Malaysia’s government achieved another legal victory in its ongoing battle to annul a $14.9 billion judgment, following a ruling by the Supreme Court of the Netherlands which dismissed an appeal by the heirs of the Sultanate of Sulu. The heirs, funded by litigation financier Therium Capital Management, claimed a breach of contract dating back to the early 1800s. According to the Reuters report, Therium has invested approximately $20 million into this case over nine rounds of funding since 2017.
“Malaysia welcomes this landmark ruling as a momentous victory for the rule of law, representing a further step towards the end of the Sulu case and the preservation of the sanctity of international arbitration as an alternative form of dispute resolution,” stated Azalina Othman Said, an official in the Malaysian prime minister’s department.
The dispute centers on an annual payment of around $1,300 that Malaysia had ceased to pay for a lease in the region formerly ruled by the Sulu sultan. A Spanish arbitrator’s award of $14.9 billion to the heirs was later undermined when Gonzalo Stampa, responsible for the ruling, was convicted on a related criminal charge. Stampa had been sentenced to six months in jail for continuing proceedings after being ordered to cease by the court, which found that the Malaysian government had not been properly served.
The claimants tried to enforce the award in Luxembourg, targeting assets of the Malaysian state energy company Petronas in nine banks. However, Petronas accused Therium of misconduct and sought to obtain subpoenaed financial documents and communications through a federal court in Manhattan, with the aim of filing a lawsuit against Therium and their lawyers in Spain for losses related to the asset seizure in Luxembourg.
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