December 2008 (or, within the 6-month grace period, by June 2009).¹⁰⁰

71. On April 11, 2009, members of the Devas team, including Dr.
Chandrasekhar and Mr. Venugopal, met with senior Antrix and ISRO officials, including
Mr. V.R. Katti, ISRO's Program Director of GEOSAT (and a Devas Board Member) and

⁹⁶ Viswanathan ¶¶ 120-26; see also GSAT 6A Spacecraft Project Report (July 2009), ↩
§§ 1, 3 (GEOSAT Programme Management Office of ISRO Satellite Center noting that
GSAT-6A's "services . . . will be used by DEVAS Multimedia Pvt., Ltd. and Antrix
Corporation of ISRO similar to GSAT 6" for "multimedia and information service . . .
that will be delivered via satellite and terrestrial systems using fixed, portable and mobile
receivers including mobile phones") (Ex. C-67).

⁹⁷ Viswanathan ¶¶ 130-33; Singh ¶ 52-54; Gupta ¶ 27; Babbio ¶ 26; Suresh Rep. at ↩
11 § 9 (Ex. C-94).

⁹⁸ See Viswanathan ¶¶ 131-132; Exs. C-70 to C-75 (photographs). ↩

⁹⁹ See Singh ¶ 55; Gupta ¶ 28. ↩

¹⁰⁰ Devas Agreement at 2 § 3(b) (providing that the initial launch date for GSAT- ↩
6/PS1 was to be 30 months from the date of the initial Upfront Capacity Reservation Fee
with a 6 month grace period) (Ex. C-16).

[Page 31]

Antrix Executive Director Mr. Murthi.¹⁰¹ At this meeting, for the first time, Antrix
projected that (despite the contractual deadline of June 2009) the satellites would not be
launched until late 2009 or early 2010. At this meeting, Dr. T.K. Alex, Director of ISAC,
stated that "the schedule projected was realistic" and Mr. Murthi stated that "all efforts
are to be put to retain our right over this important asset [the S-band] by launching the
satellite in time."¹⁰²

72. While this was disappointing to Devas, Antrix Executive Director Mr.
Murthi, confirmed ISRO's intention to accomplish the launch as soon as possible in early
2010.¹⁰³

73. In September 2009, Claimants CC/Devas and Telcom Devas, as well as
DT Asia, made a further capital injection of USD 25 million to purchase additional shares
in Devas, in order to equip Devas with sufficient capital to begin rolling out services as
soon as PS1 was launched in early 2010.¹⁰⁴

74. Also in mid-2009, Devas implemented an "Equity Incentive Plan" for key
employees. As part of that program, as approved by the Indian FIPB, DEMPL (i.e. the
Second Claimant) purchased Class D shares in Devas.¹⁰⁵ It did so through two tranches
in 2009 and 2010, resulting in DEMPL owning 6,402 Class D shares in Devas.¹⁰⁶

¹⁰¹ See Compilation of Presentations made during the Status Review of GSAT-6 and ↩
Minutes of the Review (Ex. C-64); see also Viswanathan ¶ 155.

¹⁰² "Minutes of the Status Review of GSAT 6 held with M/s Devas Multimedia Pvt. ↩
Ltd." at 1 (Apr. 15, 2009) in Compilation of Presentations made during the Status Review
of GSAT-6 and Minutes of the Review (Ex. C-64).

¹⁰³ Id. ↩

¹⁰⁴ Viswanathan ¶¶ 135-37; Singh ¶ 56; Gupta ¶¶ 29-31. ↩

¹⁰⁵ (Viswanathan ¶¶ 138-43; see also Ex. C-82 (FIBP approval for DEMPL ↩
investment).) The directors and executives who participated in the plan were
(cont'd)

[Page 32]

75. Shortly after the experimental trials were held, on November 11 and 12,
2009, Devas held a joint status review with ISRO/Antrix at the ISRO Space Application
Centre in Ahmedabad, India and ISRO Satellite Centre in Bangalore, India, respectively.
At the meetings, Devas was informed that despite significant progress having been made
on PS1, due to certain technical issues, the launch date for PS1 was now projected for
June 2010.¹⁰⁷

76. The pushing back of the launch date for PS1 was not acceptable to Devas.
Thus, at a Board meeting held on December 4, 2009, Devas determined to form a
committee of its Board, headed by Mr. Parsons (who had a great deal of experience in
satellite manufacturing) to supervise the completion of ISRO's building of the
satellites.¹⁰⁸

H. In December 2009, Dr. Radhakrishnan Secretly Orders
a "Comprehensive Review" of the Devas Agreement

77. Outwardly, the Indian Government had given its backing to the Devas
System since its inception and throughout 2009 – notwithstanding the launch delays.
Claimants know now, however, that the Indian government began secretly undermining
the contract (and Claimants' investments) as soon as Dr. Radhakrishnan took over from
Dr. Nair at the end of October 2009.

(cont'd from previous page)
Ramachandran Viswanathan, Paresh Shah, Kari Lehtinen, Gary Parsons, Lawrence T.
Babbio, Jr., George R. Olexa, Ramanaryan V. Potarazu, Rajiv Mahajan, and Vignaraj
Sanmugalingam. (See Viswanathan ¶ 142.)

¹⁰⁶ See Share Subscription Agreement (Sept. 2, 2009) (Ex. C-76); Share Subscription ↩
Agreement (June 15, 2010) (Ex. C-96).

¹⁰⁷ GSAT-6 Overview, presented by V.R. Pratap, Project Director, GSAT-6, ISRO ↩
Satellite Centre, Bangalore at 32 (Nov. 12, 2009) (Ex. C-85); see also Viswanathan ¶ 157.

¹⁰⁸ Parsons ¶ 38. ↩

[Page 33]

78. In this respect, in February 2011, Dr. Radhakrishnan announced publicly
that on December 8, 2009 – for reasons that have yet to be fully explained – he "instituted
a committee with a former member of the Space Commission to have a comprehensive
review of all aspects of [the Devas Agreement]."¹⁰⁹ Dr. Radhakrishnan commissioned Dr.
B.N. Suresh, Director of the Indian Institute of Space and Technology, as assisted by Mr.
SK Jha, the Director of DOS, Mr. S. Sayeenathan, Deputy Director of the Prime
Minister's Office, and Mr. Parameshwara, Director of Business Development (the
"Suresh Committee"),¹¹⁰ to "review and examine the legal, commercial, procedural and
technical aspects related to licensing of spectrum/frequency and leasing of transponders
with reference to Devas Multimedia Contract."¹¹¹

79. The Suresh Committee prepared a report over the course of five months
after "[a]ll applicable documents were . . . scrutinized in detail" and "[d]etailed
discussions were held with Antrix, SCPO and DOS officials on all aspects" of the "legal,
commercial, procedural and technical aspects of th[e] contract."¹¹² As discussed further
below, the Suresh Report found no wrongdoing on the part of Devas, and does not
suggest, much less recommend, that the Devas Agreement should be annulled.¹¹³

I. Antrix Announces Further Delays in the Launch of the Satellites

80. On December 23, 2009, Devas sent a letter to senior management at
Antrix and ISRO expressing Devas's continuing concern about "delays on the delivery

¹⁰⁹ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN- ↩
IBN at 7 (Feb. 8, 2011) (Ex. C-125).

¹¹⁰ Suresh Rep. Encl. 1 (Ex. C-94). ↩

¹¹¹ Id. ↩

¹¹² Suresh Rep. at 3 (Ex. C-94). ↩

¹¹³ Id. at passim. ↩

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schedule of the satellite system" and asked Antrix to "prioritiz[e] . . . the Devas satellite
system" by providing the "resource allocation required to launch the satellites
expeditiously." The letter outlined "Devas['s] . . . significant investments [for] years into
technology development, ground systems development, terminal development, technical
trials, and preparation for commercial operations," and concluded by requesting that
"[t]he Devas senior management along with the investor consortium . . . meet with
Chairman ISRO [Dr. Radhakrishnan], Dr. A. Bhaskaranarayana and [Mr. Murthi] in 4^th
week January or 1^st week of February of 2010 to review the progress & schedule of the
satellite system as well as discuss plans for initiation of commercial services."¹¹⁴ Devas
wanted to meet Dr. Radhakrishnan because, as successor to Dr. Nair and Chairman of
ISRO and Antrix, he was in a position – so Devas thought – to prevent any further delays
by prioritizing the launch of the satellite.¹¹⁵

81. In a letter dated just one week later, on December 30, 2009, Mr. Murthi
reassured Devas that "Antrix/ISRO is putting all efforts to meet the launch schedule of
July 2010," and suggested that the Devas team meet with Dr. Radhakrishnan in the first
week of February 2010.¹¹⁶

82. On February 4, 2010, Dr. Radhakrishnan met with representatives of
Devas and Claimants at ISRO headquarters in Bangalore. At that meeting, even though
Devas stressed (in a presentation) the vital importance of the "[c]ompletion and launch of
GSAT 6 & 6A [i.e., PS1 and PS2] at the earliest," and for PS1, a "launch by no later than

¹¹⁴ Letter from Devas (Viswanathan) to Antrix (Murthi) & ISRO (Bhaskarnarayana) ↩
(Dec. 23, 2009) (Ex. C-87).

¹¹⁵ Viswanathan ¶ 159. ↩

¹¹⁶ Letter from Antrix (Murthi) to Devas (Viswanathan) (Dec. 30, 2009) (Ex. C-88). ↩

[Page 35]

August 2010,"¹¹⁷ Dr. Radhakrishnan would not commit to a July or August 2010 launch
date. Instead, he indicated a new shipment date of September 1, 2010.¹¹⁸ Dr.
Radhakrishnan failed to mention that (as Claimants know) he had already ordered a
"comprehensive review" of the Devas Agreement by the Suresh Committee.

83. Subsequently, after further meetings in the Spring of 2010, Devas became
deeply concerned when ISRO started to de-link the satellite shipment date from the
satellite launch date, suggesting that the launch of PS1 could be even further delayed.

J. Devas Successfully Completes Phase II
Trials in Germany and in China

84. Devas continued with Phase II experimental trials in Germany and China.
These highly successful trials further validated the technical viability of the Devas
System.¹¹⁹

85. Subsequently, on April 21, 2010, Devas made a presentation in Bangalore,
India to the Director of the Satellite Communication and Navigation Programmes
("SCNP") at ISRO. The presentation detailed Devas's accomplishments and progress to
date, including its strategic partnerships with ISRO/Antrix and DT, Claimants, and the
members of its "[i]ndustry [e]cosystem" dealing with virtually every facet of the Devas
System.¹²⁰ It also noted that in addition to Devas's numerous approvals and licenses,

¹¹⁷ Presentation by Devas to Dr. Radhakrishnan at 13 (Feb. 4, 2010) (Ex. C-89). ↩

¹¹⁸ Viswanathan ¶ 161; see also Gupta ¶ 32; Singh ¶ 59. ↩

¹¹⁹ Viswanathan ¶ 162. ↩

¹²⁰ (Presentation by Devas to Director of SCNP, ISRO at 16 (Apr. 21, 2010) (Ex. C- ↩
93); see also Viswanathan ¶ 163; Babbio ¶¶ 18-21.) These vendors included: Tata,
Quippo, Unique Broadband Systems, Axcera, American Tower, TataSky, Star, ZeeTV,
Sequans Communications, DiBcom, Qualcomm, Intel, Quantum, Sasken, LG, Samsung,
HTC, Nokia, Huawei, Alcatel-Lucent, Runcom, Nokia Siemens Networks, and Ericsson.

[Page 36]

Devas had (1) filed intellectual property patents; (2) conducted Phase I trials and adapted
TD-LTE¹²¹ for its system; and (3) designed and tested translator and embedded
terminals.¹²²

K. The Indian Press Begins To Misrepresent the Devas Agreement

86. In late May 2010, a stream of reckless and erroneous allegations began to
appear in the Indian press concerning the Devas Project.¹²³

87. In an attempt to counter any misapprehension from this malicious press
reporting, Devas held numerous meetings with various Indian governmental ministries in
the summer and autumn of 2010.¹²⁴ These meetings explained Devas's history, progress
to date and, most importantly, the substantial benefits Devas would provide to the Indian
people and government. At none of these meetings did any agency or individual,
including the Law Minister (who was later quoted as stating that the Devas Agreement
was "illegal"¹²⁵), express any doubts or concerns about the Devas System; instead, they
appeared to be interested in the potential benefits Devas could have for them.¹²⁶ Nor did

¹²¹ As Mr. Babbio explains, TD-LTE (an acronym for Time-Division Long-Term ↩
Evolution) is a "communication technolog[y] that allow[s] for the wireless delivery of
high-speed Internet service to large geographic areas." Babbio ¶ 19. TD-LTE
technology also allows for VOIP and IPTV services. Id.

¹²² Presentation by Devas to Director of SCNP, ISRO at 17, 18 (Apr. 21, 2010) (Ex. ↩
C-93).

¹²³ Viswanathan ¶ 165. ↩

¹²⁴ Viswanathan ¶ 166; Singh ¶¶ 60-63; Gupta ¶¶ 34, 38-39; see also Devas ↩
Presentation to Sam Pitroda, Advisor to the Prime Minister of India on Public
Information Infrastructure & Innovations (June 10, 2010) (Ex. C-95); Devas Presentation
to Mr. Bhattacharya, Administrator of USO (July 22, 2010) (Ex. C-99).

¹²⁵ India Telecom, Law Ministry says ISRO's 60 MHz spectrum-leasing deal with a ↩
private firm is illegal (Aug. 1, 2010) (Ex. C-100).

¹²⁶ Viswanathan ¶ 167; see Babbio ¶ 31. ↩

[Page 37]

anyone claim that any governmental user had a need for the S-band spectrum that had been allotted to Devas.

L. The Indian Government Takes Covert
Measures To Undermine the Devas Agreement

1. The Suresh Committee Issues Its Report to the Department of Space

88. The Suresh Committee's investigation eventually resulted in a report to Dr. Radhakrishnan dated May 2010¹²⁷ and apparently delivered in June 2010. Although the report made certain suggestions concerning future contractual negotiations by Antrix and ISRO, it did not find any fault with Devas's conduct in reaching the agreement. Nor does the Suresh Report suggest in any way that the Devas Agreement should be annulled. Concerning Devas, it noted, among other things, that "[t]here is absolutely no doubt on the technical soundness of the digital multimedia services as proposed in this hybrid satellite and terrestrial system."¹²⁸

89. The Suresh Report contains a chronology of events which is consistent with the factual summary recorded above:

Figure 2¹²⁹

¹²⁷ Suresh Rep. at 1 (Ex. C-94). ↩

¹²⁸ Id. at 15 § 14(i). ↩

¹²⁹ (Id. at 6-8.) Mr. Viswanathan's witness statement describes same events in greater detail and chronological precision. ↩

[Page 38]

[Page 39]

90. The Suresh chronology ends in December 2009 precisely because, as Claimants now know, that is when Dr. Radhakrishnan, who became Secretary of DOS, Chairman of the Space Commission, Chairman of ISRO and Chairman of Antrix on

[Page 40]

October 31, 2009, initiated a "comprehensive review" of the Devas Agreement and formed the Suresh Committee for this specific purpose.¹³⁰

2. The Space Commission Authorizes
the Annulment of the Devas Agreement

91. Claimants are not aware of the precise chronological sequencing of what happened next in Dr. Radhakrishnan's quest to annul the Devas Agreement. However, it would appear that in June 2010, shortly after receiving the Suresh Committee Report,¹³¹ Dr. Radhakrishnan sought the opinion of the Additional Solicitor-General as to how the Devas Agreement could be annulled. In the ASG Opinion (which was issued to DOS on July 12, 2010 and made public by The Hindu February 11, 2011, see infra ¶ 10), the Additional Solicitor-General described the purpose of the query raised by Dr. Radhakrishnan as being, among other things, to ensure a level playing field for terrestrial users of the S-band Spectrum in India.

92. Without waiting for the opinion of the Additional Solicitor-General, the Space Commission, on July 2, 2010, decided that the "Department [of Space], in view of the priority to be given to nation's strategic requirements including societal ones may take actions necessary and instruct ANTRIX to annul the ANTRIX-DEVAS contract."¹³²

¹³⁰ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 4 (Feb. 8, 2011) (Ex. C-125); see also Chaturvedi Rep. at 43 ¶ 4.1 (Ex. C-137). ↩

¹³¹ Notwithstanding that the Suresh Report found no wrongdoing on the part of Devas and contained no suggestion that the Devas Agreement should be annulled, Dr. Radhakrishnan has stated that the "Conclusion [of that Committee] was the reason for [his] taking up the subject [of the Devas Agreement] to the Space Commission." Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 7. ↩

¹³² Copy of Decisions/Recommendations of the Space Commission in its meeting of July 2, 2010 (emphasis added) (Ex. C-97). ↩

[Page 41]

93. According to Dr. Radhakrishnan, this constituted a determination by the Space Commission that the Devas Agreement should be annulled.¹³³ Indeed, he later called it a "proactive action taken by the Department of Space as part of our internal review process and the action started in December 2009," and emphasized the "very senior members" of the Commission who were involved in the decision,¹³⁴ which included representatives of the Prime Minister's Office.¹³⁵

94. In February 2011, when Dr. Radhakrishan first publicly revealed the fact of the Suresh Report and the July 2, 2010 Space Commission decision, he stated:

Subsequent to the decisions taken by the Space Commission, . . . we started necessary actions for terminating the contract which required extensive consultations with the concerned agencies in the government. Department of Telecommunication, Department of Law and Justice, all included. The idea is to ensure that a contract that has been entered into has to be now terminated without causing much of embarrassment and damage and financial loss to the government.¹³⁶

In other words, having already decided to annul the contract, Dr. Radhakrishan then tried to find a post-hoc legal justification for the decision. This is the antithesis of the promises contained in the Devas Agreement to perform every obligation "in utmost good faith."¹³⁷

¹³³ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 11 (Feb. 8, 2011) (Ex. C-125). ↩

¹³⁴ Id. at 4. ↩

¹³⁵ Id. ↩

¹³⁶ Id. ↩

¹³⁷ Devas Agreement at 15 § 21 (Ex. C-16). ↩

[Page 42]

3. As Secretary DOS, Dr. Radhakrishnan Asks the
Additional Solicitor-General for His Opinion As
To How the Devas Agreement Can Be Terminated

95. Having determined to annul the Devas Agreement, Dr. Radhakrishnan approached Mr. Mohan Parasaran, Additional Solicitor-General of India, for an opinion on how to minimize the damage from the decision that had already been made.¹³⁸

96. On July 12, 2010, the Additional Solicitor-General issued his opinion to Dr. Radhakrishnan on "whether there are justifiable or legal grounds existing for termination of Antrix-Devas contract."¹³⁹ As recorded therein, the Additional Solicitor-General's "[o]pinion ha[d] been sought . . . as to whether Antrix-Devas contract can be annulled by invoking any of the provisions of the contract in order to (i) preserve precious S band spectrum for strategic requirements of the nation and (ii) to ensure a level playing field for other service providers using terrestrial spectrum."¹⁴⁰

97. The Additional Solicitor-General first considered whether termination for convenience was available according to the terms of Article 7(c) of the Devas Agreement. As noted above, however, the Indian Government had already made coordination filings with the ITU specifically to protect orbital slot 83°E and successfully protected the higher PFD limits at that slot.¹⁴¹ In the circumstances, it is not a surprise that the Additional Solicitor-General rejected any notion that Antrix could properly invoke Article 7(c) of the Devas Agreement, stating:

¹³⁸ ASG Opinion (Ex. C-131); see also Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 4 (Feb. 8, 2011) (Ex. C-125) ↩

¹³⁹ ASG Opinion (emphasis omitted) (Ex. C-131). ↩

¹⁴⁰ Id. ↩

¹⁴¹ See supra ¶¶ 62-63. ↩

[Page 43]

The modus of termination has been specified in the agreement in clause 7. But I am afraid that the conditions stipulated in this clause cannot be invoked at this stage for the purpose of terminating the contract.¹⁴²

98. But the Additional Solicitor-General did not leave matters there. Rather, he continued "[t]he only other relevant provision for seeking recourse to terminate the contract under the given factual scenario viz., national needs and change in governmental policies, would be Article 11 of the contract, relating to 'Force Majeure.'"¹⁴³

99. At this point, the Additional Solicitor-General's opinion ran into an inherent contradiction: even though he acknowledged that a force majeure event was "any event, condition or circumstance that is beyond the reasonable control of the party affected" and that the affected party must seek to "prevent or mitigate" the effect of a force majeure event, he nevertheless recommended that DOS/ISRO/Antrix should cause the Government of India to create a force majeure event that would terminate the contract. The Additional Solicitor-General noted that Dr. Radhakrishnan had said in its briefing note that "[t]he governmental policies with regard to allocation of satellite spectrum has undergone a sea change and there has been a tremendous demand for allocation of spectrum for national needs."¹⁴⁴

100. The Additional Solicitor-General went on to provide a road-map for how to concoct a force majeure event, stating:

However, I only wish to add one note of caution. It is always advisable that in the present case, instead of the Department of Space taking a decision to terminate, it would be more prudent that a decision is taken by the [Government of India ("GOI")], as a matter of policy, in exercise of its

¹⁴² ASG Opinion (Ex. C-131). ↩

¹⁴³ Id. ↩

¹⁴⁴ Id. ↩

[Page 44]

executive power or in other words, a policy decision having the seal and approval of the Cabinet and duly gazetted as per the Business Rules of the GOI. That would give a greater legal sanctity to the decision to terminate the contract in as much as the contractual provisions expressly stipulate that for the force majeure event, to disable one of the parties to perform its obligations under the contract, the act must be an act by the governmental authority acting in its sovereign capacity.¹⁴⁵

101. In short, then, the Additional Solicitor-General's opinion expressly states that: (1) annulment of the Devas Agreement was being sought by Dr. Radhakrishnan; (2) terrestrial telecommunications providers sought the same spectrum; and, ostensibly, (3) that the Indian government now had a need for national strategic requirements for the S-band spectrum that had been allocated to Devas, even though no such need was ever expressed to Devas in its many meetings with India's government agencies and officials. On this basis, the Additional Solicitor-General's opinion suggested that Respondent should concoct a force majeure event based on a "policy" decision having the "seal and approval of the Cabinet."

M. Devas Continues To Press For Shipment of the First Satellite, PS1

102. Immediately upon launch of PS1, Devas would have been in a position to commence its A/V broadcasting. In addition, Devas (as the only entity with the right to lease transponder capacity on that satellite, or to use the 70 MHz of S-Band spectrum allocated to it in the Devas Agreement) would, immediately upon launch of PS1, have filed for a WPC license. As the sole holder of the Leased Capacity, as a practical matter, Devas was the only operator capable of using the S-band allocated to it,¹⁴⁶ and because Antrix had promised to assist in obtaining any needed governmental license necessary for

¹⁴⁵ Id. ↩

¹⁴⁶ See supra ¶ 41. ↩

[Page 45]

the Devas System,¹⁴⁷ Devas had every reason to expect to obtain a WPC license promptly, and, indeed, expected to receive such a license for a nominal fee.¹⁴⁸

103. On July 20, 2010, Devas sent a letter to Antrix Executive Director Mr. Murthi, requesting confirmation of the October 2010 PS1 shipment date previously promised to Devas and reminded Antrix and ISRO of their prior representations that the satellite launches would be slated for expedited delivery.¹⁴⁹ Devas also asked for express confirmation that DOS/ISRO/Antrix would "coordinate . . . submittal of Devas operating license application to WPC."¹⁵⁰

104. On September 2, 2010, frustrated by ISRO's inaction, Mr. Viswanathan wrote to all the members of the Space Commission to emphasize the importance of the Devas System to India.¹⁵¹ The letter provided an overview of the Devas System and reminded the Space Commission that, between 2003 and 2005, the period during which the parties negotiated and signed the Devas Agreement, an integrated satellite multimedia system was not on the market.¹⁵²

105. On September 29, 2010 Devas arranged for a meeting with Dr. Radhakrishnan at the annual meeting of the International Academy of Astronautics in Prague and reminded Dr. Radhakrishnan about his assurance in February 2010 that

¹⁴⁷ Devas Agreement at 2 § 3(c) (Ex. C-16) ↩

¹⁴⁸ Viswanathan ¶ 152. ↩

¹⁴⁹ Letter from Devas (Viswanathan) to Antrix (Murthi) (July 20, 2010) (Ex. C-98). ↩

¹⁵⁰ Id. ↩

¹⁵¹ See, e.g., Letter from Devas (Viswanathan) to Shri T. K. Alex, Director ISAC & Member, Space Comm'n (Sept. 2, 2010) (Ex. C-106); Viswanathan ¶ 176. ↩

¹⁵² See, e.g., Letter fom Devas (Viswanathan) to Shri T. K. Alex, Director ISAC & Member, Space Comm'n (Sept. 2, 2010) (Ex. C-106). ↩

[Page 46]

ISRO/Antrix would launch PS1 by September 1, 2010. At the Prague meeting, Dr. Radhakrishnan assured Devas that the PS1 satellite would be shipped in early December 2010.¹⁵³ Amazingly, he did not mention that the Space Commission had already decided to annul the Devas Agreement. Nor did he express any need for the S-band spectrum that had been allocated to Devas.

106. Later, on October 11, 2010, Mr. Viswanathan for Devas sent a letter to Dr. Radhakrishnan, again outlining the appropriate next steps for ISRO/Antrix, namely:

• An expedited Critical Design Review ("CDR") meeting regarding the PS1 satellite, including space and ground compatibility tests;
• That the PS1 satellite launch be prioritized by use of a Russian cryogenic engine;
• That ISRO/Antrix continue to coordinate ITU filings to preserve the Devas System;
• That ISRO/Antrix support and provide assistance with Devas's application to the WPC; and
• That Antrix establish a contract to secure uplink services from ISRO.¹⁵⁴

N. In January 2011, DOS/ISRO/Antrix Sever
Communications with Devas and Claimants

107. The last meeting between Devas and officials of DOS/ISRO/Antrix occurred on January 10, 2011.¹⁵⁵ After that point, the Indian Government cut off communications.

108. For example, on January 24, 2011, Devas wrote to Dr. Radhakrishnan, asking him to confirm Antrix's commitment to launch GSAT-6/PS1 within 3-4 months

¹⁵³ See Singh ¶ 64. ↩

¹⁵⁴ Letter from Devas (Viswanathan) to Chairman, ISRO & Antrix, and Secretary, DOS (Radhakrishnan) (Oct. 11, 2010) (Ex. C-108); Viswanathan ¶ 181. ↩

¹⁵⁵ See Viswanathan ¶ 186. ↩

[Page 47]

and asking for a further meeting "to appraise Devas['s] readiness for service launch and work out further course of actions to launch GSAT 6 at the earliest."¹⁵⁶ Dr. Radhakrishnan did not respond.

109. On January 25, 2011, Devas's Chief Technology Officer, D. Venugopal, sent an e-mail to Antrix Executive Director Mr. Madushudhan, requesting Antrix to "kindly identify urgently a person from Antrix/ISRO for jointly working with Devas on joint evaluation of the procured launch for GSAT-6."¹⁵⁷ Antrix, ISRO and DOS did not respond.

O. The Indian Government Officially Annuls the Devas Agreement

1. In Early February 2011, Dr. Radhakrishnan Announces the
Indian Government's Plan to Annul the Devas Agreement

110. Starting in May 2010,¹⁵⁸ but continuing through February 2011, the Indian press made a series of reckless and erroneous allegations about the Devas Agreement and Claimants' investment. These reports reached new levels of intensity in February 2011, when elements of the press – completely without factual foundation – sought to draw a comparison between the Devas Agreement and a series of wholly unrelated controversies concerning the DOT's grant of spectrum licenses to 2G cellular operators.¹⁵⁹

111. In this overheated (and ill-informed) climate, on February 8, 2011, Dr. Radhakrishnan conducted a press conference together with Dr. Kasturirangan, a senior

¹⁵⁶ Letter from Devas (Viswanathan) to Chairman, Space Commission, Secretary, DOS & Chairman, ISRO and Antrix (Radhakrishnan) (Jan. 24, 2011) (Ex. C-121). ↩

¹⁵⁷ Email from Devas (Venugopal) to Antrix (Madushudhan) (Jan. 25, 2011) (Ex. C-122). ↩

¹⁵⁸ Viswanathan ¶ 165. ↩

¹⁵⁹ See, e.g., Pradeep Thakur, Another spectrum scam hits govt, this time from ISRO, Times of India (Feb. 8, 2011) (Ex. C-126). ↩

[Page 48]

member of Antrix and Member Science, Planning Commission and former Chairman of ISRO/Antrix and Secretary of DOS.¹⁶⁰ At that conference, he announced the government's decision to annul the Devas Agreement.

112. When asked whether the Devas Agreement had officially been terminated, Dr. Radhakrishnan explained that the Space Commission had made the decision to annul the Devas Agreement in July 2010 and that "we are going through the process of consultations [with other parts of the Indian government] for this process."¹⁶¹ He admitted that the government was not able to terminate the contract under its terms and therefore was still in the process of figuring out how to best justify its improper actions:

In any contract, there will be penalty clauses from both sides. And there are damages, there are prohibitions for termination of an agreement from both sides actually. Hence there are force majeure clauses. These are part of any clauses and once you sign a contract, you ensure all these things are in place and when you decide to terminate also you have to ensure that you use the right application of mind about this clause.

So this is the process that is going on.¹⁶²

113. In case it was not already perfectly clear that the government was unable to justify its patently improper annulment, Dr. Kasturirangan, a senior Antrix official, added: "I don't think there is finality of how we want to do this. This is under study. What is the best option . . . ."¹⁶³

¹⁶⁰ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 4 (Feb. 8, 2011) (Ex. C-125). ↩

¹⁶¹ Id. ↩

¹⁶² See id. at 11, 12 (responding to question of "When you [terminate the contract], will ISRO be considered a reliable business partner hereon onwards or are you like any other fly-by-night operator who signs a contract, annuls it under political pressure?"). ↩

¹⁶³ Id. at 12. ↩

[Page 49]

2. The Prime Minister Constitutes the Chaturvedi Committee to
"Review" the Devas Agreement, Taking Into Account the
Decision That Had Already Been Made To Annul the Contract

114. On February 9, 2011, the Indian Prime Minister constituted another committee, this time named the "High Powered" review committee and chaired by B.K. Chaturvedi. The mandate of this committee was the same as for the Suresh Committee (i.e. "review the technical, commercial, procedural and financial aspects of the Agreement"), but this time the committee was required to "tak[e] into account the report of internal review conducted by the Department of Space."¹⁶⁴ The committee also was charged to "review the adequacy of the procedures and approval processes followed by" Antrix, ISRO, and DOS, and to suggest improvements, and again was required to "tak[e] into account the review mandated by the Space Commission at its 117^th meeting, held on 2^nd July, 2010."¹⁶⁵

3. ISRO Announces that the Government
May Take A Policy Decision that Results in
a Force Majeure Under the Devas Agreement

115. On February 10, 2011, as media and political pressure mounted, a memorandum was posted on ISRO's website confirming the Indian government's pre-ordained agenda to terminate the Devas Agreement. Entitled "Background Note on Agreement between M/s. ANTRIX Corporation and M/s. DEVAS Multimedia Pvt. Ltd. regarding lease of space segment capacity," the memorandum stated, inter alia, that:

the Government in exercise of its sovereign power and function may take a policy decision to the effect that due to strategic requirements, it would

¹⁶⁴ Chaturvedi Rep., Cover Letter (March 12, 2011) (Ex. C-137); see also Press Release, Government Appoints High Powered Review Committee on DOS (Feb. 9, 2011) (Ex. C-127). ↩

¹⁶⁵ Chaturvedi Rep., Cover Letter (March 12, 2011) (Ex. C-137). ↩

[Page 50]

not be able to provide orbit slot in S-band for operating PS-1 to ANTRIX for commercial activities. In that event, ANTRIX in terms of Article 7(c) read with Article 11 dealing [sic] with Force Majeure may terminate the Agreement and inform Devas accordingly.¹⁶⁶

116. The next day, on February 11, 2011, The Hindu (an Indian newspaper) published a leaked copy of the Additional Solicitor-General's advice of July 2010, giving the Indian Government a road map on how to annul the Devas Agreement by creating a force majeure event.¹⁶⁷

117. That same day, Devas wrote to Dr. Radhakrishnan, pointing out that his December 2009 decision to "review" the Devas Agreement (as he had stated in his February 8 press conference) without informing Devas was contrary to the provision in the Devas Agreement requiring the parties to act in "utmost good faith."¹⁶⁸ The letter also demanded a full and complete disclosure of all and any issues arising from, and in relation to, the Devas Agreement that might further adversely impact the ability of DOS/ISRO/Antrix to perform the Devas Agreement.¹⁶⁹ Devas also called upon DOS/ISRO/Antrix to refrain from committing any further breaches of the Devas Agreement.¹⁷⁰ Dr. Radhakrishnan did not respond to this letter.

¹⁶⁶ Background Note on Agreement between M/s. ANTRIX Corporation and M/s. DEVAS Multimedia Pvt. Ltd. regarding lease of space segment capacity in S-Band spectrum on ISRO's satellites GSAT-6 and GSAT-6A (Feb. 10, 2011) (Ex. C-193). ↩

¹⁶⁷ ASG Opinion (Ex. C-131); see supra ¶ 10. ↩

¹⁶⁸ Letter from Devas (Viswanathan) to Chairman, Antrix, Chairman, ISRO, Secretary, Department of Space and Chairman, Space Commission (Radhakrishnan) (Feb. 11, 2011) (Ex. C-132); see also Devas Agreement at 15 § 21 (Ex. C-16). ↩

¹⁶⁹ Letter from Devas (Viswanathan) to Chairman, Antrix, Chairman, ISRO, Secretary, Department of Space and Chairman, Space Commission (Radhakrishnan) at 2 (Feb. 11, 2011) (Ex. C-132). ↩

¹⁷⁰ Id. ↩

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118. On the same date, February 11, 2011, Devas (through its Indian counsel, Dua Associates) reminded Antrix of the delay in the delivery of the space segment capacity for the period from June 22, 2009 to June 21, 2010,¹⁷¹ and called upon Antrix to pay forthwith the liquidated amount of Indian Rupees equivalent to USD 5,000,000, as a "Late Delivery Penalty" mandated by paragraph 2.1.2.2 of Exhibit B to the Devas Agreement.¹⁷² No one responded.

119. In light of Antrix's silence, on February 14, 2011, Devas wrote again to Antrix, seeking immediate confirmation whether Antrix intended to honor and abide by the terms of the Devas Agreement.¹⁷³ Devas further informed Antrix that if Devas did not receive a response to the said letter within one (1) week, Devas would invoke Article 20(a) of the Devas Agreement and refer the matter to the senior management of Antrix and Devas for resolution. Yet again, there was no response.¹⁷⁴

4. On February 17, 2011, the Cabinet Committee on Security Makes
a "Policy Decision" Reserving the S-band for "National Needs"

120. In a press release dated February 17, 2011, the Indian Government announced that the Cabinet Committee on Security had decided to "annul" the Devas Agreement.¹⁷⁵ The Law Minister, Mr. M. Veerappa Moily, issued the following statement:

¹⁷¹ Letter from Dua Associates (Sharma) to Antrix (Radhakrishnan) (Feb. 11, 2011) (Ex. C-130). ↩

¹⁷² Id. at 9. ↩

¹⁷³ Letter from Devas (Viswanathan) to Antrix (Radhakrishnan) (Feb. 14, 2011) (Ex. C-133). ↩

¹⁷⁴ See Viswanathan ¶¶ 192-193. ↩

¹⁷⁵ Press Information Bureau, Government of India, Cabinet, CCS Decides to Annul Antrix-Devas Deal (Feb. 17, 2011) (Ex. C-134). ↩

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Taking note of the fact that Government policies with regard to allocation of spectrum have undergone a change in the last few years and there has been an increased demand for allocation of spectrum for national needs, including for the needs of defence, para-military forces, railways and other public utility services as well as societal needs, and having regard to the needs of the country's strategic requirements, the Government will not be able to provide orbit slot in S band to Antrix for commercial activities, including for those which are the subject matter of existing contractual obligations for S band.

In light of this policy of not providing orbit slot in S Band to Antrix for commercial activities, the [Devas Agreement] shall be annulled forthwith.¹⁷⁶

121. It is notable that, while the press release of the Cabinet Committee on Security's "policy" decision conveniently adopted the exact form of the language in the Additional Solicitor-General's Opinion concerning the potential strategic uses for the S-band,¹⁷⁷ it notably left out the other motivation mentioned in the reference to the Additional Solicitor-General: "to ensure a level playing field for other service providers using terrestrial spectrum."¹⁷⁸

122. No one from the Indian government informed Devas or Claimants in advance of this meeting of the Cabinet Committee on Security, or gave Devas an opportunity of presenting objections to the "annulment" of the Devas Agreement.

123. Tellingly, the February 17, 2011 press release does not articulate the "national needs" that supposedly prompted the Cabinet Committee on Security to revoke the use of the S-band for commercial purposes by DOS. The press release itself uses an extremely "catch all" formula, referring to "defence, para-military forces, railways and other public utility services as well as societal needs," as well as "the needs of the

¹⁷⁶ Id. ↩

¹⁷⁷ Id. ↩

¹⁷⁸ ASG Opinion (Ex. C-131). ↩

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country's strategic requirement." At no point in their prior dealings with the Indian Government was it ever suggested to Devas or Claimants that these "needs" might require the annulment of the Devas Agreement.¹⁷⁹ Nor did the Indian Government ever consult with Devas about whether the Devas Agreement needed to be varied or any of the allotted spectrum reassigned, to take into account any of these supposed "needs."

124. The claim of "national needs" also is inconsistent with the Devas Agreement itself. Under the Devas Agreement, DOS/ISRO controlled 10% of the capacity on the satellite, meaning that DOS could have used this spectrum according to whatever "needs" the government saw fit.¹⁸⁰ And, moreover, the mandate of the Shankara Committee, which approved the Devas Agreement before it was signed, was specifically to weigh the Devas Agreement against other "possibilities of alternate uses for [the] space segment."¹⁸¹ The Shankara Committee had concluded that a customer broadcasting system of the type set forth in the Devas Agreement was the optimal use of the S-band, taking into account all competing national needs, and the Union Cabinet in 2005 endorsed this view when it approved the building of the satellites on this basis. This careful policy process stands in sharp contrast to the result-oriented, cynical steps that led to the termination of the Devas Agreement.

125. In addition, as Mr. Parsons explains, he had personally discussed the possibility of the Indian Department of Defense collaborating with DOS to build a state

¹⁷⁹ During meetings held with various governmental officials in the summer of 2010, those government officials appeared satisfied with the societal benefits that the Devas System brought to India. (Viswanathan ¶¶ 165-170.) ↩

¹⁸⁰ See Viswanathan ¶ 198. ↩

¹⁸¹ Chaturvedi Rep. at 22 ¶ 3.1.3 (Ex. C-137). ↩

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of the art satellite system that would function seamlessly alongside the Devas System in the S-band.¹⁸² Remarkably, nobody from DOS or DOD approached him or any other Devas team member before re-taking the S-band spectrum for "national needs."¹⁸³ And since 2011, no reported use of the S-band has been announced by the Indian government for national needs. To the contrary, most recently, a senior advisor to the Prime Minister has suggested that the S-band should be made immediately available to private terrestrial operators.¹⁸⁴

126. The "policy" decision of the CCS thus can be traced not to any "national needs" but to the legal predicament that DOS/ISRO/Antrix found themselves in: unable to terminate the contract for convenience under Article 7, they needed to find a deus ex machina - hence, the manufactured "force majeure" event.

5. Citing the Central Government Decision,
Antrix Terminates the Devas Agreement

127. On February 25, 2011, Antrix issued a letter to Devas, giving notice of "terminat[ion]" of the Devas Agreement.¹⁸⁵ Antrix's February 25, 2011 "termination" notice refers to the purported "policy decision" of February 17, 2011 by the Indian Cabinet Committee on Security, which Antrix claims had the effect of denying Antrix the use of orbital slot in S-band for "commercial activities."¹⁸⁶ On the basis of this alleged "policy decision," Antrix purported to terminate the Devas Agreement "for convenience"

¹⁸² Parsons ¶¶ 36-37, 49-51. ↩

¹⁸³ See id. ¶ 51. ↩

¹⁸⁴ See infra ¶ 137. ↩

¹⁸⁵ Letter from Antrix (Madhusudhan) to Devas (Feb. 25, 2011) (Ex. C-135). ↩

¹⁸⁶ Id. at 1. ↩

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pursuant to Article 7(c) of the Devas Agreement, or, in the alternative, to declare an indefinite force majeure pursuant to Article 11(b)(v) of the Devas Agreement.¹⁸⁷

128. Antrix of course knew that it had no proper basis for terminating for "convenience" pursuant to Article 7(c) because, among other things, the Additional Solicitor-General had specifically and correctly noted that the relevant orbital slot already had been obtained from the ITU.¹⁸⁸ Predictably, therefore, Antrix's notice inserted the further ground of "force majeure" on the basis of the Indian Government's "policy decision," in line with the July 2010 advice of the Additional Solicitor-General.¹⁸⁹

129. Thus, like the Cabinet Committee on Security's earlier decision, the invocation of the force majeure clause, which is expressed in very general terms, adheres closely to the text of the Additional Solicitor-General's Opinion:

[N]otice of force majeure as defined in Article 11, is expressed. The policy decision of the Central Government acting in its sovereign capacity is the event of force majeure which has occurred on 23^rd February 2011. The force majeure event commenced on 23^rd February 2011. The scope and duration of the said decision cannot be anticipated. It is likely to be indefinite. It is not possible for Antrix to take any effective step to resume the obligations under the Agreement. The event of force majeure is beyond the reasonable control of Antrix and is clearly covered by Article 11(b) of the Agreement and, in particular, 11(b)(v) '. . . act of governmental authority [sic] in its sovereign capacity . . . ' Any possibility of resumption of obligations by Antrix under the Agreement stands excluded. The [Devas Agreement] therefore, is terminated with immediate effect.¹⁹⁰

¹⁸⁷ Id. at 2. ↩

¹⁸⁸ See supra ¶ 97. ↩

¹⁸⁹ See supra ¶¶ 98-101. ↩

¹⁹⁰ Letter from Antrix (Madhusudhan) to Devas (Feb. 25, 2011) (Ex. C-135). ↩

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130. Devas responded by: (1) immediately denying the validity of the termination notice¹⁹¹ and (2) attempting, unsuccessfully, to hold a "senior management" consultation in conformity with the pre-dispute procedures in Article 20 of the Devas Agreement.¹⁹²

131. In April 2011, again relying on its claim that the contract was "terminat[ed] . . . under Article 7(c) and the notice of force majeure as defined in Article 11," Antrix tendered Devas a check (for the amount of Rs.58,37,34,000, or approximately USD 13 million) as a purported "reimbursement" of the upfront capacity reservation fees that Devas had already paid to Antrix.¹⁹³

132. Devas rejected this tender on the grounds that the purported cancellation of the contract lacked any justification under these provisions. By letter dated April 18, 2011, Devas explained that Antrix had failed to state a proper basis for terminating the Devas Agreement pursuant to Article 7(c) and that, as a matter of law, Antrix was not entitled to claim force majeure as the events allegedly giving rise to the claim of force majeure were self-induced.¹⁹⁴ Devas returned Antrix's check.¹⁹⁵

¹⁹¹ Letter from Devas (Viswanathan) to Antrix, Chairman, ISRO and Secretary, DOS (Radhakrishnan & Madhusudhana) (Feb. 28, 2011) (Ex. C-136); see also Letter from Antrix (Madhushudhan) to Devas (Apr. 15, 2011) (Ex. C-138); Letter from Devas (Viswanathan) to Antrix (Madhusudhana) (May 30, 2011) (Ex. C-141); Letter from Antrix (Madhusudhana) to Devas (June 15, 2011) (Ex. C-142). ↩

¹⁹² Antrix ignored the request for a senior management meeting and failed to negotiate within the 21-day contractual timeframe established by Clause 20(a). Eventually, a meeting occurred in mid-2011, but failed to produce any resolution. ↩

¹⁹³ Letter from Antrix (Madhushudhana) to Devas (Apr. 15, 2011) (Ex. C-138). ↩

¹⁹⁴ Letter from Devas (Viswanathan) to Antrix (Madhusudhan) (Apr. 18, 2011) (Ex. C-140). ↩

¹⁹⁵ Id. ↩

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6. The Chaturvedi Report Seeks To Justify India's Actions
By Referring to the Fact that Devas Has Foreign Shareholders

133. In March 2011, the High Powered Review Committee issued the Chaturvedi Report.¹⁹⁶ The parts that were released repeatedly stress the fact that Devas shareholders included foreign investors and suggests they somehow received an unduly favorable deal:

The shareholding in Devas and changes in it subsequently have also been a serious cause of concern . . . The original proposal, which had envisaged development and innovation by some former ISRO scientists, seem to have been diluted with the entry of major foreign players. While technically this was permitted, the entry of foreign telecom companies with huge premiums indicated that they had used this as an opportunity for entering the telecom market, which had in the meanwhile expanded rapidly in India during 2005-10. This was not an intended purpose of the original agreement.¹⁹⁷

134. This suggests that the foreign ownership of Devas was a further motivating factor in the Indian government's decision to cancel the Devas Agreement.

7. There Are Calls To Re-allocate the S-band
Spectrum to Other Terrestrial Cellular Companies

135. As discussed above, the Additional Solicitor-General was requested, in 2010, to provide a legal basis for the annulment of the Devas Agreement in part in order to "ensure a level playing field for other service providers using terrestrial spectrum."¹⁹⁸ Indeed, as early as March 2008, the Cellular Operators Association of India ("COAI") had requested, in a submission to the DOT, that India's National Frequency Allocation

¹⁹⁶ See Chaturvedi Rep. at cover page (Ex. C-137). In an effort to justify India's conduct in the court of public opinion, the Indian government published parts of the Chaturvedi Report on February 4, 2012. ↩

¹⁹⁷ Id. at 38 ¶ 3.5.9. ↩

¹⁹⁸ ASG Opinion (Ex. C-131). ↩

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Plan ("NFAP") should re-orient the S-band for terrestrial cellular operations.¹⁹⁹ In its submission, COAI argued that because the "frequency band 2500-2690 MHz [i.e., the S-band] is identified for IMT [International Mobile Telecommunications] applications, therefore [it] . . . should be earmarked as an extension band for terrestrial 3G systems."²⁰⁰

136. The WPC and Telecom Regulatory Authority of India ("TRAI") took up this call by July 2008. TRAI's "Recommendations on Allocation and Pricing for 2.3-2.4 GHz, 2.5-2.69 GHz & 3.3-3.6 GHz bands" (which includes the S-band) was largely focused on the auction specifically entrusted to DOT, including of the 40 MHz held by DOT in the S-band. However, TRAI also recommended that "DoT/WPC should coordinate with the Department of Space (DoS) and ascertain the feasibility of vacation of additional spectrum" in the S-band and further noted that "[t]he results of the efforts made by the WPC to get the required spectrum bands vacated/re-farmed from the incumbents are not available in the public domain."²⁰¹

137. Contemporary media reports from 2011 emphasized that domestic, terrestrial cellular operators were seeking access to the S-band.²⁰² These calls have since

¹⁹⁹ COAI's Proposal for Review of Draft NFAP – 2005 at 3 ("IND 53 A" row) (Ex. C-43). ↩

²⁰⁰ Id. ↩

²⁰¹ Telecom Regulatory Authority of India, Recommendations on Allocation and Pricing for 2.3-2.4 GHz, 2.5-2.69 GHz & 3.3-3.6 GHz bands at 2 ¶ 1.9, 16 ¶ 2.33(i) (July 11, 2008) (Ex. C-50). ↩

²⁰² See T. A. Johnson, Why S-Band Is So Valuable, The Indian Express (Feb. 9, 2011) (noting that "[t]errestrial mobile phone operators have been insisting that the '2.5 -2.69 GHz band (S-Band) be fully preserved as an extension band for 3G services'") (Ex. C-128); India rocks with another scam, Flare (Apr. 15, 2011) ("The key here is the S-band. According to a telecom industry report, the S-band is unique: 'As mobile voice and data traffic increases, wireless operators around the world will require additional spectrum. (cont'd) ↩

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continued.²⁰³ On May 17, 2013, Dr. Sam Pitroda, Prime Minister Singh's Public Information Infrastructure and Innovation Advisor, was quoted in the Indian Press as stating that the "Empowered Group of Ministers," a group of government ministers with power over spectrum allocation, should cause DOS spectrum in the S-band to be used for 4G mobile telephony. According to the article:

Pitroda is of the view that 80 megahertz of airwaves frequencies for 4G services can be freed from the spectrum held by Department of Space (DoS).

"DoS has earlier released 40 Mhz for mobile services. Out of the balance 150 Mhz, as per radio regulations, DoS has no proposal to utilise 80 Mhz. The frequency has been earmarked internationally for 4G/BWA (Wireless Broadband) services," [Pitroda] said.²⁰⁴

P. Devas Brings a Contractual Claim Against Antrix

138. On June 29, 2011, Devas commenced an ICC arbitration against Antrix, entitled Devas Multimedia (Private) Limited v. Antrix Corp. Ltd. (No. 18051/CYK).²⁰⁵ In

(cont'd from previous page)
However, few bands remain available for new allocation to mobile wireless services."") (Ex. C-139).

²⁰³ Eyes on S-Band, Down to Earth (March 15, 2012) (noting that "[m]obile operators have been lobbying for part of this S-band (2.5 - 2.69 GHz) as an extension for 3G services" and that "Sudhir Gupta, principal advisor (mobile services) in TRAI, informs that they have already recommended to the government that a part of S-band be allocated for commercial services like high-speed packet access used in 3G") (Ex. C-170); accord Letter from Deputy Director General, Cellular Operators Association of India (Dua) to Wireless Advisor, WPC (Chandra), Annex. 1 at 3 (Nov. 22, 2010) (requesting that the National Frequency Allocation Plan submit the 2.5-2.69 GHz band, i.e., the S-band, for IMT/3G services) (Ex. C-113). ↩

²⁰⁴ Sam Pitroda asks PM to reactivate GoM on spectrum vacation, The Economic Times (May 17, 2013) (Ex. C-187); see also Katya B. Naidu, PMO backs Pitroda's spectrum use views, Business Standard (May 17, 2013) (Ex. C-186). ↩

²⁰⁵ The Devas Agreement contains a broad arbitration clause providing for disputes to be submitted to arbitration venued in New Delhi, and specifying that "[t]he Arbitration proceedings shall be held in accordance with the rules and procedures of the [ICC] or UNCITRAL." (Devas Agreement at 15 § 20(c) (Ex. C-16).) ↩

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that Notice, Devas appointed V.V. Veeder, Q.C. of the United Kingdom as its arbitrator.²⁰⁶

139. Antrix reacted by seeking to obstruct the ICC arbitration, arguing, in its letter to the ICC of July 11, 2011, that Devas's notice of arbitration was invalid and that

to invoke the arbitration proceedings the parties first need to exhaust the remedy provided in Clause 20(a) [meetings of managers] and thereafter arrive at [a] mutual agreement selecting the arbitration rules to be applied to an arbitration in accordance with Clause 20(c) of the Agreement before issue of a notice of arbitration.²⁰⁷

140. Thus, on Antrix's absurd (and eventually unsuccessful) argument, the arbitration clause in Clause 20 was not a manifestation of consent to arbitration, and no recourse to the ICC rules was permissible unless it (Antrix) gave a further, post-dispute consent to ICC arbitration.²⁰⁸

141. In August 2011, acting on this basis, Antrix commenced a proceeding in the Supreme Court of India for injunctive relief to restrain the ICC Arbitration. This Supreme Court application was adjourned several times during 2011. Meanwhile, Antrix boycotted the ICC proceeding and failed to appoint an ICC arbitrator within the timeframe specified by the ICC Secretariat. On October 13, 2011, the ICC Court

²⁰⁶ Devas Multimedia Pvt. Ltd. v. Antrix Corp. Ltd., Request for Arbitration (June 29, 2011) (without exhibits) (Ex. C-144). ↩

²⁰⁷ Letter from Antrix (Hegde) to ICC Secretariat (Wong) at 3 (July 11, 2011) (Ex. C-145). ↩

²⁰⁸ Antrix also purported to commence its own rival arbitration, predicated upon its view that the ICC arbitration was "misconceived" and invalid. In that rival arbitration, Antrix proposed to appoint Mrs. Justice Sujata V. Manohar, a former Justice of the Supreme Court of India, as arbitrator. In its May 2013 decision, the Supreme Court of India held that this rival arbitration could not be used as a basis for invalidating Devas's previously-filed ICC arbitration. See Antrix Corp. Ltd. v. Devas Multimedia P. Ltd., Arb. Pet. No. 20 of 2011, Judgment ¶ 31 (India Sup. Ct. 2013) (Ex. C-184.) ↩

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appointed as second arbitrator the former Chief Justice of India, the Hon. Dr. Justice Adarsh Sein Anand, and on November 10, 2011, after the two party-appointed arbitrators had been unable to agree on a Chairman, the ICC Court appointed Professor Michael Pryles of Australia as President.²⁰⁹

142. On January 10, 2012, with due notice to Antrix, a preliminary teleconference in the ICC proceeding was conducted – which Antrix boycotted. At that conference, and as reflected in the Provisional Timetable and Terms of Reference subsequently adopted by the Tribunal, a briefing schedule was established, with a final two-day hearing to take place in New Delhi from April 12 to 13, 2012.

143. On February 20, 2012, Devas duly submitted its Statement of Claim, with witness statements and expert reports supporting its claim for specific performance of the Devas Agreement or, in the alternative, damages of $1.6 billion.

144. On April 9, 2012, just 3 days prior to the final ICC merits hearing in New Delhi, Antrix's Supreme Court petition was again listed before the Supreme Court of India. At that hearing, at the urging of Antrix's counsel, the Supreme Court of India granted an order staying the ICC arbitration, pending argument on Antrix's application for a final injunction staying the ICC arbitration.²¹⁰

145. At subsequent hearings that occurred throughout 2012, that injunction continued in force. It was only discharged on May 10, 2013, when, in a decision by Chief Justice Altamas Kabir, the Supreme Court of India rejected Antrix's Section 11

²⁰⁹ Letter from ICC Secretariat (Wong) to Devas's counsel and Antrix (Hegde) (Oct. 13, 2011) (Ex. C-157); Letter from ICC Secretariat (Khong) to Tribunal (Nov. 10, 2011) (Ex. C-160). ↩

²¹⁰ Antrix Corp. Ltd. v. Devas Multimedia P.Ltd., Arb. Pet. No. 20 of 2011, Order (India Sup. Ct. 2012) (Ex. C-172). ↩

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application, holding that Antrix's interpretation of Clause 20 was without merit and that Devas had validly invoked ICC arbitration pursuant to that clause. The ICC arbitration has since been resumed, although Antrix still is not participating in the arbitration.

146. In the ICC arbitration, Devas sought both specific performance and/or damages. Devas had expected that these claims would be heard at the scheduled ICC arbitration hearing dates of April and/or July 2012. The Supreme Court of India's injunction granted on April 9, 2012 led to the cancellation of these hearings, and thus removed any prospect of getting a prompt specific performance order in the ICC arbitration during 2012 or the first three quarters of 2013, as the Supreme Court's stay was not vacated until mid-May 2013.

147. On June 13, 2013, Devas wrote a letter to Antrix and noted that there "clearly was no basis for [Antrix] to terminate the [Devas] Agreement" and that "Antrix also has obstructed the expeditious determination of the arbitration proceedings commenced by Devas." Devas further noted that "Antrix continues to be in repudiatory breach of the [Devas] Agreement even today and has clearly evinced its intention not to perform the [Devas] Agreement." Devas then notified Antrix that it "has elected to, and does hereby, accept Antrix's repudiatory breach of the [Devas] Agreement, bringing the Agreement to an end as a result of Antrix's wrongful actions."²¹¹

148. It is also notable that, since 2011, Devas has been subject to a range of harassing measures from various parts of the Indian government, including its Registry of Companies (which has attempted to "investigate" the Devas Agreement even though this forms no part of its statutory functions), India's Enforcement Directorate, tax authorities,

²¹¹ Letter from Devas (Viswanathan) to Antrix (Hegde) (June 13, 2013) (Ex. C-191.) ↩

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and other government entities.²¹² It is all too clear that these steps have been taken in retaliation for Devas and Claimants daring to exercise their respective rights.

Q. The Current Proceeding

149. By letters dated December 12 and 13, 2011, Claimants invited the Republic of India to resolve the disputes that are the subject of this claim on an amicable basis, in conformity with Article 8(1) of the Treaty.²¹³ Respondent did not acknowledge, much less substantively respond to, these communications, and no amicable resolution of the dispute occurred.

150. On July 4, 2012, Claimants commenced the present Proceeding.

III.
THIS TRIBUNAL HAS JURISDICTION
OVER CLAIMANTS' TREATY CLAIMS

A. Claimants Are "Investors" As Defined By the Treaty

151. Both Claimants and Respondent have consented to arbitration of the claims that are the subject of this dispute. Article 8 of the Mauritius-India BIT establishes the scope of this Tribunal's jurisdiction. It provides:

1. Any dispute between an investor of one Contracting Party and the other Contracting Party in relation to an investment of the former under this Agreement shall, as far as possible, be settled amicably through negotiations between the parties to the dispute.
2. If such dispute cannot be settled according to the provisions of paragraph (1) of this Article within six months from the date of request for settlement, the investor may submit the dispute to:
   ....

²¹² Viswanathan ¶¶ 216-223. ↩

²¹³ Exs. C-165 to C-167 (Claimants' Requests to Settle Dispute). ↩

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1. (d) to an ad hoc arbitral tribunal set up in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law, 1976 ....

152. Thus, this Tribunal's jurisdiction is established whenever an (i) "investor of one Contracting Party" (a term defined by the Treaty), (ii) has "[a]ny dispute" with the other Contracting party "in relation to an investment of the [investor]."

153. As with all the terms of the Treaty, Article 8 should be interpreted by the customary interpretive principle of international law, as codified in Article 31(1) of the 1969 Vienna Convention on the Law of Treaties,²¹⁴ requiring that a treaty be interpreted "in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose."²¹⁵ Applying this interpretive principle, Claimants, as companies incorporated and established in Mauritius (see supra ¶¶ 24-27) plainly are "investors" as defined by Article 1(1)(b) of the Treaty,

²¹⁴ Vienna Convention on the Law of Treaties, art. 31(1), May 23, 1969, 1155 U.N.T.S. 331 ("VCLT") (Ex. CL-42). Mauritius acceded to the VCLT as from January 18, 1973. Although India has not acceded to the VCLT, Articles 31 and 32 of that convention have been held "on several occasions" to "reflect[]" the "customary international law" on treaty interpretation. See Dispute Regarding Navigational & Related Rights (Costa Rica v. Nicaragua), 2009 I.C.J. Rep. 213, Judgment at 237 ¶ 47 (July 13) (holding that "the principles of interpretation set forth in Articles 31 and 32 of the [VCLT]" represented "customary international law on the subject," and applied notwithstanding that "Nicaragua is not a party to the [VCLT]") (Ex. CL-10); Saluka Invs. B.V. v. Czech Republic, Partial Award ¶ 296 (UNCITRAL 2006) (noting that the VCLT's provisions regarding treaty interpretation "represent customary international law") (Ex. CL-31). ↩

²¹⁵ VCLT, art. 31(1) (Ex. CL-42); accord Indus Waters Kishenganga Arbitration (Pakistan v. India), Partial Award ¶ 402 (PCA 2013) (interpreting inter-governmental agreement according to the "ordinary meaning of the terms there used") (Ex. CL-18); White Indus. Australia Ltd. v. India, Final Award ¶ 7.3.2 (UNCITRAL 2011) ("The correct approach to be adopted by the Tribunal in assessing whether an 'investment' has been made is to consider the plain and ordinary meaning of the words used in the [Australia-India] BIT in their context and in the light of its object and purpose . . . .") (Ex. CL-38). ↩

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because they are "corporation[s], firm[s] or association[s], incorporated or constituted in accordance with the law of [a] Contracting Party[,]" i.e., Mauritius.

B. Claimants' Dispute Is "In Relation To" An "Investment"

154. This dispute is "in relation to" an "investment," as that term is defined by the Treaty. Article 1(1)(a) of the Mauritius-India BIT defines "investment" broadly as:

every kind of asset established or acquired under the relevant laws and regulations of the Contracting Party in whose territory the investment is made, and in particular, though not exclusively, includes:

(i) movable and immovable property as well as other rights in rem such as mortgages, liens or pledges;

(ii) shares, debentures and any other form of participation in a company;

(iii) claims to money, or to any performance under contract having an economic value;

(iv) intellectual property rights, goodwill, technical processes, know-how, copyrights, trade-marks, trade-names and patents in accordance with the relevant laws of the respective Contracting Parties;

(v) business concession conferred by law or under contract, including any concessions to search for, extract or exploit natural resources.

155. Similarly-worded BIT provisions have been recognized as conveying "a very broad meaning for the term 'investment'"²¹⁶ and applied in commensurately broad fashion. Indeed, the chapeau "every kind of asset" is "generally acknowledged as '[p]ossibly the broadest . . . general definition' contained in a BIT."²¹⁷

156. For purposes of Article 1(1)(a), Claimants' investment consists of:

²¹⁶ Fedax N.V. v. Venezuela, No. ARB/96/3, Decision on Jurisdiction ¶ 32 (ICSID 1997) (Ex. CL-13); see also White Indus. ¶ 7.3.1 (remarking that the similar definition of "investment" appearing in Australia-India BIT was "set out in broad terms") (Ex. CL-38). ↩

²¹⁷ Saipem S.p.A. v. Bangladesh, No. ARB/05/07, Decision on Jurisdiction ¶ 121 n.30 (ICSID 2007) (alterations in original) (citation omitted) (Ex. CL-30). ↩

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1. Each Claimant's respective shareholdings in Devas;
2. Each Claimant's partial indirect interest in Devas's business assets, acquired by virtue of their equity ownership of Devas, including:
   1. rights and claims to performance held by Devas pursuant to the Devas Agreement;
   2. the right, pursuant to the Devas Agreement, to provide communications services to all of India through the utilization of a portion of the "S-band," and the corresponding ability to box-out any other potential users from this portion of the S-band;
   3. the right, pursuant to the Devas Agreement, to broadcast from the 83°E orbital slot and other available slots allocated to India by the ITU in the S-band;
   4. the business developed by Devas (described above) to harness the S-band as part of an integrated hybrid satellite and terrestrial telecommunications system to provide multimedia services across India, including audio/video and broadband wireless internet communications;
   5. intellectual property rights, goodwill, technical processes, know-how and expertise committed by Devas in performing the Devas Agreement and the developing of the Devas integrated satellite system; and
   6. working capital, regulatory approvals and other assets of Devas.

157. These interests are plainly all covered by Article 1(1)(a)'s inclusive definition of "investment." While the examples in Article 1(1)(a) are non-exclusive (and would thus cover interests that are not specifically enumerated therein), Claimants also note that share and equity interests fall within sub-paragraph (ii), covering "shares in and stock and debentures of a company and any other form of participation in a company," and Devas's various assets fall within sub-paragraphs (i), (iii), (iv) and (v).²¹⁸

²¹⁸ Claimants' investments furthermore satisfy Article 2 of the Treaty, which confirms that the Treaty applies to "all investments made by investors of either Contracting Party in the territory of the other Contracting Party, accepted as such in (cont'd) ↩

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158. Finally, the scope of India's consent to arbitration under Article 8 of the Mauritius-India BIT refers to "[a]ny dispute . . . in relation to an investment." As Kenneth J. Vandevelde explains (interpreting, among others treaty clauses, a similar phrase in the Australia-India BIT):

This consent is quite broad. It does not require that the dispute involve an alleged violation of a provision of the BIT. All that is required is that the dispute concern an investment. . . . Occasionally, the consent applies to 'any dispute,' which is clearly even broader . . . .²¹⁹

159. Claimants' allegations easily fall into the category of "any dispute . . . in relation to" its investment – and, moreover, specifically relate to violations of the Treaty. In these circumstances, then, there can be no doubt that the dispute is "in relation to" "an investment," as required by the Mauritius-India BIT.

IV.
INDIA HAS UNLAWFULLY EXPROPRIATED CLAIMANTS' INVESTMENTS

A. Articles 6 and 7 of the Treaty Prohibit Expropriations by India
Except for Public Purposes, Under Due Process of Law, on a
Nondiscriminatory Basis, and Against Fair and Equitable Compensation

160. Article 6 of the Treaty provides:

1. Investments of investors of either Contracting Party in the territory of the other Contracting Party shall not be nationalised, expropriated or subjected to measures having effects equivalent to nationalisation or expropriation except for public purposes under due process of law, on a non-discriminatory basis and against fair and equitable compensation. Such compensation shall amount to

(cont'd from previous page)
accordance with its laws and regulations, whether made before or after the coming into force of this Agreement." Mauritius-India BIT, art. 2 (Ex. C-1). As noted above, each of Claimants' various equity investments was approved by the Indian FIPB. (See supra ¶ 36.)

²¹⁹ Kenneth J. Vandevelde, Bilateral Investment Treaties: History, Policy, and Interpretation at 433 § 10.2.1.1 (2010) (footnote omitted); see also id. at 433 n.26 (citing BITs) (Ex. CL-45). ↩

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the market value of the investment expropriated immediately before the expropriation or before the impending expropriation became public knowledge, whichever is the earlier, shall include interest at a fair and equitable rate until the date of payment, shall be made without unreasonable delay and shall be effectively realizable and be freely transferable.

2. The investor affected by the expropriation shall have right, under the law of the Contracting Party making the expropriation, to review, by a judicial or other independent authority of that Party, of his or its case and of the valuation of his or its investment in accordance with the principles set out in this paragraph.
3. Where a Contracting Party expropriates, nationalises or takes measures having effect equivalent to nationalisation or expropriation against the assets of a company which is incorporated or constituted under the laws in force in any part of its own territory, and in which investors of the other Contracting Party own shares, it shall ensure that the provisions of paragraph (1) of this Article are applied to the extent necessary to ensure fair and equitable compensation as specified therein to such investors of the other Contracting Party who are owners of those shares.

161. Article 7 of the Treaty further requires that "any compensation paid pursuant to Article[] . . . 6" be "freely transferred, without unreasonable delay and on a non-discriminatory basis" and "effected without unreasonable delay in any freely convertible currency at the market rate of exchange prevailing on the date of transfer."

162. The protections afforded by Articles 6 and 7 are supplemented in this case by the the "MFN" provisions of Articles 4(2) and 4(3) of the Treaty, which provide:

2. Each Contracting Party shall accord to investments of investors of the other Contracting Party, treatment which shall not be less favourable than that accorded either to investments of its own or investments of investors of any third State.
3. In addition, each Contracting Party shall accord to investors of the other Contracting Party, including in respect of returns on their

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investments, treatment which shall not be less favourable than that accorded to investors of any third state.²²⁰

163. The provisions of Article 6 and 7 (and the related obligations under the MFN clause) applies in any case where an investment is "subjected to measures having effects equivalent to nationalisation or expropriation." These terms reflect the widespread acceptance that "expropriation" includes:

not only open, deliberate and acknowledged takings of property, such as outright seizure or formal or obligatory transfer of title in favour of the host State, but also covert or incidental interference with the use of property which has the effect of depriving the owner, in whole or in significant part, of the use or reasonably-to-be-expected economic benefit of property even if not necessarily to the obvious benefit of the host State.²²¹

²²⁰ See also Mauritius-India BIT, art. 11(1) (preserving investor's right to "obligations under international law" that may entitle Claimants to "treatment more favourable than that provided for by the [Treaty]") (Ex. C-1). ↩

²²¹ Metalclad Corp. v. Mexico, No. ARB(AF)/97/1, Award ¶ 103 (ICSID 2000) (Ex. CL-23); accord CME Czech Republic B.V. v. Czech Republic, Partial Award ¶ 606 (UNCITRAL 2001) ("CME Liability") (Ex. CL-5); see also Gemplus S.A. v. Mexico; Talsud S.A. v. Mexico, Nos. ARB(AF)/04/3 & ARB(AF)/04/4, Award ¶ 8-23 (ICSID 2010) ("[A]n indirect expropriation occurs if the state deliberately deprives the investor of the ability to use its investment in any meaningful way and a direct expropriation occurs if the state deliberately takes that investment away from the investor.") (Ex. CL-15); RosInvestCo. UK Ltd. v. Russia, No. 079/2005, Final Award ¶ 624 (SCC 2010) (noting that indirect expropriation includes "deprivation of (i) the economic value of an investment (as [the investor] articulated the standard at the hearing), (ii) fundamental ownership rights, in particular, control of an ongoing business, or (iii) deprivation of legitimate investment-backed expectations" where "the 'net effect' of the measure (or set of measures) is the same as an outright expropriation, i.e., a substantial or total deprivation of the economic value of an asset") (Ex. CL-28); Restatement (Third) on Foreign Relations Law § 712 cmt. g (1987) (stating that expropriation embraces "action that is confiscatory, or that prevents, unreasonably interferes with, or unduly delays, effective enjoyment of an alien's property") (Ex. CL-46); Starrett Hous. Corp. v. Iran, Case No. 24, Award No. ITL 32-24-1, Interlocutory Award, 4 Iran-U.S. Cl. Trib. Rep. 122, 154 (1983) (expropriation embraces "interfere[nce] with property rights to such an extent that these rights are rendered so useless that they must be deemed to have been expropriated . . . .") (Ex. CL-34). ↩

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164. Furthermore, the term "expropriation" extends to direct and indirect interference with both tangible and intangible assets, including interference with in personam rights and contract rights, such as Claimants' interest in Devas, Claimants' indirect ownership of the Devas Agreement and Claimants' indirect ownership of the Devas System and business, as well as a pre-emptive position in the 70 MHz of S-band spectrum allocated under the Devas Agreement for operation of Devas's hybrid satellite-terrestrial system (see supra ¶ 41).²²²

165. As discussed in further detail below, the Government of India directly and indirectly expropriated and/or nationalized Claimants' investments. (See infra ¶¶ 166-173.) The expropriation did not comply with Articles 6 and 7 of the Treaty, not least because India has failed to compensate Claimants as required by Article 6(3) and international law. (See infra ¶¶ 195-198.)

B. The Actions of India's Cabinet Committee on Security, Antrix,
DOS and Space Commission in Annulling the Devas Agreement
Deprived Claimants of the Benefits of Their Investments in India

166. The evidence here shows that:

1. Beginning in 2009, spearheaded by Dr. Radhakrishnan, DOS covertly began a "review" of the Devas Agreement (see supra ¶¶ 78-79);
2. According to Dr. Radhakrishnan, the inter-ministerial "Space Commission" decided on July 2, 2010 to annul the Devas Agreement (see supra ¶¶ 91-94, 112);

²²² Deutsche Bank AG v. Sri Lanka, No. ARB/09/02, Award ¶ 506 (ICSID 2012) ("Contractual rights may be expropriated, a position that has been accepted by numerous investment arbitration tribunals.") (Ex. CL-8); Occidental Petroleum Corp. v. Ecuador, No. ARB/06/11, Award ¶ 455 (ICSID 2012) ("Occidental 2012 Award") (finding that an "administrative sanction," which had the effect of terminating a long term contract, was a measure "tantamount to expropriation") (Ex. CL-27). ↩

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3. On July 12, 2010, the Additional Solicitor-General advised that the contract could not be terminated for convenience under Article 7 of the Devas Agreement. However, he suggested a path to contrive a force majeure event (see supra ¶¶ 97-100);
4. The Indian government spent the next seven months putting in place the arrangements to annul the Devas Agreement (see supra ¶¶ 112-113);
5. In early February 2011 the "review" of the Devas Agreement and the decision to annul by the Space Commission was made public (see supra ¶¶ 110-113);
6. On February 17, 2011, the CCS made precisely the "policy" decision that the Additional Solicitor-General had recommended in order to create a "force majeure" event (see supra ¶¶ 120-121);
7. On February 25, 2011, citing the CCS decision as an "act" by a "governmental authority acting in its sovereign capacity" triggering a "Force Majeure" and also citing Article 7 (even though the Additional Solicitor-General had advised that Article 7's "termination for convenience" was unavailable), Antrix "cancelled" the Devas Agreement (see supra ¶¶ 127-129); and
8. The annulment of the Devas Agreement and rights therein destroyed Devas's ability to execute its business plan or otherwise monetize its assets (see supra ¶ 20).

167. These measures plainly "ha[d] the effect of depriving" Claimants "of the use or reasonably to be expected economic benefit of"²²³ their investments in Devas, therefore constituting an expropriation under Article 6 of the Treaty.

168. In Occidental, the Ecuadorian government issued an administrative decree that operated to cancel a contract in its entirety. The action (which had no justification whatsoever under the contract, arose in a "political" environment and an atmosphere of "ill-feeling" against the investor following an earlier international arbitration award favorable to Occidental) was held to be expropriatory.²²⁴

²²³ CME Liability ¶ 606 (Ex. CL-5) (citing Metalclad ¶ 103 (Ex. CL-23)). ↩

²²⁴ Occidental 2012 Award ¶¶ 439, 442-43, 456 (Ex. CL-27). ↩

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169. In Deutsche Bank AG v. Sri Lanka, the government expropriated "the entire value of [the investor's] investment . . . for the benefit of [the government] itself."²²⁵ It did so through an order of the Sri Lankan Supreme Court blocking any payment to the investor under a hedging contract, as well as a similar administrative action by the Sri Lankan Central Bank.²²⁶ These "coordinated actions" of the Sri Lankan Supreme Court and Central Bank were found to have "deprived Deutsche Bank of the economic value of the [Hedging Agreement,]" thus constituting an "expropriation of Deutsche Bank's rights[.]"²²⁷

170. A comparison may also be made to Middle East Cement, where the investor obtained a governmental license to import cement at a specifically-built port facility in Egypt. When the government enacted a measure banning the importation of cement other than through the Egyptian Cement Office, Claimant's argued that this "condemn[ed]" the investor's business "to paralysis" constituting an expropriation,²²⁸ and the tribunal agreed that there had been a de facto expropriation under the Greece-Egypt BIT because the decree had "deprive[d] the investor of the use and benefit of his investment even though he may [have] retain[ed] nominal ownership."²²⁹

171. Likewise here, the coordinated measures adopted by the CCS, DOS, the Space Commission, and ISRO/Antrix operated to prevent Devas from commencing the

²²⁵ Deutsche Bank ¶ 523 (Ex. CL-8). ↩

²²⁶ Id. ¶ 521. ↩

²²⁷ Id. ↩

²²⁸ Middle East Cement Shipping & Handling Co. S.A. v. Egypt, No. ARB/99/6, Award ¶ 82 (ICSID 2002) (Ex. CL-24). ↩

²²⁹ Id. ¶ 107. ↩

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provision of telecommunication services that it had developed on the basis of that agreement. It is classic expropriation of Claimants' rights and business.

172. It bears emphasis that Antrix's cancellation of the contract (and declaration of "force majeure") was explicitly predicated on a "sovereign" action having occurred to prevent its performance of the Devas Agreement. Indeed, the Additional Solicitor-General's opinion stated that a "decision . . . taken by the Government of India, as a matter of policy, in exercise of its executive power or in other words, a policy decision having the seal and approval of the Cabinet and duly gazetted" would be "an act by the governmental authority acting in its sovereign capacity."²³⁰ Moreover, as the above facts show, the expropriation itself was engineered through DOS and the Space Commission, as well as ISRO. Thus, it is not necessary to reach the issue of whether Antrix's actions are attributable to the State (an issue addressed separately below)²³¹ in order to conclude that there has been expropriation by the government of India.

173. In sum, the facts clearly show that Claimants were deprived of the use and enjoyment of their investments, constituting an expropriation for purposes of Articles 6 and 7 of the Mauritius-India BIT.

²³⁰ ASG Opinion (Ex. C-131). ↩

²³¹ (See infra ¶¶ 214-215.) It is likewise not necessary to find Antrix in breach of contract in order to find an expropriation. See Impregilo S.p.A. v. Pakistan, No. ARB/03/3, Decision on Jurisdiction ¶ 258 (ICSID 2005) ("[T]he fact that a breach may give rise to a contract claim does not mean that it cannot also – and separately – give rise to a treaty claim. Even if the two perfectly coincide, they remain analytically distinct, and necessarily require different enquiries.") (Ex. CL-17); accord Compañía de Aguas del Aconqija S.A. v. Argentina, No. ARB/97/3, Decision on Annulment ¶ 113 (ICSID 2002) (Ex. CL-6). ↩

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C. The Expropriation Was Unlawful in Every Respect

1. The Expropriation Was Not for a Public Purpose

174. Article 6 of the Mauritius-India BIT prohibits India from expropriating or nationalizing investments unless four conditions are satisfied, namely that it be (1) "for public purposes"; (2) "under due process of law"; (3) "on a nondiscriminatory basis"; and (4) "against fair and equitable compensation."

175. India's expropriation of Claimants' investment is unlawful if any one of these conditions was not satisfied.²³² Here, none of these conditions were satisfied.

176. The above-quoted Treaty provisions indicate that an expropriation will be unlawful for purposes of Article 6 unless it was done "for public purposes."²³³ A sovereign's mere assertion that it acted for public purposes is not sufficient to satisfy this condition; instead, Respondent must demonstrate that its measures were actually motivated by public purposes.²³⁴ In addition, it must also show that the expropriation was proportional to the purported public purpose.²³⁵

²³² See Kardassopoulos v. Georgia; Fuchs v. Georgia, Nos. ARB/05/18 & ARB/07/15, Award ¶¶ 390, 405 (ICSID 2010) (failure to provide due process of law, and failure to provide "'prompt, adequate and effective compensation,'" constituted independent bases for regarding expropriation as unlawful) (Ex. CL-20); Funnekotter v. Zimbabwe, No. ARB/05/6, Award ¶ 98 (ICSID 2009) (finding that a similar treaty provision imposed "cumulative" conditions) (Ex. CL-14). ↩

²³³ Mauritius-India BIT, art. 6(1) (Ex. C-1). ↩

²³⁴ ADC Affiliate Ltd. v. Hungary, No. ARB/03/16, Award ¶¶ 430-32 (ICSID 2006) (host state failed to "substantiate [that it was acting in the public interest] with convincing facts or legal reasoning"; holding that "[i]f mere reference to 'public interest' can magically put such interest into existence and therefore satisfy this requirement, then this requirement would be rendered meaningless since the Tribunal can imagine no situation where this requirement would not have been met" (emphasis omitted)) (Ex. CL-1). ↩

²³⁵ See James v. United Kingdom, App. No. 8793/79, Judgment (Merits) ¶ 50 (Eur. Ct. H.R. 1986) ("Not only must a measure depriving a person of his property pursue, on the facts as well as in principle, a legitimate aim 'in the public interest', but there must (cont'd) ↩

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177. A sovereign is not acting for public purposes when its measures are "financially motivated" (either in favor of itself or other investors) as that is an "improper motive."²³⁶ Indeed, an expropriation accompanied by "serious breaches of due process, transparency and indeed a lack of good faith" will rarely satisfy the "public purpose" test.²³⁷

178. The facts here readily dispel any notion of a taking "for public purposes." The CCS decision, which purported to deny "orbital slot in S band . . . for commercial activities," was publicly disclosed on February 17, 2011 and made reference to a miscellany of supposed national "needs," including military needs.²³⁸ More than two years later, however, India has made absolutely no use of the S-band spectrum for any purpose, much less the supposed "needs" identified by the Cabinet Committee on Security. Similarly, while the Additional Solicitor-General was told by Dr. Radhakrishnan that there were "strategic and societal applications" (including, according

(cont'd from previous page)
also be a reasonable relationship of proportionality between the means employed and the aim sought to be realised.") (Ex. CL-19); see also Occidental 2012 Award ¶ 456 (observing that the administrative taking was done through measures that were not "a proportionate response" to the situation facing the government) (Ex. CL-27).

²³⁶ Deutsche Bank ¶¶ 523-24 (Ex. CL-8); see also ADC ¶¶ 304, 433 (Hungary's claim of a "public interest" was "unsustainable" because the expropriated property, an airport, was subsequently re-privatized to a competitor of the investor, for a profit to the State of $2.26 billion) (Ex. CL-1); Siemens A.G. v. Argentina, No. ARB/02/8, Award ¶ 273 (ICSID 2007) (An expropriation was not in the public interest when "[i]t was an exercise of public authority to reduce the costs to Argentina of the Contract recently awarded through public competitive bidding, and as part of a change of policy by a new Administration eager to distance itself from its predecessor.") (Ex. CL-33). ↩

²³⁷ See Deutsche Bank ¶ 523 (Ex. CL-8). ↩

²³⁸ Press Information Bureau, Government of India, Cabinet, CCS Decides to Annul Antrix-Devas Deal (Feb. 17, 2011) (Ex. C-134). ↩

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to Dr. Radhakrishnan, the Indian Armed Forces, Coast Guard, Police, or Railways) none of these agencies have sought to use the S-Band.²³⁹

179. And, tellingly, Dr. Radhakrishnan's orchestrated process to annul the Devas Agrement did not involve any of these agencies. According to him, he "started necessary actions for terminating the contract which required extensive consultations with the concerned agencies in the government," which actions involved the "Department of Telecommunication, Department of Law and Justice."²⁴⁰ Notably, Dr. Radhakrishnan's list does not include any agencies concerned with "defence, para-military forces, railways or other public utility services," the departments whose "needs" supposedly animated the Cabinet Committee on Security "policy" decision.²⁴¹

180. Meanwhile, calls for the S-band spectrum to be made available to other commercial operators, including terrestrial cellular phone operators – calls that began in 2008 and were evident at the time of Dr. Radhakrishnan's "review" of the Devas Agreement²⁴² – have continued. As noted above, on May 17, 2013, Sam Pitroda, Prime Minister Singh's Public Information Infrastructure and Innovation Advisor, was quoted as

²³⁹ ASG Opinion (Ex. C-131). ↩

²⁴⁰ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 4 (Feb. 8, 2011) (emphasis added) (Ex. C-125). ↩

²⁴¹ Id. ↩

²⁴² (See infra ¶¶ 135-137.) In this regard, DOS's reference to the Additional Solicitor-General for an opinion on how to annul the Devas Agreement is telling, as it describes the purposes behind the annulment as "to . . . preserve precious S band spectrum for strategic requirements of the nation" and "to ensure a level playing field for other service providers using terrestrial spectrum." ASG Opinion (Ex. C-131) (emphasis added). The CCS "policy" decision (the purported basis for Antrix's invocation of force majeure) tellingly omits this justification (see supra ¶ 121). ↩

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suggesting that 80 MHz of the S-band spectrum held by DOS should be "freed" "for 4G services," i.e., terrestrial operations. (See supra ¶ 137.)²⁴³

181. The fabricated nature of India's "policy" decision to extricate itself from the Devas Agreement is further evident when compared with its initial decision to enter the Devas Agreement in the first place. In 2004, when the Devas Agreement was presented for final consideration, a high-level government committee, the Shankara Committee, specifically considered "alternate uses for [the] space segment" before concluding that the Devas Agreement was beneficial and should be signed (see supra ¶ 184). Thereafter, the Indian government took deliberate steps to protect PFDs at ITU WR-07.²⁴⁴ And all of this comported with SATCOM Policy, which is still in force today. There is a strong contrast between the careful analysis preceding the Devas Agreement, and the covert, ad hoc and result-oriented processes leading to the 2011 cancellation, all of which indicates that the so-called "policy" decisions underlying the cancellation were self-interested and pre-textual.

182. The "purpose" actually admitted by Dr. Radhakrishnan, and apparent in his actions, was the goal of extricating the Indian government from the Devas Agreement, amid political pressure and dissatisfaction with the contract's terms. The Additional

²⁴³ Mr. Parsons believes that 60 Mhz of the 80 MHz that Dr. Pitroda is advocating should be "freed" is the spectrum that was allocated to Devas under the Devas Agreement. (Parsons ¶ 52). An arrangement between the Government of India and cellular operators concerning the S-band and/or the Devas Agreement that contributed to the expropriation of Claimants' investments clearly would defeat any allegation that India had acted "for public purposes." See Rumeli Telekom A.S. v. Kazakhstan, No. ARB/05/16, Award ¶ 707 (ICSID 2008) (Ex. CL-29) (finding that an expropriation "was not directly for the benefit of the State" when "the court process which resulted in the expropriation of Claimants' shares was brought about through improper collusion between the State, acting through the Investment Committee, and Telcom Invest [a private, domestic entity].") ↩

²⁴⁴ Lewis ¶¶ 59-70. ↩

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Solicitor General noted that DOS was "concern[ed]" about "the technical, commercial, managerial and financial aspects of Antrix [sic]-Devas contract," and "severe penalty clauses for delayed delivery of the spacecraft and for performance failure . . . ."²⁴⁵ And Dr. Radhakrishnan stated the "review" of the Devas Agreement was commenced by him in order to terminate the contract "without causing much of embarrassment and damage and financial loss to the government."²⁴⁶ As a matter of law, a desire to escape a commercial arrangement, or avoid political outcomes, is not a "public purpose." (See supra ¶ 177 & n.236.)

183. Even if some colorable "public purpose" could be ascribed to the expropriation, Respondent's actions (leading to the destruction of Devas's rights and Claimants' investments) could in no way be described as "proportional" to that purpose. The lack of proportionality in India's actions is evident not only in the blanket nature of the CCS decision (which purported to quarantine the entire S-band for unspecified and vaguely-described national or strategic "needs"), but also by the fact that India took action covertly and unilaterally, without even attempting to explore whether its supposed "needs" could be accommodated within the structure of the Devas Agreement and Devas's need to use the S-Band for provison of audio/visual and BWA satellite and terrestrial services.²⁴⁷ In fact, as discussed by Mr. Parsons, had the Indian government approached Devas about any real national needs for the S-band, Devas could have

²⁴⁵ ASG Opinion (Ex. C-131) ↩

²⁴⁶ Transcript, Press Conference by Dr. Radhakrishnan and Dr. Kasturirangan, CNN-IBN at 4 (Feb. 8, 2011) (emphasis added) (Ex. C-125). ↩

²⁴⁷ See supra ¶¶ 123-125. ↩

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worked with the government to accommodate those needs within the framework of the Devas Agreement.²⁴⁸

184. The evidence thus indicates that Respondent's actions in causing the cancellation of the Devas Agreement lacked a legitimate public purpose. But it bears emphasis that the Mauritius-India BIT requires that every nationalization, lawful or unlawful, must be the subject of compensation,²⁴⁹ meaning that Respondent remains liable to compensate Claimants even if somehow it is able to show its measures were undertaken "for public purposes."

2. The Expropriation Was Effected Without Due Process

185. Article 6 of the Treaty further requires that an expropriation must be "under due process of law," a requirement that the Indian Government has utterly failed to meet.

186. The concept of "due process" in Article 6 refers to more than mere compliance with local law, but also incorporates the principles of international due process:

[T]he contents of the notion of due process of law make it akin to the requirements of the "Rule of Law", an Anglo-Saxon notion, or of the "Rechtsstaat", as understood in continental law. Used in an international agreement, the content of this notion is not exhausted by a reference to the

²⁴⁸ See Parsons ¶¶ 35-37, 49-51. ↩

²⁴⁹ See Mauritius-India BIT, art. 6 (Ex. C-1); Vandevelde, Bilateral Investment Treaties at 307 § 6.5.3.4 ("While an expropriation must be for a public purpose if it is to be lawful, the fact that it is for a public purpose in no way excuses the obligation to pay compensation.") (Ex. CL-45). ↩

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national law of the Parties concerned. The "due process of law" of each of them must correspond to the principles of international law.²⁵⁰

187. As indicated in Siag and Middle East Cement, one basic element of due process is that the host state explicitly notify the investor of the proposed expropriatory measures and give it the opportunity to be heard and/or to mitigate the impact of the threatened measures.²⁵¹ Furthermore, due process also requires that the expropriation be conducted with "reasonable advance notice and a fair hearing" and cannot be "carried out in a manner that can at best be described as opaque."²⁵²

188. Finally, denial of due process may occur not just where procedural rights are ignored, but "due process may be denied . . . substantively[,]"²⁵³ which occurs when a host state ignores and violates its own and/or international law in the conduct of an expropriation.²⁵⁴

²⁵⁰ Kardassopoulos ¶ 394 (emphasis omitted) (Ex. CL-20) (quoting Organisation for Economic Co-operation and Development, Draft Convention on the Protection of Foreign Property). ↩

²⁵¹ In Siag, without prior notice Egypt's Ministry of Tourism enacted, a ministerial resolution, cancelling a land development contract and "redeeming 'all the land . . . with all the structures thereon.'" Siag v. Egypt, No. ARB/05/15, Award ¶¶ 36, 442 (ICSID 2009) (Ex. CL-32). This was held to be a violation of due process. Id. ¶ 442. In Middle East Cement, the tribunal considered Egypt's seizure of the ship the M/V Poseidon 8, which was conducted without individual notice to the investor, to violate due process. Middle East Cement ¶ 143 (Ex. CL-24). The tribunal determined that, even though Egypt advertised the auction in local newspapers, and may have accorded with Egyptian law, nevertheless the expropriation was not conducted "under due process." Id. ¶¶ 143, 147; cf. Metalclad ¶¶ 91, 97 (finding "procedural and substantive deficiencies" when investor was denied a permit "at a meeting . . . of which [it] received no notice, to which it received no invitation, and at which it was given no opportunity to appear") (Ex. CL-23). ↩

²⁵² Kardassopoulos ¶ 397 (Ex. CL-20); accord ADC ¶ 435 (Ex. CL-1). ↩

²⁵³ Siag ¶ 440 (Ex. CL-32). ↩

²⁵⁴ See Kardassopoulos ¶ 441 (due process requires a compensation process that is "both procedurally and substantively fair") (Ex. CL-20). ↩

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189. India's clandestine conduct leading up to the cancellation of the Devas Agreement is a classic denial of due process. First, Dr. Radhakrishnan commissioned the Suresh Report, as part of a secret "review" of the Devas Agreement (see supra ¶¶ 78-79). The Space Commission decision of July 2010 to "annul" the contract likewise was taken behind closed doors, without any notice to Devas or Claimants. The decision preceding the announcement of February 8, 2011 that the government was "reviewing" the contract with a view to cancelling it, as well as Antrix February 10, 2001 and the CCS decision of February 17, 2011 denying use of the S-band were likewise all taken by the Government unilaterally and in secret. (See supra ¶¶ 90-101, 111-113.) The result was that the termination notice of February 25, 2011 presented the cancellation of the Devas Agreement as a fait accompli, with no prior opportunity (much less notice) to Devas or Claimants to allow them to present objections to India's decisions.²⁵⁵ Moreover, the decision to fabricate a force majeure event was enacted in contravention to the contractual requirement that a force majeure event must be "beyond the reasonable control of the party affected" and have only have occurred "despite all efforts of the Affected Party to prevent it or mitigate its effects."²⁵⁶

190. Worse still, all throughout this time, Devas was performing the Devas Agreement, in reliance upon India's prior indications of support for the Devas System and business, including making final preparations for the launch of PS1 (which ought to have commenced by that stage) and further preparations for the PS2 satellite launch (which

²⁵⁵ As Mr. Parsons relates, had the Indian government approached Devas, any legitimate public need for the S-band spectrum could have been accommodated without terminating the Devas Agreement. See Parsons ¶¶ 35-37, 49-51. ↩

²⁵⁶ Devas Agreement at 8 § 11 (Ex. C-16). ↩

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Devas was led to believe would launch soon after PS1). (See supra ¶¶ 65-69, 73, 84-85, 102-106.)

191. Such secrecy and dishonesty, whereby the drastic government action annulling the Devas Agreement was first announced in the media, is the antithesis of due process. Indeed, as the Kardassopoulos tribunal remarked, "'[b]ack-door press reports are the opposite of due process.'"²⁵⁷

3. The Expropriatory Measures Were Discriminatory

192. Respondent's expropriatory measures also were unlawful because they were not taken on a "non-discriminatory" basis, as required by Article 6(1) of the Treaty. Discrimination in the expropriation context takes place when an investment is nationalized "for reasons unrelated to the host state's legitimate regulatory objectives"; for example, "a measures that expropriates foreign investment solely because it is foreign-owned would violate this condition."²⁵⁸

193. In ADC and CME, the respondent host state was found to have breached the applicable BITs because their expropriations involved nationalization of a foreign investor's assets due, at least in part, to the investor's foreign nationality.²⁵⁹

194. Here, the evidence shows that the measures in question were aimed exclusively at extinguishing the interests of Devas, and were motivated in part by the fact that Devas was owned by the Claimants and DT Asia, who are foreign. This is made clear by the Indian government's own statements, which have derided Devas because of

²⁵⁷ Kardassopoulos ¶ 402 (alteration in original) (citation omitted) (Ex. CL-20). ↩

²⁵⁸ Vandevelde, Bilateral Investment Treaties at 273 § 6.5.1 (Ex. CL-45). ↩

²⁵⁹ See ADC ¶ 443 (Ex. CL-1); CME Liability ¶ 612 (Ex. CL-5). ↩

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its partial foreign ownership,²⁶⁰ as well as reports and other evidence that indicate that the S-band spectrum was most likely withheld from Devas at the behest of more politically-powerful domestic terrestrial operators.²⁶¹ Thus, because the expropriation appears to have been motivated at least in part by the fact that Devas was substantially foreign owned, it was discriminatory.

4. India Not Only Has Failed to Pay Fair and Equitable Compensation, It Has Categorically Refused to Do So

195. Article 6(1) of the Mauritius-India BIT mandates that "fair and equitable compensation" "made without unreasonable delay" is a condition of any expropriation. Such compensation:

shall amount to the market value of the investment expropriated immediately before the expropriation or before the impending expropriation became public knowledge, whichever is the earlier, shall include interest at a fair and equitable rate until the date of payment, shall be made without unreasonable delay and shall be effectively realizable and be freely transferable.²⁶²

²⁶⁰ See supra ¶¶ 133-134; Chaturvedi Rep. at 38 ¶ 3.5.9 (Ex. C-137). ↩

²⁶¹ See supra ¶¶ 135-137. ↩

²⁶² Mauritius-India BIT, art. 6(1) (Ex. C-1). Although the quantification of damages awaits the next phase of this proceeding, the meaning of "market value" can hardly be contested. It is: ↩

[t]he price, expressed in terms of cash equivalents, at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arm's length in an open and unrestricted market, when neither is under compulsion to buy or sell and when both have reasonable knowledge of the relevant facts.

American Society of Appraisers, International Glossary of Business Valuation Terms 27 (2009) (defining "fair market value") (Ex. CL-43); accord Starrett Hous. Corp. v. Iran, Case No. 24, Award No. 314-24-1, Final Award, 16 Iran-U.S. Cl. Trib. Rep. 112, 201 (1987) (defining "fair market value as the price that a willing buyer would pay to a willing seller in circumstances in which each had good information, each desired to maximize his financial gain, and neither was under duress or threat") (Ex. CL-35).

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196. The failure to pay "market value" compensation alone constitutes a breach of Article 6(1) of the Treaty. In Kardassopoulos, it was "uncontroversial on the facts of [that] case[] that no payment was made to Mr. Kardassopoulos by the Georgian Government in compensation for the expropriation of his investment."²⁶³ Accordingly, the tribunal concluded that "[Georgia] breached the [treaty] by reason of its continuing failure to pay prompt, adequate and effective compensation, as required by the terms of [the treaty]."²⁶⁴

197. In a similar vein, the tribunal in Funnekotter observed that the takings of certain landholdings by alleged war veterans, which were encouraged and supported by the government of Zimbabwe, constituted an unlawful expropriation because no payment had been made.²⁶⁵

198. In this instance, Respondent has not even attempted to pay Claimants the fair market value of their lost investment,²⁶⁶ and in fact has repudiated its duty to do so. On this basis as well, the expropriation is unlawful.

²⁶³ Kardassopoulos ¶ 405 (Ex. CL-20). ↩

²⁶⁴ Id. ¶ 408. ↩

²⁶⁵ Funnekotter ¶ 107 (Ex. CL-14); accord Gemplus ¶ 8-25 (finding that "these expropriations were unlawful under the BITs and international law, given the facts found by the Tribunal and the further fact that the Respondent did not meet the condition required by Article 5 . . . regarding the payment of adequate compensation.") (Ex. CL-15). ↩

²⁶⁶ As noted above, Antrix purported to tender USD 13 million as a termination fee under the Devas Agreement – a tender that was rejected by Devas. (See supra ¶¶ 131-132.) ↩

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V.
INDIA'S CONDUCT ALSO VIOLATED OTHER ARTICLES OF THE TREATY

A. Expropriatory Action Also Constitutes Unfair and Inequitable Treatment, Thus Violating Article 4(1) of the Treaty

199. Article 4(1) of the Treaty provides:

Investments and returns of investors of either Contracting Party shall at all times be accorded fair and equitable treatment in the territory of the other Contracting Party. Neither Contracting Party shall in any way impair by unreasonable or discriminatory measures the management, maintenance, use, enjoyment or disposal of investments in its territory by investors of the other Contracting Party.

200. The first sentence of Article 4(1) constitutes a "fair and equitable treatment" clause of a type commonly found in modern BITs. The Gemplus tribunal, interpreting comparable provisions of the Mexico-France and Mexico-Argentina BITs, observed that "this phrase . . . includes the exercise of good faith or the absence of manifest irrationality, arbitrariness or perversity by [the host state]."²⁶⁷

201. As the Saluka tribunal further explained, the "fair and equitable treatment" standard is to be given broad effect:

Bilateral investment treaties . . . are designed to promote foreign direct investment as between the Contracting Parties; in this context, investors' protection by the "fair and equitable treatment" standard is meant to be a guarantee providing a positive incentive for foreign investors.
. . . .
The [host state] . . . has therefore assumed an obligation to treat a foreign investor's investment in a way that does not frustrate the investor's underlying legitimate and reasonable expectations. A foreign investor whose interests are protected under the [BIT] is entitled to expect that the [host state] will not act in a way that is manifestly inconsistent, non-

²⁶⁷ Gemplus ¶¶ 7-2 & 7-72 (Ex. CL-15). ↩

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transparent, unreasonable (i.e., unrelated to some rational policy), or discriminatory (i.e., based on unjustifiable distinctions).²⁶⁸

202. In CME, it was held that where, as here, an expropriation occurs, this almost by definition also violates the fair and equitable treatment standard in that the expropriation "undermin[es]" the investment, which "equally is a breach of the obligation of fair and equitable treatment."²⁶⁹

203. In Occidental, the Tribunal interpreted the "fair and equitable treatment" standard in a setting where the measure in question – termination – was purportedly done as a sanction against the claimant's breach of an anti-transfer provision in one of its agreements. In such a setting, the "fair and equitable treatment" standard required that the measures in question "bear a proportionate relationship" to the supposed

²⁶⁸ Saluka ¶¶ 293, 309 (Ex. CL-31). As Saluka indicates, the obligation to provide fair and equitable treatment still affords the State room to exercise "its legitimate right to take measures for the protection of the public interest." Id. ¶ 309. There is, however, no basis for claiming such a "right" in this case: not only were the measures taken here neither bona fide nor for any national "needs", but, moreover, these measures were grossly disproportionate, carried out in secrecy and without any transparency, commercially self-interested, and undertaken without due process of law (see supra ¶¶ 178-191). Thus, as in Saluka, claims of "public interest" carry no weight here. ↩

²⁶⁹ See CME Liability ¶ 611 (Ex. CL-5); see also El Paso Energy Int'l Co. v. Argentina, No. ARB/03/15, Award ¶ 515 (ICSID 2011) (finding the "cumulative effect" of a series of adverse regulatory measures was such as to violate the fair and equitable treatment standard) (Ex. CL-11); Walter Bau AG (In Liquidation) v. Thailand, Award ¶¶ 12.43-12.44 (UNCITRAL 2009) (breaches of contractual commitments, over time, defeated legitimate expectations of investor and thus violated fair and equitable treatment standard) (Ex. CL-37); Eureko B.V. v. Poland, Partial Award ¶¶ 232-34 (Ad hoc tribunal 2005) (finding breach of Netherlands-Poland BIT's fair and equitable treatment obligation: "[Poland], consciously and overtly, breached the basic expectations of Eureko that are the basis of its investment" and "[Poland], by the conduct of organs of the State, acted not for cause but for purely arbitrary reasons linked to the interplay of Polish politics and nationalistic reasons of a discriminatory character") (Ex. CL-12); CME Liability ¶ 611 (holding that host state "breached its obligation of fair and equitable treatment [in Netherlands-Czech BIT] by evisceration of the arrangements in reliance upon [which] the foreign investor was induced to invest") (Ex. CL-5). ↩

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governmental aims underlying the state measures in question.²⁷⁰ The expropriatory measures in that case were held to be disproportionate to any national need, and thus a violation of the "fair and equitable treatment" standard.²⁷¹

204. For these reasons, the expropriatory nature of Respondent's actions mandates the conclusion that Respondent has breached Article 4(1) of the Treaty.

B. India's Conduct Violated Numerous Other Aspects of the "Fair and Equitable Treatment" Standard

205. The fair and equitable treatment standard is flexible, and has been held to arise in a variety of situations where a state violates other "legitimate expectations," including cases of: (1) denial of due process or procedural fairness; (2) coercion and harassment by the organs of the host state; (3) failure to offer a stable and predictable legal framework; (4) unjustified enrichment; (5) evidence of bad faith; (6) absence of transparency; and (7) arbitrary and discriminatory treatment.²⁷²

206. As the Gemplus tribunal further observed, a state commits a breach of the fair and equitable treatment where its actions are "manifestly irrational, arbitrary and perverse, being also conducted in bad faith towards the Claimants and their rights as investors under the . . . BIT[]."²⁷³

²⁷⁰ Occidental 2012 Award ¶ 416 (Ex. CL-27). ↩

²⁷¹ Id. ¶¶ 450-52. Here, issues of proportionality do not even arise, because the measures in question were not borne of legitimate policy aims. ↩

²⁷² Siag ¶ 450 (Ex. CL-32); Lemire v. Ukraine, No. ARB/06/18, Decision on Jurisdiction and Liability ¶ 284 (ICSID 2010) (Ex. CL-21); Ioana Tudor, The Fair and Equitable Treatment Standard in the International Law of Foreign Investment 154-81 (2008) (Ex. CL-44); see also Rumeli ¶ 609 (Ex. CL-29). ↩

²⁷³ Gemplus ¶ 7-76 (Ex. CL-15). ↩

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207. In El Paso, the "fair and equitable treatment" standard was said to mean that "the State should not unreasonably modify the legal framework or modify it in contradiction with a specific commitment not to do so."²⁷⁴

208. The facts of this case evidence serial violations of these standards.

209. First, Respondent's conduct – fabricating a sham "force majeure" decision to try to mask a deliberate revocation of the contract has consistently been held to be contrary to international law and good faith.²⁷⁵ Claimants' legitimate expectations in connection with their investment in Devas were completely subverted by these actions.

210. Second, Respondent's conduct is contrary to the numerous repeated commitments of support for the Devas Agreement, many of which were made directly to Claimants and thus plainly intended to induce Claimants to inject such capital.²⁷⁶

211. Third, Respondent's conduct unjustly enriched the state at the expense of the investor; a recognized indicia of unfair and inequitable conduct.²⁷⁷

²⁷⁴ El Paso ¶ 364 (emphasis omitted) (Ex. CL-11). ↩

²⁷⁵ See Nykomb Synergetics Tech. Holding AB v. Latvia, Award § 3.8(b) (SCC 2003) (holding that a force majeure clause that "expressly ma[de] reservations for new laws or regulations, which may alter the parties' rights or obligations under the contract" did not permit a government to use legislation to "revoke" contractual commitments) (Ex. CL-26); Himpurna California Energy Ltd v. P.T. (Persero) Perusahaan Listruik Negara, Final Award ¶ 144 (UNCITRAL 1999) (holding that a state enterprise could not "avoid liability by invoking State actions" where the "legal framework" between the State and the enterprise indicated they were entwined) (Ex. CL-16). ↩

²⁷⁶ CME Liability ¶ 611 (Ex. CL-5). ↩

²⁷⁷ See Total S.A. v. Argentina, No. ARB/04/1, Decision on Liability ¶ 112 (ICSID 2010) ("'[I]f a State . . . deprives an investor of acquired rights in a manner that leads to the unjust enrichment of the State, then there is at least a prima facie case for arguing that the fair and equitable standard has been breached.'") (Ex. CL-36) (quoting United Nations Conference on Trade and Development, Fair and Equitable Treatment, UNCTAD Series on Issues in International Investment Agreements, UNCTAD/ITE/IIT/11 (Vol. III) at 12 (1999)). ↩

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212. Fourth, the Government of India engaged in arbitrary decision-making, and made only abrupt, "ambush" announcements regarding its behavior (see supra ¶ 190), in violation of the duty to act transparently and consistently.²⁷⁸

213. Finally, the bad faith conduct of the government has been compounded by the harassing measures in order to punish Devas and Claimants for exercising their respective rights.²⁷⁹

214. It bears emphasis that Respondent cannot evade liability for its various bad faith actions by claiming that they were solely attributable to Antrix. First, as a factual matter, the current case implicates conduct by a plethora of state actors, from the Prime Minister on down. Moreover, the facts here show that Antrix, in practice, is fully integrated into DOS and ISRO, rendering the entities inseparable. (See supra ¶¶ 29-30.) Were that not enough, Antrix entered into the Devas Agreement explicitly on behalf of DOS/ISRO, in respect of transponder capacity on satellites to be owned and operated by ISRO, and furthermore (in Article 3 of the Devas Agreement) placed responsibilities on Antrix for "obtaining all necessary Governmental and Regulatory Approvals relating to orbital slots and frequency clearances."²⁸⁰ And, not only did it accede to the Devas Agreement only after a government committee – the Shankhara Committee – had

²⁷⁸ See Saluka ¶ 309 (Ex. CL-31). ↩

²⁷⁹ Supra ¶ 148. See Desert Line Projects LLC v. Yemen, No. ARB/05/17, Award ¶¶ 186-94 (ICSID 2008) (holding that "fair and equitable treatment" standard breached when investor was subjected to a pattern of state harassment intended to deprive it of the benefit of rights under an international arbitral award, leading to a surrender of such rights under duress) (Ex. CL-7). ↩

²⁸⁰ Devas Agreement at 2 § 3(c) (Ex. C-16). This represents a point of contrast to the White Industries case, where no allegation of agency was made with respect to the subject entity, Coal India. ↩

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endorsed the agreement as being consistent with government policy (see supra ¶ 55),²⁸¹ but Antrix purportedly also undertook to terminate the Devas Agreement upon the instructions of the Space Commission and under the direction of the Department of Space (see supra ¶¶ 92-94). These facts all indicate that Antrix has acted as agent of DOS/ISRO.²⁸² Accordingly, in assessing Respondent's liability, Antrix's various actions, including its executives' repeated assurances of support for the Devas System and its subsequent cynical adoption of the manufactured force majeure, should be directly attributed to Respondent.²⁸³ And even if Antrix were regarded as separate from the Indian Government, the integrated DOS/ISRO/Antrix management structure means that any knowledge imputed to Antrix must also be imputed to Respondent.

²⁸¹ Cf. Maffezini v. Spain, No. ARB/97/7, Award ¶¶ 78, 83 (ICSID 2000) (English translation) (certain actions of Spanish industrial development company, Sociedad para el Desarrollo Industrial de Galicia Sociedad Anonima (SODIGA) were attributable to the State when they involved "implementation of government policies relating to industrial promotion," including activities regarding a particular loan) (Ex. CL-22). ↩

²⁸² See, e.g., Deutsche Schachtbau- und Tiefbohrgesellschaft mbH v. United Arab Emirates, No. 3572, Final Award (ICC 1982), reprinted in Sigard Jarvin et al., Collection of ICC Arbitral Awards 1986-1990 154, 162 (1994) (holding Government and Rakoil "jointly and severally liable" where "Rakoil must be seen as an instrument chosen by the Government to enjoy certain rights and discharge certain obligations on behalf of the Government, but not to the exclusion of the Government's own rights or obligations.") (Ex. CL-9); Wintershall A.G. v. Qatar, Partial Award on Liability at 27-28 (Ad hoc tribunal 1988), 28 I.L.M. 798, 811-12 (1989) (although national oil company had a separate legal personality under Qatari law, it was "'an arm or agent of the Government in respect of the concession areas held by it'") (Ex. CL-39); Nykomb § 4.2 (finding that Latvia "must be considered responsible for Latvenergo's [a state enterprise's] actions under the rules of attribution in international law" where "Latvenergo cannot be considered to be, or to have been, an independent commercial enterprise, but clearly [sic] a constituent part of the Republic's organization of the electricity market") (Ex. CL-26). ↩

²⁸³ Respondent's liability for violations of the Treaty is readily established even before considering Antrix's status, for the reasons already set forth above and based on the expropriatory and other conduct of the PMO, CCS, Space Commission, DOS, ISRO and the numerous officials and representatives of these organizations. ↩

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215. By reason of each and all of the above matters, Respondent has violated the "fair and equitable" guarantees in the first sentence of Article 4(1) of the Treaty.

C. The Measures Were "Unreasonable," In Breach of Article 4(1)

216. The measures adopted by Respondent furthermore violated the second sentence of Article 4(1) of the Treaty, which prohibits a host state from "impair[ing] by unreasonable or discriminatory measures the management, maintenance, use, enjoyment, or disposal of investments in its territory by investors of the other Contracting Party."

217. In Rumeli, an unjustifiable termination of the foreign investor's interest in a joint venture for the provision of mobile telecommunications services was held to constitute an "unreasonable" measure in breach of the Turkey-Kazakhstan BIT.²⁸⁴ The Tribunal held:

[T]he standard of "reasonableness" has no different meaning than the "fair and equitable treatment" standard "with which it is associated." Reasonableness therefore requires that the State's conduct "bears a reasonable relationship to some rational policy . . . ."²⁸⁵

218. In Rumeli, the fact that a measure violated the "fair and equitable" treatment protection meant that it also was "unreasonable" and also (in the circumstances of that case) "discriminatory." Precisely the same conclusions are open in this case, for the reasons already set forth above. (See supra ¶¶ 199-215.)

219. In CME, the state "Media Council" took a series of state measures, all intended to deprive the Dutch investor of the use and enjoyment of a license. The CME

²⁸⁴ Rumeli ¶ 681 (Ex. CL-29). The relevant obligation in Rumeli, imported via the MFN clause, was "the obligation not to impair by unreasonable, arbitrary, or discriminatory measures the management, maintenance, use, enjoyment, or disposal of such investments." Id. ¶ 575. ↩

²⁸⁵ Id. ¶ 679 (footnote omitted) (quoting Saluka ¶ 460 (Ex. CL-31)). ↩

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tribunal found that the State Media Council's actions were "unreasonable" measures in violation of the Treaty:

On the face of it, the Media Council's actions and inactions in 1996 and 1999 were unreasonable as the clear intention of the 1996 actions was to deprive the foreign investor of the exclusive use of the Licence under the [Memorandum of Agreement] and the clear intention of the 1999 actions and inactions was [to] collude with the foreign investor's Czech business partner to deprive the foreign investor of its investment.²⁸⁶

220. The substantive holdings of the UNCITRAL tribunal in BG Group v. Argentina (none of which were considered, much less impugned, by any subsequent post-award proceedings),²⁸⁷ endorsed the view that "unreasonableness" can be ascertained from the circumstances of the case:

"[R]easonableness" should be measured against the expectations of the parties to the bilateral investment treaty, rather than as a function of the means chosen by the State to achieve its goals:
. . . As with the fair and equitable standard, the determination of reasonableness is in its essence a matter for the arbitrator's judgment. That judgment must be exercised within the context of asking what the parties to bilateral investment treaties should jointly anticipate, in advance of a challenged action, to be appropriate behaviour in light of the goals of the Treaty.
. . . Thus, withdrawal of undertakings and assurances given in good faith to investors as an inducement to their making an investments [sic] is by definition unreasonable and a breach of the treaty.²⁸⁸

²⁸⁶ CME Liability ¶ 612 (emphasis added) (Ex. CL-5). ↩

²⁸⁷ The BG Group award is currently subject to post-award proceedings on recognition and enforcement, which are pending before the Supreme Court of the United States. The object of those proceedings does not involve the merits of the tribunal's substantive determinations, but certain matters concerning the jurisdiction of the tribunal. ↩

²⁸⁸ BG Group Plc. v. Argentina, Final Award ¶¶ 342-43 (UNCITRAL 2007) (Ex. CL-3) (second alteration in original) (footnotes omitted) (quoting CME Liability ¶ 158 (Ex. CL-5)). ↩

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221. That same observation applies here: the nullification of an investment on specious grounds, through a fabricated and self-made force majeure, in direct contravention of numerous prior state approvals and assurances of support, is plainly "unreasonable."

D. The Measures Furthermore Were "Discriminatory," in Breach of Article 4(1)'s Second Sentence

222. Separately and independently,²⁸⁹ the measures also violated Article 4(1) because they were "discriminatory." As indicated above, the facts indicate that Respondent's representatives have sought to justify Respondent's annulment of the Devas Agreement on the grounds that foreigners stood to gain from the investment. (See supra ¶¶ 133-134.)

223. In CME, the government took deliberate steps to undermine a foreign investor's use and enjoyment of a media license.²⁹⁰ In Saluka, the host state treated a domestic bank owned by the foreign investor in a manner that was adverse to the treatment it provided to similarly-situated banks with domestic owners.²⁹¹ In both cases,

²⁸⁹ Importantly, a measure can violate Article 4(1)'s "unreasonableness" standard even if no "discrimination" occurred. In Siag, for example, an Egyptian state measure, annulling the right to use a hotel resort even though there was no basis for doing so, was an "unreasonable" measure in violation of the Italy-Egypt BIT, even though no discrimination was found. See Siag ¶ 459 ("The Tribunal has no hesitation in finding that many of the measures taken by Egypt in the course of this dispute were unreasonable in the ordinary meaning of that term.") (Ex. CL-32); see also MTD Equity Sdn Bhd. v. Chile, No. ARB/01/7, Award ¶ 196 (ICSID 2004) (declining to reach a holding on the claim that a decision by a state, reversing a prior policy to allow a given parcel of land to be used for urban development, was discriminatory, on the grounds that "[t]he approval of an investment against the Government urban policy can be equally considered unreasonable") (Ex. CL-25). ↩

²⁹⁰ See CME Liability ¶ 612 (Ex. CL-5). ↩

²⁹¹ See Saluka ¶ 347 (Ex. CL-31). ↩

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it was held that the measures deliberately targeting a foreign investor were discriminatory and therefore a violation of the Netherlands-Czech BIT's ban on "discriminatory" measures, and the same conclusion applies here with respect to Article 4(1) of the Treaty.

E. India Failed to Provide Full Security and Protection to Claimants' Investments, As Required by the MFN Clauses in Articles 4(2) and 4(3)

224. Pursuant to the MFN clauses in Articles 4(2) and (3) of the Treaty,²⁹² Claimants are entitled to the protections set forth in Article 3(2) of the Serbia-India BIT, which provides that "[i]nvestments and returns of investors . . . shall enjoy full legal protection and security."²⁹³

225. As the CME tribunal explained, a "full security and protection" clause obligates the host state "to ensure that neither by amendment of its laws nor by actions of its administrative bodies is the agreed and approved security and protection of the foreign investor's investment withdrawn or devalued."²⁹⁴ In this case, this standard has been violated by (1) the Cabinet's actions, and other affirmative acts, which caused a "withdrawal and devaluation" of the investment, and (2) the other numerous government acts described above that served as a pretextual basis for annulling the Devas Agreement. Accordingly, Respondent has violated the MFN provisions of Articles 4(2) and (3) of the Treaty.

²⁹² See supra ¶ 162; cf. White Indus. ¶¶ 11.2.3-11.2.4 (Ex. CL-38). ↩

²⁹³ Serbia-India BIT, art. 3(2) (Ex. CL-40). ↩

²⁹⁴ CME Liability ¶ 613 (Ex. CL-5); see also Azurix Corp. v. Argentina, No. ARB/01/12, Award ¶¶ 406, 408 (ICSID 2006) (interpreting "full protection and security" guarantee as being broader than mere guarantee of "physical" security; noting that the word "full" extends the scope of protection such that "full protection and security may be breached even if no physical violence or damage occurs") (Ex. CL-2). ↩

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VI.
CLAIMANTS SHOULD BE AWARDED THEIR
FEES AND COSTS FOR THIS PROCEEDING

226. The power of the Tribunal to award costs is set forth in Articles 38 and 40 of the UNCITRAL Rules 1976 (Ex. CL-41):

Article 38

The arbitral tribunal shall fix the costs of arbitration in its award. The term 'costs' includes only:

1. The fees of the arbitral tribunal to be stated separately as to each arbitrator and to be fixed by the tribunal itself in accordance with article 39;
2. The travel and other expenses incurred by the arbitrators;
3. The costs of expert advice and of other assistance required by the arbitral tribunal;
4. The travel and other expenses of witnesses to the extent such expenses are approved by the arbitral tribunal;
5. The costs for legal representation and assistance of the successful party if such costs were claimed during the arbitral proceedings, and only to the extent that the arbitral tribunal determines that the amount of such costs is reasonable;
6. Any fees and expenses of the appointing authority as well as the expenses of the Secretary-General of the Permanent Court of Arbitration at The Hague

. . . .

Article 40

1. Except as provided in paragraph 2, the costs of arbitration shall in principle be borne by the unsuccessful party. However, the arbitral tribunal may apportion each of such costs between the parties if it determines that apportionment is reasonable, taking into account the circumstances of the case.
2. With respect to the costs of legal representation and assistance referred to in article 38, paragraph (e), the arbitral tribunal, taking into account the circumstances of the case, shall be free to determine which party shall bear such costs or may apportion such

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costs between the parties if it determines that apportionment is reasonable.

227. In Kardassopoulos, it was said that "there is no reason in principle why a successful claimant in an investment treaty arbitration should not be paid its costs," which included "legal fees, experts' fees, administrative fees and the fees of the Tribunal."²⁹⁵ The same principle applies to BIT cases governed by the UNCITRAL Rules, and, indeed, costs have been awarded to the successful party in cases governed by the UNCITRAL Rules (1976). As one UNCITRAL tribunal noted, the "more recent practice in investment arbitration [is] of applying the general principle of 'costs follow the event.'"²⁹⁶

228. Claimants respectfully submit that they should be awarded all of their legal fees, costs and other disbursements associated with this arbitration, as well as their share of the costs of the Tribunal and any costs associated with applications to the Appointing Authority.

VII.
RELIEF SOUGHT

229. Claimants respectfully request that the Arbitral Tribunal issue an award:

1. Declaring that the Tribunal has jurisdiction over all of Claimants' claims;
2. Declaring that Respondent has unlawfully expropriated Claimants' investments, in breach of Articles 6 and 7 of the Mauritius-India BIT;

²⁹⁵ Kardassopoulos ¶¶ 689, 692 (Ex. CL-20); see also Gemplus ¶ 17-24 ("[T]he Tribunal decides to apply the general principle that the Claimants, as the successful party, should recover their costs from the Respondent, as the unsuccessful party.") (Ex. CL-15); ADC ¶ 542 (awarding costs to successful claimant) (Ex. CL-1). ↩

²⁹⁶ Chevron Corp v. Ecuador, Final Award ¶ 375 (UNCITRAL 2011) (Ex. CL-4). ↩

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3. Declaring that Respondent has failed to accord fair and equitable treatment to the Claimants' investments, in violation of Article 4(1) of the Mauritius-India BIT;
4. Declaring that Respondent has engaged in unreasonable and/or discriminatory measures with respect to Claimants' investments, in violation of Article 4(1) of the Mauritius-India BIT;
5. Declaring that Respondent has failed to provide full legal protection and security with respect to Claimants' investments, in violation of the "most favored nation" provisions of Articles 4(2) and 4(3) of the Mauritius-India BIT, which incorporate Article 3(2) of the Serbia-India BIT;
6. Declaring that Respondent is liable to pay the costs of these proceedings to date; and
7. Ordering that these proceedings continue for the purposes of determining the reparations due to Claimants, including a determination of the damages owed to Claimants, and the allocation of costs and other matters related to quantum.

Dated: July 1, 2013

Respectfully submitted,

Signature

John L. Gardiner
Timothy G/Nelson
Elizabeth Hellmann
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
Four Times Square
New York, New York 10036
U.S.A.
Telephone: +1-212-735-3000
Facsimile: +1-212-735-2000

SKADDEN, ARPS, SLATE
MEAGHER & FLOM (UK) LLP
David Kavanagh
40 Bank Street
Canary Wharf
London, E14 5DS, England
Tel: +44.20.7519.7000
Fax: +44.20.7519.7070

Claimants' Legal Representatives

1827854-NYCSR07A - MSW