Deadlock continues: Amazon-Future talks to resolve row break down

SC allows Amazon to file interim application

Out-of-court talks between Future Group, Reliance Industries (RIL), and Amazon to resolve the legal battle arising out of the sale of Future Group’s assets to RIL have not led to a resolution, counsels for Future Coupons and Amazon told the Supreme Court on Tuesday.

On March 3, Amazon had proposed a dialogue with Future Group and RIL to end the legal deadlock and the court had given them time until March 15 to come up with a settlement.

Amazon told the court it would like to begin arbitration proceedings in Singapore, which had been put on hold by the Delhi High Court. Future Group had agreed to this.

Amazon’s counsel said the Supreme Court had been told no assets (of Future Group) would be transferred, and the orders (of the court) had been flouted.

However, Future Group’s counsel denied this.

On Tuesday, the Supreme Court allowed Amazon to file an interim application and the case was adjourned until March 16. 

According to a source in the know, Amazon will file an interim application, asking for a resumption of tribunal hearing and also an injunction on Future Retail from transferring its assets to RIL.

In a newspaper advertisement on Tuesday, the US e-commerce major accused Future Retail and RIL of “fraud” over the transfer of stores.

RIL started the takeover of Future Group stores on February 25.

On March 9, Future Group said in two stock exchange filings it received termination notices on March 7 and March 8 for 947 stores, which it had sub-leased from Reliance entities.

Future Lifestyle has received termination notices for 78 Brand Factory stores and 34 Central stores and these stores have been contributing 55-65 per cent of the company’s retail revenues, it said in its stock exchange filing.

Future Group has approximately 1,500 stores and the remaining stores (around 550 stores) are still with it.

On March 15, Amazon filed a petition in the Delhi High Court to stop Future Retail’s (FRL’s) $3.4-billion deal with RIL. Amazon has asked the court to issue an injunction (in terms of the directions passed by the arbitral tribunal), restraining respondents from taking steps to complete the impugned transaction with entities that are part of the RIL group.

The case will come up for hearing on March 22.

“Amazon’s public notice seems to be irregular and improper considering the parties are currently litigating before courts. Amazon has made serious allegations of ‘playing a fraud on the Courts’ and ‘making false submissions before the Supreme Court’ against Future Group,” said Sohil Shah, principal associate, Pioneer Legal.

Sonam Chandwani, managing partner, KS Legal & Associates, said: “The situation is deteriorating, and the two titans engaged in such a fierce conflict presents a dismal image.”

Pavana Padmakumar, an associate at law firm Pioneer Legal, said: “What the public notice achieves for Amazon may be two-fold: Primarily, it re-emphasises Amazon’s intent to battle it out with FRL and its promoters, and secondly, to show the violation of a court order, thereby indicating contempt on the part of FRL.”