Storm LLC v. Telenor Mobile Communications

Norwegian company Telenor Mobile Communications AS (Telenor) (plaintiff) and Ukrainian company Storm LLC (defendant) owned Ukrainian company Kyivstar G.S.M. Storm was a holding company owning 40 percent of Kyivstar. Altimo Holdings Investment Ltd. (Altimo), formerly Alpha Telecommunications, owned 50.1 percent of Storm through related company Alpren Ltd. Kyivstar’s shareholder agreement included an arbitration provision requiring that disputes be arbitrated in New York. Telenor initiated arbitration, alleging that Storm violated the shareholder agreement by failing to follow Kyivstar’s governance procedures. During arbitration, Alpren, 49 percent owner of Storm, brought suit against Storm in Ukraine, arguing that the shareholder agreement was unenforceable. Vadim Klymenko, vice president of Altimo, appeared on behalf of Storm and countered Alpren’s claims. The Ukraine court found that the shareholder agreement was invalid, and Storm appealed. The ruling was affirmed, invalidating the shareholder agreement and arbitration provision. Storm moved to dismiss the arbitration, which the arbitrator denied. Storm filed suit in state court, later removed to federal district court, opposing the arbitration based on subject-matter jurisdiction. The district court declined to review Storm’s lawsuit involving an interlocutory arbitration order because the Ukraine court did not order that Storm could not participate in arbitration. Alpren brought suit in Ukraine against Storm and Klymenko. The Ukraine court ruled that Klymenko, Storm, and Telenor were precluded from arbitrating. Telenor filed suit in district court, requesting that Storm be compelled to arbitrate, and sought an antisuit injunction preventing litigation in Ukraine.