Embassy Law Web Log   
Washington, DC, USA      

Russia Storms Bulgarian Offices

The Sofia Echo describes a November 5, 2009 raid by Russian forces of a Bulgarian state office in Moscow, in Russian police storms Bulgarian state properties in Moscow and noted the explanation for the raid: A search warrant based on allegations of violations of intellectual property.

The article alleged a breach of the 1961 Vienna Convention of Diplomatic Relations which provides for the inviolability of diplomatic premises. The affected property is part of the Bulgarian Ministry of Economy, Energy and Tourism and is one of the biggest Bulgarian state-owned properties abroad. It is home to a number of Bulgarian companies that rent offices there, the report continues. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

United States Joins Iran on International Law Issue

On November 2, 2009, Lynne Marek provides details on a case involving the discovery of assets held by foreign nations. The issue is of significant interest to the United States, she reports in DOJ Urges 7th Circuit to Shield Iranian Artifacts From Seizure by Terrorism Victims. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP. Disclaimer: The author's partner appears in the matter on behalf of a foreign government; the outcome could affect other government clients of the author's firm.

Abuse of Foreign Embassy for Political Propaganda

The International Court of Justice published a press release dated October 29, 2009, on the filing by the Republic of Honduras of a claim against the Federative Republic of Brazil. Allegedly, Brazil's embassy in Honduras awards critics of the Honduras government safe haven and enables the critics' political propaganda. The release states:

Honduras respectfully requests the Court to adjudge and declare that Brazil does not have the right to allow the premises of its Mission in Tegucigalpa to be used to promote manifestly illegal activities by Honduran citizens who have been staying within it for some time now and that it shall cease to do so. Just as Brazil rightly demands that the Honduran authorities guarantee the security and inviolability of the Mission premises, Honduras demands that Brazil's diplomatic staff stationed in Tegucigalpa devote themselves exclusively to the proper functions of the Mission and not to actions constituting interference in the domestic affairs of another State. Id.
Honduras argues that Brazil violates, inter alia, the 1961 Vienna Convention on Diplomatic Relations and claims damages. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Terror Claims Not Commercial Claims

On October 28, 2009, the United States District Court for the District of Columbia determined that terror activities cannot simply be restyled as commercial activities. Plaintiffs had based certain claims for compensation on the terror exception to the sovereign immunities of Libya under the Foreign Sovereign Immunities Act.

When the exception for state sponsors of terrorism became inapplicable after the renewal of relations between the United States and Libya, they sought to pursue their claims under the commercial exception of the FSIA.

The court explained why that avenue is not open to the plaintiffs, in the matter McDonald et al. v. Socialist People's Libyan Arab Jamahiriya et al., docket number 06-0729. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

FSIA 0 : EFT Transfer Jurisdiction 1

In an October 16, 2009 decision, the United States Court of Appeals for the Second Circuit reversed its Winter Storm doctrine in the matter The Shipping Corporation of India Ltd v. Jaldhi Overseas Pte Ltd., docket number 08-3477, but skipped a decision on an underlying FSIA issue because it would become moot.

Under Winter Storm, the presence of Dollar-denominated funds in the Second Circuit for merely a split second could trigger attachments in certain maritime matters. The court explains the critical views and economic effects of the precedent. It also details how subsequent decisions changed some of its effects on the EFT practice.

By expressly overruling Winter Storm, the appellate court in New York City intends to increase clarity and legal certainty which should be welcomed by the banking sector and U.S. marshalls in its district as well as foreign defendants who - aside from EFT transfers in United States currency - lack other connections to the United States courts in the district. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Argentina Attachment Reversed

In an October 15, 2009 decision, the United States Court of Appeals for the Second Circuit reversed the order of attachment against the Republic of Argentina in Aurelius Capital Partners v. The Republic of Argentina, docket number 08-5621. Justice Sotomayor belonged to the panel before her call to the United States Supreme Court and did not participate in the decision. The court summarizes the matter as follows:

The Republic of Argentina appeals from the district court's orders of attachment and execution entered in late 2008 over Argentine social security funds, which under proposed Argentine legislation were to be transferred to the Administración Nacional de Seguridad Social (the Administration), an Argentine governmental entity. The orders were confirmed in the district court's opinion and order dated December 11, 2008, immediately after the legislation transferring the funds to the Administration became effective. We reverse the decision of the district court and vacate the orders.
As explained in a 29-page opinion, the court concluded that the funds were immune from attachment under the Foreign Sovereign Immunities Act (Act), 28 U.S.C. §§ 1602-1611 it reversed the decisions of the district court and vacated its order. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Reconciled Immunity for International Organizations

Two brief opinions on the reconciliation of precedent with respect to the immunity of international organizations excel in Jorge Villa v. Inter-American Development Bank, docket number 08-7042. The October 5, 2009 decision relates to the denial of a rehearing en banc and is of interest to practitioners of international organization law. -- Clemens Kochinke, Berliner, Corcoran & Rowe, LLP, Washington DC.

Alien Torts Statute: Business Liable for State Acts

The violation of human rights may be sanctioned by U.S. courts. Even if they involve non-American corporations and human rights violations by foreign nations, claims find their way to American courts.

But the latter will not necessarily remain there, as the new decision from the United States Court of Appeals for the Second Circuit illustrates with its October 2, 2009 dismissal in the matter The Presbyterian Church of Sudan et al. v. Talisman Energy, Inc., docket number 07-0016.

The complaint is based on the Alien Tort Statute, 28 USC § 1350. The dismissal of the suit against the Canadian defendent corporation concludes a detailed legal analysis which the court summarized:

We hold that under the principles articulated by the United States Supreme Court in Sosa v. Alvarez-Machain, 542 U.S. 692 (2004), the standard for imposing accessorial liability under the ATS must be drawn from international law; and that under international law, a claimant must show that the defendant provided substantial assistance with the purpose of facilitating the alleged offenses. Applying that standard, we affirm the district court's grant of summary judgment in favor of Talisman, because plaintiffs presented no evidence that the company acted with the purpose of harming civilians living in southern Sudan. Id. 8.
-- Clemens Kochinke, partner http://www.bcr.usBerliner, Corcoran & Rowe, LLP, Washington, DC.

No Due Process in State Matters

The United States Court of Appeals for the Second Circuit in New York City overruled its precedent allowing for due process protections for states in the context of a jurisdictional analysis. The September 28, 2009 ruling in the matter Frontera Resources Azerbaijan Corporation v. State Oil Company of the Azerbaijan Republic, docket number 07-1815, involves a conflict between a Cayman Islands company and the state oil agency over the confirmation of a Swedish arbitral award against the state entity. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.

Picasso in Spain and California Courts

Plaintiffs, alleging expropriation of art by Nazi Germany, may rely for subject matter jurisdiction of United States courts on 28 USC §1605(a)(3) even if they seek to recover the art from another nation.

On September 8, 2009, the United States Court of Appeals for the Ninth Circuit decided in Claude Cassirer v. Thyssen-Bornemisza Collection Foundation, docket number 06-56325, that the expropriation exception of the Foreign Sovereign Immunities can apply to a state and its foundation that have not been involved in the expropriation.

In addition, the court explored whether the required commercial activity of the defendants King of Spain and the Thyssen-Bornemisza in the United States suffice to meet the definition in 28 USC §1604(d). In relying on Siderman de Blake v. Republic of Argentina, 965 F.2d 699 (1992) and Altmann v. Republic of Austria, 317 F.3d 954 (2002), the court upheld the lower court's finding of commercial transactions by the art foundation as generating a sufficient nexus.

Based on limited jurisdictional discovery, the district court had concluded that the foundation transacted business as a purchaser and a seller of goods and services and as an advertiser in distributing marketing and other commercial materials in the United States.

The appellate court concluded its analysis with a detailed discussion of the exhaustion requirement, developed for Alien Tort Statute litigation, as applied to FSIA matters. Its remand to the district court includes instructions for a further analysis of the case in light of a limited exhaustion requirement to be imposed on the plaintiff. As a result, the plaintiff may need to pursue claims in Spain or Germany, not in the United States, if the district court so decides.

Judge Ikuta's minority opinion takes exception to writing a judge-made exhaustion requirement into the FSIA. -- Clemens Kochinke, partner, Berliner, Corcoran & Rowe, LLP, Washington, DC.