Ecuador in the Twilight Zone

For those interested in the Lago Agrio case, I’m trying to publish some reactions to last week’s first-round presidential election from various points on the Ecuadoran political spectrum. The first is from Gustavo Domínguez, whom I met on my 2014 trip to Ecuador. Domínguez was a consultant to the Ecuadoran government and one of the leading government voices during the trip, along with Ambassador Nathalie Cely, Camilo Zambrano, from the Ecuadoran embassy’s political section, and Paola Carrera, the Assistant Secretary for Environmental Quality. I didn’t know it at the time, but Domínguez is also (or perhaps became) a critic of the Ecuadoran government who was jailed for a time after protesting government policy. I thought his perspective would be particularly interesting to readers because he has at various times both helped and protested against the current government. Thanks, Gustavo, for your contribution!

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Case of the Day: In re Rainsy

The case of the day is In re Rainsy (N.D. Cal. 2017). Sam Rainsy, a Cambodian politician, and several other Cambodians had “alleg[ed] human rights violations before the International Criminal Court.” They brought an application for leave to take discovery from Chevron Corp. relating to the 2016 assassination of Cambodian government critic Kem Ley. They sought the discovery not just for use in the ICC proceeding but also in connection with a libel claim Cambodia’s prime minister brought against Rainsy after Rainsy accused the government of involvement in the assassination.

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Water Splash: Notes on Volkswagen from the new ABA Treatise

The publication of the new ABA treatise, which I noted yesterday, reminded me that I had already written about the question I noted last month in my discussion of the government’s amicus brief in the Water Splash case, namely whether the Hague Service Convention applies to all judicial documents, or just to the summons and complaint. Here is a short excerpt from my chapter in the new book, without the footnotes.

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Book of the Day: International Aspects of U.S. Litigation

Cover of International Aspects of U.S. Litigation

Readers, I am very pleased to announce the publication of the ABA’s new two-volume deskbook, International Aspects of U.S. Litigation, edited by James E. Berger of King & Spalding. The book features contributions from many excellent authors, including several friends. I am the author of the chapter of service of process. Other chapters cover subject-matter and personal jurisdiction, venue, forum non conveniens, parallel proceedings, forum selections clauses, the Alien Tort Statute, the extraterritoriality of US law, choice of law clauses, conflict of laws, proof of foreign law, treaties as substantive law, pretrial discovery, recognition and enforcement of judgments, res judicata, international arbitration, sovereign litigation, foreign bankruptcy, and trade disputes.

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Case of the Day: CBF Indústria de Gusa v. AMCI Holdings

Men casting pig iron, ca. 1900
Casting pig iron, Chicago, ca. 1900

The case of the day is CBF Indústria de Gusa S/A v. AMCI Holdings, Inc. (2d Cir. 2017). CBF and several other plaintiffs were Brazilian companies in the business of producing and supplying pig iron. They sold the iron to Primetrade AG, a Swiss company, which then supplied it to Primetrade USA. In 2004, one of Primetrade AG’s ships exploded off the coast of Colombia, and the master and five of his crew died in the accident. In 2005, because of the bad publicity that followed the accident, Primetrade AG transferred it assets, including its contracts with CBF, to Steel Base Trade AG, another Swiss company, which had the same officers and directors as Primetrade and the same offices. In 2007, AMCI International GmbH, a company controlled by Hans Mende and Fritz Kundrun, purchased SBT and its US subsidiary, still named Primetrade USA. In 2008, CBF and SBT entered into contracts for the purchase and sale of 103,500 metric tons of pig iron for more than $76 million. The contracts called for delivery of the pig iron in the United States between April and December 2008. They contained an agreement to arbitrate all disputes under the ICC Rules in Paris. As commodity prices fell in 2008, SBT defaulted on the contracts—it purchased only 33,056 metric tons in all. Its representative told CBF that “it is not our style to walk away from obligations,” and “we are not walking away!!!” CBF later claimed these were false representations made to give Mende and Kundrun time to fraudulently convey SBT’s assets to another company they owned, Prime Carbon, which had begun making large purchases of pig iron and which had the same officers and directors as SBT and the same address as SBT’s parent, AMCI. After SBT transferred its assets to Prime Carbon, it declared bankruptcy in the Cantonal Court of Zug, Switzerland.


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Case of the Day: Washington v. Trump

Statue of the Authority of the Law
Credit: Ferrylodge

Here’s a quick take on the Ninth Circuit’s per curiam decision in Washington v. Trump, the government’s motion for a stay of the temporary restraining order enjoining enforcement of Executive Order 13769, the ban on the entry into the United States of Syrian refugees and all nationals of several majority-Muslim countries. As you probably have read by now, the court denied the motion, which means the TRO stays in place pending the government’s appeal.

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Case of the Day: Iraq Middle Market Development Foundation v. Harmoosh

The case of the day is Iraq Middle Market Development Foundation v. Harmoosh (4th Cir. 2017). The Foundation lent $2 million to Al-Harmoosh for General Trade, Travel, and Tourism, an Iraqi company. The loan agreement had an agreement to arbitrate all “disputes, controversies and claims between the parties which may arise out of or in connection with the Agreement.” Mohammad Harmoosh, a managing partner of Al-Harmoosh, gave a promissory note to the Foundation to guarantee payment of the loan. When Harmoosh refused to pay, the Foundation sued for breach of contract in the District of Maryland. Harmoosh successfully moved to dismiss on the grounds that the dispute was arbitrable, but he did not move to compel arbitration.

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Case of the Day: In re Kiobel

The case of the day is In re Kiobel (S.D.N.Y. 2017). Esther Kiobel was the plaintiff in the now-famous Kiobel case, a class action against Royal Dutch Shell and others under the Alien Tort Statute, claiming that Shell was liable for human rights violations committed by the Nigerian government against her and others in Nigeria who had opposed Shell’s activities in Nigeria. The case led to a Second Circuit decision holding that corporations cannot be liable for torts in violations of international law under the ATS, and it culminated in Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013), which affirmed on different grounds, holding that the presumption against extraterritoriality applied to the ATS. The result was that Kiobel could not pursue her claims in the US courts. As we’ll see in today’s case, her new plan is to seek relief in a proceeding in the Netherlands. To obtain evidence for use in that prospective case, Kiobel brought a § 1782 application seeking leave to serve subpoenas on Cravath, Swaine & Moore LLP, lawyers for Shell in the earlier US case and some related US proceedings.

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Case of the Day: Phoenix Process Equipment v. Capital Equipment & Trading

The case of the day is Phoenix Process Equipment Co. v. Capital Equipment & Trading Corp. (W.D. Ky. 2017). Phoenix was a Kentucky company that designs and manufactures water recycling equipment used to wash coal. Capital Equipment & Technology Corp., a Delaware corporation that used the trade name CETCO, was its distributor in Russia and Ukraine. The distribution contract was signed by its CEO, Alexander Chudnovets. Capital Equipment & Technology Corp. was dissolved in 2011, unbeknownst to Phoenix. Phoenix continued to do business with two other companies that used the CETCO name: Capital Equipment & Trading Corp., a Texas corporation, and Coralina Engineering, LLC, a Russian limited liability company. Chudnovets was the sole member of Coralina and the the CEO of Capital Equipment & Trading.

A dispute arose when Phoenix learned that Coralina was selling products very similar to its own within the distribution territory. Phoenix sued in the Jefferson Circuit Court, and the defendants removed the case to the District Cout. The claims for for breach of contract, unfair competition, violations of the Uniform Trade Secrets Act, civil conspiracy, and fraud. Coralina and Chudnovets moved to dismiss for insufficient service of process.

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