Justice decides to proceed with the transfer of Eldorado Brasil to Paper Excellence

In a new decision by the Court of Justice of São Paulo (TJ-SP), the transfer of control of Eldorado Brasil to Paper Excellence (PE), a minority partner of J&F Investimentos in the pulp producer, was resumed.

This Monday, the 20th, the judge José Benedito Franco de Godoi, from the 1st Chamber of Corporate Law of the TJ-SP, said that the suspension of the arbitration and the annulment action initiated by J&F is no longer valid and determined that the arbitral tribunal and the presidency of TJ-SP are informed of the decision. In this way, the arbitration can resume the procedures for transferring control of Eldorado, after more than four years of legal dispute.

Recently, the judge José Carlos da Costa Netto decided to reinstate the suspension of all legal procedures related to the dispute between J&F and PE, amid a discussion on conflict of competences. According to the judge, the decision would be valid until the conflict of jurisdiction was judged by the Special Group of the Private Law Section. However, PE, which is at the origin of the questioning, ended up withdrawing an appeal with a view to ending this discussion.

In this week’s order, addressed to Costa Netto, Franco de Godoi argued that the jurisdictional competence of the Special Group “exhausted after the approval of the withdrawal of the motion for clarification” by PE. The judge also points out that the competence of Costa Netto, who is the rapporteur in this case, ceased to exist and, therefore, the suspension decision is no longer valid.

“Thus, there is no way to prevent the processing of the appeals, because with the approval of the withdrawal carried out by the Hon. Mr. Judge Costa Netto, despite being negligible, his competence was erased (…) This time, the decision rendered has no legal repercussions”, says the order.

In a note to Valor Econômico, J&F reported that “the processing of the annulment action and the arbitration procedure is suspended due to a conflict of jurisdiction caused by successive appeals” by Paper Excellence.

“Any movement in these processes during the suspension is null, in accordance with article 201 of the internal regulations of the Court of Justice of São Paulo, which determines that ‘once a conflict of competence arises, the process will be suspended’, the rapporteur of the conflict being responsible for ‘ decide on urgent measures’. There is, therefore, no way for any order to transfer shares,” claimed the Batista brothers’ holding company.

Paper Excellence did not comment on the matter.