Nori Holdings Limited et al v. PJSC Bank Okritie Financial Corporation, [2018] EWHC 1343 (Comm)

NORI HOLDINGS LIMITED ET AL V PJSC BANK OKRITIE FINANCIAL CORPORATION

Nori Holdings Limited et al v PJSC Bank Okritie Financial Corporation, [2018] EWHC 1343 (Comm)

Whether the court of one EU Member State can grant an anti-suit injunction where one of the parties has started legal proceedings in another EU Member State in disregard of an existing arbitration agreement between the parties?

The Brussels Regulation was adopted by the European Union in 2000 in order to minimize the impact of differences between national rules governing jurisdiction.
An injunction to stop legal action launched in violation of an arbitration agreement in another Member State court cannot be granted by an English court.

Five Share Pledges over shares owned by the three Claimants were used as security for the more than $500m in short-term loans made by the defendant, a Russian company. These Share Pledges had an arbitration clause with London as the seat.
The short-term loans backed by Share Pledges were then replaced with long-term unsecured bonds as a result of a sequence of transactions that occurred in August 2017.
The arbitration clause of the Share Pledges was purportedly referenced in five Pledge Terminations that terminated the Share Pledges and were regulated by Cyprus law.
The Claimants transferred the shares that were the subject of the earlier Share Pledges to other firms after the August Transactions, and those companies then pledged the shares to a different bank.
After the August Transactions, the Claimants transferred the shares covered by the earlier Share Pledges to other businesses, who subsequently pledged them to a different bank as collateral for additional loans.
The borrowers/claimants sought to enforce the arbitration clause in the agreements between the parties by applying to the English court for an anti-suit injunction aiming to prevent the Defendant from moving on with its claim.

The English court reaffirmed the validity of the West Tankers Inc. principles by refusing to grant an anti-suit injunction against the Russian bank.
In so doing, the English court clarified that the Recast Regulation adopts the same position as its predecessor, which rejects the grant of anti-suit injunctions to enforce arbitration clauses between parties in the European Union.
The Court held that English court cannot grant ant-suit injunction to restrain proceedings in another Member State court brought in breach of an arbitration agreement.