How have Crystallex and ConocoPhillips pursued enforcement of their awards in U.S. and foreign courts?
Executive summary
Crystallex converted an April 2016 ICSID award into a U.S. federal judgment and pursued veil‑piercing remedies to attach PDVSA/CITGO shares in Delaware, initiating a judicial‑sale process to satisfy its roughly $1.2 billion award plus interest [1] [2]. ConocoPhillips secured multi‑billion ICSID and ICC awards and has pursued enforcement in U.S. courts and overseas by seeking recognition of the awards, attachment of Venezuelan assets abroad, and seizures of revenue streams tied to Venezuelan projects [3] [4] [5].
1. Crystallex’s conversion of an ICSID award into U.S. judgment and targeted attachments
Crystallex confirmed its ICSID Additional Facility award as a judgment in the U.S. District Court for the District of Columbia and then registered that judgment in Delaware to commence enforcement proceedings [2] [1]. After registration, Crystallex successfully argued in Delaware that PDVSA was Venezuela’s alter ego under Bancec, enabling attachment of PDVSA’s ownership interests in PDV Holding, the parent of CITGO, and execution of a writ of attachment against those shares [1] [6]. The Delaware litigation evolved into a judicial‑sale process over PDV Holding shares overseen by the district court and a special master, with competing creditor claims and liens — a process chronicled in contemporaneous coverage and practitioner updates [7] [8].
2. Legal theory and jurisdictional maneuvers in Crystallex’s strategy
Crystallex relied on FSIA ancillary‑enforcement doctrines and the alter‑ego/veil‑piercing framework to overcome presumptive immunity and reach state‑owned enterprise assets, an approach the Third Circuit has endorsed in precedent cited in enforcement opinions [6] [9]. Practitioners and courts have debated whether the commercial‑activity and “direct effect” tests of FSIA apply when transfers predate a formal award, a point litigated in related briefing and appellate opinions [10] [11]. Steptoe and other law‑firm analyses emphasize that Crystallex’s tactics raise enduring questions about the interaction of international arbitration awards, FSIA immunity, and enforcement tools used by judgment creditors [1] [7].
3. ConocoPhillips’s multi‑forum enforcement: U.S. courts, ICSID annulment battles, and seizures abroad
ConocoPhillips obtained large arbitral awards against Venezuela — including an ICSID award exceeding $8 billion and ICC awards — and pursued recognition in U.S. federal court, where judges have entered judgments enforcing those awards [3] [5] [4]. Venezuela sought annulment and stays at ICSID, but at least one annulment committee dismissed Venezuela’s challenge, clearing the path for enforcement [3] [4]. ConocoPhillips has complemented U.S. litigation with efforts in foreign jurisdictions to seize or freeze Venezuelan assets and to intercept payments from joint ventures — for example, seeking seizures in Trinidad and Tobago and other fora where PDVSA or Venezuela have receivables [3] [4].
4. Tactical overlap, competition among creditors, and the role of sanctions
Both Crystallex and ConocoPhillips have operated in a crowded enforcement field where multiple judgment creditors compete for the same Venezuelan assets, and secured creditors (bondholders) assert priority claims that complicate attachments and sales [7] [8]. U.S. sanctions and OFAC licensing play a decisive practical role: sanctions have blocked some direct transfers and require special authorization or carve‑outs for enforcement actions, a constraint noted in practitioner summaries and case filings [9] [1]. Commentators warn that OFAC policy and lien priority disputes substantially shape which enforcement avenues are viable in practice [1] [8].
5. Court rulings, precedent, and unresolved legal questions
U.S. appellate decisions have both enabled enforcement by affirming alter‑ego findings for PDVSA and left open circuit splits and limits that other courts may resolve only with further litigation or Supreme Court guidance [6] [2]. The litigation shows a pattern: arbitration awards produce judgments, creditors register those judgments in U.S. districts, then press veil‑piercing and ancillary‑jurisdiction arguments while balancing OFAC and competing‑lien realities — but long‑running sales and asset seizures remain contested and uncertain [1] [7] [8]. Where reportage or the public record does not establish particular asset seizures or global freezes, reporting is limited to the judicial filings and practitioner accounts cited above [3] [4].