Case of the Day: Freedom Watch v. OPEC
Posted on September 25, 2014
The case of the day is Freedom Watch, Inc. v. OPEC (D.C. Cir. 2014). This is the appeal from the case of the day from January 28, 2013. Here is a bit of my description of the case from the prior post:
Freedom Watch, a right-wing organization that accuses the “Obama-Clinton regime” of “using the economic crisis as an excuse to turn our nation into a socialist Euro-style welfare state,” sued OPEC on antitrust theories. I am going to go out on a limb here and guess that its claims lacked merit. OPEC moved to dismiss for insufficient service of process. According to OPEC’s motion to dismiss, “Plaintiff’s counsel, Mr. Larry Klayman, ersonally handed an envelope containing a summons, the complaint and other documents, all in English, to an Austrian police officer (not an employee of OPEC) who was present at the reception desk in the lobby of OPEC’s headquarters in Vienna.” On the other hand, according to the return of service, filed after the motion to dismiss, Courtney Butcher of Beverly Hills, California served the summons at OPEC headquarters on Frederich Luger, “intake officer of OPEC,” who supposedly was designated by law to accept service of process on OPEC.
The case came out pretty much as I predicted. The main question was whether the service complied with FRCP 4(f)(2)(A) was whether the service complied with Austrian law. It didn’t, because Austrian doesn’t permit private process servers and because Austrian law has a special provision forbidding service of process on international organizations without the involvement of the Austrian government. So the court unanimously concluded that the district court had gotten the main question right—Freedom Watch had not (yet) effectively served process.
But then the case took a very odd turn. The majority (Judges Srinivasan and Tatel) held that the judge had abused his discretion by refusing to grant leave to serve process on OPEC’s US counsel via FRCP 4(f)(3). The idea of using FRCP 4(f)(3) to effect service on OPEC is a good one—indeed, it’s what I suggested Klayman try in my prior post. But what makes the court’s decision odd is that Klayman never filed a motion for leave to serve process under FRCP 4(f)(3) in the lower court; instead, he merely referenced the possibility of FRCP in his briefs in opposition to the motion to dismiss. Since under FRCP 7(b)(1) any request for a court order must be made by motion, and since even its references to FRCP 4(f)(3) below did not really address service on OPEC’s US counsel but rather focused on methods such as service by fax that the lower court permissibly (according to the DC Circuit panel) rejected, there’s a strong case to be made that Freedom Watch hadn’t really done what it needed to do in order to create an appellate issue. This was the point of Judge Wilkins’s partial dissent, which seems basically right to me. How can it be an abuse of discretion for the lower court to deny permission to do something that the appellant never actually moved for permission to do?
In any event, the DC Circuit did not reverse; it vacated and remanded for further proceedings. So it will still be open to the District Court to refuse leave. We’ll see what happens.