Khudyan v. Republic of Armenia

CourtDistrict Court, District of Columbia
DecidedJuly 14, 2025
DocketCivil Action No. 2024-1054
StatusPublished

This text of Khudyan v. Republic of Armenia (Khudyan v. Republic of Armenia) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Khudyan v. Republic of Armenia, (D.D.C. 2025).

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA ____________________________________ ) EDMOND KHUDYAN, ) ) Plaintiff, ) ) v. ) Civil Action No. 24-1054 (RBW) ) REPUBLIC OF ARMENIA, ) ) Defendant. ) )

MEMORANDUM OPINION

The plaintiff, Edmond Khudyan, brings this civil action against the defendant, the

Republic of Armenia, pursuant to 22 U.S.C. § 1650a and Article 54 of the Convention on the

Settlement of Investment Disputes between States and Nationals of Other States (the “ICSID

Convention”), seeking recognition and enforcement of a judgment entered in an International

Centre for Settlement of Investment Disputes (“ICSID”) annulment decision in the amount of

$438,393.84 issued in favor of the plaintiff and against the defendant by an international tribunal

on July 21, 2023, in ICSID Case No. ARB/17/36. See Petition to Recognize Arbitration Award

Pursuant to 22 U.S.C. § 1650a, Exhibit (“Ex.”) 1 (Khudyan v. Republic of Armenia, ICSID Case

No. ARB/17/36, Decision on Annulment ¶ 259 (July 21, 2023)) (“Annulment Decision”), ECF

No. 1-2.

Currently pending before the Court are (1) the plaintiff’s Petition to Recognize

Arbitration Award Pursuant to 22 U.S.C. § 1650a (“Pl.’s Pet.”), ECF No. 1, which the defendant

opposes, see Opposition to Khudyan’s Petition to Enforce Annulment Award, Counterpetition to

Confirm Arbitral Award (“Def.’s Counterpet.”) at 1, ECF No. 15; and (2) the defendant’s

counterpetition to confirm a prior arbitral award in favor of the defendant and against the plaintiff and Arin Capital & Investment Corporation (“Arin Capital”), 1 see id. Upon careful

consideration of the parties’ submissions, 2 the Court concludes for the following reasons that it

must grant the plaintiff’s petition and deny the defendant’s counterpetition.

I. BACKGROUND

1. Factual and Procedural Background

In 2017, the plaintiff, along with Arin Capital, “the company of which he is a sole

shareholder,” submitted arbitration claims against the defendant to the ICSID, alleging that the

defendant “violated international law by failing to prevent the embezzlement of his investment in

a real estate development.” Pl.’s Pet. ¶ 19. The defendant argued that the ICSID did not have

jurisdiction over those claims because the plaintiff “was an Armenian citizen and [ ] his co-

claimant did not invest in the real estate.” Id. On December 15, 2021, an ICSID tribunal

“upheld [the defendant]’s jurisdictional objections . . . [and] ordered [the plaintiff] and his co-

claimant [Arin Capital] jointly and severally [liable] to reimburse a portion of [the defendant]’s

costs in the arbitration.” Id. ¶ 20 (citing Annulment Decision ¶¶ 69–71); see Def.’s Counterpet.,

Ex. 1 (Khudyan et al. v. Republic of Armenia, ICSID Case No. ARB/17/36, Award ¶ 452 (Dec.

15, 2021)) (“Original Cost Decision”), ECF No. 15-2.

In February 2022, the plaintiff contacted the Head of the Republic of Armenia’s Passport

and Visa Department, which confirmed that the plaintiff was never a citizen of the Republic of

Armenia. See Pl.’s Pet. ¶ 21 (citing Annulment Decision ¶ 126). Subsequently, “[o]n April 8,

2022, [the plaintiff] sought annulment of the award’s citizenship finding and cost order under

1 The parties and the ICSID decisions at issue in this case also refer to this entity as Arin US. For consistency, the Court refers to Arin Capital throughout. 2 In addition to the filings already identified, the Court considered the following submissions in rendering its decision: (1) the plaintiff’s Reply in Support of His Petition to Recognize Arbitration Award and in Opposition to Respondent’s Counter-Petition (“Pl.’s Opp’n”), ECF No. 16, and (2) the defendant’s Reply to its Counterpetition to Confirm Arbitral Award (“Def.’s Reply”), ECF No. 19.

2 Article 52(1)(b) of the ICSID Convention, claiming that the tribunal ‘manifestly exceeded its

powers’ by failing to exercise jurisdiction over him.” Id. ¶ 22 (citing Annulment Decision ¶¶ 7,

72). Pending the outcome of the Annulment Proceeding, the Annulment Committee “ordered

[the plaintiff] to put the amount of the costs order into escrow as a condition for staying

enforcement, which [he] did.” Id. ¶ 23 (citing Annulment Decision ¶¶ 25, 30–31).

On July 21, 2023, the Annulment Committee “upheld [the plaintiff]’s application, finding

that the ‘starting point’ of the tribunal’s citizenship analysis consisted of an assumption that was

never substantiated.” Id. ¶ 24 (citing Annulment Decision ¶¶ 187–217). Therefore, the

Committee annulled in part the Original Cost Decision, but annulled in full the Original Cost

Decision’s order that the plaintiff and Arin Capital pay the defendant an award of fees and costs.

See id. ¶ 26 (quoting Annulment Decision ¶¶ 244–45). In issuing the decision, the Committee

recognized that although only Mr. Khudyan had sought annulment and, thus, the Original Cost

Decision’s jurisdictional conclusions as to Arin Capital “remain[ed] valid and effective[,]” id.,

because “[t]he Tribunal did not distinguish between the two Claimants[,]” id., “the Committee is

not in a position to determine for itself what portion of the costs awarded by the Tribunal relate

to Mr[.] Khudyan and which part to Arin [Capital], each of which was jointly and severally liable

for the full amount awarded,” id. Therefore, the Committee determined that the only course of

action was to annul the award in full. See id. In addition to annulling the Original Cost

Decision’s award of costs and fees, the Committee “ordered [the defendant] to reimburse all of

the plaintiff’s incurred costs, which amounted to $438,393.84.” Id. ¶ 27 (citing Annulment

Decision ¶¶ 252–58). Despite the Committee’s rulings, the plaintiff represents that “[the

defendant] has not yet paid [him.]” Id. ¶ 30.

3 Consequently, on April 12, 2024, the plaintiff filed his Petition in this Court, see id. at 1,

requesting, inter alia, that the Court (1) “[o]rder[] that the pecuniary obligation in the Annulment

Decision in favor of [the plaintiff] against [the defendant] be recognized and entered as a

judgment . . . in the same manner and with the same force and effect as if the Annulment

Decision were a final judgment of this Court,” id. at 9; and (2) “[e]nter[] judgment in favor of

[the plaintiff] against [the defendant] equal to [ ]$438,393.84, plus applicable post-judgment

interest up to the date when payment is made full[,]” id. And, on October 22, 2024, the Clerk of

this Court entered a default against the defendant, see Default at 1 (Oct. 22, 2024), ECF No. 8, in

response to the plaintiff’s request, see Affidavit in Support of Default at 2, ECF No. 6. Shortly

thereafter, on October 30, 2024, the plaintiff moved for a default judgment pursuant to 28 U.S.C.

§ 1608(e) and Federal Rule of Civil Procedure 55(b)(2), alleging that the defendant “was

properly served with the Summons and Petition over six months [prior], and . . . failed to file a

responsive pleading or otherwise appear.” See Petitioner Edmond Khudyan’s Motion for Entry

of Default Judgment at 2, ECF No. 9.

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