PDF: 2962 pages, 5.2 MB - Bay Area Council Economic Institute

Legal Services
interim order, necessitating use of Indian counsel. The reason is that arbitration is expensive and
time-consuming in many cases, as commercial arbitrators in India tend to be retired Supreme
Court or High Court judges who may not be in a hurry to bring a case to conclusion since they
are paid according to time spent.
Indian courts, meanwhile, tend to be conservative with monetary awards and have also been
inconsistent in enforcing commercial arbitration awards. India does not view the U.S. as a reciprocating
territory and so will not enforce a U.S. court judgment against a party in India without a
separate subsequent lawsuit being filed in India, with the overseas judgment being submitted as
evidence. At the same time, a U.S. arbitral award is directly enforceable in India in accordance
with India's arbitral law.
Where international arbitration is a possibility, foreign law firms recommend to clients that
contracts with Indian parties be written as enforceable in the laws of a neutral country, such as
Singapore or the U.K.—or where Indian law is applied, that a venue outside India be used.
Following the Growth
Real estate work has been an important component of India practices, as Silicon Valley companies
set up offices in major and “Tier 2” cities, and help locate R&D and design centers in government-sponsored
tech parks or economic zones. Real estate documents are often in local languages,
Patil says, and are not stored electronically, making title searches difficult. Indian laws
restrict foreign ownership of land, favoring long-term leases of government-controlled or approved
properties. Structuring entities offshore—Mauritius, Singapore and the British Virgin
Islands are common locations—and negotiating leases in tech parks and economic zones can
provide favorable tax treatment.
Shirish Gupta, an associate in the Palo Alto office of Chicago-based Mayer Brown
LLP and past president of the Bay Area chapter of the South Asian Bar Association
(SABA), says SABA members tend to break down into two groups: younger
immigration and employment lawyers, and more senior IP litigators.
Gupta and other attorneys interviewed for this report agree that IP licensing and distribution
agreements, along with M&A, are the key areas of growth opportunity in terms of legal services,
as basic technologies pioneered by Bay Area firms are finding new applications throughout India
in the automotive, energy, environmental, transportation, health care, financial, wireless and
other sectors.
But an overall aversion to risk, along with regulatory hurdles, continues to hold back
the kind of entrepreneurial startup and vertical integration activity seen elsewhere.
Attorneys and venture investors at a November 2007 India M&A panel hosted by
Orrick Herrington & Sutcliffe LLP in Menlo Park, for example, observed that Indian
companies are prohibited from buying over their net worth and the large family shareholders
that dominate many Indian firms often refuse to dilute their holdings in cash-stock deals. On the
entrepreneurial side, startups are still relatively few and venture capitalists want to see a
93