MIAMI (March 12, 2019) – In a case of international significance, Holland & Knight successfully defended client Helsinge Inc., an energy advisory and trading firm, and its owners against bribery claims brought by Venezuela’s Petroleos de Venezuela SA (PDVSA) through a special “litigation trust.”
On March 8, U.S. District Judge Darrin Gayles found that the trust did not have standing to pursue the claims and its assignment of claims were of "questionable authenticity and legality."
"While the court is mindful of the suffering of the people of Venezuela and severity of the allegations against defendants, it cannot create standing where there is none," stated Judge Mr. Gayles.
In addition to Helsinge, the PDVSA litigation trust also named Colonial Group Inc., Glencore Ltd., Lukoil Petroleum Ltd., Masefield AG, Trafigura AG and Vitol SA and several subsidiaries in its suit.
Early in their defense, Holland & Knight Partners Alex Gonzalez, Israel Encinosa and Brian Briz challenged the litigation trust's standing and attempted to set up depositions with high-level PDVSA officials to determine how the litigation trust was formed. However, no Venezuelan official was allowed to participate.
"As the court correctly noted in its order, the trust is invalid, among other reasons, because the primary purpose for creating the so-called PDVSA US Litigation Trust was primarily to benefit the lawyers, investigator and financier who under the arrangement would receive 66 percent of any recovery," said Mr. Gonzalez. "The purpose was not, as the plaintiff argued, to primarily benefit the suffering Venezuelan people."