The Supreme Court’s October 2013 Term: The Coming Year in International Judicial Assistance

Now that the Supreme Court has issued its last decisions of the October 2012 term, it’s time to look ahead to the coming year. Happily, the Supreme Court will hear several cases that should be of interest to Letters Blogatory readers, and there are some pending petitions that also bear watching.

Petitions Granted

DaimlerChrysler v. Bauman

In Bauman v. DaimlerChrysler Corp., 644 F.3d 909 (9th Cir. 2011), several Argentinians sued DaimlerChrysler AG, claiming that its subsidiary, Mercedes Benz Argentina, had collaborated with the government in kidnapping, torturing, and even murdering the plaintiffs and their decedents. The District Court had dismissed the case against DaimlerChrysler AG, holding that it lacked personal jurisdiction, but on appeal the Ninth Circuit reversed on the grounds that DaimlerChrysler was subject to general personal jurisdiction in California because its subsidiary, Mercedes Benz USA, was subject to general personal jurisdiction and was DaimlerChrysler’s agent for service of process. The question for the Supreme Court is whether the exercise of jurisdiction violated the Due Process Clause. This decision could affect the practical breadth of the Volkswagen rule, which permits a plaintiff to avoid resort to the Hague Service Convention when state law permits service on a foreign defendant by, say, service on its US subsidiary.

Lozano v. Alvarez

In Lozano v. Alvarez, 697 F.3d 41 (2d Cir. 2012), Alvarez and Lozano met and dated, but never married, in England. They had a child in 2005 and lived together as a family for three years. In 2008, they separated (Alvarez claimed she had been abused; Lozano denied it), and in 2009, Alvarez and the child moved to New York, where they live with Alvarez’s sister. Alvarez and the child had UK passports and entered the country on a tourist visa, which later expired. Lozano started proceedings in England to have the child returned to the UK under the Hague Convention on the Civil Aspects of International Child Abduction, and he later brought a petition under the Convention and the International Child Abduction Remedies Act in New York. The District Court held that Lozano had made out a prima facie case because the child had been a habitual resident of the UK and he had had parental rights when Alvarez left the country. Alvarez raise the “now settled” defense, but Lozano argued that the defense was unavailable until one year after the child’s removal and that the one-year period should be tolled until the time he was reasonably able to learn of the child’s whereabouts. The judge disagreed, holding that the one-year period was not intended to give a reasonable amount of time for a petitioner to bring a claim, but to take into account that the interests of a “settled” child had to be weighed. Lozano appealed. On appeal, the United States filed a brief as amicus curiae, taking the position that equitable tolling does not apply to the one-year period, but that the court has equitable discretion to order a child returned at any time, and that the mother’s immigration status was a factor in deciding whether the child was “now settled.”

The Second Circuit held that the one-year period was not subject to equitable tolling, contrary to decisions of the Fifth, Ninth, and Eleventh Circuits. The court also held that Alvarez’s immigration status (she and the child were in the country illegally) did not preclude a finding that the child was settled in the United States. In his petition for certiorari, Lozano challenges both holdings.

BG Group v. Argentina

BG Group plc v. Republic of Argentina was the case of the day on January 19, 2012 (in the D.C. Circuit) and a related decision in the district was the case of the day on January 24, 2011, making it one of Letters Blogatory’s very first cases of the day. The case involved an investment treaty arbitration between a British firm and Argentina, held in Washington. The arbitral tribunal had held that it had jurisdiction notwithstanding Argentina’s argument that BG had failed to proceed first in Argentina’s own courts, as Argentina claimed the treaty required. Argentina sought to vacate the award but was unsuccessful. But on appeal, Argentina did better; the DC Circuit held that the lower court had erred in refusing to vacate the award. Argentina argued that while the tribunal would have power to decide on arbitrability challenges after the agreement to arbitrate became effective, the parties did not intend to give it that power before the agreement to arbitrate was triggered, and the court agreed. In its petition, BG pointed to several other appellate decisions said to be at odds with the DC Circuit’s holding and also to the general “pro-arbitration” policies of the FAA and the New York Convention. Argentina argued that there was no conflict.

Petitions To Watch

Arab Bank v. Linde

In a “case to watch” post in March 2012, I noted Linde v. Arab Bank plc, a case then pending in the Second Circuit. The plaintiffs were victims of terror attacks in Israel and the Palestinian territories who sought to hold Arab Bank liable because they alleged it had acted as the banker to the terrorists, including groups such as Hamas, the Palestinian Islamic Jihad, the Al Aqsa Martyrs’ Brigade, and the Popular Front for the Liberation of Palestine. The Bank, citing Jordanian, Lebanese, and Palestinian bank secrecy laws, refused to comply with Judge Nina Girshon’s order to provide discovery. The judge sanctioned the Bank and indicated that she would instruct the jury that it could infer that the bank had provided financial services to foreign terrorist organizations and that it had acted knowingly and purposefully. She also precluded the bank from offering any evidence that would tend to prove its state of mind. The Bank appealed, and in the alternative it sought a writ of mandamus. I wrote that the appeal was “timely in light of the recent ABA resolution on Aérospatiale and foreign data protection laws,” which I had discussed in a post in February 2012.

In January 2013, the Court of Appeals for the Second Circuit dismissed the appeal for want of jurisdiction. Ordinarily an appeal must await the entry of a final judgment, and the court found that Judge Girshon’s sanctions order was not in the small category of interlocutory orders that may be appealed before entry of judgment. The court also denied the petition for a writ of mandamus on the grounds that the Bank had not established that it had a “clear and indisputable right” to relief or that it lacked an effective appellate remedy after final judgment. In March 2013, the court denied a petition for rehearing by the panel or en banc.

The Bank has now filed a petition for a writ of certiorari seeking Supreme Court review. The petition argues that the sanctions order violates principles of comity because it required the Bank to violate the laws of two foreign countries and of the Palestinian Territories. The Bank distinguishes these privacy laws from “blocking statutes” that some countries have enacted as a response to what they have regarded as the overreach of US courts in ordering discovery abroad. And the Bank emphasized the trend in the law towards greater deference to comity concerns, e.g., in Morrison with respect to securities fraud and in Kiobel with respect to the Alien Tort Statute. And the Bank raised the specter of interference in US foreign relations: “Given the volatile situation in the Middle East, the courts below should not have treated the views of three foreign governments dismissively.” Finally, the Bank pointed to the ABA resolution. (The Bank also sought review of the lower courts’ refusal to dismiss the ATS claims on Kiobel grounds, but I don’t consider that argument here any further, other than to observe that it is difficult to see why mandamus relief would be appropriate on that issue, since the remedy on appeal seems adequate).

Laos v. Thai-Lao Lignite

Thai-Lao, one of my favorite cases, may be headed back to the Supreme Court after an earlier denial of cert. In the earlier proceedings, the District Court confirmed an arbitral award against the government of Laos. This was followed by some § 1782 proceedings, including an interesting decision denying Thai-Lao leave to take discovery from Laos itself under the statute on the grounds that Laos, a foreign sovereign, was not a “person” for purposes of § 1782.

The court entered several post-judgment discovery orders, to which Laos unsuccessfully objected, claiming that the assets that were the subject of the discovery orders were immune from discovery on various grounds. (I’m not going to detail the issues here, but I’ll have another post about them soon!) Laos appealed and in the alternative petitioned for a writ of mandamus. Laos, joined by the United States and the Federal Reserve Bank of New York, sought a stay pending appeal from the Second Circuit, which the court granted only in part. Laos then sought a stay from Justice Ginsburg, who granted a temporary stay but then denied the stay after receiving briefs. The Supreme Court docket indicates that Laos sought the stay pending the appeal and pending a petiiton for a writ of certiorari. So it seems clear that this case will yield a petition for cert., either this coming term or the next.

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2012), a nuts-and-bolts guide to international judicial assistance issues, and the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012.

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