Embassy Law Web Log   
Washington, DC, USA      

Vacated Default Judgment Against Foreign Sovereign

Default judgments against foreign sovereigns are especially disfavored, the United States District Court for the District of Columbia explained in a 20-page memorandum opinion on December 28, 2009. In Reuven Gilmore et al. v. Palestinian Interim Self-Government Authority et al., docket number 01-853, the court examined the default of the Authority in case alleging acts of terrorism.

The sovereign suffered a default but after consultation with the United States Department of State understood that such complaints deserve a proper response, and it launched its defense. The Authority is not recognized by the United States as a sovereign nation, but they maintain diplomatic relations.

Therefore, the court decided to apply the precedential reasoning from Practical Concepts, Inc. v. Republic of Bolivia, 811 F.2d 1543, 1551 n. 19 (D.C. Cir. 1987), to the instant case. An important factor for the leniency afforded the Authority is its accommodation of plaintiffs in certain regards to mitigate undue hardship to them. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Sean Goldman Return Under Hague Convention

The United States Secretary of State has a brief note on the Sean Goldman return to his American father from Brazil under the Hague Convention on International Child Abduction. There are no details on the efforts of the embassy in what has been called the Miracle in Rio.

Waiver Implied in Garnishment?

When it completed a form in a garnishment matter and objected to the personal jurisdiction, did the Japan Bank for International Cooperation imply a waiver of its immunity from subject matter jurisdiction? On December 3, 2009, the United States District Court for the District of Columbia held in Inversora Murten S.A. v. Energoproject Holding Co., docket number 03-73, that the bank did not.

The court explains the reasons in its detailed opinion. Most importantly, the garnishment form does not constitute one of the pleadings where a failure to object would be harmful. In addition, the court emphasizes the intent standard that bars an inadvertent waiver from becoming effective under the Foreign Sovereign Immunities Act. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Material Support in Terror Exception to FSIA

On November 30, 2009, the United States District Court for the District of Columbia dismissed the complaint in the matter Asemani v. Syrian Arab Republic, docket no. 09-1158, on the basis of the defendant's immunity under the Foreign Sovereign Immunities Act.

The plaintiff alleged that he was tortured on July 14, 2000 by several members of the Iranian Revolutionary Guards Corps in Tehran. He claimed that the Syrian Arab Republic was liable for his personal injury because Syrian military and intelligence agents informed Iranian authorities of his religious dissent. This exchange of information, he claimed, proximately caused his torture and resulting injuries.

The court noted that foreign states are not immune from claims for damages based on personal injury … caused by an act of torture under 28 U.S.C. §1605A, the most recent amendment to the FSIA. However, in order for the plaintiff to be awarded damages, he must show that "the foreign sovereign engaged in conduct that falls within the ambit of the statute,"i.e. here by providing material support for an act of torture.

Upon reviewing the definition of material support as defined in 18 U.S.C. §2339A, the court determined that Syria's relaying of information to Asemani's torturers fell short of the statutory definition of 'material support'. -- Laura P. Valle, legal assistant, Berliner, Corcoran & Rowe, LLP, Washington D.C.

Immunity in Emergency

Foreign states providing assistance in emergencies should be immune from proceedings for acts or omissions in such assistance. The same applies to their personnel, an Australian bill, Foreign States Immunities Amendment Bill 2009, provides. The November 7, 2009 bill is available at Lexis Legal. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Enforcement of Arbitral Awards Against Sovereigns

Juris Publishing recently released a treatise entitled, Enforcement of Arbitral Awards Against Sovereigns. Bound in hard-cover and measuring approximately 500 pages, the volume is described as a comprehensive discussion of the trials parties face when initiating arbitration against a foreign sovereign. The publisher notes that the book includes a thorough discussion of immunities, diplomatic protection, and enforcing awards won against sovereigns before ending with a discourse on several jurisdictions where enforcement against sovereign assets is commonly sought. Through November 25, 2009, the publisher is offering a 20% discount off of the regular price of $125. -- Laura P. Valle, Legal Assistant, Berliner Corcoran & Rowe, LLP, Washington D.C.

U.S. Seeks Counterterrorism Seizure

On November 12, 2009 the United States Department of Justice reported that the United States Attorney for the Southern District of New York filed an amended complaint in United States v. Assa Corp., docket no. 08-10934. The amended complaint seeks the complete forfeiture of all assets belonging to Assa Corp. and the Alavi Foundation. Assets are reported to include several bank accounts, a 36-story high-rise in Manhattan, and a number of other properties throughout the United States including four places of worship.

According to the Alavi Foundation website, the foundation is a charitable organization which promotes Islamic education and culture through academic grants and scholarships. Assa Corp. is a subsidiary of Assa Co. Ltd.; an entity which, the amended complaint alleges, represents the interests of Iranian board members in the nationalized Bank Melli Iran.

The amended complaint relies on evidence which suggests that both Assa Corp. and the Alavi Foundation provide illicit financial services for Bank Melli Iran and the Iranian government including but not limited to, managing assets and income in the Manhattan building and running a charitable organization for Iran, according to the U.S. Department of Justice. The United States argues that because neither the Alavi Foundation nor Assa Corp. ever applied for a license from the Department of the Treasury, providing any financial services to Bank Melli or the Government of Iran violates the International Emergency Economic Powers Act (IEEPA).

On November 15, 2009 the government of Iran condemned the U.S. move, calling the action a disgrace, the Washington Post wrote. -- Laura P. Valle, Legal Assistant, Berliner Corcoran & Rowe, LLP, Washington D.C.

FSIA: Military or Terror Action?

On November 3, 2009, the United States District Court for the District of Columbia dismissed the complaint in the matter Baumel v. the Syrian Arab Republic, docket number 06-682.

On June 11, 1982, the Syrian Army captured Zachary Baumel, an American citizen and member of the Israeli Defense Forces Armored Corps, in Lebanon. He was taken to Damascus where he was displayed as a trophy of war in a victory parade. Since then, Baumel has not been seen or contacted by friends, family, or members of the international community. The plaintiffs, representing the Baumel family, sued the Syrian government for several claims including battery, assault, and solatium, and asked for punitive damages.

The plaintiffs filed the suit on April 14, 2006 under 28 USC §1605(a)(7), the FSIA exception for state sponsors of terrorism, and then amended their complaint under §1605A on July 14, 2009. The new statute gave plaintiffs with pending suits against state sponsors of terrorism the ability to sue for solatium and ask for punitive damages.

The defendants argued that the amendment to the claim was time-barred. The statute gave pending suits 60 days to re-file their claim under §1605A after its enactment on January 28, 2008. The court agreed with Syria that the plaintiffs had brought their cause of action against Syria a year too late.

Also, the court found that the plaintiffs' cause of action under 28 USC §605(a)(7) failed. The court concluded that it is not an act of 'terrorism' for a designated foreign state to fail to release a combatant captured on the battlefield upon cessation of military hostilities. Therefore, the exception to Syria's immunity under 28 USC §1605(a)(7) did not apply in this case. -- Laura P. Valle, legal assistant, Berliner, Corcoran & Rowe, LLP, Washington D.C.

China not Liable for Bonds in U.S.

Courthouse News Service describes the determination by United States District Court Judge Richard J. Howell of the dismissall of a claim by Gloria Bolanos Pons and Aitor Rodriguez Soria against the People's Republic of China for some $2.4 billion in bonds issues by the Chinese government in 1913. The November 5, 2009 report China Off the Hook for $2.4B Bond-Holder Debt states that the claims are barred by the Foreign Sovereign Immunities Act. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Immunity for Argentina

On November 5, 2009, the United States Court of Appeals for the Second Circuit remanded Seijas v. Argentina, docket number 08-2847, to the lower court to explain its 2008 Temporary Restraining Orders and address Argentina's FSIA claims.

On April 18, 22 and 25, 2008 the District Court had granted several TROs which restrained Argentina's ability to transfer, sell, pledge, loan, or otherwise encumber Argentinean bonds held in the Depository Trust Corporation in New York.

The District Court held a hearing on April 30, 2008, to determine whether these TROs should be converted into preliminary injunctions but the court reserved a decision, thus allowing the TROs to continue until they converted automatically into preliminary injunctions on May 23, 2008. Argentina appealed, claiming that the injunctions were precluded by the FSIA which granted it immunity under 28 USC §1609.

The Second Circuit found that the preliminary injunctions were unsupported by the requisite findings and remanded the case to allow the District Court to provide an explanation for its decision. While this represents a small victory for Argentina, the Circuit Court refused to address the FSIA claim and allowed the foreign nation's assets to remain frozen. -- Laura P. Valle, legal assistant, Berliner, Corcoran & Rowe, LLP, Washington, D.C.