GDG Acquisitions, LLC v. Government of Belize ( 2014 )

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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-11616
________________________
D.C. Docket No. 1:12-cv-20558-WJZ
GDG ACQUISITIONS, LLC,
Plaintiff - Appellant,
versus
GOVERNMENT OF BELIZE,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(April 22, 2014)
Before MARCUS, Circuit Judge, and COOGLER * and BOWEN, ** District Judges.
MARCUS, Circuit Judge:
*
Honorable L. Scott Coogler, United States District Judge for the Northern District of Alabama,
sitting by designation.
**
Honorable Dudley H. Bowen, Jr., United States District Judge for the Southern District of
Georgia, sitting by designation.
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GDG Acquisitions, LLC (“GDG”) alleges that the Government of Belize
(“Government”) breached a contract for the lease of office telecommunications
equipment. Without reaching the merits of the dispute, the district court dismissed
on two alternative grounds, pursuant to the doctrines of forum non conveniens and
international comity. As we see it, the district court abused its considerable
discretion in dismissing for forum non conveniens without first evaluating the
significance of a forum-selection clause in the underlying contract. See Atl.
Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex., 134 S. Ct. 568
(2013). Therefore, we vacate the forum non conveniens dismissal and remand to
allow the district court to determine the enforceability and significance of the
forum-selection clause.
In addition, we vacate the district court’s dismissal on the alternative ground
of international comity. “Retrospective” international comity does not apply
without a judgment from a foreign tribunal or parallel foreign proceedings. See
Ungaro-Benages v. Dresdner Bank AG, 379 F.3d 1227, 1238 (11th Cir. 2004).
Nor does this commercial contract dispute fall within the markedly more limited
reach of “prospective” international comity, a doctrine we have reserved for
exceptional diplomatic circumstances. See id.
I.
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A.
The tale of this case begins with an effort by the Government of Belize (the
“Government”) to reduce its expenditures on office telephone services. In 2002,
Government Minister Ralph Fonseca entered into discussions with a Belizean
company, International Telecommunications, Ltd. (“Intelco”), to lease hardware
equipment including telephones, cables, routers, and servers. Fonseca negotiated
in Florida and in Washington, D.C., with Glenn Godfrey, a former Attorney
General of Belize who was the founder and a director of Intelco. Fonseca and
Godfrey reached an agreement, though the parties in this litigation now dispute
whether Fonseca had the authority to contract on behalf of the Government. On
December 18, 2002, Fonseca and Godfrey met in Miami to close the deal with
representatives of the International Bank of Miami, a United States bank that
financed the deal.
Fonseca, as the Government’s “Minister of Budget Management,” and
Godfrey, as Intelco’s “Chairman,” signed a “Master Lease Agreement” obligating
Intelco to lease the equipment to the Government in exchange for quarterly rent
payments totaling $6,748,189.20 between 2003 and 2007. Intelco assigned these
payments to the International Bank of Miami for a single upfront cash payment
from the bank of $5 million. The Master Lease Agreement characterized itself as a
“net lease” that required the Government to make payments unconditionally,
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without any right to abatement or reduction for any reason. The lease terms
provided that Intelco had no obligation to provide services once the Government
took possession of the phone equipment in Florida.
The Master Lease Agreement contained provisions stating that the
Government waived its sovereign immunity and consented to suit in the United
States:
[R]ights and obligations under this Master Lease or any Lease
Schedule shall be determined exclusively in accordance with the
governing laws of the State of Florida, irrespective of conflict of law
principles. Lessee irrevocably submits to the exclusive jurisdiction of
any of the federal and state courts in the State of Florida in any action
or proceeding arising out of or relating to the Master Lease or any
Lease Schedule, and Lessee hereby irrevocably agrees that all claims
in respect of such action or proceeding may be heard and determined
in any court of competent jurisdiction in the State of Florida.
The lease also contained a waiver of objections to venue or to claims of
inconvenient forum:
Lessee hereby irrevocably waives any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to the Master Lease or any Lease Schedule
and hereby further irrevocably waives any claim that any such suit,
action or proceeding brought in any such court has been brought in an
inconvenient forum. Lessee specifically acknowledges that Miami-
Dade County, Florida is a proper venue for the Lessor to bring suit
against Lessee pursuant to the Master Lease or any Lease Schedule.
The Master Lease Agreement obligated the Government to return the
equipment to Intelco at the end of 2007 or to continue paying rent at the same rate,
month-to-month, for up to a year. After one year, the Government had to return
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the equipment or continue rent payments. Fonseca and Godfrey agreed to a second
lease of additional equipment to run from 2003 to 2008, also for $6,748,189.20 in
rent and also assigned to the International Bank of Miami, under the terms of the
same Master Lease Agreement. The Government made the rental payments in full
for the terms of the two leases, totaling $13.5 million. The complaint in this case
alleges that the Government has not made any additional lease payments as
required by the Master Lease since 2008, even though it continues to possess and
use the equipment.
B.
Glenn D. Godfrey, formerly of Intelco, created GDG as a Florida limited
liability company, with its principal office in Houston, Texas, on or about January
26, 2012. Godfrey remains GDG’s sole member. On or about Feburary 1, Intelco
assigned all of its assets to GDG, including its interest in the Belize agreements.
On February 10, GDG sued the Government of Belize in the United States District
Court for the Southern District of Florida. GDG alleged that the Government owes
it approximately $14 million in unpaid rent, with the amount growing each month.
The Government maintains that the equipment is defective and that the Master
Lease Agreement is null and void because Fonseca lacked constitutional power,
and thus actual authority, to sign telecommunications agreements for the
Government of Belize.
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The Government moved the district court to dismiss on three grounds: (1)
foreign sovereign immunity pursuant to the Foreign Sovereign Immunities Act, 28
U.S.C. §§ 1602 et seq.; (2) the doctrine of forum non conveniens; and (3) the
doctrine of international comity. The district court found first that the case should
be dismissed because of forum non conveniens. According to the court, a Belizean
forum was available and adequate. In addition, balancing the private factors, the
original contract had been made in Belize between Belizean entities, even though
rights under the agreement had been assigned to GDG, an American entity, before
the suit commenced. Witnesses and documents were more readily accessible in
Belize and enforcing a judgment would be easier for a Belizean court. Similarly,
the district court found that public interest factors favored dismissal.
Administrative challenges and the difficulty of applying foreign law made trying
the case in federal court more burdensome. Finally, GDG could reinstate its
lawsuit in Belize, where the Government was subject to jurisdiction.
The district court alternatively found dismissal appropriate pursuant to the
doctrine of international comity, which “encompasses the principle of respect for
the acts of sovereign nations.” Belize Telecom, Ltd. v. Gov’t of Belize, 528 F.3d
1298, 1305 (11th Cir. 2008). After weighing the strengths of the foreign and
domestic interests in this case, the district court concluded that Belizean interests
prevailed because of the need to interpret and apply Belize’s law and because the
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case involved telecommunications services that could affect the citizens of Belize.
The district court did not reach the question of whether foreign sovereign
immunity precluded subject matter jurisdiction. See Sinochem Int’l Co. v.
Malaysia Int’l Shipping Corp., 549 U.S. 422, 432 (2007) (“A district court . . . may
dispose of an action by a forum non conveniens dismissal, bypassing questions of
subject-matter and personal jurisdiction, when considerations of convenience,
fairness, and judicial economy so warrant.”).
GDG appealed the dismissal, arguing that the district court erred in its
application of both forum non conveniens and international comity. GDG moved
for supplemental briefing after the United States Supreme Court decided Atlantic
Marine, which addressed the effect of a forum-selection clause on forum non
conveniens analysis. 134 S. Ct. at 581-82. We granted the motion and both parties
filed supplemental briefs.
The district court had jurisdiction over this action because the Government
of Belize is a foreign state. See 28 U.S.C. § 1330. We have appellate jurisdiction
because dismissal came in a final order. See 28 U.S.C. § 1291.
II.
We review the district court’s forum non conveniens dismissal for abuse of
discretion. Aldana v. Del Monte Fresh Produce N.A., 578 F.3d 1283, 1288 (11th
Cir. 2009). Therefore, we will “affirm unless we find that the district court has
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made a clear error of judgment, or has applied the wrong legal standard.” Id.
(quoting United States v. Frazier, 387 F.3d 1244, 1259 (11th Cir. 2004)). Based on
controlling Supreme Court case law decided after the district court issued its
dismissal order, we conclude that the district court erred because it conducted its
forum non conveniens analysis without first considering the application of the
forum-selection clause found in the Master Lease Agreement. See Atl. Marine,
134 S. Ct. 568.
To obtain dismissal for forum non conveniens, “[t]he moving party must
demonstrate that (1) an adequate alternative forum is available, (2) the public and
private factors weigh in favor of dismissal, and (3) the plaintiff can reinstate his
suit in the alternative forum without undue inconvenience or prejudice.” Leon v.
Millon Air, Inc., 251 F.3d 1305, 1310-11 (11th Cir. 2001). Just last year, the
Supreme Court in Atlantic Marine explained that an enforceable forum-selection
clause carries near-determinative weight in this analysis:
When parties agree to a forum-selection clause, they waive the right to
challenge the preselected forum as inconvenient or less convenient for
themselves or their witnesses, or for their pursuit of the litigation. A
court accordingly must deem the private-interest factors to weigh
entirely in favor of the preselected forum. . . .
As a consequence, a district court may consider arguments
about public-interest factors only. Because those factors will rarely
defeat a transfer motion, the practical result is that forum-selection
clauses should control except in unusual cases.
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134 S. Ct. at 582 (emphasis added). Thus, a district court now must consider an
enforceable forum-selection clause in the forum non conveniens analysis. A
binding forum-selection clause requires the court to find that the forum non
conveniens private factors entirely favor the selected forum.
This approach is consonant with the Supreme Court’s longstanding
recognition “that privately bargained-for forum-selection clauses [are] a necessary
component of the expanded international commercial relationships of our time.”
Estate of Myhra v. Royal Caribbean Cruises, Ltd., 695 F.3d 1233, 1240 (11th Cir.
2012); see Scherk v. Alberto-Culver Co., 417 U.S. 506, 516 (1974) (“A contractual
provision specifying in advance the forum in which disputes shall be litigated and
the law to be applied is, therefore, an almost indispensable precondition to
achievement of the orderliness and predictability essential to any international
business transaction.”); The Bremen v. Zapata Off-shore Co., 407 U.S. 1, 12-13
(1972) (“There are compelling reasons why a freely negotiated private
international agreement, unaffected by fraud, undue influence, or overweening
bargaining power, such as that involved here, should be given full effect.” (footnote
omitted)); see also Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473
U.S. 614, 631 (1985) (“The Bremen and Scherk establish a strong presumption in
favor of enforcement of freely negotiated contractual choice-of-forum
provisions.”).
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In this case, the district court dismissed for forum non conveniens without
addressing the significance of the forum-selection clause. In the face of this recent
high court ruling, we are obliged to vacate the forum non conveniens dismissal.
See Atl. Marine, 134 S. Ct. at 581 (“The calculus changes . . . when the parties’
contract contains a valid forum-selection clause . . . .”); La Seguridad v. Transytur
Line, 707 F.2d 1304, 1308 (11th Cir. 1983) (“[T]he court abuses its discretion
when it fails to balance the relevant factors.”). We remand to allow the district
court to determine in the first instance whether the forum-selection clause in the
Master Lease Agreement is enforceable. If the forum-selection clause binds the
Government, the district court must find that the forum non conveniens private
factors unequivocally support the selected forum. See Atl. Marine, 134 S. Ct. at
582. The forum non conveniens analysis should then proceed, with the
understanding that “[i]n all but the most unusual cases . . . ‘the interest of justice’ is
served by holding parties to their bargain.” Id. at 583.
The Government argues nevertheless that the district court need not have
considered the forum-selection clause, for two reasons. First, the Government
claims that the provision is “permissive,” not “mandatory.” See Global Satellite
Commc’n Co. v. Starmill U.K., Ltd., 378 F.3d 1269, 1272 (11th Cir. 2004). “A
permissive clause authorizes jurisdiction in a designated forum but does not
prohibit litigation elsewhere.” Id. A mandatory clause, by contrast, “dictates an
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exclusive forum for litigation under the contract.” Id. (quoting Snapper, Inc. v.
Redan, 171 F.3d 1249, 1262 n.24 (11th Cir. 1999)). The Government points to one
sentence from the forum-selection clause in which “Lessee specifically
acknowledges that Miami-Dade County, Florida is a proper venue for the Lessor to
bring suit against Lessee pursuant to the Master Lease or any Lease Schedule.”
But the lease also provides that the “Lessee irrevocably submits to the exclusive
jurisdiction of any of the federal and state courts in the State of Florida in any
action or proceeding arising out of or relating to the Master Lease . . . .” (emphasis
added). Second, the Government argues that the court need not have looked to the
forum-selection clause because the Government overcame the presumption of
validity. See The Bremen, 407 U.S. at 15. The Government claims it made a
sufficient showing before the district court that the clause was unenforceable as
either “unreasonable and unjust” or invalid due to “fraud or overreaching.” Id.
The problem is that both arguments require the interpretation and analysis of
the Master Lease Agreement. We are reluctant to address them until the district
court has had an opportunity to consider them first. On remand, the district court
should determine whether the Master Lease Agreement contains a mandatory
forum-selection clause that binds the Government.
III.
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We also review the district court’s decision to dismiss based on international
comity for abuse of discretion. Belize Telecom, 528 F.3d at 1303. International
comity is an abstention doctrine that reflects “the extent to which the law of one
nation, as put in force within its territory, whether by executive order, by
legislative act, or by judicial decree, shall be allowed to operate within the
dominion of another nation.” Hilton v. Guyot, 159 U.S. 113, 163 (1895).
“International comity serves as a guide to federal courts where ‘the issues to be
resolved are entangled in international relations.’” Ungaro-Benages, 379 F.3d at
1237 (quoting In re Maxwell Commc’n Corp., 93 F.3d 1036, 1047 (2d Cir. 1996)).
The doctrine of comity “is not a rule of law, but one of practice, convenience, and
expediency.” Somportex Ltd. v. Phila. Chewing Gum Corp., 453 F.2d 435, 440
(3d Cir. 1971). “Although more than mere courtesy and accommodation, comity
does not achieve the force of an imperative or obligation. Rather, it is a nation’s
expression of understanding which demonstrates due regard both to international
duty and convenience and to the rights of persons protected by its own laws.” Id.
Most frequently, international comity is applied retrospectively, when courts
consider whether to respect the judgment of a foreign tribunal or to defer to
parallel foreign proceedings. See Ungaro-Benages, 379 F.3d at 1238. For
retrospective international comity, courts consider whether the foreign court was
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competent, whether the foreign judgment was fraudulent, and whether that
judgment violated American public policy notions of decency and justice. Id.
Far more rarely, courts have applied international comity prospectively,
without a conflicting past or present foreign proceeding. See id. In such cases,
“domestic courts consider whether to dismiss or stay a domestic action based on
the interests of our government, the foreign government and the international
community in resolving the dispute in a foreign forum.” Id. “Applied
prospectively, federal courts evaluate several factors,” namely, (1) “the strength of
the United States’ interest in using a foreign forum,” (2) “the strength of the
foreign governments’ interests,” and (3) “the adequacy of the alternative forum.”
Id.
Only once has this Court ever sustained the dismissal of a lawsuit based on a
prospective application of international comity. In Ungaro-Benages, a plaintiff
claimed that two German banks stole her family’s ownership interest in a
manufacturing company as part of the Nazi program of “Aryanization.” Id. at
1229-30. The district court granted summary judgment based in part on the
doctrine of international comity, and a panel of this Court affirmed. Id. at 1232.
President Clinton had reached an agreement with the German government to
achieve a “legal peace” by establishing a private foundation -- funded by voluntary
contributions from the German government and German companies -- to hear
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claims brought by victims of the Nazi regime. Id. at 1231. This Court “decide[d]
to abstain based on the strength of our government’s interests in using the
Foundation, the strength of the German government’s interests, and the adequacy
of the Foundation as an alternative forum.” Id. at 1239. We noted that “the
President has the constitutional authority to settle the international claims of
American citizens, even if the claimants would prefer litigation in American
courts,” id., and “that American and German governments have entered into
extensive negotiations over this subject and those negotiations affect thousands of
other victims of the Nazi regime,” id. at 1240.
To support its application of prospective international comity, this Court in
Ungaro-Benages cited only three cases, all from the Second Circuit. In two, the
Second Circuit ultimately refused to abstain. See Jota v. Texaco, Inc., 157 F.3d
153 (2d Cir. 1998) (considering whether to dismiss proceedings related to
environmental damage in Ecuador based on Ecuador’s interest in foreign or
domestic resolution and holding dismissal on grounds of forum non conveniens
and comity erroneous); Pravin Banker Assocs. v. Banco Popular Del Peru, 109
F.3d 850 (2d Cir. 1997) (affirming district court’s refusal to stay an action brought
by an American holder of Peruvian debt while Peru attempted to renegotiate its
commercial debt under the Brady Plan). Thus, Ungaro-Benages relied on only one
case that actually dismissed domestic claims to allow foreign proceedings. See Bi
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v. Union Carbide Chems. & Plastics Co., 984 F.2d 582 (2d Cir. 1993). In Bi, the
Second Circuit applied the “act of state doctrine” when India created an
adjudication mechanism that granted exclusive government standing to represent
the victims of a mass tort, the Bhopal disaster. Id. at 586. The Bi court concluded:
We hold that when a recognized democracy determines that the
interests of the victims of a mass tort that occurred within its borders
will be best served if the foreign government exclusively represents
the victims in courts around the world, we will not pass judgment on
that determination, and we will permit only the foreign government
access to our courts to litigate those claims, subject of course to our
own requirements for standing.
Id.
In this case, we think the district court abused its discretion in its application
of the three Ungaro-Benages factors that bear on prospective international comity.
Notably, in Ungaro-Benages, all three factors favored dismissal. First, “[t]he
United States government ha[d] consistently supported the Foundation as the
exclusive forum” after the “President entered into negotiations with the German
government and determined that the interests of American citizens, on the whole,
would be best served by establishing the Foundation Agreement” because it
“creat[ed] a comprehensive compensatory scheme.” Id. at 1239. Second, “the
German government ha[d] a significant interest in having the Foundation be the
exclusive forum for these claims in its efforts to achieve lasting legal peace with
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the international community.” Id. Third, the Foundation was an adequate forum.
Id.
Unlike in Ungaro-Benages, here the United States does not have a
significant interest in the foreign adjudication of this matter. The district court
recognized that “the United States does have a general interest in seeing that a
party’s contractual obligations are honored.” We agree. In this case, “the United
States has a strong interest in ensuring the enforceability of valid debts under the
principles of contract law, and in particular, the continuing enforceability of
foreign debts owed to United States lenders.” Pravin Banker Assocs., 109 F.3d at
855; see Allied Bank Int’l v. Banco Credito Agricola de Cartago, 757 F.2d 516,
521-22 (2d Cir. 1985) (“The United States has an interest in ensuring that creditors
entitled to payment in the United States in United States dollars under contracts
subject to the jurisdiction of United States courts may assume that, except under
the most extraordinary circumstances, their rights will be determined in accordance
with recognized principles of contract law.”). The Master Lease Agreement was
negotiated and signed in the United States. Intelco completed its performance by
presenting the telephone equipment for acceptance in Florida. GDG, one of the
parties to the litigation, is an American entity. Litigation in a federal forum
advances the United States’ interest in enforcing agreements formed and
performed on American soil in disputes involving an American party. Tellingly, in
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Ungaro-Benages the United States submitted a Statement of Interest that
represented that it was “in the foreign policy interests of the United States for the
case to be dismissed.” 379 F.3d 1232. No statement of foreign policy interest
from the United States appears in the current record, and we can discern no such
interest favoring the foreign adjudication of this matter. Thus, the first Ungaro-
Benages factor weighs against dismissal.
As for the second factor, the district court abused its discretion in
determining that the Government of Belize possesses a strong interest in litigation
abroad, strong enough to outweigh the interest of the United States. To the
contrary, the Government of Belize lacks a sufficiently strong interest in foreign
adjudication. This dispute resembles so many other garden-variety commercial
contract actions: GDG sues for breach of an equipment lease contract, but the
Government claims it is not bound by the agreement. The record contains no
indication that Belize has established an exclusive method of adjudicating this type
of contract dispute that would be undermined by prosecution in federal court. In
Ungaro-Benages, an American suit would have undermined the German
Foundation’s uniform system for paying Nazi-era claims to thousands of victims.
379 F.3d at 1239-40. In Bi, a federal court action would have conflicted with
exclusive Indian government standing to litigate liability for the Bhopal disaster.
984 F.2d at 586. In other words, Germany and India had powerful and easily
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discernible interests in protecting their dispute-resolution systems involving
thousands of claimants from the corrosion or collapse that would occur if the
claims were handled by federal courts. Here, in sharp contrast, GDG’s suit does
not affect a collective solution to widespread harms. Its federal claims conflict
with no foreign system or proceedings.
As a litigant, the Government of Belize now may prefer to handle this suit in
its own courts. But a foreign sovereign party’s post hoc preference to defend a
contract action at home is not a cognizable prospective international comity
interest. Prospective international comity requires a serious problem that would be
created by federal court proceedings but that would not be present if the matter
were adjudicated abroad. Here, we can see no such problem. The parties dispute
only the performance under a contract, and the United States is an adequate forum.
The Government’s invocation of contract cases involving the retroactive
application of international comity says little about whether courts should extend
prospective international comity to this commercial contract dispute. Though a
Belizean forum may be altogether adequate, adequacy is not enough. Ultimately,
prospective international comity does not apply because neither the United States
nor Belize has the requisite interest.
As we view it, the district court erred when it reached the opposite
conclusion based on Belize Telecom. 528 F.3d 1298. A materially different set of
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facts in that case led us to find it “clear that the interests of Belize far outweigh[ed]
the American interests.” Id. at 1307. The Belize Telecom dispute arose when the
Government of Belize took control of shares of Belize Telecommunications
Limited, “the primary provider of telecommunications in Belize.” Id. at 1300. The
litigants disputed whether the Government acted in accordance with that
company’s articles of association, as interpreted according to Belize law, when it
removed the company’s directors and elected a new slate. Crucially, Belize
Telecom involved a retrospective international comity dismissal, which entails a
wholly different test and different analysis than in prospective cases. See Ungaro-
Benages, 379 F.3d at 1238. While the Court’s opinion mentioned foreign and
domestic interests, Belize Telecom did not weigh them in the context of the
Ungaro-Benages prospective framework.
Moreover, none of the three foreign interests cited in Belize Telecom apply
here. First, in Belize Telecom “[n]one of the parties to the litigation [wa]s an
American corporation,” and the lawsuit was only “tangentially” connected to the
United States because it involved payments due to an American bank. 528 F.3d at
1307. Here, GDG is an American corporation. And the contract in dispute was
negotiated, signed, and performed in the United States.
Second, the action in Belize Telecom threatened to affect the mass “delivery
of telecommunications services” to the citizens of Belize. Id. Not so here, where
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the record contains no indication that the case will have any impact on the
provision of Belizean telecommunications services. Moreover, we are not inclined
to give weight to another nation’s interest merely because of the use of a product
purchased in the United States. If foreign purchasers could avoid contract actions
in American courts by simply citing the use of goods abroad, international comity
abstention would lose its moorings. American merchants rely on the availability of
United States courts when dealing with foreign nations in international commerce.
Such commerce could be constricted if a merchant knew that an expansive
prospective international comity doctrine would allow a foreign government
counterparty to remove any suits to its own courts. This result would harm foreign
governments, who could have greater difficulty obtaining favorable terms in
American transactions. While the Government may now have an ex post interest
in litigation in Belize, it may have had an ex ante interest in a federal forum.
Third, Belize Telecom “involve[d] the interpretation of the articles of
association of a Belizean corporation pursuant to Belize law.” Id. at 1307. In this
case, American law applies. The contract unambiguously provided that rights and
obligations related to the lease “shall be determined exclusively in accordance with
the governing laws of the State of Florida, irrespective of conflicts of laws
principles.” It may be true that adjudication in federal court could require some
application of Belizean law in determining whether Fonseca acted with the
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authority to bind the Government to the Master Lease Agreement. But federal
courts regularly interpret and apply foreign law without offending international
interests. See Fed. R. Civ. P. 44.1. And the bulk of the law to be applied to the
interpretation of the contract in this case plainly is American. In short, we think
the district court abused its discretion in determining that Belize’s preference for
“seeing that its national laws are properly interpreted” is the type of strong interest
that warrants prospective international comity dismissal.
To date, we have reserved prospective international comity abstention for
rare (indeed often calamitous) cases in which powerful diplomatic interests of the
United States and foreign sovereigns aligned in supporting dismissal. We decline
to transform prospective international comity into a forum-selection tool for
sovereign litigants to wield in common breach of contract actions. Because
neither the United States nor Belize has a strong interest in adjudication of this
matter abroad, the district court erred in applying international comity
prospectively.
IV.
The district court erred in dismissing on each alternative ground. We vacate
the forum non conveniens dismissal and remand to the district court so that it may
determine the enforceability of the forum-selection clause and its significance to
the forum non conveniens analysis. We also vacate its dismissal based on
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prospective international comity because that exceptional doctrine does not apply
to the commercial dispute in this case.
VACATED and REMANDED.
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