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August 2013: Complete Arbitration Victory for Kingdom of Cambodia

August 2013

Working as co-counsel with Freshfields, the firm recently obtained an important international arbitration victory denying all claims for damages against our client, the Kingdom of Cambodia, and awarding substantial attorneys’ fees and costs.

In 2009, Cambodia Power Company initiated an arbitration claim through the International Center for the Settlement of Investment Disputes (ICSID) against the Kingdom of Cambodia, alleging that the Cambodian government had committed numerous breaches of contracts for the development of a major power plant in Phnom Penh, and claiming over $250 million in damages. At the outset, the firm participated in the successful defense of two key motions by the Cambodia Power Company to exclude the vital witness statements of the Cambodian government’s key witness, a former consultant for Cambodia Power Company who had shepherded the development effort of the power plant over its 4 year history and, in the process, had retained voluminous project documents, correspondence, and notes.

The arbitration hearing was held in September 2012. On April 22, 2013, the ICSID tribunal rendered its decision, holding that the Kingdom of Cambodia did not breach its agreements with Cambodia Power Company and denying all of the claims brought against the Kingdom of Cambodia. The ICSID tribunal also ordered Cambodia Power Company to pay the Kingdom of Cambodia over $5.6 million for legal costs and expenses in arbitration and costs incurred by counsel over the last four years. As a result, the Kingdom of Cambodia may continue the development of much needed power infrastructure, free of the huge financial impact that an adverse decision in the arbitration would have caused to those efforts.