The Supreme Court on Wednesday (November 5,2020) stayed execution of the international arbitration award that asked Antrix Corporation, the commercial arm of Indian Space Research Organization, to pay compensation of $1.2 billion to Bengaluru-based startup Devas Multimedia for cancelling a satellite deal in 2005.
A bench headed by Chief Justice S A Bobde and comprising Justices L Nageswara Rao and Indu Malhotra stayed the execution of the international award which was passed last week by the US court.
Devas Multimedia had filed a case against Antrix for damages it suffered owing to the cancellation of the agreement to use two satellites (GSAT-6 and GSAT-6A) for high-speed beaming of video content on mobile devices on the S-band spectrum in February 2011.
The two companies had entered into an agreement in 2005. Devas was promoted by a few former employees of ISRO.
The then UPA government cancelled the controversial contract in February 2011, invoking sovereignty and decided to use the advanced satellites (GSAT-6 and GSAT-6A) for the country’s strategic use.
After 2011, Devas moved various legal avenues in India, including the Supreme Court, which directed for a tribunal.
While the international arbitral tribunal had passed the award in September 2015, the order to execute it was delivered by a US court last week.
As per the agreement in January 2005, Antrix had agreed to build, launch and operate two satellites and to make available 70 MHz of S-band spectrum to Devas, which the latter planned to use to offer hybrid satellite and terrestrial communication services throughout India.
The agreement was terminated by Antrix in February 2011. Over the next several years, Devas approached various legal avenues in India. This included the Supreme Court, which directed for a tribunal.
In his October 27 order, the US District Judge ruled that Antrix Corporation pay a compensation of $562.5 million to Devas Multimedia Corporation and the related interest rate amounting to a total of $1.2 billion.
Both Devas and Antrix, on July 16, 2020, filed the instant motion, a Joint Status Report in which they disputed whether the court should lift or extend the stay, and if the latter, whether Antrix would be required to post security.