Case of the Day: HWB Victoria Strategies v. Argentina

Saab 340
Argentine Air Force aircraft Saab 340. Credit: Jorge Alberto Leonardi

The case of the day is HWB Victoria Strategies Portfolio v. Republic of Argentina (D. Kan. 2017). HWB and several other plaintiffs were judgment creditors of Argentina in the Argentine bond case I’ve written about before. They obtained a writ of attachment in the Cowley County Kansas court and attached two aircraft engines owned by the Argentine government located at a General Electric plant in Arkansas City, Kansas. Argentina removed the case to the federal court, and it and GE moved to quash the writ of attachment.

The evidence was that the engines were for two Saab 340 military airplanes owned by the Argentine Air Force. The court held, correctly, that under 28 USC § 1611(b)(2), the engines were immune from attachment. The statute provides an exemption from attachment and execution for property of a foreign sovereign that “is, or is intended to be, used in connection with a military activity and (A) is of a military character, or (B) is under the control of a military authority or defense agency.” The court went on to consider whether the property was used for a commercial activity in the United States, correctly finding that it wasn’t. But that part of the analysis wasn’t really necessary. The structure of the statute is that (1) property of a foreign sovereign is generally immune from execution; but (2) property used for a commercial activity in the United States may not be immune from execution if one of several exceptions apply; but (3) in any case, the commercial activity exception does not apply to military property within the scope of the statute I just quoted.

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