Paul Hastings LLP was recognized as a “runner up” for The American Lawyer’s Litigator of the Week for securing a victory on behalf of the Ad Hoc Board of Venezuela’s state-owned oil company, Petróleos de Venezuela (PDVSA). The Southern District of New York dismissed a securities and New York common law fraud action brought in connection with PDVSA’s nearly $2 billion bond offering for failure to state a claim – a dismissal rarely granted in securities actions. 

In VR Global Partners L.P. v. Petróleos de Venezuela SA, No. 23-cv-05604 (S.D.N.Y.), VR Global Partners, L.P. brought a lawsuit alleging both securities and common law fraud in connection with PDVSA’s bond issuance and subsequent litigation brought by the PDVSA’s Ad Hoc Board seeking to declare the bonds invalid. 

On April 8, 2024, Judge Denise Cote granted PDVSA’s motion to dismiss for failure to state a claim.  The court agreed with our arguments that VR Global’s fraud allegations were illogical, unsupported, and conclusory.

This is the second significant victory Paul Hastings has secured for PDVSA’s Ad Hoc Board in the past three months. In February 2024, we persuaded the New York Court of Appeals to hold that Venezuelan law rather than New York state law governs the validity of the bonds at issue.  The district court here expressly referenced that decision as supporting its findings that VR Global’s fraud allegations were implausible. The team was recognized with a LOTW “Shout-Out” for that win.

Co-Chair of the Complex Litigation and Arbitration practice Kurt W. Hansson and partner Igor V. Timofeyev led the Paul Hastings team, which also included associates James L. Ferguson, Zoe Lo, and Zach Melvin.

More details on the victory can be found here.

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