Saint-Gobain Performance Plastics Europe v. Bolivarian Rep. of Venezuela

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 15, 2021 Decided January 25, 2022
No. 21-7019
SAINT-GOBAIN PERFORMANCE PLASTICS EUROPE,
APPELLEE
v.
BOLIVARIAN REPUBLIC OF VENEZUELA,
APPELLANT
Appeal from the United States District Court
for the District of Columbia
(No. 1:20-cv-00129)
Kent A. Yalowitz argued the cause for appellant. With
him on the briefs were E. Whitney Debevoise, Allon Kedem,
Sally L. Pei, and Stephen K. Wirth.
Lewis S. Yelin, Attorney, U.S. Department of Justice,
argued the cause for amicus curiae United States. With him on
the brief were Brian M. Boynton, Acting Assistant Attorney
General, and Sharon Swingle and Cynthia A. Barmore,
Attorneys.
Alexander A. Yanos argued the cause for appellee.
With him on the brief was Carlos Ramos-Mrosovsky.
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Before: ROGERS and WALKER, Circuit Judges, and
EDWARDS, Senior Circuit Judge.
Opinion for the Court by Circuit Judge ROGERS.
ROGERS, Circuit Judge: The Bolivarian Republic of
Venezuela appeals the district court’s grant of summary
judgment to Saint-Gobain Performance Plastics Europe upon
determining it had properly served the Republic with court
process pursuant to the Hague Convention on the Service
Abroad of Judicial and Extrajudicial Documents in Civil or
Commercial Matters, Nov. 15, 1965, 20 U.S.T. 361, T.I.A.S.
No. 6638. Articles 2 to 6 of the Hague Convention require that
a plaintiff request service from a Central Authority designated
by the receiving state and receive a certificate of service from
the Central Authority stating it has served the defendant by a
method consistent with the state’s internal law. Because
Venezuelan law requires lawsuits against the Republic to be
served on the Attorney General, and the Attorney General was
never served, we reverse and remand the case to the district
court.
I.
The Foreign Sovereign Immunities Act (“FSIA”), 28
U.S.C. § 1608, identifies four methods for serving a foreign
state, in descending order of preference. Service is established
(1) when service is made “in accordance with any special
arrangement for service between the plaintiff and the foreign
state or political subdivision”; (2) “by delivery of a copy of the
summons and complaint in accordance with an applicable
international convention on service of judicial documents”; (3)
by sending a copy of the relevant documents to be “dispatched
by the clerk of the court to the head of the ministry of foreign
affairs of the foreign state concerned”; and (4) by sending
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copies of the documents to be “dispatched by the clerk of the
court to the Secretary of State [who] shall transmit one copy of
the papers through diplomatic channels to the foreign state.”
Id. § 1608(a)(1)–(4). At issue here is the second option, as no
special service arrangement existed between the parties.
The Hague Convention is an international agreement
among the signatory sovereign states on service of judicial
documents that the Preamble states is designed to “simplify[]
and expedit[e] the procedure” for serving process abroad. It
was ratified by the United States Senate on April 14, 1967. 113
CONG. REC. - SENATE, 9664-65 (1967). Article 2 requires
signatory states to “designate a Central Authority which will
undertake to receive requests for service coming from other
Contracting States.” Under Article 5, once the Central
Authority receives a request for service, it must serve the
documents “by a method prescribed by [the receiving state’s]
internal law” or “by a particular method requested by the
applicant” that is compatible with that law. Article 6 requires
the Central Authority to provide a certificate of service that
conforms to a specified model. Paragraph 1 of Article 15, in
turn, prohibits entry of a default judgment where the foreign
defendant “has not appeared” until the document is served
according to the receiving state’s internal law or the documents
are “actually delivered . . . by another method provided for by
this Convention.” Paragraph 2 provides that in the absence of
a certificate of service, the entry of a default is permitted where:
(a) the document was transmitted by one of the
methods provided for in [the] Convention,
(b) a period of time of not less than six months,
considered adequate by the judge in the
particular case, has elapsed since the date of the
transmission of the document, [and]
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(c) no certificate of any kind has been received,
even though every reasonable effort has been
made to obtain it . . . .
Saint-Gobain Performance Plastics Europe is a French
corporation that held a 99.99% interest in NorPro Venezuela,
C.A., a Venezuelan company that produced components for
hydraulic fracturing. In March 2011, then-President Hugo
Chávez of the Bolivarian Republic of Venezuela ordered
expropriation of Saint-Gobain’s interest. Based on protection
against expropriation by the France-Venezuela Bilateral
Investment Treaty of April 15, 2004, Saint-Gobain sought
compensation and entered into arbitration with the Republic
pursuant to the International Centre for Settlement of
Investment Disputes (“ICSID”) Convention. An arbitral
tribunal found that the Republic had breached the Investment
Treaty and in November 2017 awarded Saint-Gobain $42
million for the expropriation.
When the Republic failed to pay the award, Saint-Gobain
in December 2018 filed a lawsuit in the United States District
Court for the District of Delaware seeking to register and
enforce the arbitral award pursuant to the ICSID Convention,
specifically 22 U.S.C. § 1650(a), which grants federal district
courts subject matter jurisdiction over actions to enforce ICSID
arbitral awards. In the absence of a special arrangement for
service by the parties, Saint-Gobain proceeded under the
FSIA’s second preferred service option and on December 14,
2018, as Venezuelan law required sent requests for service with
copies of its complaint and summons to the Republic’s
designated Central Authority. T. Flores and I. Ruiz signed for
delivery of the requests for service on December 21 and 27,
respectively. Saint-Gobain sought no further response from the
Central Authority and received none. In June 2019, Saint-
Gobain moved for a default judgment against the Republic. The
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Republic moved to dismiss for lack of personal jurisdiction, on
the ground it had not properly been served, and for improper
venue in Delaware.
The Delaware district court found that it had jurisdiction
inasmuch as the Hague Convention “does not permit a foreign
sovereign to feign non-service by its own failure to complete
and return the required certificate.” D. Del. Slip Op. at 2.
Saint-Gobain had served the Republic pursuant to Article 15(1)
when it “serv[ed] the appropriate documents directly to the
Central Authority designated by the Republic.” Id. at 22. Upon
granting Venezuela’s venue motion, the court transferred the
case to the District of Columbia.
In the U.S. District Court for the District of Columbia,
Saint-Gobain moved for summary judgment and the Republic
moved to dismiss for lack of personal jurisdiction. The district
court, treating the motion to dismiss as a motion for
reconsideration of the Delaware district court’s jurisdictional
determination, denied the Republic’s motion and granted
summary judgment to Saint-Gobain. D.D.C. Slip Op. 2. The
court agreed with the Delaware court that service was complete
under Article 15 when Saint-Gobain submitted its requests for
service because that interpretation was “reasonable and
consistent with the findings of other courts.” D.D.C. Slip Op.
19–20 (citing Box v. Dall. Mex. Consulate Gen., 487 Fed.
App’x 880, 886 (5th Cir. 2012); Devengoechea v. Bolivarian
Republic of Venez., No. 12-cv-23743, 2014 WL 12489848 at
*1 (S.D. Fla. Apr. 25, 2014); Scheck v. Republic of Arg., No.
10-cv-5167, 2011 WL 2118795 at *3 (S.D.N.Y. May 23,
2011)). It ruled that Article 15 properly applied “in the context
of evaluating a motion for default,” id. at 21, and that
requesting service from the Central Authority was sufficient in
cases against a foreign sovereign state. Id. at 22–23. Absent
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other objections, summary judgment was therefore
appropriate. Id. at 7–8, 24.
The Republic appeals, and our review of the district
court’s determination that it had personal jurisdiction over the
Republic is de novo. Shatsky v. Palestine Liberation Org., 955
F.3d 1016, 1036 (D.C. Cir. 2020); Estate of Klieman v.
Palestinian Auth., 923 F.3d 1115, 1123 (D.C. Cir. 2019).
II.
In cases of treaty interpretation, the Supreme Court has
instructed that courts must “begin with the text,”
Volkswagenwerk AG v. Schlunk, 486 U.S. 694, 699 (1988)
(internal quotations omitted), and that “[w]here the text is clear
. . . [the courts] have no power to insert an amendment,” Chan
v. Korean Air Lines, Ltd., 490 U.S. 122, 134 (1988). “To alter,
amend, or add to any treaty, by inserting any clause, whether
small or great, important or trivial,” the Court explained,
”would be on our part an usurpation of power, and not an
exercise of judicial functions.” Id. at 135 (quoting In re The
Amiable Isabella, 19 U.S. (6 Wheat.) 1, 71 (1821)). Because
the Hague Convention is a treaty, this law applies. See Water
Splash v. Menon, 137 S. Ct. 1504, 1508–09 (2017). Courts
must also adhere to the plain text when interpreting the FSIA’s
requirements for service given the “sensitive diplomatic
implications” of suits against foreign sovereigns. Republic of
Sudan v. Harrison, 139 S. Ct. 1048, 1062 (2019); see also
Transaero, Inc. v. La Fuerza Aerea Boliviana, 30 F.3d 148, 154
(D.C. Cir. 1994).
The plain text of Article 5 of the Hague Convention
requires that the Central Authority serve the defendant “by a
method prescribed by its internal law” or “by a particular
method requested by the applicant, unless such a method is
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incompatible with the law of the State addressed.” Convention,
art. 5. Because Saint-Gobain did not propose its own method
of service, this court looks to the method of service prescribed
by the law of the Republic to determine whether Article 5’s
requirements were met.
Under Venezuelan law, lawsuits against the Republic must
be served on the Attorney General of the Republic. Organic
Law of the Attorney General’s Office, art. 95, published in
Official Extraordinary Gazette No. 6.210, at 66 (Dec. 30, 2015)
(Venez.). The parties do not dispute either that the Attorney
General was not served or that Saint-Gobain did not receive a
certificate of service from the Central Authority.
Consequently, service was not completed under Article 5 of the
Convention.
Saint-Gobain nonetheless contends that when the foreign
defendant is a state, requesting service from the Central
Authority suffices because the Central Authority is the state.
Saint-Gobain Br. 26–27. This interpretation is unsupported by
the plain text of the Convention. The Convention states in
Article 2 that the Central Authority receives requests for
service, not that this constitutes legal service, and under
Articles 4 and 13, the Central Authority retains the power to
object to requests that do not comply with the Convention or
that infringe the receiving state’s sovereignty. Viewing the
Central Authority as legally equivalent to a sovereign
defendant would amend the Convention by effectively
rendering irrelevant the signatory state’s law in determining
whether service is complete. The Convention specifies that
service must be made either by a “method prescribed by [the
receiving state’s] internal law,” or by a “method requested by
the applicant, unless . . . incompatible with the law of the
[receiving state].” Convention, art. 5. Because Venezuelan
law requires service on the Attorney General in lawsuits filed
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against the Republic, that also is what the Convention requires.
The interpretation of a treaty such as the Hague Convention is
“governed by the text [of the Convention,] solemnly adopted
by the governments of many separate nations,” and the court
has “no power to insert an amendment” where the “text is
clear.” Chan, 490 U.S. at 134. Saint-Gobain does not cite
contrary authority.
Article 15(1), on which Saint-Gobain relies, is not a basis
for obtaining personal jurisdiction here. Article 15(1) states
that “[where] the defendant has not appeared, judgment shall
not be given until it is established that — (a) the document was
served by a method prescribed by the internal law of the State
addressed, or (b) the document was actually delivered to the
defendant . . . by another method provided for by this
Convention.” The Republic appeared before both the
Delaware district court and the District of Columbia district
court to challenge the personal jurisdiction of the courts. Saint-
Gobain has neither completed service in compliance with
Venezuelan law, which requires service on the Attorney
General, nor identified another method of service under the
Convention with which it complied. Therefore, Saint-Gobain
has not satisfied the requirements of either Article 5 or Article
15(1).
The District of Columbia district court cited with approval
the Delaware district court’s conclusion that the Hague
Convention “does not permit a foreign sovereign to feign non-
service by its own failure to complete and return the required
certificate,” noting such a conclusion was “reasonable and
consistent with the findings of other courts.” D.D.C. Slip Op.
19-20 (quoting D. Del. Slip Op. 21). The district court’s
reliance on unpublished decisions outside of this circuit is
unpersuasive. Id. In Devengoechea, 2014 WL 12489848 at *1
(S.D. Fla. Apr. 25, 2014), the court provided no explanation for
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the conclusion that service on the Central Authority is alone
sufficient to serve a foreign sovereign defendant. Box, 487
Fed. App’x at 886 (5th Cir. 2012), and Scheck, 2011 WL
2118795 at *3 (S.D.N.Y. May 23, 2011), concern service under
Article 15(2), which is not at issue here, and do not interpret
the text of Article 5. The district court’s conclusion suggests
that a foreign sovereign could not contest service once its
Central Authority has received a request for service, but this
does not comport with the plain text of Article 6 of the
Convention. At no point does the Hague Convention modify
Articles 5 or 15(1) to dispense with their requirements for
service when the defendant is a state.
To the extent the district courts’ rulings may be understood
to suggest possible bad faith by the Republic in failing to assure
that its Central Authority actually served the Attorney General
and notified Saint-Gobain that service had been made, the plain
text of the Convention speaks for itself. Unlike in Water
Splash, 137 S. Ct. at 1508, where the FSIA and the Hague
Convention Article 10(a) were silent on use of mail “for the
purpose of service,” the Convention is not silent on the
elements of service at issue and nowhere provides that these
requirements are inapplicable when the defendant is a
sovereign state. Even when “the equities of a particular case
may seem to point in the opposite direction,” the Supreme
Court has required courts to adhere to the plain text of the FSIA
and the Hague Convention in view of the “sensitive diplomatic
implications.” Harrison, 139 S. Ct. at 1062.
Notably, Saint-Gobain has alternative means of effecting
service on the Republic. For example, the FSIA permits
service through diplomatic channels where other methods have
failed, 28 U.S.C. § 1608(a)(4), a channel that is also
recommended by the Convention in case of “difficulties” or
“exceptional circumstances.” Convention, arts. 9, 14; see also
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Water Splash, 137 S. Ct. at 1508 (citing as well arts. 8, 11 &
19). Saint-Gobain objects only that “there is no indication of
how long diplomatic service may take,” Saint-Gobain Br. 35,
but its claims of inconvenience do not affect how the courts are
required by Supreme Court precedent to interpret the
Convention. Harrison, 139 S. Ct. at 1062.
Accordingly, the court reverses the grant of summary
judgment to Saint-Gobain and remands the case for the district
court to afford Saint-Gobain the opportunity to effect service
pursuant to the Hague Convention or otherwise as 28 U.S.C.
§ 1608 allows, see FED. R. CIV. P. 4(j)(1).