Case: 19-11656 Date Filed: 05/14/2020 Page: 1 of 14
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-11656
Non-Argument Calendar
________________________
D.C. Docket No. 1:16-cv-25052-JEM
HORACIO SEQUEIRA,
a citizen of the United States of America,
Plaintiff-Appellant,
versus
THE REPUBLIC OF NICARAGUA,
a foreign country,
CITY OF CHINANDEGA,
a political subdivision of the foreign Country of the
Republic of Nicaragua,
EDUARDO JOSE CALLEJAS CALLEJAS,
an individual citizen of the United States of America,
ESTRELLITA DEL CARMEN TROZ MARTINEZ,
an Individual Chief Public Records of Chinandega, Nicaragua,
CHIEF OF PUBLIC RECORDS OF CHINANDEGA, NICARAGUA,
Defendants-Appellees.
Case: 19-11656 Date Filed: 05/14/2020 Page: 2 of 14
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(May 14, 2020)
Before WILSON, BRANCH, and TJOFLAT, Circuit Judges.
PER CURIAM:
Horacio Sequeira appeals pro se the District Court’s order dismissing his
action against the Republic of Nicaragua, the City of Chinandega, Eduardo Jose
Callejas Callejas, and Estrellita Del Carmen Troz Martinez (“Troz”) for lack of
subject matter jurisdiction. The Foreign Sovereign Immunities Act (“FSIA”)
“provides the sole basis for obtaining jurisdiction over a foreign state in the courts
of this country.” OBB Personenverkehr AG v. Sachs,
136 S. Ct. 390, 393 (2015)
(quotation marks omitted). “Under the FSIA, a foreign state is presumptively
immune from suit unless a specific exception applies.” Permanent Mission of
India to the U.N. v. City of N.Y.,
551 U.S. 193, 197,
127 S. Ct. 2352, 2355 (2007).
The District Court determined that sovereign immunity barred suit against
Nicaragua and Chinandega and dismissed Sequeira’s amended complaint against
those parties. In addition, because both Callejas and Sequeira are residents of
Florida, the Court dismissed the action for lack of complete diversity.
2
Case: 19-11656 Date Filed: 05/14/2020 Page: 3 of 14
In broad strokes, Sequeira alleged that Nicaragua and Chinandega contracted
with Callejas, who in turn contracted with Sequeria, to illegally take Sequeria’s
farmland in Nicaragua and sell the livestock as meat products in the United States.
Sequeira also sued Troz, the Chief of Public Records in Chinandega, for her
participation in this alleged scheme.
On appeal, Sequeira alleges that Nicaragua and Chinandega are subject to
suit in the United States because the purported contract they had with Callejas
included an arbitration provision, thus waiving their sovereign immunity. He first
contends that the District Court erred in concluding the contract was inauthentic as
it assessed evidence at the motion-to-dismiss stage instead of weighing the
evidence in the light most favorable to him. In addition, Sequeira argues that the
District Court erred when it found that Nicaragua and Chinandega were not subject
to suit based on either the commercial-activity exception or the expropriation
exception to the FSIA. Sequeira also contends that the District Court erred when it
found that, absent FSIA jurisdiction, there could be no subject matter jurisdiction
over Callejas and Troz due to a lack of complete diversity among the parties.
Finally, Sequeira argues that the magistrate judge abused his discretion in denying
Sequeira’s request for jurisdictional discovery.
We affirm.
I.
3
Case: 19-11656 Date Filed: 05/14/2020 Page: 4 of 14
Sequeira originally filed suit in 2016, alleging that Appellees had breached a
contract, illegally took his farmland in Nicaragua, and illegally sold his livestock
as meat products. In the complaint, Sequeira alleged that “Nicaragua through its
political subdivision of Chinandega waived its sovereign immunity by entering
into a private contract with the defendant Eduardo Jose Callejas Callejas.” The
complaint alleged that Sequeira and Callejas are both domiciled in Florida and that
Troz, the Chief of Public Records in Chinandega, is a resident of Nicaragua.
The District Court dismissed the complaint for lack of subject matter
jurisdiction because there were no allegations that a contract existed between
Nicaragua and Sequeira. Furthermore, the Court concluded that it lacked subject
matter jurisdiction over Sequeira’s other claims because the parties were not
completely diverse.
Sequeira moved for leave to amend his complaint. In his motion, Sequeira
included a translated declaration from Mariano Guerra Morales (“Guerra”) who
purported to be the Executive Director of the Cattle Raising Program under the
Nicaraguan Rural Development Institute (“IDR”). Guerra’s declaration claimed
that in 2001 or 2002, Nicaragua, through the IDR, entered a contract with Sequeira
and others to raise livestock at the El Pital farm. Sequeira did not provide a copy
of the contract. He did provide a copy of a rental agreement between himself and
4
Case: 19-11656 Date Filed: 05/14/2020 Page: 5 of 14
Callejas, which references an agreement between Sequeira, Nicaragua, and the
IDR. The District Court granted Sequeira’s motion for leave to amend.
In his amended complaint, Sequeira alleges that Nicaragua waived its
sovereign immunity because the IDR contract included an arbitration provision,
and that, therefore, the District Court has subject matter jurisdiction. He also
alleges that the Appellees engaged in commercial activities in the United States,
including selling meat products in the United States, retaining and paying
American attorneys, paying the salary of “front men” located in the United States,
and because Callejas paid rent from Florida. Sequeira alleges that Troz and
Callejas acted on behalf of Nicaragua and Chinandega to illegally take his
property.
The Appellees moved to dismiss. Callejas moved to dismiss each claim as
being barred by the statute of limitations. Nicaragua, Chinandega and Troz moved
to dismiss for lack of subject matter jurisdiction, lack of personal jurisdiction,
failure of service of process, improper venue, and failure to state a claim. In their
motion to dismiss, Nicaragua and Chinandega submitted several declarations.
Notably, they submitted a declaration from Miguel Angel Baca Jimenez, a legal
advisor for the IDR record keeping organization, who found no record of any
contract between Sequeira and the IDR.
5
Case: 19-11656 Date Filed: 05/14/2020 Page: 6 of 14
Sequeira moved for limited jurisdictional discovery, seeking to subpoena
documents held by the Defendants’ attorneys in Washington, inspect records in
Nicaragua, and request admissions from six individuals regarding Appellees’
commercial activities in the United States. The District Court denied the motion,
concluding that sovereign-immunity interests outweighed Sequeira’s vague and
improper requests for discovery.
In his response to the motions to dismiss, Sequeira repeated his jurisdictional
arguments and submitted a translation of a purported modification to his alleged
contract with the IDR. He did not submit a copy of the original contract, nor did
he submit a copy of the original modification.
Thereafter, the Court dismissed Sequeira’s amended complaint, finding that
it lacked subject matter jurisdiction. Sequeira appeals.
II.
A plaintiff who seeks to sue a foreign state has the burden of establishing
subject matter jurisdiction by “producing evidence” that one of the FSIA’s
sovereign-immunity exceptions applies. Butler v. Sukhoi Co.,
579 F.3d 1307,
1312–13 (11th Cir. 2009). A district court determines whether a plaintiff has
satisfied this burden by examining the allegations in the complaint and any
undisputed facts that the parties submit.
Id. at 1313. If the plaintiff satisfies this
6
Case: 19-11656 Date Filed: 05/14/2020 Page: 7 of 14
burden, the foreign state then has the burden of proving by a preponderance of the
evidence that the exception cited by the plaintiff does not apply.
Id.
We review a district court’s determination that it lacks subject matter
jurisdiction under the FSIA de novo and its factual findings for clear error.
Calzadilla v. Banco Latino Internacional,
413 F.3d 1285, 1287 (11th Cir. 2005).
We consider a factual finding clearly erroneous when we are left with a “definite
and firm conviction that a mistake has been committed” after reviewing all the
evidence. U.S. Commodity Futures Trading Comm’n v. Hunter Wise Commodities,
LLC,
749 F.3d 967, 974 (11th Cir. 2014) (quotation marks omitted). We will not
consider a factual finding clearly erroneous if it is plausible based on the record
viewed in its entirety. Odyssey Marine Expl., Inc. v. Unidentified Shipwrecked
Vessel,
657 F.3d 1159, 1169 (11th Cir. 2011). We will not consider a factual
finding clearly erroneous if it is based on one of two permissible views of the
evidence. Commodity Futures Trading Comm’n v. Gibraltar Monetary Corp.,
575
F.3d 1180, 1186 (11th Cir. 2009).
III.
A.
Sequeira claims that the arbitration provision in the purported contract
between the IDR, Callejas, and him impliedly waived Nicaragua’s, and thus
7
Case: 19-11656 Date Filed: 05/14/2020 Page: 8 of 14
Chinandega’s, sovereign immunity.1 The District Court determined that the
purported contract was not authentic. It also concluded that the signatory of the
purported contract lacked the authority to waive Nicaragua’s and Chinandega’s
sovereign immunities. Sequeira contends that the District Court improperly
weighed the evidence in favor of the Appellees. We conclude that the District
Court did not clearly err in determining that the contract was inauthentic.
The Appellees challenged the authenticity of the contract, mounting a factual
attack on Sequeira’s allegations of waiver. In cases involving a factual attack on
subject matter jurisdiction, the district court “is free to independently weigh facts”
and resolve the jurisdictional issue on the merits, even when there are disputed
material facts. Morrison v. Amway Corp.,
323 F.3d 920, 924–25 (11th Cir. 2003)
(contrasting the standard of review used for factual attacks on subject matter
jurisdiction with the standard applied to summary judgment motions). This means
that a district court may go beyond the four corners of a complaint when
determining whether subject matter jurisdiction exists under the FSIA. See
Comparelli v. Republica Bolivariana De Venez.,
891 F.3d 1311, 1322 (11th Cir.
2018).
1
A foreign state can impliedly waive its sovereign immunity when it
(1) agrees to arbitration in another country, (2) agrees that the law of a particular
country should govern the contract, or (3) files a responsive pleading without
raising sovereign immunity as a defense.
Calzadilla, 413 F.3d at 1287.
8
Case: 19-11656 Date Filed: 05/14/2020 Page: 9 of 14
The District Court did not err when it determined that the contract was
inauthentic. The District Court’s conclusion that the submitted document “appears
to be a sham contract created by Plaintiff for the purpose of defeating dismissal of
his complaint” is more than plausible. As the District Court noted, the timing of
Sequeira’s submission was highly suspect; it was only after the Court pointed out
that there could be no waiver without an agreement and after Sequeira requested—
and was denied—discovery to find the contract that a copy of the agreement
“magically appeared” in his possession. In addition, the content of the agreement
raises suspicion. The record supports the District Court’s conclusion that “specific
details believed to satisfy exceptions under the FSIA or to prevent dismissal were
haphazardly compiled to form a contract.” The translated modification includes
suspicious “Insertion of an Arbitration Clause” language and references an
amendment that is not otherwise mentioned. 2 The purported agreement also
mandated arbitration under CAFTA or a “Federal Court in Miami Florida” but
failed to specify what law applies or what happens when the parties do not agree.
The District Court also found it suspicious that the agreement included a provision
that subsequent agreements need not be notarized considering the circumstances
2
The District Court also found that it was “highly suspect that Guerra makes
no mention of the 2005 amendment in his purported declaration.” (emphasis in
original).
9
Case: 19-11656 Date Filed: 05/14/2020 Page: 10 of 14
surrounding a similar lawsuit by Sequeira’s brother in a different court. 3 We also
note that the substance of the agreement is questionable. The agreement lacks
clear terms and does not explain why a Nicaraguan-based–cattle-raising
arrangement provided for exclusive distribution to Miami.
Given the record, the District Court did not clearly err in finding that the
contract was inauthentic and, consequently, that Nicaragua and Chinandega did not
waive their sovereign immunities.
B.
The District Court also did not err in concluding that the commercial-activity
exception did not apply. The FSIA provides that a foreign state is not entitled to
sovereign immunity in any case that is
based upon a commercial activity carried on in the United States by
the foreign state; or upon an act performed in the United States in
connection with a commercial activity of the foreign state elsewhere;
or upon 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[.]
3
Specifically, the Magistrate Judge found that the provision “appears to be
in response to the California federal court’s finding in Jairo Sequeira’s case that the
contract submitted was void under Nicaraguan law because it was notarized by
Jairo’s brother, the Plaintiff here. The Undersigned also finds it suspicious that
Plaintiff was the notary for the contract submitted by his brother, which was found
to be void.” See Sequeira v. Republic of Nicaragua, No. CV13-4332,
2018 WL
6267835, at *5 (C.D. Cal. Aug. 24, 2018), aff’d,
791 F. App'x 681 (9th Cir. 2020).
10
Case: 19-11656 Date Filed: 05/14/2020 Page: 11 of 14
28 U.S.C. § 1605(a)(2). A foreign state engages in commercial activity when it
participates in a transaction as a private party would. Beg v. Islamic Republic of
Pak.,
353 F.3d 1323, 1325 (11th Cir. 2003). Thus, “public acts,” such as takings,
are not considered commercial activities. See
id. at 1325–26. In addition, for a
suit to be “based on” commercial activity in the United States, the alleged
commercial activity must be “the gravamen” of the plaintiff’s complaint. OBB
Personenverkehr, 136 S. Ct. at 395 (quotation marks omitted). In ascertaining the
gravamen of a complaint, courts are to focus on the core conduct giving rise to the
suit rather than individually analyzing the elements of each cause of action.
Id. at
396. This approach prevents plaintiffs from side-stepping the FSIA’s limitations
“through artful pleading.”
Id.
The commercial-activity exception does not apply here because Sequeira’s
amended complaint was based on the alleged taking of his land, which is not a
commercial activity. See
Beg, 353 F.3d at 1326. The other activities that allegedly
occurred in the United States, such as selling meat and paying “front men,” do not
constitute the “gravamen” of Sequeira’s complaint. See OBB
Personenverkehr,
136 S. Ct. at 395.
C.
The FSIA provides that a foreign state is not entitled to sovereign immunity
in a case where “rights in property taken in violation of international law are in
11
Case: 19-11656 Date Filed: 05/14/2020 Page: 12 of 14
issue and that property or any property exchanged for such property is present in
the United States in connection with a commercial activity carried on in the United
States by the foreign state.” 28 U.S.C. § 1605(a)(3).
“[A]n amended complaint supersedes and replaces the original complaint
unless the amendment specifically refers to or adopts the earlier pleading.” Varnes
v. Local 91, Glass Bottle Blowers Ass’n,
674 F.2d 1365, 1370 n.6 (11th Cir. 1982).
Thus, the allegations in an initial pleading are abandoned and “no longer a part of
the pleader’s averments” once an amended pleading has been filed. Dresdner
Bank AG v. M/V Olympia Voyager,
463 F.3d 1210, 1215 (11th Cir. 2006)
(quotation marks omitted).
Sequeira did not re-allege in his amended complaint that the expropriation
exception applied. In addition, Sequeira never requested permission to add such an
allegation to his amended complaint, even though he had ample time to do so.
Therefore, the District Court did not err when it did not consider the expropriation
exception because Sequeira did not properly raise the expropriation exception as a
possible basis for subject matter jurisdiction.
III.
Because the District Court did not have FSIA jurisdiction over Nicaragua
and Chinandega, there was no basis for supplemental jurisdiction over the claims
against Troz and Callejas. The District Court did not have an independent basis for
12
Case: 19-11656 Date Filed: 05/14/2020 Page: 13 of 14
subject matter jurisdiction as to the claims against Troz and Callejas because those
claims were based on state law and the parties lacked diverse citizenship. Thus,
the District Court did not err in dismissing Sequeria’s complaint.
IV.
We review a district court’s denial of jurisdictional discovery for abuse of
discretion. See United Techs. Corp. v. Mazer,
556 F.3d 1260, 1280–81 (11th Cir.
2009). This standard provides a range of choice for the district court. Alliant Tax
Credit 31 v. Murphy,
924 F.3d 1134, 1145 (11th Cir. 2019). Accordingly, when
applying this standard, we will affirm unless we find that the district court made a
clear error of judgment or applied the wrong legal standard. GDG Acquisitions
LLC v. Gov’t of Belize,
849 F.3d 1299, 1312 (11th Cir. 2017).
In determining whether jurisdictional discovery should be permitted against
a foreign state, a district court is “to balance the need for discovery to substantiate
exceptions to statutory foreign sovereign immunity against the need to protect a
sovereign’s or sovereign agency’s legitimate claim to immunity from discovery.”
Butler, 579 F.3d at 1314 (quotation marks omitted) (alteration adopted). This
balancing test is designed to ensure that jurisdictional discovery is used only to
confirm specific factual allegations and does not cause the undue burdens that
foreign sovereign immunity is designed to prevent.
Id.
13
Case: 19-11656 Date Filed: 05/14/2020 Page: 14 of 14
Given the breadth and lack of detail involved in Sequeira’s request for
jurisdictional discovery, it was reasonable for the District Court to conclude that
the request was not consistent with the permissible scope and purposes of
jurisdictional discovery against a foreign state. Therefore, the District Court did
not abuse its discretion in denying Sequeira’s request.
V.
Because Nicaragua, Chinandega, and Troz mounted a factual attack on
Sequeira’s stated bases for subject matter jurisdiction, the District Court was
permitted to rule on the validity of the purported contract and was not required to
weigh the evidence in the light most favorable to Sequeira. The District Court also
appropriately determined that Sequeira had not demonstrated that another
exception allowed for subject matter jurisdiction. The District Court also
reasonably concluded that Sequeira’s broad requests did not justify jurisdictional
discovery. We affirm.
AFFIRMED.
14
