Articles Posted in US Court of Appeals for the Second Circuit

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Vera sued the Republic of Cuba for the extrajudicial killing of his father in 1976. In 2008, Vera obtained a default judgment against Cuba in Florida state court, relying on the “terrorism exception” to sovereign immunity, 28 U.S.C. 1605A(a)(1). Vera then secured a default judgment against Cuba in a U.S. District Court in New York, which granted full faith and credit to the Florida judgment. Vera served information subpoenas on the New York branches of various foreign banks, including BBVA, which refused to comply with the subpoena’s request for information regarding Cuban assets located outside the U.S. BBVA moved to quash the subpoena, contending that Vera’s judgment was void for lack of subject matter jurisdiction under the Foreign Sovereign Immunities Act, 28 U.S.C. 1602. The Second Circuit reversed in favor of BBVA. The district court lacked subject matter jurisdiction over Vera’s action against Cuba because Cuba was not designated a state sponsor of terrorism at the time Vera’s father was killed. Vera failed to establish that Cuba was designated a state sponsor of terrorism as a result of his father’s death. The FSIA’s terrorism exception to sovereign immunity—the only potential basis for subject matter jurisdiction— did not apply. Cuba was immune from Vera’s action. View "Vera v. Republic of Cuba" on Justia Law

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Plaintiff filed suit under the Federal Tort Claims Act (FTCA) after he was held in immigration detention for more than three years because the government mistakenly believed that he was a deportable alien. The district court found the government liable to plaintiff on the false imprisonment claim, dismissed the malicious prosecution claim and negligent investigation claim on motion, and entered judgment for the government on the negligent delay claim post-trial. The Second Circuit reversed the judgment as to the false imprisonment claim because it was time-barred. The court affirmed the judgment in all other respects, holding that the malicious prosecution claim failed because the government did not act with malice, the negligent investigation claim failed for lack of a private analogue, and the negligent delay claim failed because plaintiff suffered no cognizable damages. View "Watson v. United States" on Justia Law

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Fed. R. Civ. P. 60(b)(5) applies to a district court's consideration of a motion to vacate a judgment enforcing an arbitral award that has since been annulled in the primary jurisdiction. In this case, petitioners submitted to arbitration in Malaysia a commercial dispute arising from the terminations by Laos of contracts granting TLL rights to mine lignite. An arbitral panel found Laos in breach and awarded petitioners approximately $57 million. Petitioners subsequently began enforcement actions under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Petitioners received judgment in their favor in the United States and United Kingdom. In 2012, the arbitral award was set aside. The Second Circuit affirmed the district court's order vacating the United States judgment, holding that the district court did not exceed the permissible bounds of its discretion under the facts of this case. The court also held that the district court did not exceed the permissible bounds of its discretion in refusing to order Laos to post security during the pendency of its Rule 60(b) motion and any subsequent appeals, nor did it err by refusing to enforce the English judgment. View "Thai-Lao Lignite (Thailand) Co., Ltd. v. Government of the Lao People’s Democratic Republic" on Justia Law

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The Fifth Amendment's prohibition on the use of compelled testimony in American criminal proceedings applies even when a foreign sovereign has compelled the testimony.  When the government makes use of a witness who had substantial exposure to a defendant's compelled testimony, it is required under Kastigar v. United States, 406 U.S. 441 (1972), to prove, at a minimum, that the witness's review of the compelled testimony did not shape, alter, or affect the evidence used by the government.  A bare, generalized denial of taint from a witness who has materially altered his or her testimony after being substantially exposed to a defendant’s compelled testimony is insufficient as a matter of law to sustain the prosecution’s burden of proof. In this case involving the London Interbank Offered Rate (LIBOR), defendants were convicted of wire fraud and conspiracy to commit wire fraud and bank fraud. The Second Circuit held that defendants' compelled testimony was "used" against them, and this impermissible use before the petit and grand juries was not harmless beyond a reasonable doubt.  Accordingly, the court reversed the judgments of conviction and dismissed the indictment. View "United States v. Allen" on Justia Law

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The Second Circuit held that the district court erred in declining to vacate an arbitral award‐creditor’s ex parte petition for entry of a federal judgment against a foreign sovereign premised on an award made under the International Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). The court rejected Mobil's argument that 22 U.S.C. 1650a provides an independent grant of subject‐matter jurisdiction for actions against foreign sovereigns and decided that the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. 1330, 1391(f), 1441(d), 1602‐1611, provides the sole basis for subject‐matter jurisdiction over actions to enforce ICSID awards against a foreign sovereign. Because Mobil's utilization of ex parte proceedings were neither permitted by the FSIA nor required by Section 1650(a), the court reversed Venezuela's motion to vacate, vacated the judgment in favor of Mobil, and remanded with instructions to dismiss the ex parte petition. View "Mobil Cerro Negro, Ltd. v. Bolivarian Republic of Venezuela" on Justia Law

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Plaintiffs filed suit against BNTK and BUSA for their alleged roles in plaintiffs' 2008 abduction from London and their prolonged detention in Belarus by authorities of that country. The Second Circuit held that it has jurisdiction to review this appeal pursuant to the collateral order doctrine; the district court acted within its discretion in ordering limited jurisdictional discovery and in sanctioning defendants for failing to comply with that order; but to the extent the challenged October 20, 2015 order not only required defendants to pay an earlier accrued monetary sanction but also struck their sovereign immunity claim in its entirety, it exceeded the district court's discretion. Accordingly, the court affirmed the challenged order generally, vacating only that part striking defendants' foreign sovereign immunity claim, and remanded for further proceedings. View "Funk v. Belneftekhim" on Justia Law