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United States: Court of Appeals for the Third Circuit Decision in Velidor V. L/P/G Benghazi (Yugoslav Seamen's Claims; Foreign Sovereign Immunities Act; Service of Process)*
Published online by Cambridge University Press: 20 March 2017
Abstract
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- Type
- Judicial and Similar Proceedings
- Information
- Copyright
- Copyright © American Society of International Law 1982
Footnotes
[Reproduced from 653 Federal Reporter, 2d Series, 812-822 (1981).
[The U.S. Foreign Sovereign Immunities Act of 1976 appears at 15 I.L.M. 1388 (1976).]
References
2 Plaintiffs contend that CALTRAM failed to carry its burden of proving that it is within the scope of the FSIA. Although the question cf CALTRAM's status has not been certified for this interlocutory appeal, it is a matter inextricably linked to the issue whether in personam jurisdiction over CALTRAM exists under the FSIA. The same type and Quantum of proof offered by CALTRAM was found sufficient to establish the applicability of the FSIA in Jet Line Services. Inc. v. M/V Marsa £7 Hariga, 462 F.Supp. 1165 (D.Md.!S78). Accordingly, the district court did not err in holding that CALTRAM had demonstrated its status as an instrumentality of a foreign sovereign under § 1003(b) of the Act.
3 Plaintiffs testified that they were misled because other vessels in the CALTRAM fleet flew the flag of Libya, and because the Lloyds Register of Shipowners did not reveal the link between the Benghazi's owner and the government of Algeria. In fact, the Lioyds Register indicated that another shipping company, Compagnie Nationale Algerienne de Navigation, was the national entity. See H.R.Rep No. 1487, 94th Cor.g.2d Sess. 21-22 (1976). reprinted in [1976] U.S.Code Cong. & Ad.News 6604, 6620-21 (evidence that a party has relied on a standard registry of ships, which did not reveal the foreign state's interest in the vessel, would be prima facie evidence of a party's lack of awareness that the vessel of a foreign state was involved).
4 28 U.S.C. § 1605(b) provides:
(b)A foreign state shall not be immune from the jurisdiction of the courts of the United States in any case in which a suit in admiralty is brought to enforce a maritime lien against a vessel or cargo of the foreign state, which maritime lien is based upon a commercial activity of the foreign state: Provided, That—
(1)notice of the suit is given by delivery of a copy of the summons and of the complaint to the person, or his agent, having possession of the vessel or cargo against which the maritime lien is asserted; but such notice shall not be deemed to have been delivered, nor may it thereafter be delivered, if the vessel or cargo is arrested pursuant to process obtained on behalf of the party bringing the suit— unless the party was unaware that the vessel or cargo of a foreign state was involved, in which event the service of process of arrest shall be deemed to constitute valid delivery' of such notice; and
(2)notice to the foreign state of the commencement of suit as provided in section 1608 of this title is initiated within ten days either of the delivery of notice as provided in subsection (b)(1) of this section or, in the case of a party who was unaware that the vessel or cargo of a foreign state was involved, of the date such party determined the existence of the foreign state's interest. Whenever notice is delivered under subsection (b)(1) of this section, the maritime lien shall thereafter be deemed to be an in personam claim against (he foreign state which at that time owns the vessel or cargo involved; Provided, That a court may not award judgment against the foreign state in an amount greater than the value of the vessel or cargo upon which the maritime lien arose, such value to be determined as of the time notice is served under subsection (b)(1) of this section.
5 28 U.S.C. § 1608(b) provides:
(b) Service in the courts of the United States and of the States shall be made upon an agency or instrumentality of a foreign state:
(1) by delivery of a copy of the summons and complaint in accordance with any special arrangement for service between the plaintiff and the agency or instrumentality; or
(2) if no special arrangement exists, by delivery of a copy of the summons and complaint either to an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service of process in the United States; or in accordance with an applicable international convention on service of judicial documents; or
(3) if service cannot be made under paragraphs (1) or (2), and if reasonably calculated to give actual notice, by delivery of a copy of the summons and complaint, together with a translation of each into the official language of the foreign state—
(A) as directed by an authority of the for eign state or political subdivision in response to a letter rogatory or request or
(B) by any form of mail requiring a signed receipt, to be -addressed and dispatched by the clerk of the court to the agency or instrumentality to be served, or
(C) as directed by order of the court consistent v/ith the law of the place where service is to be made.
6 The doctrine was articulated in the Tate Letter, drafted by the then-Actir.g Legal Adviser to the Department of State, Jack B. Tate. 26 Dept. of State Bulletin 984 (1952).
7 Section 1603(d) provides:
(d) A “commercial activity” means either a regular course of commercial conduct or a particular commercial transaction or act. The commercial character of an activity shall be determined by reference to the nature of the course of conduct or particular transaction or act, rather than by reference to its purpose.
Congress deliberately left the distinction between commercial and governmental activities open for judicial adumbration on a case-bycase basis. See H.R.Rep.No.94 -1487, supra, at 16. The legislative history indicates that if the activity is one in which a private entity could engage, it is not entitled to immunity, even if the contract seeks to procure goods for a governmental purpose. See Texas Trading & Milling Corp. v. Fed'l Repub. of Nigeria. 647 F.2d 300. 308-09 (2d Cir. 1981).
8 See, e.g., Everett v. U. S.. 277 F. 256 (D.Wis.), affd, 2S4 F. 2C3 (9th Cir), cert, dewed, 261 U.S. 615, 43 S.Ct. 361, 67 L.Ed. 82S (1921); Tlie Acorn, 32 F. 638 (p.Pa.1887).
9 See Ruggiero v. Compania Peruana De Vapores, 639 F.2d 872 (2d Cir. 1981) (Longshoremen and Harbor Worker's Compensation Act Case; court holds that 28 U.S.C. § 1330 is exclusive, so that plaintiffs cannot invoke procedures available when jurisdiction can be founded on 28 U.S.C. § 1332).
10 Act of July 20, 1790, c. 29, § 6, 1 Stat. 133; R.S. § 4529.
11 The constitutionality of ex-tending the Seaman's Act to foreign ships and foreign seamen was settled in Strathearn S.S. Co. v. Dillon, 252 U.S. 348, 40 S.Ct. 350, 64 L.Ed. 607 (1920), and its companion case. The Westmeatn, 252 U.S 358, 40 S.Ct. 353, 6-1 L.l'.d. 612 (1920), affg, 258 F. 446 (2d Cir. 1919). In Strathearn a British subject shipped on a British vessel under a contract executed in Britain that called for all wages to be paid at the end of the three year voyage. While the ship was docked in Florida, the seaman demanded one-half of his wages under § 597 of the Seaman's Act. The shipowner argued that the application of this statute to foreign seamen constituted an unconsti tutional destruction of contract rights. Relying on Patterson v. The Bark Eudora, 190 U.S 16“. 23 S.Ct. 821. 47 L.Ed. 1002 (1903), which lud rejected this argument, the Supreme Court held that Congress had authority to pass § 597 by virtue of its constitutional jurisdiction over foreign merchant vessels in United States parts This authority entitled Congress to set the terms and conditions under which foreign vessels may enter United States harbors and bring foreign seamen into United States ports. In return for the privilege of conducting maritinw business in United States ports, foreign ship owners are obliged to compensate seamen as cording to United States laws, contract processions to the contrary notwithstanding.
12 We must also inquire whether this exercise, of subject matter jurisdiction is proper under Article III, and whether the assertion of personal jurisdiction comports with the due process clause. Texas Trading & Milling, supra, at 308. See also Verlinden B.W. v. Central Bank of Nigeria. 647 F.2d 320 (2d Cir. 1981).
In the present case, the response to these inquiries appears to be self-evident. The case arises under a federal statute, 46 U.S.C. §§ 596-97. within the meaning of Article Hi's federal question authority, and CALTRAM routinely conducts its navigation and cargo business within the United States, thus satisfying the due process notion of “minimum contacts.”
13 There is an alternative argument for finding in personam jurisdiction over CALTRAM with regard to breach of contract claims. Under § 1605(a)(2). United States courts may assume jurisdiction over actions based on “an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that Act causes a direct effect in the United States.” Here, the act outside the United States was the breach of employment contracts. The direct effect in the United States is that the seamen were brought to a domestic port without wages because of the alleged breach, in contravention of United States policy.