The legal battle between Jeff Bezos-led Amazon and Kishore Biyani-headed Future Group has reached to new heights. Amazon.com Inc. has filed a petition in Delhi High Court asking for the detention of Future Group’s founder and seizure of assets for violating an arbitration court’s order to temporarily halt Future Group’s $3.4-billion deal with Mukesh Ambani-owned Reliance Industries (RIL), revealed sources.
“In the light of above, the necessary consequence of the willful disobedience by the majority Respondents and KMP Respondents entails attachment of property of the aforesaid Respondents and detention in the civil prison of the Respondent nos. 3-11 as well as the directors of FCLP (Future Coupons Pvt Ltd), FRL (Future Retail Limited), Respondent no.14, 15 and 16,” said the Amazon petition and which was seen by Business Standard.
In the petition, the Respondent no.3 has been mentioned as Kishore Biyani, the executive chairman and group CEO of FRL and Respondent no.8 is Rakesh Biyani, who is the managing director of FRL.
“The petitioner submits that if the relief as sought for in the present petition are not granted, the majority Respondents and KMP Respondents will proceed with the impugned transaction, as they have publicly declared and repeatedly sought,” said the petition. It said this will vitiate the petitioner’s entire investment in FCPL, which is not compensable in monetary terms. “Thus if the majority Respondent and KMP Respondents continue with their contumacious conduct, it will cause irreparable loss and injury to the petitioner.”
According to an analysis of the petition by legal experts, Amazon in its present petition filed before Delhi HC has accused Future Group’s founders and other Respondents of violating the Delhi HC order dated December 21, 2020.
“Here the court had essentially upheld the validity of the Order passed by the Emergency Arbitrator passed in Singapore under SIAC (Singapore International Arbitration Centre) Rules, as valid under Indian law,” said Salman Waris, managing partner at technology law firm TechLegis Advocates and Solicitors.
He said Amazon has also alleged in the present petition that the Future Groups founders and other Respondents have misrepresented and selectively quoted from the order of the HC before various authorities and Government bodies to be able to secure necessary approvals for their deal thus committing contempt. “Hence Amazon has now sought the implementation of October 25, 2020 Order of the HC seeking Injunction against the Future Group founders and other Respondents and also their detention in Civil Prison.”
Last week, market regulator Securities and Exchange Board of India’s (Sebi ) approved Future Group's scheme of arrangement and sale of assets to Reliance. Based on this, the Bombay Stock Exchange also granted its "no adverse observation" report to the deal. However, Amazon said Sebi’s approval for Future Retail’s deal with Reliance Industries is subject to court decisions.
Sebi has allowed the deal with some riders. It has reportedly said the litigation pending before the Delhi High Court and arbitration proceedings by Amazon contesting the deal should be specifically mentioned by Future Group while seeking shareholders or the National Company Law Tribunal approval. It has also reportedly held that Sebi's go-ahead on the draft scheme of arrangement would be subject to the outcome of these proceedings.
Equipped with the notice from the Delhi High Court, Amazon this month had also sent another letter to the Sebi, requesting it not to issue a ‘no-objection certificate’ (NOC) to the Future Retail-Reliance Industries deal and suspend the review immediately. The e-commerce firm had further urged the markets regulator to direct the Indian Stock Exchanges to not to issue no-objection or approval letter to Future Retail.
This month it also informed Sebi about the formation of the arbitration tribunal at the Singapore International Arbitration Centre (SIAC). The next phase of arbitration proceedings between Amazon and Future Group is expected to begin soon in Singapore, according to the sources.
In August 2020, Future Group struck a $3.4-billion asset sale deal with Reliance Industries (RIL). Amazon then sent a legal notice to Future, alleging the retailer’s deal breached an agreement with the American e-commerce giant.
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