Mitigation can require going to court, but should not require exhaustion of remedies

You are not logged in. If you are a subscriber, please Login to access. If you are not a subscriber, you can contact us for a rate quote at subscribe@iareporter.com. Alternatively, you can sign up to receive free email headlines here.

Refraining from local proceedings was not unreasonable

Articles 1116 and 1117 are different and not a mere formality

Compensation is improper for claims brought under 1116, Canada argues

Compensation does not proceed from reflective losses

“High standard of factual certainty” required to establish causality

Project would not have proceeded “in all probability”

No tax gross-up to account for home state’s taxes

Uncertainty would have doomed the investors’ claims for lost profits

For co-arbitrator, failure to mitigate justifies limited compensation

Investors are awarded slightly more than their sunk costs, at $7 million

Duty to mitigate applies to investor in NAFTA context, tempered by reasonableness

Damages under NAFTA not the same as domestic judicial review

Home state submission supports host state on reflective loss and valuation date

Subsequent practice of NAFTA parties on reflective loss takes precedence over arbitral case-law, Canada recalls

Investors respond to US filing

Investors argue that NAFTA states have all misinterpreted Article 1116

Shareholder/company distinction underpins Canada’s response

No causal link between JRP breaches and project’s failure

Investors insist that project was lawfully required to be approved; failure to approve therefore directly caused loss

Tribunal did not decide whether project might have been rejected on some other basis

Cases on valuation date are inapplicable here; no grounds for gross-up to account for tax imposed by non-disputing state

Claimants seek $443 million in lost profits, using DCF model

DCF not applicable, Canada says; arbitrators should look at amounts invested instead

Investors claim project is secure enough for DCF; precedent exists both for valuation at date of award and for tax gross-up

Archives