Corporación Mexicana De Mantenimiento Integral, S. De R.L. De C v. v. ( 2016 )


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  • 13‐4022
    Corporación Mexicana De Mantenimiento Integral, S. De R.L. De C.V. v. Pemex‐Exploración Y Producción
    UNITED STATES COURT OF APPEALS
    FOR THE SECOND CIRCUIT
    August Term, 2014
    (Argued: November 20, 2014      Decided: August 2, 2016)
    Docket No. 13‐4022
    ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x
    Corporación Mexicana De Mantenimiento Integral, S. De R.L. De C.V.,
    Petitioner‐Appellee,
    ‐ v.‐
    Pemex‐Exploración Y Producción,
    Respondent‐Appellant.
    ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x
    Before:                    WINTER, JACOBS, and RAGGI, Circuit Judges.
    Respondent‐appellant Pemex‐Exploración Y Producción (“PEP”) appeals
    from the judgment of the United States District Court for the Southern District of
    New York (Hellerstein, J.) confirming an arbitral award notwithstanding that the
    award was nullified by a court in Mexico, where the award was rendered.  We
    conclude that:
    (1)  There is personal jurisdiction over PEP, and venue lies in the Southern
    District of New York;
    (2)  The district court did not abuse its discretion in confirming the award;
    and;
    (3)  The district court, which included in its judgment $106 million in
    performance bonds that PEP collected, did not thus exceed its authority.
    Accordingly, we affirm the judgment of the district court in all respects.
    Judge Winter concurs in a separate opinion.
    CATHERINE E. STETSON, HOGAN
    LOVELLS US LLP, Washington, D.C.;  on
    the brief:  Dennis H. Tracey, III, Ira M.
    Feinberg, Hagan C. Scotten & Erin M.
    Meyer, Hogan Lovells US LLP, New York,
    NY; Richard C. Lorenzo, Hogan Lovells US
    LLP, Miami, FL, for Appellant.
    PAUL D. CLEMENT (with Zachary D.
    Tripp & William R. Levi on the brief),
    BANCROFT PLLC, Washington, D.C.; also
    on the brief: Jeffrey S. Bucholtz & Brian
    Callanan, King & Spalding LLP,
    Washington, DC; Richard T. Marooney &
    Charles C. Correll, Jr., King & Spalding
    LLP, New York, NY, for Appellee.
    2
    Preet Bharara (with David S. Jones, Caleb
    Hayes‐Deats & Emily E. Daughtry on the
    brief), United States Attorney for the
    Southern District of New York, for Amicus
    Curiae United States of America; also
    on the brief: Joyce Branda, Douglas N.
    Letter & Sharon Swingle, Civil Division,
    Department of Justice, Washington, D.C.;
    Mary E. McLeod, Department of State,
    Washington, D.C.
    Erik S. Jaffe, Erik S. Jaffe, P.C., Washington,
    D.C., for Amicus Curiae The Government
    of the United Mexican States in support of
    Respondent‐Appellant.
    Peter B. Rutledge, Athens, GA, for Amicus
    Curiae The Chamber of Commerce of the
    United States of America in support of
    Petitioner‐Appellee; on the brief: Kathryn
    Comerford Todd & Tyler R. Green,
    National Chamber Litigation Center, Inc.,
    Washington, D.C.
    DENNIS JACOBS, Circuit Judge:
    The truly unusual procedural history of this case requires us to reconcile
    two settled principles that militate in favor of opposite results:  a district court’s
    discretion to confirm an arbitral award, and the comity owed to a foreign court’s
    ruling on the validity of an arbitral award rendered in that country, here, Mexico.
    Petitioner‐appellee Corporación Mexicana De Mantenimiento Integral, S. De R.L.
    3
    De C.V. (“COMMISA”) contracted with respondent‐appellant Pemex‐
    Exploración Y Producción (“PEP”), a state‐owned enterprise, to build oil
    platforms in the Gulf of Mexico.  The contracts provided that arbitration would
    be the exclusive mechanism for dispute resolution.  When the parties’
    relationship disintegrated, each side accused the other of breach.  COMMISA
    initiated arbitration proceedings, prevailed, and in 2009 obtained an award of
    approximately $300 million.
    COMMISA then petitioned the United States District Court for the
    Southern District of New York (Hellerstein, J.) (“Southern District”) for
    confirmation of the award, which was done.  PEP appealed the district court’s
    judgment to this Court (“First Appeal”) and simultaneously attacked the arbitral
    award in the Mexican courts.  The Eleventh Collegiate Court in Mexico set aside
    the arbitral award on the ground that PEP, as an entity deemed part of the
    Mexican government, could not be forced to arbitrate.  Armed with that decision,
    PEP moved in this Court to vacate the Southern District’s judgment and remand
    the First Appeal in light of the Eleventh Collegiate Court’s decision.  We granted
    that motion.  On remand, the Southern District conducted an evidentiary hearing,
    adhered to its previous ruling, issued a new judgment confirming the arbitral
    award, and thus set the stage for the present appeal.
    4
    We hold that the Southern District properly exercised its discretion in
    confirming the award because giving effect to the subsequent nullification of the
    award in Mexico would run counter to United States public policy and would (in
    the operative phrasing) be “repugnant to fundamental notions of what is decent
    and just” in this country.  We further conclude that PEP’s personal jurisdiction
    and venue objections are without merit.  Finally, we hold that the Southern
    District did not exceed its authority by including in its judgment $106 million
    attributed to performance bonds that PEP collected.  The judgment is affirmed.
    BACKGROUND
    This protracted litigation, begun in 2004, has challenged the courts of two
    countries.  We summarize here only those facts useful for understanding the
    issues presented and our resolution of them.
    1.
    COMMISA is a Mexican subsidiary of KBR, Inc., a United States
    construction and military‐contracting corporation.  PEP is one of four
    subsidiaries of Petroleos Mexicanos (“PEMEX”), an oil and gas company acting
    on behalf of the Mexican government.  PEMEX and PEP are public entities of the
    Mexican government, but have the capacity to independently own property and
    5
    carry out business under their own names.  Together, PEMEX and its subsidiaries
    “comprise the state oil and gas company of . . . Mexico.”  Joint Appendix (“J.A.”)
    at 1515.
    In 1997, COMMISA and PEP contracted for COMMISA to build oil
    platforms in the Gulf of Mexico.  The contract, governed by Mexican law,
    contained the following arbitration clause:
    23.3    Arbitration.  Any controversy, claim, difference, or
    dispute that may arise from or that is related to, or associated
    with, the present Contract or any instance of breach with the
    present Contract, shall be definitively settled through
    arbitration conducted in Mexico City, D.F., in accordance with
    the Conciliation and Arbitration Regulations of the
    International Chamber of Commerce that are in effect at that
    time.  The arbitrators shall be three in number, and the
    language in which the arbitration shall be conducted shall be
    Spanish.
    J.A. at 93.  PEP’s (now disputed) authority to bind itself to arbitration was
    premised on the following provision of the “PEMEX and Affiliates Organic
    Law”:
    In the event of international legal acts, Petróleos Mexicanos or its
    Affiliates may agree upon the application of foreign law, the
    jurisdiction of foreign courts in trade matters, and execute arbitration
    agreements whenever deemed appropriate in furtherance of their
    purpose.
    Special Appendix (“SPA”) at 41.
    6
    Two other provisions of the contracts bear on this appeal.  One clause gave
    PEP the unilateral right to “Administrative Rescission” if COMMISA breached
    the contract or abandoned its work; another clause required COMMISA to post
    performance bonds.
    2.
    Difficulties arose, in part over PEP’s insistence that the platforms be fully
    constructed before being put into place in the Gulf of Mexico, something
    COMMISA considered impractical given the weight of the completed platforms.
    Logistics and cost issues abounded, prompting the parties to execute a new
    contract in May 2003.  The 2003 contract contained virtually‐identical arbitration
    and administrative rescission clauses.
    The 2003 contract failed to resolve the parties’ differences, and the conflict
    reached climax in March 2004 when PEP, alleging that COMMISA had failed to
    meet contractual milestones and had abandoned the project, gave notice of its
    intent to administratively rescind the contract.  PEP seized the platforms, which
    were 94 percent complete; ejected COMMISA from the work sites; and gave
    notice by letter of its intention to administratively rescind the contracts.  After a
    fruitless conciliation effort, COMMISA filed a demand for arbitration with the
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    International Chamber of Commerce in December 2004.  When PEP informed
    COMMISA two weeks later that it was indeed effecting administrative rescission,
    COMMISA filed an amparo action in the District Court on Administrative Matters
    for the Federal District (“Mexican District Court”) challenging the
    constitutionality, appropriateness, and timeliness of PEP’s administrative
    rescission1; COMMISA lost on all counts.
    During the pendency of the amparo action, arbitration proceedings began in
    Mexico City in May 2005, with the active participation of both parties.
    In November 2006, the arbitration panel issued its Preliminary Award,
    finding that it possessed jurisdiction over the dispute and enjoining PEP from
    attempting to collect on the performance bonds until the issuance of a final
    arbitral award authorizing collection.  Prior to the issuance of the Preliminary
    Award, PEP’s arguments did not include a contention that its administrative
    rescission was an act of authority not subject to arbitration under Mexican law.
    1 An amparo action is a mechanism available to litigants in Mexico challenging
    the validity or constitutionality of governmental acts; the sole remedy is a
    declaration that the challenged governmental action is invalid.
    8
    3.
    Two developments in Mexican law transpired while arbitration
    proceedings were ongoing.  In December 2007, the Mexican Congress changed
    the available forum for claims that (like COMMISA’s) raise issues related to
    public contracts, and vested exclusive jurisdiction for such disputes in the Tax
    and Administrative Court.  Not incidentally, the switch curtailed the applicable
    statute of limitations: previously, ten years for suits in the Mexican District
    Courts; afterward, for suits in the Tax and Administrative Court, 45 days.
    Second, in May 2009, the Mexican Congress enacted Section 98 of the Law
    of Public Works and Related Services  (“Section 98”), which ended arbitration for
    certain claims (such as those by COMMISA):
    An arbitration agreement may be executed regarding the disputes
    arising between the parties related to the construction of contractual
    clauses or related to issues arising from the performance of the
    contracts . . . The administrative rescission, early termination of the
    contracts and such cases as the Regulation of this Law may
    determine may not be subject to arbitration proceedings.
    J.A. at 3758.
    9
    4.
    Promptly after the issuance of the Preliminary Award in November 2006‐‐
    and before the enactment of Section 98‐‐PEP asked the arbitration tribunal to
    reconsider its Preliminary Award and‐‐for the first time‐‐contended that
    administrative rescission was categorically exempt from arbitration as an act of
    authority on behalf of the Mexican government.  The tribunal rejected this
    argument in its December 2009 Final Award, and, in a voluminous decision,
    found that PEP breached the contracts and awarded COMMISA approximately
    $300 million in damages.
    COMMISA raced to confirm the award in the Southern District, which
    ruled in COMMISA’s favor in August 2010.  PEP appealed that judgment to this
    Court in the First Appeal and simultaneously challenged the arbitral award in
    Mexico by filing its own amparo action, which eventually made its way to the
    Eleventh Collegiate Court, the analog of the United States Court of Appeals for
    the District of Columbia Circuit.  In September 2011, the Eleventh Collegiate
    Court held that PEP’s rescission was not arbitrable and ordered that the award be
    annulled; its analysis repeatedly referenced the newly‐enacted Section 98.
    10
    The First Appeal was still pending when the Eleventh Collegiate Court
    rendered its decision.  Pressing its advantage, PEP successfully moved here for
    vacatur and remand so that the Southern District could consider the effect of the
    Eleventh Collegiate Court’s decision.  See Corporación Mexicana de
    Mantenimiento Integral, S. De R.L. De C.V. v. Pemex Exploración Y Producción,
    No. 10‐4656, 2012 WL 9346475, at *1 (2d Cir. Feb. 16, 2012).
    On remand, the Southern District received further briefing and conducted
    a three‐day evidentiary hearing chiefly focused on the meaning of applicable
    Mexican legal provisions.  See Corporación Mexicana de Mantenimiento Integral,
    S. De R.L. De C.V. v. Pemex Exploración Y Producción, 962 F. Supp. 2d 642, 644
    (S.D.N.Y. 2013).  The parties presented dueling experts who disputed whether the
    Eleventh Collegiate Court’s decision was consistent with the development of
    Mexican law, and whether the 2007 change in the applicable statute of limitations
    could apply retroactively to the instant dispute.  Ultimately, the Southern District
    “decline[d] to defer to the Eleventh Collegiate Court’s ruling,” and again
    “confirm[ed] the Award” on the ground that annulment of the award “violated
    basic notions of justice in that it applied a law that was not in existence at the
    time the parties’ contract was formed and left COMMISA without an apparent
    11
    ability to litigate its claims.”  Id.  Specifically, the Southern District concluded
    that the Eleventh Collegiate Court applied Section 98 retroactively “to favor a
    state enterprise over a private party,” and that COMMISA would be left “without
    a remedy” for its claims given the compressed statute of limitations for actions
    instituted in the Tax and Administrative Court.  Id. at 659‐60.
    PEP appeals from that judgment.
    DISCUSSION
    In reviewing a district court’s confirmation of an arbitral award, we
    ordinarily review legal issues de novo and findings of fact for clear error.  See
    Pike v. Freeman, 266 F.3d 78, 86 (2d Cir. 2001).  In this case, because the Southern
    District’s holding necessarily encompassed its decision to deny comity to a
    foreign judgment, the standard of review is modified: “[w]e review a district
    court’s decision to extend or deny comity to a foreign proceeding for abuse of
    discretion.”  Finanz AG Zurich v. Banco Economico S.A., 192 F.3d 240, 246 (2d
    Cir. 1999).  Accordingly, we review the Southern District’s denial of comity for
    abuse of discretion, and we review underlying conclusions of law de novo and
    the underlying findings of fact for clear error.  This approach is consistent with
    our precedent in other contexts.  See Levitt v. J.P. Morgan Sec., Inc., 710 F.3d 454,
    12
    464 (2d Cir. 2013) (“We review a district court’s grant of class certification for
    abuse of discretion, and review the conclusions of law underlying that decision
    de novo . . . although ‘we review for clear error the factual findings underlying
    th[at] ruling.’” (alteration in original) (citations omitted) (quoting Teamsters
    Local 445 Freight Div. Pension Fund v. Bombardier Inc., 546 F.3d 196, 201 (2d Cir.
    2008)).
    As to the remaining issues on appeal, we review the Southern District’s
    conclusions of law de novo and findings of fact for clear error.  See, e.g., Gulf Ins.
    Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005) (venue); Mario Valente
    Collezioni, Ltd. v. Confezioni Semeraro Paolo, S.R.L., 264 F.3d 32, 36 (2d Cir.
    2001) (personal jurisdiction).
    I
    PEP raises two threshold objections challenging: (1) the Southern District’s
    exercise of personal jurisdiction over PEP, and (2) the location of venue in that
    district.  We consider personal jurisdiction first.
    “Because the requirement of personal jurisdiction represents first of all an
    individual right, it can, like other such rights, be waived.”  Ins. Corp. of Ireland,
    Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 703 (1982).  “The actions
    13
    of the defendant may amount to a legal submission to the jurisdiction of the court
    . . . .”  Id. at 704‐05.  Therefore, “[t]he requirement that a court have personal
    jurisdiction is a due process right that may be waived either explicitly or
    implicitly.”  Transaero, Inc. v. La Fuerza Aerea Boliviana, 162 F.3d 724, 729 (2d
    Cir. 1998); see also City of N.Y. v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 133 (2d
    Cir. 2011) (“Personal jurisdiction, unlike subject‐matter jurisdiction, can,
    however, be purposely waived or inadvertently forfeited.”).  The term
    “forfeiture” is more apt than “waiver” here because the issue is whether PEP has
    lost its personal jurisdiction objection through its conduct.2
    When the First Appeal was pending, PEP fully briefed its jurisdiction and
    venue arguments.  But, once armed with the Eleventh Collegiate Court decision,
    PEP moved this Court to vacate and remand to the Southern District for
    reconsideration.  To state the obvious, PEP then believed that the Southern
    District would reverse course.  Nowhere in that motion did PEP suggest that the
    relief it sought by motion here and on remand in the Southern District might
    2 See Hamilton v. Atlas Turner, Inc., 197 F.3d 58, 61 (2d Cir. 1999) (“The term
    ‘waiver’ is best reserved for a litigant’s intentional relinquishment of a known
    right.  Where a litigant’s action or inaction is deemed to incur the consequence of
    loss of a right, or, as here, a defense, the term ‘forfeiture’ is more appropriate.”).
    14
    offend “traditional notions of fair play and substantial justice” or otherwise
    implicate personal jurisdiction concerns.  Gucci America, Inc. v. Weixing Li, 768
    F.3d 122, 134 (2d Cir. 2014) (quoting Int’l Shoe Co. v. State of Wash., Office of
    Unemployment Compensation and Placement et al., 326 U.S. 310, 316 (1945)).
    Thus, PEP’s due process objections evidently disappeared when its prospects of
    success were buoyed by the Eleventh Collegiate Court’s decision.  Because PEP
    affirmatively and successfully sought relief from this Court remanding for a new
    merits determination in the Southern District, it forfeited its argument that
    personal jurisdiction is lacking.  PEP cannot now re‐contest personal jurisdiction
    merely because it is dissatisfied with its tactical choice.3
    Our sister circuits have reached similar conclusions in other contexts.  See
    Gerber v. Riordan, 649 F.3d 514, 519 (6th Cir. 2011) (“‘[T]he voluntary use of
    3 COMMISA did not make the forfeiture argument in its initial brief.  Rather,
    at our direction, the parties submitted post‐argument letter briefs on the
    forfeiture issue.  “Entertaining issues raised for the first time on appeal is
    discretionary with the panel hearing the appeal.”  Greene v. United States, 13
    F.3d 577, 586 (2d Cir. 1994).  The “general rule that an appellate court will not
    consider an issue raised for the first time on appeal” “is not an absolute bar . . .
    the general rule is disregarded when we think it necessary to remedy an obvious
    injustice.”  Id.  Here, as explained in text, our consideration of the issue is
    necessary to prevent PEP from reviving threshold arguments that are
    incompatible with seeking merits‐based relief from this Court and the Southern
    District.
    15
    certain [district] court procedures’ serve[s] as ‘constructive consent to the
    personal jurisdiction of the [district] court . . . .’” (alteration in original) (quoting
    Ins. Corp. of Ireland, 456 U.S. at 704)); PaineWebber Inc. v. Chase Manhattan
    Private Bank (Switzerland), 260 F.3d 453, 460‐61 (5th Cir. 2001) (“[W]hen ‘a party
    seeks affirmative relief from a court, it normally submits itself to the jurisdiction
    of the court with respect to the adjudication of claims arising from the same
    subject matter.’”(quoting Bel‐Ray Co., Inc. v. Chemrite (Pty) Ltd., 181 F.3d 435,
    443 (3d Cir. 1999))); see also Hunger U.S. Special Hydraulics Cylinders Corp. v.
    Hardie‐Tynes Mfg. Co., 203 F.3d 835 (Table), 2000 WL 147392, at *3 (10th Cir.
    2000) (“After its lengthy participation in this litigation, [and] efforts to seek
    affirmative relief . . . [defendant] may not pull its personal jurisdiction defense
    ‘out of the hat like a rabbit.’”(quoting Fed. Deposit Ins. Corp. v. Oaklawn
    Apartments, 959 F.2d 170, 176 (10th Cir. 1992))).
    Moreover, PEP’s personal jurisdiction argument has changed over time, so
    that it is unclear whether the challenge that we find forfeited is one that was
    actually raised in the first instance.  In the Southern District, PEP’s initial motion
    to dismiss for lack of personal jurisdiction was premised on inadequate service of
    process.  Due process concerns were nowhere to be found; indeed, PEP’s counsel
    16
    emphasized the limited scope of the personal jurisdiction argument, conceding
    that the well‐known minimum contacts test was inapplicable to PEP.4   It was not
    until briefing was complete that PEP raised before the Southern District the due
    process point it advances on appeal.5
    Having sought additional proceedings addressed to the merits, both here
    and in the Southern District, PEP may not now contest personal jurisdiction.  “To
    waive or forfeit a personal jurisdiction defense, a defendant must give a plaintiff
    a reasonable expectation that it will defend the suit on the merits or must cause
    the court to go to some effort that would be wasted if personal jurisdiction is later
    found lacking.”  Mobile Anesthesiologists Chicago, LLC v. Anesthesia Assocs. of
    Houston Metroplex, P.A., 623 F.3d 440, 443 (7th Cir. 2010).
    4 See J.A. at 2006 (“Personal jurisdiction is effected by proper service, and our
    position is there is no proper service.  The minimal contacts test has been
    eliminated by the Second Circuit in this context.”).
    5 Although COMMISA did not initially argue forfeiture, see supra n.3, it did
    argue that PEP waived its objection to personal jurisdiction by explicitly
    conceding that the jurisdictional protections of the Due Process Clause do not
    apply here.  We need not consider COMMISA’s waiver argument because we
    conclude, in any event, that these jurisdictional protections do not apply to PEP,
    see infra pp. 20‐22, which affirmatively claims that it is functionally the Mexican
    government.
    17
    PEP contends that its motion for a remand to consider the Eleventh
    Collegiate Court’s decision simply advanced a menu of options not limited to
    vacatur and remand, and that this Court’s choice to remand cannot support a
    finding of forfeiture.  This mischaracterizes PEP’s litigation position before this
    Court on the First Appeal; PEP explicitly angled for a full vacatur and remand of
    the case, and it downplayed other alternatives.  Rather than pursue the First
    Appeal on grounds (inter alia) of personal jurisdiction and venue, PEP effectively
    abandoned those arguments and pressed for a remand to consider intervening
    precedent on which PEP thought it could win.6  That abandonment constitutes
    forfeiture.
    *   *   *
    In any event, PEP’s due process argument fails because PEP is a
    corporation owned by a foreign sovereign.  The jurisdictional protections of the
    6 PEP, in its post‐argument letter brief, argues that its request was tantamount
    to a request for a remand following an indicative ruling but concedes it chose not
    to follow this path.  That choice had consequences; if PEP had moved for an
    indicative ruling, and the Southern District had issued such a decision, this Court
    could have “remand[ed] for further proceedings” but would “retain[] jurisdiction
    unless [we] expressly dismisse[d] the appeal.”  FED. R. APP. P. 12.1(b) (emphasis
    added).  That (or, for that matter, a remand pursuant to United States v. Jacobson,
    15 F.3d 19, 22 (2d Cir. 1994)) is far afield from what PEP urged this Court to do,
    which was a full vacatur and remand without qualification.
    18
    Due Process Clause do not apply to “foreign states and their instrumentalities”.
    Frontera Res. Azerbaijan Corp. v. State Oil Co. of Azerbaijan Republic, 582 F.3d
    393, 399 (2d Cir. 2009).  The same conclusion does not follow for foreign
    corporations; see Bensmiller v. E.I. Dupont de Nemours & Co., State of La., 47
    F.3d 79, 81 (2d Cir. 1995) (“First, the court must determine if the state’s long‐arm
    statute reaches the foreign corporation.  Second, if the statute does reach the
    corporation, then the court must decide whether that exercise of jurisdiction
    offends due process.”).  This distinction rests on the principle that due process
    rights can only be exercised by persons,  see Frontera, 582 F.3d at 398, including
    corporations, which are persons at law.  See Phillips v. Tobin, 548 F.2d 408, 411
    (2d Cir. 1976).  The line between a foreign sovereign and a foreign corporation
    can sometimes be indistinct, but our conclusion‐‐that PEP falls in the former
    category‐‐is informed by First Nat’l City Bank v. Banco Para el Comercio Exterior
    de Cuba, 462 U.S. 611 (1983) (“Bancec”).
    Bancec established the presumption that “government instrumentalities
    established as juridical entities distinct and independent from their sovereign
    should normally be treated as such.”  Id. at 626‐27.  The presumption, however,
    “may be overcome in certain circumstances,” as “where a corporate entity is so
    19
    extensively controlled by its owner that a relationship of principal and agent is
    created.”  Id. at 628‐29.  Although Bancec disclaimed a “mechanical formula for
    determining the circumstances under which the normally separate juridical
    status of a government instrumentality is to be disregarded,” the Court indicated
    that a valid basis for “declin[ing] to adhere blindly to the corporate form” would
    be “where doing so would cause . . . an injustice.”  Id. at 632‐33.  Thus Bancec
    relied on “equitable principles” to disregard the corporate form and thereby
    prevent the government of Cuba from hiding behind a juridical entity (to obtain
    relief) without itself appearing, which would necessarily waive sovereign
    immunity and force it to answer for a violation of international law.  Id. at 630.
    Although Bancec arose in a different context, it is “applicable when the question
    is whether the instrumentality should have due process rights to which the state
    is not entitled.”  Frontera, 582 F.3d at 400.
    This is one of the easy cases because PEP affirmatively claims that it is
    functionally the Mexican government‐‐which it advances as the reason it cannot
    be forced to arbitrate.  The Eleventh Collegiate Court opinion reinforces that
    20
    view.7  Applying “recognized equitable principles,” PEP should be treated for
    personal jurisdiction purposes as the foreign sovereign it claims to be when it
    comes to other issues in this litigation.  Bancec, 462 U.S. at 633.  In Mexico, oil is a
    state‐owned resource, and PEP’s actions sought to protect Mexican oil interests
    from a foreign private corporation; bluntly put, PEP acted as the state.  That is the
    basis of the following argument by PEP that nullification of the arbitral award
    should be upheld: “the view that public entities can abrogate contracts for reasons
    unavailable to private parties is hardly alien to American law.  For example, the
    U.S. Government can block breach‐of‐contract suits against it by asserting that the
    litigation would reveal state secrets.”  Appellant’s Br. at 53 (emphasis added).
    PEP’s assertion (in arguing the merits) that it is integral to the Mexican
    7 See J.A. at 3749 (“[S]uch administrative rescission of the public works
    contract . . . involves the supervision of the resources of the State and society for
    the purposes of meeting the needs of the latter.”); id. at 3750 (“[P]ublic powers
    that aim at safeguarding the public benefit and interest cannot” be waived); id.
    (“This is supported by the fact that the jurisdictional function exercised to set
    aside acts of authority is an exclusive function of the State and can only be
    delegated to its bodies.  However, acting in the capacity as state body entails
    pursuing, with its own will, public interests.  This is evidently not done by
    private parties when they submit their disputes to arbitrators, for in those cases
    they are solely pursuing private objectives.”); id. at 3754 (“[A]ppellant acted in its
    capacity as public entity and authority in a superior‐to‐subordinate
    relationship.”).
    21
    government binds it for all portions of this appeal, including personal
    jurisdiction.
    The authorities on which PEP relies fail to persuade.  In GSS Group Ltd. v.
    National Port Authority, 680 F.3d 805, 814 (D.C. Cir. 2012), the D.C. Circuit
    recited the principle that the “presumption of separateness gives way only if a
    foreign ‘corporate entity is so extensively controlled by its owner that a
    relationship of principal and agent is created,’ or when ‘broader equitable
    principle[s]’ dictate that separate treatment ‘would work fraud or injustice.’”
    (citations omitted) (quoting Bancec, 462 U.S. at 629).  The court applied the
    presumption of separateness: the National Port Authority of Liberia claimed to
    be an independent juridical entity, and the court observed that the opposing
    party “failed to contest that characterization.”  Id. at 817.  The court therefore had
    no occasion to consider when a foreign corporation should be treated as its owner‐
    sovereign.  First Investment Corporation of Marshall Islands v. Fujian Mawei
    Shipbuilding, Limited, 703 F.3d 742, 755 (5th Cir. 2012) likewise notes that
    manipulation of the corporate form “to perpetrate a fraud or injustice” warrants
    overcoming the presumption of separateness. In any event, treating PEP as
    separate from the Mexican government for the purpose of personal jurisdiction
    22
    would work an “injustice” insofar as it would allow PEP to characterize its status
    vis a vís the Mexican government in whatever way is advantageous to its several
    arguments.  See Bancec, 462 U.S. at 633.
    II
    This panel is unanimous in concluding that venue lies in the Southern
    District of New York.  But we differ as to which rationale is strongest.
    The view of two of the panel members is that, for essentially the same
    reasons that PEP forfeited its challenge to personal jurisdiction, it has a fortiori
    forfeited its challenge to venue, because venue is “a limitation designed for the
    convenience of litigants, and, as such, may be waived by them.”  Olberding v. Ill.
    Cent. R.R. Co., 346 U.S. 338, 340 (1953).  An objection to venue “may be lost . . . by
    submission through conduct.  Whether such surrender of a personal immunity be
    conceived negatively as a waiver or positively as a consent to be sued, is merely
    an expression of literary preference.  The essence of the matter is that courts affix
    to conduct consequences as to place of suit consistent with the policy behind
    [venue statutes] which is ‘to save defendants from inconveniences to which they
    might be subjected if they could be compelled to answer in any district, or
    wherever found.’”  Neirbo Co. v. Bethlehem Shipbuilding Corp., 308 U.S. 165, 168
    23
    (1939) (citation omitted) (quoting General Inv. Co. v. Lake Shore & M.S. Ry. Co.,
    260 U.S. 261, 275 (1922)).  PEP cannot now reject this forum as extraordinarily
    inconvenient when it affirmatively sought relief from this Court and from the
    Southern District of New York.8
    III
    The domestic enforcement of foreign arbitral awards is governed by two
    international Conventions: the Inter‐American Convention on International
    8  The concurring opinion argues that forfeiture is limited to “conduct that
    deliberately avoids a final disposition of personal jurisdiction and venue issues
    until a loss on the merits appears likely,” i.e. sandbagging.  Concurring Op. At 2.
    PEP’s conduct fits the bill: it sought full reconsideration of the merits in the
    Southern District after the venue and personal jurisdiction issues were fully
    briefed before this Court, then asserted its personal jurisdiction and venue
    defenses after losing on the merits in the Southern District.
    The concurring opinion contends that PEP’s motion to remand was not
    gamesmanship; however, in light of PEP’s entire course of conduct, we see it
    distinctly otherwise.  Further, the sole relief sought by PEP in its motion to
    remand was reconsideration of the result; PEP’s motion argued against holding
    the appeal in abeyance as impractical given the changed circumstances of the
    litigation.
    Finally, there is a basic and serviceable difference between a Jacobson
    remand (which elicits an answer to a question that may assist resolution of the
    pending appeal) and an ordinary remand (which allows reconsideration of the
    outcome).  Our remand was of a second kind, notwithstanding that any further
    appeal was directed to the same panel.  See, e.g., United States v. Rivalta, 925
    F.2d 596, 597 (2d Cir. 1991).
    24
    Commercial Arbitration (“Panama Convention”) and the Convention on the
    Recognition and Enforcement of Foreign Arbitral Awards (“New York
    Convention”).  There is no substantive difference between the two9: both evince a
    “pro‐enforcement bias.”  Yusuf Ahmed Alghanim & Sons v. Toys “R” Us, Inc.,
    126 F.3d 15, 20 (2d Cir. 1997).  The Federal Arbitration Act (“FAA”) expressly
    incorporates the terms of the Panama Convention.  See 9 U.S.C. § 301 (“The Inter‐
    American Convention on International Commercial Arbitration of January 30,
    1975, shall be enforced in United States courts in accordance with this
    chapter.”).10
    9  See Productos Mercantiles E Industriales, S.A. v. Faberge USA, Inc., 23 F.3d
    41, 45 (2d Cir. 1994) (“The legislative history of the Inter‐American Convention’s
    implementing statute, however, clearly demonstrates that Congress intended the
    Inter‐American Convention to reach the same results as those reached under the
    New York Convention: ‘The New York Convention and the Inter‐American
    Convention are intended to achieve the same results . . . in view of . . . the parallel
    legislation under the Federal Arbitration Act that would be applied to the
    Conventions, [it is expected] that courts in the United States would achieve a
    general uniformity of results under the two conventions.’”(quoting H.R. Rep. No.
    501, 101st Cong., 2d Sess. 4 (1990), reprinted in 1990 U.S.C.C.A.N. 675, 678)).
    10 The Panama Convention applies to this case since a “majority of the parties
    to the arbitration agreement are citizens of . . . States that have ratified or acceded
    to the [Panama Convention] and are member States of the Organization of
    American States.”  9 U.S.C. § 305(1).
    25
    Article V of the Panama Convention sets out‐‐and limits‐‐the discretion of
    courts in enforcing foreign arbitral awards: “The recognition and execution of the
    decision may be refused, at the request of the party against which it is made, only
    if such party is able to prove to the competent authority of the State in which
    recognition and execution are requested” one of seven defenses.  Panama
    Convention art. V(1), Jan. 30, 1975, O.A.S.T.S. No. 42, 1438 U.N.T.S. 245 (emphasis
    added). “Article V provides the exclusive grounds for refusing confirmation
    under the Convention, [and] one of those exclusive grounds is where ‘t[he]
    award . . . has been [annulled] or suspended by a competent authority of the
    country in which, or under the law of which, that award was made.’”  Yusuf, 126
    F.3d at 20 (quoting Panama Convention art. V(1)(e), Jan. 30, 1975, O.A.S.T.S. No.
    42, 1438 U.N.T.S. 245); see also 9 U.S.C. § 207 (“The court shall confirm the award
    unless it finds one of the grounds for refusal or deferral of recognition or
    enforcement of the award specified in the said Convention.”).  In sum, a district
    court must enforce an arbitral award rendered abroad unless a litigant satisfies
    one of the seven enumerated defenses; if one of the defenses is established, the
    district court may choose to refuse recognition of the award.
    26
    At first look, the plain text of the Panama Convention seems to
    contemplate the unfettered discretion of a district court to enforce an arbitral
    award annulled in the awarding jurisdiction.  However, discretion is constrained
    by the prudential concern of international comity, which remains vital
    notwithstanding that it is not expressly codified in the Panama Convention.  See
    Pravin Banker Assocs., Ltd. v. Banco Popular Del Peru, 109 F.3d 850, 854 (2d Cir.
    1997) (“Although courts in this country have long recognized the principles of
    international comity and have advocated them in order to promote cooperation
    and reciprocity with foreign lands, comity remains a rule of ‘practice,
    convenience, and expediency,’ rather than of law.”(quoting Somportex Ltd. v.
    Phila. Chewing Gum Corp., 453 F.2d 435, 440 (3d Cir. 1971))); In re Maxwell
    Comm’n Corp. plc, 93 F.3d 1036, 1047 (2d Cir. 1996) (“When construing a statute,
    the doctrine of international comity is best understood as a guide where the
    issues to be resolved are entangled in international relations.”).
    Accordingly, “a final judgment obtained through sound procedures in a
    foreign country is generally conclusive . . . unless . . . enforcement of the judgment
    would offend the public policy of the state in which enforcement is sought.”
    Ackermann v. Levine, 788 F.2d 830, 837 (2d Cir. 1986) (emphasis in original).  “A
    27
    judgment is unenforceable as against public policy to the extent that it is
    ‘repugnant to fundamental notions of what is decent and just in the State where
    enforcement is sought.’” Id. at 841 (quoting Tahan v. Hodgson, 662 F.2d 862, 864
    (D.C. Cir. 1981)); see also Fed. Treasury Enter. Sojuzplodoimport v. Spirits Int’l
    B.V., 809 F.3d 737, 743 (2d Cir. 2016) (“Nevertheless, ‘courts will not extend
    comity to foreign proceedings when doing so would be contrary to the policies or
    prejudicial to the interests of the United States.’”(quoting Pravin, 109 F.3d at
    854)).
    The public policy exception does not swallow the rule: “[t]he standard is
    high, and infrequently met”; “a judgment that ‘tends clearly’ to undermine the
    public interest, the public confidence in the administration of the law, or security
    for individual rights of personal liberty or of private property is against public
    policy.”  Ackermann, 788 F.2d at 841 (quoting Somportex, 453 F.2d at 443).  The
    exception accommodates uneasily two competing (and equally important)
    principles: [i] “the goals of comity and res judicata that underlie the doctrine of
    recognition and enforcement of foreign judgments” and [ii] “fairness to litigants.”
    Id. at 842.
    28
    Precedent is sparse; but the few cases that are factually analogous have
    endorsed this approach.  See Baker Marine (Nig.) Ltd. v. Chevron (Nig.) Ltd., 191
    F.3d 194, 197 n.3 (2d Cir. 1999) (“Recognition of the Nigerian [annulment of the
    arbitral award] in this case does not conflict with United States public policy.”);
    see also TermoRio S.A. E.S.P. v. Electranta S.P., 487 F.3d 928, 938 (D.C. Cir. 2007)
    (“Baker Marine is consistent with the view that when a competent foreign court
    has nullified a foreign arbitration award, United States courts should not go
    behind that decision absent extraordinary circumstances not present in this case
    . . . . Therefore, it is unsurprising that the courts have carefully limited the
    occasions when a foreign judgment is ignored on grounds of public policy.  A
    judgment is unenforceable as against public policy to the extent that it is
    ‘repugnant to fundamental notions of what is decent and just in the State where
    enforcement is sought.’” (citation omitted) (quoting Ackermann, 788 F.2d at
    841)).
    Consequently, although the Panama Convention affords discretion in
    enforcing a foreign arbitral award that has been annulled in the awarding
    jurisdiction, and thereby advances the Convention’s pro‐enforcement aim, the
    exercise of that discretion here is appropriate only to vindicate “fundamental
    29
    notions of what is decent and just” in the United States.  Id. (quoting Ackermann,
    788 F.2d at 841).
    IV
    Applying this standard, we conclude that the Southern District did not
    abuse its discretion in confirming the arbitral award notwithstanding
    invalidation of the award in the Mexican courts.  The high hurdle of the public
    policy exception is surmounted here by four powerful considerations: (1) the
    vindication of contractual undertakings and the waiver of sovereign immunity;
    (2) the repugnancy of retroactive legislation that disrupts contractual
    expectations; (3) the need to ensure legal claims find a forum; and (4) the
    prohibition against government expropriation without compensation.
    1.  Contractual Waivers of Sovereign Immunity
    The “Pemex and Affiliates Organic Law” specifically authorized PEP to
    agree to execute arbitration agreements, as it did in both the 1997 and 2003
    contracts; the arbitration clauses likewise constrained COMMISA to arbitrate as
    the sole recourse for challenging any breach.  When arbitration proceedings were
    underway, PEP participated without contending that its act of administrative
    30
    rescission was beyond the reach of arbitration; that argument was advanced only
    after PEP’s loss was presaged by issuance of the Preliminary Award.
    That valid waivers must be enforced is settled domestic law.  The Supreme
    Court has blessed contractual waivers of sovereign immunity and accompanying
    agreements to arbitrate.  See C&L Enters., Inc. v. Citizen Band Potawatomi Indian
    Tribe of Okla., 532 U.S. 411, 418‐23 (2001) (“We are satisfied that the Tribe in this
    case has waived, with the requisite clarity, immunity from the suit . . . . brought
    to enforce [the] arbitration award . . . [t]he Tribe clearly consented to arbitration
    and to the enforcement of arbitral awards . . . the Tribe thereby waived its
    sovereign immunity from . . . suit.”); Cooke v. United States, 91 U.S. 389, 398
    (1875) (“If [the United States] comes down from its position of sovereignty, and
    enters the domain of commerce, it submits itself to the same laws that govern
    individuals there.”).11
    These values are not local.  The North American Free Trade Agreement
    (“NAFTA”), ratified by Mexico and the United States, treats arbitration as a
    11 The Restatement of Foreign Relations Law also espouses this view.  See
    Restatement (Third) of the Foreign Relations Law of the United States § 456(2)
    (1987)(“Under the law of the United States . . . an agreement to arbitrate is a
    waiver of immunity from jurisdiction in . . . an action to enforce an arbitral award
    rendered pursuant to the agreement.”).
    31
    “mechanism for the settlement of investment disputes that assures both equal
    treatment among investors of the Parties in accordance with the principle of
    international reciprocity and due process before an impartial tribunal.”  NAFTA
    art. 1115, Jan. 1, 1994.
    Giving effect to PEP’s twelfth‐hour invocation of sovereign immunity
    shatters COMMISA’s investment‐backed expectation in contracting, thereby
    impairing one of the core aims of contract law.  See Hunt Constr. Grp., Inc. v.
    Brennan Beer Gorman/Architects, P.C., 607 F.3d 10, 14 (2d Cir. 2010) (“[C]ontract
    law . . . is designed to enforce parties’ contractual expectations . . . .”).
    2.  Retroactive Application of Laws
    Giving effect to the nullification would likewise impair the closely‐related
    concept of avoiding retroactive application of laws.  The Mexican government’s
    adoption of Section 98 was an abrupt departure from the “Pemex and Affiliates
    Organic Law” as well as from the contracts signed by the parties; allowing
    Section 98 to nullify COMMISA’s arbitral award would deprive COMMISA of its
    contract rights through a retroactive change in law.
    Retroactive legislation that cancels existing contract rights is repugnant to
    United States law.  That repugnance is “deeply rooted in [Supreme Court]
    32
    jurisprudence, and embodies a legal doctrine centuries older than our Republic.”
    Landgraf v. USI Film Prods., 511 U.S. 244, 265 (1994).  “Elementary
    considerations of fairness dictate that individuals should have an opportunity to
    know what the law is and to conform their conduct accordingly; settled
    expectations should not be lightly disrupted.”  Id.  Anti‐retroactivity is a
    principle embedded in “several provisions” of the Constitution, including:
    !      The Ex Post Facto Clause’s ban on retroactive application of penal
    legislation;
    !      The proscription against states retroactively impairing the obligation
    of contracts;
    !      The prohibition on Bills of Attainder, stopping legislatures from
    “singling out disfavored  persons and meting out summary
    punishment for past conduct”; and
    !      The Due Process Clause, and corresponding rights to “fair notice”.
    Id. at 266.  It is therefore understatement to observe that “[r]etroactivity is not
    favored in the law.”  Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 208 (1988).
    As the Southern District recognized, “retroactive application of laws and the
    33
    unfairness associated with such application is at the center of the dispute before
    me.”  Corporación Mexicana, 962 F. Supp. 2d at 659.
    Prior to the enactment of Section 98, PEP was authorized to arbitrate, did in
    fact agree to do so, and actively participated in the arbitration proceedings.  The
    effect of the ruling by the Eleventh Collegiate Court‐‐that acts of administrative
    rescission are not arbitrable‐‐may well have been compelled by the legislature’s
    enactment of Section 98.  But the effect of the ruling amounts to retroactive
    application of that law.  True, the Eleventh Collegiate Court specifically stated it
    was not retroactively applying Section 98, and we are in no position to pass upon
    that court’s interpretation of Mexican law, or upon the sufficiency of its
    precedent.  We are concerned here with the effect of Section 98 in these
    circumstances and upon these parties.  And it is incontestable that the capacity of
    PEP to arbitrate was established in prior law; that it was withdrawn with respect
    to certain disputes that had already arisen; and that it was withdrawn in a way
    that frustrated contractual expectation, undid an arbitral award, and precluded
    redress by COMMISA in any forum.  The sequence of events and the
    circumstances in which Section 98 was enacted thus resulted in a retroactive
    application of Section 98 as a matter of United States law.  That PEP is part of the
    government that promulgated the law does not help at all.
    34
    PEP argues that the Eleventh Collegiate Court’s decision followed from a
    1994 Mexican Supreme Court decision, and that COMMISA was thus on notice
    prior to 2009 that administrative rescissions were not arbitrable.  Whether the
    Eleventh Collegiate Court properly reasoned from the 1994 precedent is
    emphatically not for U.S. courts to say.  But notice is germane to the issue of
    enforcement.  It therefore matters that the word “arbitration” does not appear in
    the 1994 decision, which simply declares that administrative rescission is an act
    of authority.  One of PEP’s own witnesses, in the evidentiary hearing before the
    Southern District, testified that the 1994 decision was a “weak premise” for the
    Eleventh Collegiate Court to rely upon, considering the number of other cases
    going the other way.  J.A. at 3072‐73.  It is therefore unsurprising that the opinion
    of the Eleventh Collegiate Court relies heavily on Section 98 and very little on the
    Mexican Supreme Court decision.12
    12 See J.A. at 3758‐63 (“This criterion is strengthened by the fact that, due to the
    amendments of the current law of Public Works and Related Services, Section 98
    states as follows . . . . The express prohibition that the administrative rescission or
    the early termination of this type of contract cannot be subject to arbitration is
    present in the second paragraph of this legal provision . . . it is evident that the
    current trend of the legislator regarding public works is to protect the economy
    and public expenditure by abandoning the practices that were aimed at granting
    more participation to private parties than to the State.  Therefore, the State should
    be granted, once again, suitable mechanisms to fulfill those objectives . . . if, as in
    35
    3.  Availability of a Forum
    If the Southern District had recognized and implemented the nullification
    of the arbitral award, COMMISA would have had no sure forum in which to
    bring its contract claims.  The imperative of having cases heard‐‐somewhere‐‐is
    firmly embedded in legal doctrine:
    !      The grant of a forum non conveniens motion that would otherwise
    be proper “would not be appropriate where the alternative forum
    does not permit litigation of the subject matter of the dispute.”  Piper
    Aircraft Co. v. Reyno, 454 U.S. 235, 254 n.22 (1981).
    !      The general rule of mootness is relaxed for issues that are “capable of
    repetition, yet evading review” because otherwise parties would be
    left “without a chance of redress.”  S. Pac. Terminal Co. v. Interstate
    Commerce Comm’n, 219 U.S. 498, 515 (1911).
    !      In federal habeas corpus cases, a state prisoner can overcome a
    procedural default stemming from state restrictions on direct appeal,
    this case, a contract is subject to administrative rescission by a party acting in the
    capacity as authority such act may not be tried, modified, avoided or altered by
    an arbitration panel.  This would be contrary to public policy which is currently
    particularly protected by the amendment of the law which expressly sets forth
    such prohibition.”).
    36
    given a showing of cause and prejudice to allow the prisoner “fair
    process” and “the opportunity to comply with the State’s procedures
    and obtain an adjudication on the merits of his claims.”  Martinez v.
    Ryan, 132 S.Ct. 1309, 1317 (2012).
    These examples spring from the same source: litigants with legal claims should
    have an opportunity to bring those claims somewhere.
    Absent confirmation of the award, COMMISA would lose the opportunity
    to bring its claims because of the change in Mexican law subjecting COMMISA’s
    claims to the 45‐day statute of limitations in the Tax and Administrative Court.  It
    is no conjecture that COMMISA’s suit would be dismissed as time‐barred; the
    Tax and Administrative Court did precisely that.  See J.A. at 2870‐71.
    The statute of limitations is not the only barrier COMMISA would face.  Its
    claims were tossed by the Tax and Administrative Court on the additional
    ground that, because COMMISA’s claims were presented in the Mexican District
    Court, they were barred by res judicata.  See J.A. at 2872.  This also raises
    equitable concerns.  After PEP rescinded, COMMISA instituted an amparo action
    in the Mexican District Court, which the arbitral panel presumably could not
    37
    adjudicate.13  COMMISA lost.  Later, after the promulgation of Section 98, when
    COMMISA sought a ruling in the Tax and Administrative Court, that court
    rejected COMMISA’s breach claims on the ground of res judicata, citing the
    amparo action.  Since the arbitral award favorable to COMMISA was treated as a
    legal nullity, COMMISA was thus twice the victim of unforseen changes in the
    law.  Such a result offends basic domestic principles of claim preclusion.  See
    Allen v. McCurry, 449 U.S. 90, 94 (1980) (“Under res judicata, a final judgment on
    the merits of an action precludes the parties or their privies from relitigating
    issues that were or could have been raised in that action.”) (emphasis added).
    We agree with the Southern District that COMMISA’s inability to have its
    breach claims heard magnifies the injustice.  See Corporación Mexicana, 962 F.
    Supp. 2d at 659 (“[T]his unfairness was exacerbated by the fact that the Eleventh
    Collegiate Court’s decision left COMMISA without a remedy to litigate the
    merits of the dispute that the arbitrators had resolved in COMMISA’s favor.”).
    13 See J.A. at 1486 (“COMMISA sought to stop PEP from administratively
    rescinding the Contracts pursuant to public law provisions, the subject matter of
    which cannot be brought before this Arbitral Tribunal’s Jurisdiction.”).
    38
    4.  Government Expropriation Without Compensation
    PEP, acting on behalf of the Mexican government, rescinded the contracts
    and forcibly removed COMMISA from the project sites.  Then, by legislation,
    Mexico frustrated relief that had been granted to COMMISA in the arbitral forum
    and consigned it to a forum in which relief was foreclosed both by the statute of
    limitations and res judicata.  The Eleventh Collegiate Court did no more than
    apply this Mexican law.  At the same time, the enforcement of such Mexican law
    amounted to a taking of private property without compensation for the benefit of
    the government.  In the United States, this would be an unconstitutional taking.
    See Tahoe‐Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning Agency, 535 U.S. 302,
    321 (2002) (“When the government physically takes possession of an interest in
    property for some public purpose, it has a categorical duty to compensate the
    former owner, regardless of whether the interest that is taken constitutes an
    entire parcel or merely a part thereof.” (citation omitted)).  This feature of United
    States law is not peculiar to this country.  NAFTA provides that “[n]o party may
    . . . take a measure tantamount to nationalization or expropriation of such an
    investment (‘expropriation’), except . . . on payment of compensation in
    accordance with paragraphs 2 through 6.”  NAFTA art. 1110, Jan. 1, 1994.  No
    payment was made in accordance with NAFTA or otherwise.
    39
    *   *   *
    Any court should act with trepidation and reluctance in enforcing an
    arbitral award that has been declared a nullity by the courts having jurisdiction
    over the forum in which the award was rendered.  However, we do not think that
    the Southern District second‐guessed the Eleventh Collegiate Court, which
    appears only to have been implementing the law of Mexico.  Rather, the Southern
    District exercised discretion, as allowed by treaty, to assess whether the
    nullification of the award offends basic standards of justice in the United States.
    We hold that in the rare circumstances of this case, the Southern District did not
    abuse its discretion by confirming the arbitral award at issue because to do
    otherwise would undermine public confidence in laws and diminish rights of
    personal liberty and property.  See Ackermann, 788 F.2d at 841.   Taken together,
    these circumstances validate the exercise of discretion and justify affirmance.
    V
    Pursuant to the contracts, COMMISA posted $106 million in performance
    bonds.  After entry of the Final Award in favor of COMMISA, PEP collected on
    the bonds.  The Southern District’s judgment includes the $106 million.  PEP
    argues that inclusion of that amount in the judgment exceeded the bounds of the
    Southern District’s confirmation authority.  See 28 U.S.C. 1605(a)(6).
    40
    “[T]he confirmation of an arbitration award is a summary proceeding that
    merely makes what is already a final arbitration award a judgment of the court.”
    Florasynth, Inc. v. Pickholz, 750 F.2d 171, 176 (2d Cir. 1984).  The pertinent
    question, then, is whether the performance bonds were part of the “final
    arbitration award.”  Id.
    The Preliminary Award ordered PEP to “refrain from filing any claim
    attempting to collect the bonds granted in its favor . . . until the Tribunal issues its
    final award, and according to such award, PEP has any right to claim the
    payment of the bonds.”  J.A. at 143 (emphasis added).  The Final Award
    concluded that PEP was “defeated in the merits” of the dispute, that PEP
    engaged in “repeated breaches,” and that COMMISA’s success entitled it to
    damages, litigation expenses, and costs.  Id. at 861‐68.  The Final Award also
    emphasized the validity of the Preliminary Award, and its injunction against
    collecting on the performance bonds: “[I]t must be reminded that in the
    Preliminary Award it was determined that the Tribunal has jurisdiction to hear
    . . . the application of conventional penalties through the collection on
    performance bonds posted by claimant . . . . The aforementioned Preliminary
    Award is binding and unalterable, as it is now final.”  Id. at 180.
    41
    The conditions stated in the Preliminary Award for collection on the
    performance bonds were the issuance of a final award (which happened), “and
    according to such award, PEP has any right to claim the payment of the bonds”‐‐
    a condition that was conspicuously unsatisfied.  Id. at 143 (emphasis added).  The
    order enjoining PEP from collecting on the performance bonds was therefore part
    of the Final Award itself.
    PEP argues that the omission of any reference to the performance bonds in
    the damages section of the Final Award points the other way because the panel
    enumerated the items that comprised the Award in painstaking‐‐and presumably
    comprehensive‐‐detail.  This argument, however, ignores the sequence of events;
    PEP relied on the Eleventh Collegiate Court decision as a judgment authorizing it
    to collect on the performance bonds.  But that ruling was issued in October 2011‐‐
    after the Final Award had already issued.  So there was no occasion for the Final
    Award to specify damages stemming from conduct that had not yet occurred,
    especially since PEP was forbidden from collecting on the bonds unless and until
    the tribunal determined that PEP was entitled to do so.
    Although the confirmation role is limited, we have still allowed district
    courts to interpret the contents of applicable awards.  See Folkways Music
    42
    Publishers, Inc. v. Weiss, 989 F.2d 108, 111 (2d Cir. 1993) (“In finding that the
    award encompassed rights to the underlying works, the district court properly
    interpreted the award.”).  The Southern District’s interpretation was sound; the
    $106 million was properly included in the judgment.
    CONCLUSION
    For the foregoing reasons, the judgment of the Southern District is
    affirmed.
    43
    1   13-4022, Corporación Mexicana de Mantenimiento Integral, S. de
    2   R.L. de C.V. v. Pemex Exploración y Producción
    3
    4   WINTER, Circuit Judge, concurring:
    5        I concur in my colleagues’ disposition of this appeal while
    6   disagreeing with their imposing of a forfeiture with regard to
    7   personal jurisdiction and venue.       I agree that PEP should be
    8   treated as a foreign sovereign for personal jurisdiction
    9   purposes, see Maj. Op. 18-23, and that personal jurisdiction over
    10   PEP exists in the Southern District of New York.       I also conclude
    11   that venue is proper in the Southern District of New York under
    12   28 U.S.C § 1391(f)(3) because PEP is an “agency or
    13   instrumentality” of the State of Mexico and was “doing business”
    14   in New York.
    15        a) Forfeiture
    16        My colleagues rule, sua sponte, that, “[b]ecause PEP
    17   affirmatively and successfully sought relief from this Court
    18   remanding for a new merits determination in the Southern
    19   District, it forfeited its argument that personal jurisdiction is
    20   lacking.”   Maj. Op. 15.   “[F]or essentially the same reasons[,] .
    21   . . it has a fortiori forfeited its challenge to venue.”       Maj.
    22   Op. 23.
    23        My colleagues rely principally on “gamesmanship” or
    24   “sandbagging” cases, Hamilton v. Atlas Turner, Inc., 
    197 F.3d 58
    ,
    1
    1   62 (2d Cir. 1999) (finding defendant forfeited personal
    2   jurisdiction defense by not moving to dismiss in order to “gamble
    3   it could raise the personal jurisdiction issue on the eve of
    4   trial, in case a trial occurred”), none of which lend their
    5   ruling any support whatsoever.   The gamesmanship arises from the
    6   fact that defendants have an interest in obtaining a favorable
    7   ruling on the merits that would constitute res judicata.   Pursuit
    8   of this interest creates an incentive on their part to preserve
    9   any existing personal jurisdiction and venue defenses but not
    10   seek a definitive ruling -- which might lead only to a new
    11   lawsuit elsewhere -- until a favorable merits ruling appears
    12   unattainable.   Courts have the opposite incentive.   Why address
    13   the merits at all if plaintiffs are in the wrong court?
    14   Therefore, we have found forfeiture in conduct that deliberately
    15   avoids a final disposition of personal jurisdiction and venue
    16   issues until a loss on the merits appears likely.
    17        No such gamesmanship occurred in this matter.    Although the
    18   grounds on which PEP challenged personal jurisdiction in the
    19   district court changed over the course of the litigation, PEP
    20   timely litigated that issue and the issue of proper venue in the
    21   district court.   In moving to dismiss the petition to confirm the
    22   ICC’s arbitration award, PEP filed a motion to dismiss, arguing
    23   that (i) the district court lacked personal jurisdiction, and
    2
    1   (ii) venue was improper under 28 U.S.C § 1391(f)(3) because PEP
    2   was not doing business in New York.    An August 25, 2010 hearing
    3   thoroughly explored those issues.    In confirming the ICC’s
    4   arbitration award, the district court expressly held that it had
    5   personal jurisdiction over PEP and that venue was proper in the
    6   Southern District of New York.
    7        On appeal, PEP’s brief extensively argued that “[t]he
    8   district Court [] erred in holding that it had personal
    9   jurisdiction over PEP,” Br. of Resp’t-Appellant at 19,
    10   Corporación Mexicana de Mantenimiento Integral, S. de R.L. de
    11   C.V. v. Pemex Exploración y Producción (“PEMEX”), No. 10-4656-cv,
    12   
    2012 WL 9346475
    (2d Cir. Feb. 16, 2012), and that it “erred in
    13   holding that venue was proper in the SDNY,” 
    id. at 22.
    14        After briefing in this court, however, the Eleventh
    15   Collegiate Court of Mexico rendered its decision invalidating the
    16   ICC’s arbitration award.   PEP understandably moved before this
    17   panel for a remand to allow the district court to reconsider the
    18   validity of the arbitration award in light of the Mexican ruling.
    19   In so moving, PEP did not mention the personal jurisdiction and
    20   venue issues, already fully briefed before this panel, because
    21   there had been no intervening events casting light upon those
    22   issues.   However, PEP requested in the alternative that the
    23   appeal be held in abeyance pending disposition of a Fed. R. Civ.
    3
    1   P. 60(b) motion, based on the Mexican court ruling, in the
    2   district court.   Appearing as amicus curiae, the United States
    3   supported the motion to remand.
    4        The seeking of a remand was perfectly understandable.      The
    5   intervening Mexican decision was of unquestioned relevance to
    6   this appeal, as the appearance of the United States as amicus
    7   curiae and Judge Jacobs’ opinion amply demonstrate.    In all
    8   probability, had oral argument proceeded, we would have remanded
    9   to obtain the views of the district court as to the bearing of
    10   the Mexican judicial ruling on the merits issues.
    11        In light of the indisputable relevance of the Mexican
    12   ruling, my colleagues’ forfeiture ruling is not only sua sponte,
    13   but also unprecedented.   We have ruled that courts should proceed
    14   with “caution” in finding forfeiture of personal jurisdiction
    15   defenses.   
    Atlas, 197 F.3d at 60
    .    Forfeiture is to be
    16   principally found in cases of “sandbagging,” for example, where a
    17   defendant “rais[es] the issue of personal jurisdiction on a
    18   motion to dismiss, [then] deliberately refrain[s] from pursuing
    19   it any further when his motion is denied in the hopes of
    20   receiving a favorable disposition on the merits, and then
    21   rais[es] the issue again on appeal only if he [is] unhappy with
    22   the district court's ultimate decision.”     Peterson v. Highland
    23   Music, Inc., 
    140 F.3d 1313
    , 1318 (9th Cir. 1998).     “Typically,
    4
    1   courts have found forfeiture only if the party waited years
    2   before moving or engaged in substantial pre-trial activity.”
    3   Infinity Consulting Grp., LLC v. Am. Cybersystems, Inc., 
    2010 WL 4
      2267470, *1-2 (E.D.N.Y. May 30, 2010); see also In re Helicopter
    5   Crash Near Wendle Creek, Brit. Columbia on Aug. 8, 2002, 485
    
    6 F. Supp. 2d 47
    , 52 (D. Conn. 2007) (noting that “[i]n most cases
    7   where courts have found waiver, the defendant has waited multiple
    8   years after its answer to file a motion to dismiss”).
    9         More specifically, in most cases where we and other courts
    10   have found forfeiture, defendants failed to bring up personal
    11   jurisdiction or improper venue defenses in their answer, as
    12   required by Fed. R. Evid. 12(h), or had moved for summary
    13   judgment on the merits prior to moving to dismiss for lack of
    14   personal jurisdiction or improper venue.1               In other cases, courts
    15   have found forfeiture where the defendant defaulted and later
    16   brought a personal jurisdiction defense,2 or where the defendant
    1
    See Concession Consultants, Inc. v. Mirisch, 
    355 F.2d 369
    , 371 (2d Cir. 1966) (ruling
    that the defendants had forfeited the privilege to object to improper venue when they
    did not make their objection until after the district court raised the issue sua
    sponte -- long after the defendants had originally filed their answer, which did not
    oppose venue); Thompson v. United States, 
    312 F.2d 516
    , 520 (10th Cir. 1962) (holding
    that defendant had waived any defense of improper venue when he made the argument only
    after filing a motion for summary judgment); Misch on Behalf of Estate of Misch v. Zee
    Enterprises, Inc., 
    879 F.2d 628
    , 631-32 (9th Cir. 1989) (noting that a defendant
    waives personal jurisdiction and improper venue defenses when he files for summary
    judgment prior to filing motions to dismiss for lack of personal jurisdiction or
    improper venue).
    2
    See City of New York v. Mickalis Pawn Shop, LLC, 
    645 F.3d 114
    , 115 (2d Cir. 2011)
    (finding defendants waived their personal jurisdiction defense when they initially
    “press[ed] that defense but then willfully withdr[ew] from the litigation and
    default[ed], even after being warned of the consequences of doing so”); Trustees of
    Cent. Laborers' Welfare Fund v. Lowery, 
    924 F.2d 731
    , 732-33 (7th Cir. 1991) (finding
    forfeiture after defendants moved to vacated default judgment entered against them six
    5
    1   began vigorously arguing personal jurisdiction or improper venue
    2   defenses only after participating in the litigation for a very
    3   long time.3     In no cases have courts found forfeiture in the
    4   circumstances present here -- where PEP timely and repeatedly
    5   sought dismissal of the action based on personal jurisdiction and
    6   improper venue defenses, failing to do so only in moving to
    7   remand -- or holding the appeal in abeyance -- for the district
    8   court’s consideration of the Mexican court decision rendered
    9   after briefing of the appeal in this court.
    10         In fact, many courts have declined to find forfeiture where
    11   defendants did not argue personal jurisdiction or improper venue
    12   defenses at every possible stage of litigation, including cases
    13   in which litigants were quite derelict in raising these defenses.
    14   See Sands Harbor Marina Corp. v. Wells Fargo Ins. Servs. of
    15   Oregon, Inc., 
    2016 WL 160721
    , at *4 (E.D.N.Y. Jan. 13, 2016)
    16   (refusing to find forfeiture of personal jurisdiction defense
    17   where defendant first made the defense in a motion to dismiss but
    18   later failed to make the defense when the district court was
    years earlier); Robertson v. Dowbenko, 443 Fed.Appx. 659, 661-62 (2d Cir. 2011)
    (finding defendant forfeited personal jurisdiction defense by not complying with
    discovery orders resulting in default).
    3
    See Hamilton v. Atlas Turner, Inc., 
    197 F.3d 58
    , 61 (2d Cir. 1999) (finding defendant
    forfeited personal jurisdiction defense by not moving to dismiss for four years after
    filing his answer and after “considerable pretrial activity [had] occurred”);
    Continental Bank, N.A. v. Meyer, 
    10 F.3d 1293
    , 1297 (7th Cir. 1993) (finding personal
    jurisdiction defense forfeited where defendants had “fully participated in litigation
    of the merits for over two-and-a-half years[, including participating in discovery,]
    without actively contesting personal jurisdiction”).
    6
    1   considering to dismiss the case on other grounds); In re
    2   Helicopter Crash Near Wendle Creek, Brit. Columbia, 
    485 F. Supp. 2d 3
      at 51-52 (finding no forfeiture of personal jurisdiction defense
    4   where defendant pled the defense in its answer but waited four
    5   months to file a motion to dismiss); Phat Fashions, L.L.C. v.
    6   Phat Game Athletic Apparel, Inc., No. 00–cv–0201, 
    2001 WL 7
      1041990, *3–4 (S.D.N.Y. Sept. 7, 2001) (finding no forfeiture of
    8   personal jurisdiction defense -- even though defendant did not
    9   assert the defense until thirteen months after the complaint was
    10   filed and the parties had completed discovery on substantive
    11   claims -- because “[d]efendant's delay in bringing its motion
    12   does not rise to the level of egregiousness that other courts
    13   have found sufficient to constitute a forfeiture”); Infinity
    14   Consulting Grp., LLC, 
    2010 WL 2267470
    , at *1-2 (finding no
    15   forfeiture of personal jurisdiction defense even when defendants
    16   waited nearly ten months before moving to dismiss on personal
    17   jurisdiction grounds and eight months to answer the complaint);
    18   Johnson v. Masselli, 
    2008 WL 111057
    , at *3 (N.D.Ind. Jan. 4,
    19   2008) (ruling defendants did not waive objection to venue by
    20   defending against temporary restraining order and participating
    21   in hearings and discovery related to preliminary injunction
    22   request where objection to venue was raised in responsive
    23   pleading); Biro v. Condé Nast, 
    2014 WL 4851901
    , at *7 (S.D.N.Y.
    7
    1   Sept. 30, 2014) (no forfeiture where defendant filed a motion to
    2   dismiss “eleven months after filing her answer,” and, “[i]n the
    3   interim, the parties were engaging in jurisdictional discovery, a
    4   process that generated disputes as late as” one month before the
    5   motion was filed).   I have found no case imposing forfeiture in
    6   circumstances like those before us -- the sole act of delay in
    7   pursuing personal jurisdiction and venue defenses being an
    8   alternative (to holding the appeal in abeyance) request for a
    9   remand on indisputably valid grounds -- much less doing so sua
    10   sponte.
    11        My colleagues muddy the waters by seeking to distinguish
    12   this case from our well-established and routine practice of so-
    13   called Jacobson remands.   In typical Jacobson remands, we remand
    14   partial jurisdiction to the district court to supplement the
    15   record on a discrete factual or legal issue while retaining
    16   jurisdiction over the original appeal.   United States v.
    17   Jacobson, 
    15 F.3d 19
    , 22 (2d Cir. 1994).   Jacobson remands are
    18   enormously helpful tools, see United States v. Salameh, 
    84 F.3d 19
      47, 50 (2d Cir. 1996) (noting that Jacobson remands “eliminate[]
    20   any question as to the district court's jurisdiction [over the
    21   particular issue] and enables [the appellate] [c]ourt to provide,
    22   if appropriate, for the automatic restoration of appellate
    23   jurisdiction, without the need for a new notice of appeal”).
    8
    1   This rationale may be the result of my colleagues’ fear that
    2   future litigants will avoid or argue against Jacobson remands
    3   entirely, lest they risk forfeiting claims or defenses raised in
    4   their original briefs.
    5        My colleagues distinguish this matter from routine Jacobson
    6   remands on the ground that we retained no jurisdiction in our
    7   remand in this matter.   Relying on the cession of partial or full
    8   jurisdiction for such a distinction is irrelevant, in my view.    A
    9   request for a Jacobson remand may well be part of a factual
    10   pattern justifying a forfeiture ruling.
    11        In this matter, our remand order limited the issues to be
    12   decided by the district court and directed that any subsequent
    13   appeal be referred to this panel.     The remand order confined the
    14   district court to addressing the effect of the intervening
    15   decision of the Eleventh Collegiate Court of Mexico on the
    16   arbitrability issues.    PEMEX, 
    2012 WL 9346475
    , at *1.   In
    17   remanding, we specifically stated we were “reach[ing] no other
    18   issue,” and we ordered that “[a]ny subsequent appeal in th[e]
    19   case should be referred to this panel.”    
    Id. 20 In
    my innocence -- or lack of prescience -- I thought we
    21   were ordering the reference of any subsequent appeal to this
    22   panel in the interests of judicial economy because we had
    23   familiarized ourselves with the issues other than arbitrability,
    9
    1   i.e. personal jurisdiction and venue.   As a panel member voting
    2   in favor of the remand as justified in the interests of judicial
    3   economy, it never occurred to me that my colleagues viewed the
    4   limited remand as limiting the issues to be heard on the
    5   subsequent appeal.   Had I realized such a limitation was
    6   contemplated, I would have dissented.   It is of small comfort
    7   that my innocence and lack of prescience was shared by COMMISA,
    8   which never raised forfeiture in arguing the personal
    9   jurisdiction and venue issues on the second appeal.   Rather, my
    10   colleagues dispose of PEP’s proffer of an alternative to a full
    11   vacatur and remand, i.e. retaining jurisdiction but holding the
    12   appeal in abeyance pending disposition of a Rule 60(b) motion, is
    13   disregarded because it was “downplayed” while PEP “angled” for a
    14   full remand, subjective purposes not glaringly obvious to this
    15   observer.
    16        b) Venue
    17        Because I agree with my colleagues on the merits of the
    18   personal jurisdiction issue, I turn to the venue question.
    19        Under FSIA, “[a] civil action against a[n] [agency or
    20   instrumentality of a foreign state] . . . may be brought[] in any
    21   judicial district in which the agency or instrumentality is
    10
    1   licensed to do business or is doing business . . . .”                    See 28
    2   U.S.C. § 1391(f)(3).4
    3         FSIA defines “agency or instrumentality of a foreign state”
    4   as “any entity” that is (1) “a separate legal person, corporate
    5   or otherwise,” (2) “an organ of [the] foreign state or political
    6   subdivision thereof, or a majority of whose shares or other
    7   ownership interest is owned by a foreign state or political
    8   subdivision thereof,” and (3) “neither a citizen of a State of
    9   the United States as defined in section 1332(c) and (e) of this
    10   title, nor created under the laws of any third country.”                     28
    11   U.S.C. § 1603(b).        That the first and third requirements are met
    12   by PEP is not in dispute.
    13         Regarding the second requirement, because PEP is owned by
    14   PEMEX, PEP is not an entity whose majority ownership is held by a
    15   foreign state.       See Dole Food Co. v. Patrickson, 
    538 U.S. 468
    ,
    16   475-77 (2003) (entity whose ownership is separated by “one or
    17   more corporate tiers” from foreign state does not fall within
    18   majority ownership provision of 28 U.S.C. § 1603(b)(2)).                     So, the
    19   question becomes whether PEP is an “organ” of the State of
    20   Mexico.    I believe that it is.
    4
    Title 28 U.S.C. § 1391(f)(3) states that “[a] civil action against a foreign state as
    defined in section 1603(a) of this title may be brought--in any judicial district in
    which the agency or instrumentality is licensed to do business or is doing business,
    if the action is brought against an agency or instrumentality of a foreign state as
    defined in section 1603(b) of this title.” Title 28 U.S.C. § 1603(a), in turn,
    defines a “foreign state” to “include . . . an agency or instrumentality of a foreign
    state as defined in [28 U.S.C. § 1603(b)].”
    11
    1        In Filler v. Hanvit Bank, we adopted a five factor test to
    2   determine whether a corporation is an “organ” of a foreign state:
    3       (1) whether the foreign state created the entity for a
    4       national purpose; (2) whether the foreign state
    5       actively supervises the entity; (3) whether the
    6       foreign state requires the hiring of public employees
    7       and pays their salaries; (4) whether the entity holds
    8       exclusive rights to some right in the [foreign]
    9       country; and (5) how the entity is treated under
    10       foreign state law.
    11
    12   
    378 F.3d 213
    , 217 (2d Cir. 2004) (quoting Kelly v. Syria Shell
    13   Petroleum Dev. B.V., 
    213 F.3d 841
    , 846–47 (5th Cir. 2000)); see
    14   also USX Corp. v. Adriatic Ins. Co., 
    345 F.3d 190
    , 209 (3d Cir.
    15   2003).   “Filler invites . . . a balancing process, without
    16   particular emphasis on any given factor and without requiring
    17   that every factor weigh in favor of, or against, the entity
    18   claiming FSIA immunity.”    In re Terrorist Attacks on Sept. 11,
    19   2001, 
    538 F.3d 71
    , 85 (2d Cir. 2008) (internal citation and
    20   quotation marks omitted), abrogated on other grounds by Samantar
    21   v. Yousuf, 
    560 U.S. 305
    (2010); see also European Cmty. v. RJR
    22   Nabisco, Inc., 
    764 F.3d 129
    (2d Cir. 2014), rev’d on other
    23   grounds by 
    136 S. Ct. 2090
    (2016).
    24        PEP easily satisfies factors (1), (2), (4), and (5), and may
    25   satisfy (3) --   hiring public employees -- although the record is
    26   unclear in this regard.    First, PEP was created for a national
    27   purpose.   Since 1938, it has been “entrusted [] with the central
    12
    1   planning and management of Mexico’s petroleum industry.”     J.
    2   App’x at 1526.    Second, PEP is highly supervised by the State of
    3   Mexico.   The Mexican government controls the annual budget of
    4   PEMEX -- which controls PEP -- and can “intervene directly . . .
    5   in [PEMEX and its subsidiaries] commercial and operational
    6   affairs.”    
    Id. at 1523.
      Under PEMEX’s charter, the Mexican
    7   government appoints all members of PEMEX’s board of directors,
    8   with ten of the fifteen directors being representatives of the
    9   state and/or public officials.     See RJR 
    Nabisco, 764 F.3d at 145
    10   (“We have said that a foreign state actively supervises an organ
    11   when it appoints the organ's key officials and regulates some of
    12   the activities the organ can undertake.”)     Third, “Mexican law
    13   gives [PEP] the exclusive right to exploit Mexico’s hydrocarbon
    14   reserves.”    Petróleos Mexicanos, Annual Report (Form 20-F) 23
    15   (June 30, 2009).    Fourth, Mexican law treats PEP as a government
    16   entity, as starkly evidenced by the Eleventh Collegiate Court of
    17   Mexico’s decision that PEP could not be forced to arbitrate
    18   precisely because it is a part of the Mexican government.        See
    19   Peninsula Asset Mgmt. (Cayman) Ltd. v. Hankook Tire Co., Ltd.,
    20   
    476 F.3d 140
    , 143 (2d Cir. 2007) (finding the foreign state law
    21   factor of Filler satisfied when the “Korean government informed
    22   the State Department and the district court that it treats [the
    23   entity] as a government entity”).
    13
    1        Under our caselaw, if PEP was so intertwined with the State
    2   of Mexico as to be deemed the state itself, Section 1391(f)(3)
    3   would be inapplicable.   See 28 U.S.C.A. § 1391(f)(3) (applying
    4   only “if the action is brought against an agency or
    5   instrumentality of a foreign state”).   In Garb v. Republic of
    6   Poland, we explained that, if the “core functions” of the legal
    7   entity “are predominantly governmental,” it is a “foreign state,”
    8   while if the “core functions” of the legal entity are
    9   “predominantly . . . commercial,” it is an “agency or
    10   instrumentality of a foreign state.”    
    440 F.3d 579
    , 594 (2d Cir.
    11   2006).    In Garb, we held that the Ministry of the Treasury of
    12   Poland is not an “agency or instrumentality” of the Polish state,
    13   because the core functions of the Treasury are governmental.      Its
    14   roles included “hold[ing] and administer[ing] the property of the
    15   Polish state,” and it also “represent[ed] the Polish State with
    16   respect to financial claims brought against the State.”    
    Id. at 17
      594-95.
    18        In contrast, PEP is clearly a commercial entity.    It has no
    19   regulatory functions.    Cf. Servaas Inc. v. Rep. of Iraq, 
    2011 WL 20
      454501, at *3 (2d Cir. Feb. 10, 2011) (finding the core function
    21   of the Ministry of Industry of Iraq is governmental and not
    22   commercial because, in part, it approves “applications for
    23   trademark registration, a regulatory function that [is]
    14
    1   quintessentially governmental”).     Its primary role is to find,
    2   develop, and sell oil and natural gas.    This is an inherently
    3   commercial role.   See NML Capital, Ltd. v. Rep. of Argentina, 892
    
    4 F. Supp. 2d 530
    , 533 (S.D.N.Y. 2012) (finding an Argentinean
    5   natural gas company’s core functions were “predominantly
    6   commercial” -- despite its “function[ing] in accordance with the
    7   policies and goals of the Republic [of Argentina]” -- because its
    8   “primary function is to sell natural gas at low prices in
    9   Argentina”).
    10        I note that my conclusion that PEP is an “agency or
    11   instrumentality” of the State of Mexico is entirely consistent
    12   with holding -- for personal jurisdiction purposes -- that PEP is
    13   a “foreign sovereign” rather than merely a “foreign corporation”
    14   under First Nat’l City Bank v. Banco Para el Commercio Exterior
    15   de Cuba, 
    462 U.S. 611
    (1983) (“Bancec”), a holding of my
    16   colleagues that I join.
    17        The core of the venue dispute, however, is whether PEP is
    18   “doing business” in New York.   This language suggests that some
    19   substantial activity of a commercial nature be engaged in by the
    20   defendant and that the activity be more than an isolated
    21   instance.   Significance and continuity must, therefore, be found.
    22   Wiwa v. Royal Dutch Petroleum Co., 
    226 F.3d 88
    , 95 (2d Cir.
    23   2000).   In the present matter, PEP has served as a guarantor for
    15
    1   thirty-five of PEMEX’s bond issuances in New York -- guaranteeing
    2   the payment of all principal and interest in the amount of $9.5
    3   billion -- and has served as the agent for service of process for
    4   each of those issuances.    This significant, continuous course of
    5   commercial activity and presence in New York for litigation
    6   purposes easily satisfies the pertinent language of Section
    7   1391(f)(3).
    8        PEP argues, however, that “doing business” must be defined
    9   narrowly in light of a purported “settled” meaning given to those
    10   words in the context of personal jurisdiction (but before the
    11   decision Int’l Shoe Co. v. Wash., 
    326 U.S. 310
    (1945)).
    12   Similarly, PEP notes that, when Congress enacted FSIA in 1976, it
    13   based Section 1391(f)(3) on 28 U.S.C. § 1391(c), which, at the
    14   time, provided that “[a] corporation may be sued in any judicial
    15   district in which it is incorporated or licensed to do business
    16   or is doing business.”     S. Rep. No. 94-1310, at 31 (1976); H.R.
    17   Rep. No. 94-1487, at 32 (1976).    PEP relies upon some non-FSIA
    18   cases rendered under the old Section 1391(c) that “consistently
    19   rejected efforts to rely on a company’s participation in the New
    20   York financial markets in order to establish venue under” Section
    21   1391(c).   Br. of Appellant at 28.
    22        Contrary to PEP’s suggestion, “doing business” for purposes
    23   of Section 1391(c) was historically far from clearly defined.
    16
    1   See 14D Wright & Miller, Fed. Prac. & Proc. § 3811 n.16 (4th ed.)
    2   (“This aspect of the statute [the phrase “doing business”] proved
    3   the most difficult to construe.”); see also 1 William H. Manz,
    4   Foreign Sovereign Immunities Act of 1976 with Amendments:   A
    5   Legislative History of Pub. L. No. 94-583, 48 (2000) (“[I]t is
    6   difficult to say where [instrumentalities] ‘reside’ under the
    7   corporate standards of ‘. . . doing business’ used in section
    8   1391(c).”).    Indeed, “[t]here was never an exact formula under
    9   which the question of ‘doing business’ was decided,” although
    10   “[m]ore than a single or casual transaction was required before
    11   the corporation was regarded as doing business in the district
    12   for federal venue purposes.”    Wright & Miller, Fed. Prac. & Proc.
    13   § 3811 n.16.
    14        The language of the statute governs our interpretation.       See
    15   In re Tribune Co. Fraudulent Conveyance Litig., 
    818 F.3d 98
    , 112-
    16   24 (2d Cir. 2016).    I find no difficulty in holding that serving
    17   as the guarantor of $9.5 billion raised in thirty-five bond
    18   issuances and agreeing to be served process in New York regarding
    19   enforcement of the guarantees is “doing business” in New York.
    20   The quantum of business is significant, the number of
    21   transactions easily supports a finding of continuity, and the
    22   agreement to be served process in connection with this activity
    17
    1   nails down PEP’s presence in New York for purposes of Section
    2   1396.
    3           That conclusion is consistent with current caselaw.    In
    4   Altmann v. Rep. of Austria, the Ninth Circuit held that an
    5   Austrian art gallery owned by the Austrian government was “doing
    6   business” in the Central District of California for venue
    7   purposes because the gallery’s publications and advertisements
    8   had been distributed in that District, even though the gallery
    9   did not directly publish the materials in California.       
    317 F.3d 10
      954, 972 (9th Cir. 2002), opinion amended on denial of reh’g, 327
    
    11 F.3d 1246
    (9th Cir. 2003), and aff’d on other grounds, 
    541 U.S. 12
      677 (2004).     The Ninth Circuit suggested that “doing business,”
    13   despite not being defined by FSIA, is essentially synonymous with
    14   “commercial activity,” which is defined.     See 
    id. (noting with
    15   evident agreement that the “district court [had] found ‘no
    16   authority that suggests that a foreign agency or instrumentality
    17   that engages in ‘commercial activity’ within a district is not
    18   also ‘doing business' within a district’”) (quoting Altmann v.
    19   Rep. of Austria, 
    142 F. Supp. 2d 1187
    , 1215 (C.D. Cal. 2001)).
    20           No decision seems to be in conflict with Altmann.    Cf. Arch
    21   Trading Corp. v. Rep. of Ecuador, 
    2015 WL 3443906
    , *4 (S.D.N.Y.
    22   May 28, 2015) (providing little examination of § 1391(f)(3) but
    23   finding an Ecuadoran state owned bank was not “doing business” in
    18
    1   the United States when it merely provided loans to Ecuadoran
    2   citizens who had been living abroad on their return to Ecuador);
    3   Ocean Faith Shipping Co., Ltd. v. Union of India Food Corp. of
    4   India, 
    1996 WL 227827
    , at *2 (E.D.La. May 3, 1996) (providing
    5   little examination of § 1391(f)(3) but finding that state owned
    6   grain shipper was not necessarily “doing business” in New Orleans
    7   simply because “the port of New Orleans exports more grain than
    8   any port in the world” -- a direct connection had to be shown);
    9   Shirobokova v. CSA Czech Airlines, Inc., 
    335 F. Supp. 2d 989
    , 991
    10   (D. Minn. 2004) (finding that code sharing arrangement between
    11   airlines were insufficient to establish venue under the “doing
    12   business” test in the absence of a physical presence in Minnesota
    13   and airline operations in the state).
    14        As the district court found, PEP engaged in “systematic,
    15   deliberate corporate activity . . . to obtain funds for its
    16   operational activities through its parent in New York, and [PEP
    17   had] established a presence for the purpose of obtaining these
    18   funds in New York.”   Corporación Mexicana de Mantenimiento
    19   Integral, S. de R.L. de C.V. v. Pemex Exploración y Producción,
    20   No. 10-cv-00206 (AKH), ECF No. 47, at *25 (S.D.N.Y. Aug. 26,
    21   2010).   Serving as a guarantor for thirty-five bond issuances and
    22   agreeing to accept service of process for those issuances is a
    23   substantial “commercial” activity.
    19
    1        Other precedent also supports my conclusion.   For example,
    2   in Rep. of Argentina v. Weltover, Inc., the Supreme Court held
    3   that Argentina was engaged in “commercial activity” when it
    4   issued bonds in the United States.   
    504 U.S. 607
    , 609-14 (1992);
    5   see also Jackson v. People's Rep. of China, 
    550 F. Supp. 869
    , 873
    6   (D.Ala. 1982) (applying the commercial activity exception to
    7   bonds issued by China on the basis that “[i]t is clear that the
    8   sale, issuance for sale and authorization of issuance for sale in
    9   the United States constitutes a ‘commercial activity’”).
    10   Likewise, in Mortimer Off Shore Servs., Ltd. v. Fed. Republic of
    11   Germany, we concluded that the Federal Republic of Germany’s
    12   assumption of liability for West German bonds issued in the
    13   United States was “commercial activity” under FSIA.   
    615 F.3d 97
    ,
    14   107 (2d Cir. 2010).
    15        c) Conclusion
    16        I therefore concur in the result.
    17
    20
    

Document Info

Docket Number: 13-4022

Filed Date: 8/2/2016

Precedential Status: Precedential

Modified Date: 8/2/2016

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