Henry Reid instructed in Payward Inc & Ors v Maxim Chechetkin [2023] EWHC 1780 (Comm)

Henry Reid in conjunction with Chloe Bell of 3 Verulam Buildings successfully resists the enforcement of an arbitral award in the English Commercial Court on grounds of public policy

Henry Reid of Outer Temple Chambers acted in conjunction with Chloe Bell of 3 Verulam Buildings for Mr Maxim Chechetkin against US and UK entities associated with the prominent cryptocurrency exchange ‘Kraken’. The claim was brought under s.26 FSMA 2000 in respect of the sale of certain products in breach of the general prohibition created under FSMA 2000.

Henry, together with Chloe, acted at all stages of the claim successfully opposing the Defendants’ challenge of the High Court’s jurisdiction [2022] EWHC 3057 (Ch) and other injunctive applications. Mr Chechetkin then opposed Kraken’s Part 8 Claim to enforce a US arbitration decision in the Commercial Court.

In a judgment handed down by Bright J on 14 July 2023, the Commercial Court refused to enforce an arbitral award made under the auspices of JAMS in San Francisco, California, on the grounds that it contravened English consumer protection which has the status of public policy under section 103 of the Arbitration Act 1996. Bright J also concluded that the arbitral award stifled Mr Chechetkin’s ability to advance a claim under FSMA 2000.

Henry was instructed by Alexander Shirtcliff of Blake Morgan LLP.

The case is one of the leading regulatory claims in respect of the sale of cryptoassets in the English courts to date, and is likely to have wider implications for investors trading on other crypto-exchanges, many of which have compulsory arbitration, exclusive jurisdiction and applicable law clauses which purport to exclude English law statutory protections.

Judgment

Read the full judgment for Payward Inc and others v Maxim Chechetkin [2023] EWHC 1780 (Comm) here.

This case has attracted a lot of industry interest, with some further commentary on the earlier stages below.

Acuity Law
Simmons and Simmons LLP
Lexology / Hausfeld LLP

Find out more

Henry’s practice covers a wide array of commercial, corporate and financial services matters with an emphasis on commercial litigation, contentious and non-contentious financial services, regulatory investigations, fintech, sanctions and banking law.

To find out more about Henry, contact Sam Carter on +44 (0)203 989 6669.

News 14 Jul, 2023