Comm'ns Import Export S.A. v. Republic of the Congo

916 F.Supp.2d 48

COMMISSIONS IMPORT EXPORT S.A., Plaintiff,

v.The REPUBLIC OF the CONGO and Caisse Congolaise D'Amortissement, Defendants.

Civil No. 12–743 (RCL).

United States District Court, District of Columbia.

Jan. 8, 2013.

Limited on Preemption Grounds

D.C. Official Code, 2001 Ed. §§ 15–363, 15–364(a, b)

Francis A. Vasquez, Jr., Frank Panopoulos, Jonathan C. Ulrich, White & Case LLP, Washington, DC, Owen C. Pell, Peter E. Wilhelm, White & Case LLP, New York, NY, for Plaintiff.

Michael Robert Lazerwitz, Boaz S. Morag, Jesse D.H. Sherrett, Cleary, Gottlieb, Steen & Hamilton, LLP, New York, NY, for Defendants.

MEMORANDUM OPINION

ROYCE C. LAMBERTH, Chief Judge.

Plaintiff Commissions Import Export (“Commisimpex”) has uncovered a procedural loophole in Chapter 2 of the Federal Arbitration Act (“FAA Ch. 2”), 9 U.S.C. §§ 201 et seq. Its attempt to exploit this loophole raises a question of first impression in this Circuit: whether FAA Ch. 2's three-year statute of limitations on confirmation actions for foreign arbitral awards, 9 U.S.C. § 207, preempts a plaintiff from using the District of Columbia's Uniform Foreign–Country Money Judgments Recognition Act (“D.C. Recognition Act”), D.C. Code §§ 15–361 et seq., to obtain a U.S. Court Judgment enforcing a foreign Judgment which enforces an otherwise stale foreign arbitral award. Now before the Court is Commisimpex's motion for summary Judgment. ECF No. 37. Upon consideration of plaintiff's motion, defendants' opposition, ECF No. 39, plaintiff's reply, ECF No. 40, applicable law, and for reasons given below, the Court finds that this maneuver is preempted, and will DENY plaintiff's motion and DISMISS plaintiff's action with prejudice.

I. BACKGROUND AND PROCEDURAL HISTORY¹

This case arises out of a dispute over the repayment of debts owed under contracts between Commisimpex and defendant the Republic of the Congo (“Congo”). Pl.'s Statement of Material Facts (“Pl.'s Statement”) ¶ 2, ECF No. 37–1; Defs.' Statement of Material Facts (“Defs.' Statement”) ¶ 2, ECF No. 39–1.

A. The 1992 Agreement

In 1992 the parties entered an agreement for the repayment of certain outstanding debts under these contracts providing for arbitration under the Rules of the International Chamber of Commerce (“ICC”). Pl.'s Statement ¶¶ 3–4; Defs.' Statement ¶¶ 3–4. Pursuant to the 1992 agreement, defendant Caisse Congolaise d'Amortissement (“CCA”), a department of the Congo's Ministry of Economy, Finance and Planning, drew up promissory notes endorsed in favor of Commisimpex, and the Congo issued a series of commitment letters agreeing to submit disputes arising under the notes to arbitration in Paris, France, under rules of the ICC. Pl.'s Statement ¶¶ 5–6; Defs.' Statement ¶¶ 5–6.

B. The 2000 Arbitral Award

The Congo failed to satisfy its obligations under the 1992 agreement. Pl.'s Statement ¶ 7; Defs.' Statement ¶ 7. Commisimpex commenced arbitration in Paris with the ICC naming Congo and CCA as respondents. Pl.'s Statement ¶¶ 7–8; Defs.' Statement ¶¶ 7–8. Congo and CCA defended against the arbitration, which resulted in an arbitral award of over $31 million in Commisimpex's favor. Pl.'s Statement ¶ 9; Defs.' Statement ¶ 9; see also Enforceable Copy of an Arbitration Award (“Award”), Dec. 7, 2000, Amended Compl., Ex. A, ECF No. 35–1.

C. The 2009 English Court Judgment

The Congo failed to satisfy the 2000 award. Pl.'s Statement ¶ 12; Defs.' Statement¶ 12. Roughly nine years later, Commisimpex sought to enforce the Judgment in the Queen's Bench Division of the High Court of Justice, Commercial Court in London, England. Pl.'s Statement ¶¶ 12–13; Defs.' Statement ¶¶ 12–13. In July 2009 the English Court entered Judgment enforcing the 2000 award, and augmented the amount of the award with additional “penalty interest” and other costs. Pl.'s Statement 14–15; Defs.' Statement 14–15; see also Order, Commissionss Import Export S.A. v. Republic of the Congo, High Court of Justice, Queen's Bench Division, Commercial Court, 2009 Folio 804, July 10, 2009, Ex. B, Amended Compl. ECF No. 35–2. This Judgment was subsequently amended and reduced to account for Commisimpex's successful seizure of assets elsewhere. See Pl.'s Statement ¶ 21; Order, Commissions Import Export S.A. v. Republic of the Congo, High Court of Justice, Queen's Bench Division, Commercial Court, 2009 Folio 804, Nov. 3, 2011, Ex. C, Amended Compl. ECF No. 35–3.

D. The Present Case

Two years later, and more than a decade after the 2000 award, Commisimpex filed an action in the Southern District of New York seeking “recognition of the English Judgment ... pursuant to the Foreign Sovereign Immunities Act and the New York Uniform Foreign Country Money Judgments Recognition Act,” N.Y. C.P.L.R. §§ 5301–5309 (McKinney). Commissions Imp. Exp. S.A. v. Republic of the Congo, 11–cv–6176, 2012 WL 1468486 at *1 (S.D.N.Y. Apr. 27, 2012); see also Compl., Sept. 2, 2011, ECF No. 1. Judge Keenan found venue improper and transferred the case to this district. Commissions Imp. Exp. S.A., 2012 WL 1468486 at *6.

After transfer, Commisimpex filed an amended and supplemental complaint, seeking recognition of the 2009 English Judgment under the D.C. Recognition Act, D.C. Code §§ 15–361, et seq.; Amended Compl., June 22, 2012, ECF No. 35.² Commisimpex does not rely on the FAA because, as it concedes, “any claim to enforce the Award directly would be time-barred by operation of 9 U.S.C. § 207.” Pl.'s Mot. 14.

II. ANALYSISA. Summary Judgment Legal Standard

Summary Judgment is “appropriate where the pleadings and the record ‘show that there is no genuine issue as to any material fact and that the moving party is entitled to Judgment as a matter of law.’ ” TermoRio S.A. E.S.P. v. Electranta S.P., 487 F.3d 928, 941 (D.C.Cir.2007) (quoting Kingman Park Civic Ass'n v. Williams, 348 F.3d 1033, 1041 (D.C.Cir.2003) (quoting Fed.R.Civ.P. 56(c))). A material fact is one that “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Actions to enforce foreign Judgments under the D.C. Recognition Act are appropriately resolved on summary Judgment. See, e.g., Cont'l Transfert Technique, Ltd. v. Fed. Gov't of Nigeria, 800 F.Supp.2d 161, 164–65 (D.D.C.2011).

B. Defendants Expressly Waived Sovereign Immunity

Foreign states are “immune from the jurisdiction of the courts of the United States and of the States” except as provided in the Foreign Sovereign Immunities Act (“FSIA”). 28 U.S.C. § 1604. A “foreign state” within the meaning of FSIA is immune from this Court's jurisdiction unless one of the statute's enumerated exceptions applies. Samantar v. Yousuf, 560 U.S. 305, 130 S.Ct. 2278, 2285, 176 L.Ed.2d 1047 (2010). FSIA is the “sole basis for obtaining jurisdiction over a foreign state in federal court.” Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 439, 109 S.Ct. 683, 102 L.Ed.2d 818 (1989).

A “foreign state” includes “a political subdivision of a foreign state or an agency or instrumentality of a foreign state” and the Act defines the latter as “any entity ... which is an organ of a foreign state or political subdivision thereof.” § 1603(a)-(b). In the present case, it is undisputed that Congo is a foreign state and CCA is an agency or instrumentality of a foreign state. See Am. Supplemental Compl. ¶ 5; Answer to Am. Supplemental Compl. ¶ 5. Accordingly, FSIA gives the “sole basis” for jurisdiction over both defendants. See Argentine Rep., 488 U.S. at 439, 109 S.Ct. 683.

FSIA provides that “a foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case ... in which the foreign state has waived its immunity either explicitly or by implication ....” § 1605(a)(1). Commisimpex argues, and defendants concede, that defendants explicitly waived their immunity to suit in their 1992 agreement. Pl.'s Mot. 7–12; Defs.' Opp'n 41. Commisimpex points to the following language which appears in each of defendants' 1992 commitment letters:

This undertaking is considered as a commercial instrument governed by commercial law and is constituted for commercial purposes. It follows that the signatory hereof irrevocably and on a final basis waives the right to invoke any immunity from legal proceedings as well as any immunity from execution in the context of the settlement in the context of the settlement of a dispute relating to the undertakings which are the subject hereof.

Pl.'s Mot. 9; Pl.'s Statement ¶ 6 (citing Commitment Letters Nos. 75, 78, 85, 88, 95, 99, 105 & 108, ECF Nos. 37–21, 37–22, 37–23, 37–24, 37–25, 37–26, 37–27 & 37–28). This language expressly waives defendants' sovereign immunity pursuant to § 1605(a)(1). Moreover, defendants concede that they waived their sovereign immunity and “do not deny that this Court has jurisdiction to adjudicate Commisimpex's cause of action for recognition of the English Order....” Defs.' Opp'n 41. The Court has subject matter jurisdiction. ³

C. FAA Ch. 2 Preempts Commisimpex's Maneuver

Commisimpex's sole cause of action relies on the D.C. Recognition Act, D.C. Code §§ 15–361, et seq.; see Am. Supplemental Compl. ¶¶ 19–24, which requires courts in the District of Columbia to “recognize a foreign-country Judgment” as long as it “[g]rants or denies recovery of a sum of money,” is “Final,” “Conclusive,” and “Enforceable” “[u]nder the law of the foreign country where rendered,” and certain additional conditions are met. See, e.g.,D.C. Code §§ 15–363, 364(a)-(b). Commisimpex argues that this obligates the Court to enforce the 2009 English Judgment enforcing the 2000 Award. See Amended Compl. ¶¶ 2, 20–22.

Defendants insist that the 2009 English Judgment fails to meet certain statutory conditions, see Def.'s Opp'n 35–38, but the Court need not address these issues. Assuming all statutory conditions were satisfied, enforcement of the 2009 English Judgment under the D.C. Recognition...