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The yearslong legal battle over a $486 million arbitral award involving Doraleh Container Terminal SA and the Republic of Djibouti has been resolved, with both parties agreeing to end litigation in a Washington, D.C., federal court.

U.S. District Judge Beryl A. Howell signed off on the stipulation of dismissal on Tuesday, finalizing the agreement just days after the parties informed the court they would not pursue arbitration over contentious representation issues.

Key Settlement Terms

As part of the settlement, Djibouti agreed not to oppose the use of discovery already obtained by DP World Djibouti FZCO, Doraleh Container Terminal’s parent company, in a separate enforcement case concerning a related $194.3 million arbitral award.

The dispute stemmed from a 2006 concession agreement between DP World and Djibouti's Port de Djibouti SA to build and operate the Doraleh international container terminal, considered one of Africa’s most advanced ports. In 2019, Doraleh Container Terminal won the $486 million arbitral award after DP World was ousted from the lucrative port management deal.

Representation Dispute

The litigation took an unusual turn due to a 2018 governance crisis at Doraleh Container Terminal. Djibouti had appointed Chantal Tadoral as a provisional administrator to navigate the venture through the conflict.

This appointment raised questions about whether Quinn Emanuel Urquhart & Sullivan LLP had proper authorization to represent Doraleh Container Terminal in the enforcement proceedings. In a 2-1 decision earlier this year, the D.C. Circuit ruled that the district court was obligated to resolve these questions, citing principles that a lawyer’s authority can be challenged at any point in litigation.

Broader Implications

Djibouti, located strategically near two of the world’s busiest shipping routes, has been at the center of legal and geopolitical disputes over control of its ports. The resolution of this case, however, clears a major obstacle in DP World’s broader efforts to enforce arbitral awards against the East African nation.

Neither Quinn Emanuel attorneys representing Doraleh Container Terminal nor Kramer Levin Naftalis & Frankel LLP, representing Djibouti, provided comments on the settlement.

A Complex Legal Saga

The settlement marks the end of a four-year legal battle over a multimillion-dollar arbitration victory tied to Djibouti’s efforts to regain control over port operations. The case underscores the complex interplay of corporate governance, international arbitration, and sovereign rights in the global shipping industry.