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ACTION NEA-16
INFO OCT-01 ISO-00 COME-00 EB-11 CIAE-00 INR-10 NSAE-00
RSC-01 DRC-01 /040 W
--------------------- 022969
P 050545Z JUN 74
FM AMEMBASSY NEW DELHI
TO SECSTATE WASHDC PRIORITY 1851
LIMITED OFFICIAL USE NEW DELHI 7401
E.O. 11652: N/A
TAGS: BGEN, IN.
SUBJECT: ARBITRATION AWARD AGAINST FERTILIZER COPERATION OF INDIA
1. THE LAW FIRM OF TAFT, STETTINIUS AND HOLLISTER, CINCINNATI,
OHIO, ACTING FOR IDI MANAGEMENT, INC. (FORMERLY GIRDLER CORPOR-
ATION) WROTE COMMERCIAL COUNSELOR DUNCAN-PETERS RECENTLY THAT
AN INTERNATIONAL ARBITRATION TRIBUNAL HAS ISSUED AN AWARD IN
FAVOR OF ITS CLINETS IN THE AMOUNT OF US$302,600.50 AGAINST THE
GOI-OWNED FERTILIZER CORPORATION OF INDIA (FCI). SPECIFICALLY,
THE CINCINNATI LAW FIRM SOUGHT THE EMBASSY'S ASSISTANCE IN
ENCOURAGING THE GOI AND THE FCI TO RECOGNIZE AND PAY THE AWARD
WITHOUT RESORT TO FURTHER LITIGATION OF ADOPTION OF EVASIVE
TACTICS.
2. THE EMBASSY HAS ADVISED JAMES R. BRIDGELAND, PARTNER OF
THE LAW FIRM HANDLING THIS CASE, THAT THE EMBASSY WOULD ENDEAVOR
TO ASCERTAIN THE POSITION THAT THE FCI INTENDS TO TAKE IN THE
MATTER AND INFORM HIM ACCORDINGLY THROUGH THE DEPARTMENT.
3. THE EMBASSY HAS BEEN INFORMED BY A RELIABLE CONTACT IN THE
FCI THAT THE ARTBITRATION AWARD IS LIKELY TO BE CHALLENGED BY
THE FCI IN THE DELHI HIGH COURT. THE FCI HOUSE COUNSEL FEELS
THAT THE FCI HAS A STRONG CASE IN GETTING THE AWARD SET ASIDE.
IN SUPPORT OF THIS, THE FCI IS IN THE PROCESS OF OBTAINING THE
OPINIONS OF SEVERAL SENIOR INDIAN COUNSELS. THE APPARENT CON-
TENTION OF THE FCI COUNSEL APPEARS TO BE THAT INASMUCH AS THE
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AWARD DOES NOT PROVIDE THE REASONS FOR THE VARIOUS DECISIONS
THE BASIS ON WHICH THE AWARD HAS BEEN ARRIVED AT IS INCORRECT
IN LAW.
4. INASMUCH AS THIS CASE IS PURELY A COMMERCIAL ARBITRATION
BETWEEN TWO CONTRACTING PARTIES, THE EMBASSY, AFTER CAREFUL
CONSIDERATION, HAS REFRAINED FROM MAKING ANY REPRESENTATIONS
TO THE GOI WITH RESPECT TO THIS MATTER. IN OUR OPINION, SUCH
ACTION CAN BE MISCONSTRUED AS INTEREFERENCE AND COULD PROVE
TO BE COUNTERPRODUCTIVE.
5. ACTION REQUESTED: PLEASE ADVISE BRIDGELAND OF THE SUBSTANCE
OF THIS TELEGRAM AND RECOMMEND THAT HE HAVE HIS INDIAN LAW
ASSOCIATES FOLLOW DEVELOPMENTS IN INDIA CLOSELY. SCHNEIDER
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