Cleary Gottlieb represented BNP Paribas and BNP Paribas Personal Finance in their successful defense against the challenge by Galeries Lafayette of an ICC arbitral award rendered on October 30, 2017.
The underlying dispute related to the sale by Galeries Lafayette to BNP Paribas Personal Finance of the shares of their joint-venture LaSer, owner of consumer credit group Laser-Cofinoga.
Galeries Lafayette and BNP Paribas Personal Finance each owned 50% of LaSer. In September 2012, Galeries Lafayette exercised its put option to sell its interest in LaSer to BNP Paribas Personal Finance.
The parties had contractually agreed that the price of that interest was to be determined by a panel of three experts, whose decision was to be final and binding. In May 2014, the experts unanimously determined that price to be €102.5 million.
In October 2014, Galeries Lafayette commenced an ICC arbitration before three French-speaking Swiss arbitrators, seeking the annulment of the sale of the LaSer shares, and €678 million in damages stemming from the alleged “gross underestimation” by the experts of the value of LaSer.
On October 30, 2017, the arbitral tribunal rendered its final award, in which it rejected Galeries Lafayette’s claim for €678 million in damages. The arbitral tribunal also ordered Galeries Lafayette to pay our clients’ share of the ICC costs ($425,405) and two thirds of our clients’ attorney’s fees, i.e., €1.4 million.
Galeries Lafayette challenged the award before the Paris Court of Appeals, based on an alleged lack of impartiality of the arbitral tribunal. BNP Paribas and BNP Paribas Personal Finance pleaded that Galeries Lafayette’s argument was not really about impartiality, but rather was an attempt to challenge the tribunal’s interpretation of certain exhibits, which under French law cannot justify the annulment of an arbitral award.
On December 17, 2019, the Paris Court of Appeals dismissed Galeries Lafayette’s challenge of the award in its entirety, and ordered it to pay €140,000 in costs.
Galeries Lafayette further appealed to France’s highest court, the Court of Cassation. On March 31, 2021, the Court of Cassation rejected Galeries Lafayette’s action, and ordered it to pay an additional €3,000 in costs.