A&O Shearman secured landmark victory before French Supreme Court for Alcatel Lucent

The case stemmed from a dispute initiated in 2018 by an ADR holder, ABC Arbitrage, seeking preferential subscription rights during a capital increase. In first instance and appeal, the French Courts dismissed ABC Arbitrage’s claims, which then filed an appeal to the French Supreme Court.

On November 26, 2025, the French Supreme Court rejected this further appeal and ruled that ADR holders are legally entitled to rights only against the depositary bank, who issued the ADR, but do not acquire the status of shareholder and associated preferential subscription rights in the capital increase of a French company.

This is the first precedent to address this issue. This important decision has been published in the Bulletin of the French Supreme Court, reflecting its significance and the court’s intention to make its position clear.

Erwan Poisson, partner at A&O Shearman, commented: “This landmark decision provides clear guidance for cross-border capital markets participants, as it reinforces longstanding market practice reflected in U.S. law governed deposit agreements. It confirms that ADR holders have contractual rights against the depositary, but not shareholder rights under French law.”

A&O Shearman's Paris Litigation & Investigation team, led by partner Erwan Poisson and counsel Julie Metois in prominent roles, led the proceedings.