S’pore SC Bars Har­ish Salve from Ap­pear­ing in Dai­ichi-Ran­baxy Case

Ran­baxy is seek­ing to set aside over $500-m pay­out to Dai­ichi

The Economic Times - - Companies: Pursuit Of Profit - Sa­man­waya.Rau­tray @times­group.com

New Delhi: The Supreme Court of Sin­ga­pore has dis­al­lowed se­nior ad­vo­cate Har­ish Salve from ap­pear­ing be­fore it on be­half of the cor­po­rate sell­ers of Ran­baxy who are seek­ing to set aside an award in ex­cess of $500 mil­lion by a lo­cal ar­bi­tra­tion panel to pur­chaser Dai­ichi for not re­veal­ing the risks in­volved in the buy­out.

Salve, in a first such move by a se­nior ad­vo­cate from In­dia, made an ap­pli­ca­tion to the Sin­ga­porean Supreme Court seek­ing to ar­gue against the award on be­half of the sell­ers. He has ap­peared ear­lier for the sell­ers in the Delhi High Court. For­mer Ran­baxy pro­mot­ers Malvin­der Singh and Shivin­der Singh are ac­cused of con­ceal­ing in­for­ma­tion re­gar- ding wrong­do­ing at Ran­baxy when they sold a ma­jor­ity stake in it to the Ja­panese firm in 2008. The sell­ers are seek­ing to have the award ei­ther set aside or a re­duc­tion in the quan­tum, in ap­peal. Dai­ichi, on the other hand, has ap­plied to the court to have the award en­forced.

A Sin­ga­pore ar­bi­tral tri­bunal had by a ma­jor­ity de­ci­sion of 2:1 found that the sell­ers were li­able for fraud­u­lently mis- rep­re­sent­ing and/or con­ceal­ing from the buyer the source and sever­ity of the com­pany’s reg­u­la­tory prob­lems.

The tri­bunal ar­rived at the award on the ba­sis of In­dian tort law, which man­dates that in de­ceit claims, the party al­leg­ing fraud would be en­ti­tled to be put back on the po­si­tion he would have been in, had the wrong not been com­mit­ted.

This was cal­cu­lated as the dif­fer­ence be­tween what the buyer paid for the shares and the ac­tual worth of the shares, less any ben­e­fits it has re­ceived, to­gether with pre- and post-award in­ter­est.

The sell­ers have chal­lenged the quan­tum of the award and have urged the court to set it aside on the ground that the tri­bunal had awarded “puni­tive, ex­em­plary, mul­ti­ple and/ or con­se­quen­tial dam­ages” ex­pressly pro­hib­ited by the ar­bi­tra­tion agree­ment.

Har­ish Salve FILE PHOTO

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