STEPANAKERT — On December 10 Nagorno-Karabakh Republic (NKR) President Bako Sahakyan sent...
N.Y. District Court Orders $37.5 Million Judgement Against Former Environment Minister of Armenia
NEW YORK — In a judgement dated September 5, 2012, the U.S. Southern District Court of New York ordered the U.S. Marshall of the same district to seize $37,537,978 from Vardan Ayvazyan to be paid to Global Gold Mining LLC.
Vardan Ayvazyan, a former RA Minister of the Environment, had been sued by Global Gold for exerting undue pressure on one of its subsidiaries that was the license holder for the Hankavan mine in Armenia.
In 2006, a subsidiary of the Company which was the license holder for the Hankavan property was the subject of corrupt and improper demands and threats from the now former Minister of the Ministry of Environment and Natural Resources of Armenia, Vardan Ayvazyan. The Company reported this situation to the appropriate authorities in Armenia and in the United States; eventually, the Company lost control of the Hankavan property as a result of Ayvazyan.
The Company engaged international and local counsel to pursue prosecution of the illegal and corrupt practices directed against the subsidiary. On November 7, 2006, the Company initiated the thirty-day good faith negotiating period (which is a prerequisite to filing for international arbitration under the applicable 2003 Share Purchase Agreement) with the three named sellers/shareholders and one previously undisclosed shareholder and the principal directing the other shareholders, Ayvazyan.
The Company filed for arbitration under the rules of the International Chamber of Commerce, headquartered in Paris, France (‘ICC’) on December 29, 2006. On June 25, 2008, the Federal District Court for the Southern District of New York ruled that Ayvazyan was required to appear as a respondent in the ICC arbitration.
On September 5, 2008, the ICC International Court of Arbitration ruled that Ayvazyan shall be a party in accordance with the decision rendered on June 25, 2008 by the Federal District Court for the Southern District of New York. Subsequently, in December 2011 the ICC Tribunal decided to proceed only with the three named shareholders; in March 2012, GGM filed an action in Federal District Court pursuant to that Court’s prior decisions for damages against Ayvazyan and/or to conform the ICC Tribunal to the precedents. Based on the evidence of the damages suffered as a result of Ayvazyan’s actions, the final $37,537,978.02 federal court judgment in favor of GGM is comprised of $27,152,244.50 in compensatory damages plus $10,385,734.52 of interest at 9% from 2008.
The Company has notified the ICC that the pending arbitration against the other three shareholders should be terminated as moot, considering the final judgment against Ayvazyan.
This new decision will probably not impact Ayvazyan since the United State and Armenia have no treaties regarding the seizure of assets.
The only practical implication is tat Ayvazyan will be barred from entering the States.
Chief Executive Officer and Chairman of Global Gold Mining is Van Krikorian, a member of Armenian Assembly of America Board of Trustees