New York Judge Pauses Enforcement of $490M Judgment Against Kurdistan Regional Government

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A New York federal judge has decided to pause the litigation filed by Alcazar Capital Partners, a subsidiary of Kuwaiti logistics firm Agility Public Warehousing Co., to enforce a $490 million judgment against the Kurdistan Regional Government of Iraq. This decision comes as a related arbitration proceeding takes center stage.

U.S. District Judge Arun Subramanian ruled on Thursday that the enforcement case should be put on hold until the outcome of the ongoing arbitration before the International Centre for Settlement of Investment Disputes (ICSID). Judge Subramanian emphasized that there is no need to address the central arguments in the current case while the arbitration is still in progress.

The litigation stems from a dispute over a $250 million loan provided by Alcazar to Korek Telecom, a Kurdish mobile phone operator, in 2007. The loan was guaranteed by the Kurdistan Regional Government, with Alcazar seeking to enforce a 2022 Kuwaiti court judgment against the Iraqi government for repayment. However, the Kurdistan government argues that the debt no longer exists following an ICSID tribunal award, though that award was partially annulled earlier this year and is now under review by a new tribunal.