Smith v. Overseas Korean Cultural Heritage Foundation

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUl\{BlA
Therrell Sniith,
Plaimiff, _
Case No. l:l7-cv~00598 (TNM)
v.
Overseas Kol‘ean Cultur_al Heritage
_Foundation AKA The Overseas Korean
Cultural Heritage Foundation, USA,
Defendant.
‘ MEMORANI)UM OPINION
Plaintif``f`` Then‘ell Smith filed a``three-count complaint in Superior Courf of the District of
Columbia against defendant Overseas Korean Cultural Heritage Foundation, also known as the
Overseas Korean Cultural Heritage Foundation, USA, seeking damages related to the
Def``endant’s construction project on a property next to Plaintif``f’ s residence The Defendant
removed the action to this Court' and filed anmotion to dismiss based on Federal Rules of Civil
Procedure 12(b)( 1), lZ(b)(4), and lZ(b)(S). Def``.’S_ l\/lot.-to Disrniss 6-7. This motion is ripe for
adjudication, as are two other motions: Plaintiff’s Motion to Strike an affidavit filed in support
of the Def``endant’s Notice of Removal, and the Defendant’s Motion to Stay Discovery pending a
ruling on its Motion to Disrniss. Upon consideration of`` the pleadings, relevant laW, and related
legal memoranda in opposition and in support, the Def``endant’s Motion to_ Dismiss is DENI_ED
and the Plaintist Motion to Strike Af``fidavit is DENIED. The Defendant’s Motion to Stay
Discovery_is accordingly DENIED as moot.
I. Background
Plaintiff is a 100-year old resident of`` 14 Logan Circle in Washington, D.C. Compl. 1l 2. _
The Defendant, arSouth Korean cultural foundation,- is the owner of the property next to
Plaintif``f’s and has been engaged in a construction project to open the property as a museum. Id.
1l 4-5, Pl.’s l\/lemo. of Opposing P. & A. to Def``.’s Mot. to Dismiss Ex. 3. Plaintiff filed suit in
Superior Court for the District of`` C-olumbia and delivered to Defendant’s registered agent a copy
of`` the complaint and summonsl Compl. l. Plaintiff`` claims that the construction has resulted in
damage to Plaintir``f"s property, harmed Plaintiff’ s physical health, and caused her to incur certain
_ professional fees Which she alleges should be reimbursed by the Defendant. Compl. 1l1l 20, 28,
l 33, 42; Def.’s Notice of Removal 11 ll l
The Defendant removed the action to this Courtl and has filed two motions: a Motion to
Dismiss on the bases that the Def``endant Was not properly served under the Foreign Sovereign
lmrnunities Act (“F_SIA”) and Federal Rule of _Civil Procedure l2(b)(4) and lZ(b)(S) and that this
Court lacks subject matter jurisdiction pursuant to Federal Rule of Civil Procedure lZ(b)(l ); and
a Motion to Stay ]f)iscoveryl until the Motion to Dismiss is decided See Def``.’s Notice of
Removal; Def.’s Mot. to Dismiss; Def.’s Qpp. and l\/lot. to Stay.Discovery Pending Ruling on
'Def``.’s Mot. to Dismiss. Plaintiff has tiled a Motion toStrike an'af``fi_davit submitted With the
Det``endant’s l\/[oti.on to Dismiss. Pl.’s l\/[ot. to Strike Affidavit of S_oo~Dong O in Support of
Def.’,s Notice of" Removal. All three motions, Which are ripe, are considered below.
' "Plaintif``f does not contest the propriety of.removal. See generally 28 U.S.C. §§ l44l(d),
l446(b); Pl.’s Opp’n to Def``.’s Mot. to Dismiss; Pl.’s Mot. to Strike Af``fidavit; Pl.’S Opp’n to
Def.’s Mot. to Stay Discovery. - '
II. Legal Standard
Under Federal Rule of Civil Procedure lZ(b)(4) and lifb)($), a complaint may be '
dismissed, respectively, for “insufficient process” or “insufficient service of process.” A motion
under Rule lZ(b)(4) is “proper only to challenge noncompliance With the provisions of Rule 4(b)
. . . that deals specifically With the content of the summons.” Charles Alan Wright & Arthur R.
l\/liller, Federal Practice & Procedure § 1353 (3d ed. 2004) (“Wright & Miller”). A motion under
Rule lZ(b)(§) is the “proper vehicle for challenging the mode of delivery or the lack of delivery
of the summons and complaint.’_" Id_ When challenged on these grounds, the plaintiff has the
burden of establishing proper service ofprocess. See Light v. Wolj§ 816 F.2d 746, 751-_(D.C. Cir.
1937) (quoring wright & Miner § 1'083). t '
l _ f Under Federal Rul_e of Civil Procedure lZ(b)(l), a complaint maybe dismissed for lack
of subject matter jurisdiction The,plaintiff bears the burden of proof to establish that the court
has subject matter jurisdiction Arpaz'o v._ Obama, 797- F.3d ll, 19 (D.C. _Cir. 2015).`` A court-
may look beyond the complaint to consider “undisputed'facts evidenced on the record” to satisfy
itself that it has subject matter jurisdiction Coalitz``onfor Underground Expansion vt Mineta, 333
F.3d 193, 198 (D.C. Cir. 2003).
III. Analysis
The Motion to Dismiss turns on Whether the Defendant is either:' (_l) a “foreign State or .
political subdivision of a foreign state,” covered by 28 U.S.C. § l608(a); or (2) “an agency or
instrumentality of a foreign state,” covered by 28 U.S.C. § l608(b). The Defendant argues that
the former applies and that Plaintiff failed to serve the Defendant by any of the methods
prescribed by § léOS(a). l\/lerno. in Support of Def.’s Mot. 'to'Dismiss 4. Plaintiff appears to _ -
concede that she did not serve the Defendant using any of the procedures listed in § l608(a), but
she counters that § 1608(b) is the relevant sub-Section7 making service proper because she served
Defendant’s registered agent. Pl.’s Memo. of Opposing P. & A. to Def.’s Mot. to Dismiss 4. ln
particular, § l608(b) allows for service to be effectuated by “delivering a copy of the summons
and complaint . . . to any other agent authorized or appointed by law to receive service of process
in the United States.” 28 U.S.C.¢§ l608(b)(2). I agree that § 1608(b) applies and that Plaintiff
has met her burden to show that service of process Was proper. - 1
To determine Whether an entity is a c‘foreign_ state or political subdivision of a foreign
State” or “an agency or instrumentality of a foreign state,” the relevant inquiry is Whether the
core function of- the entity is governmental or commercial. Roea’er v. Islamr'c Republz'c of tran,
333 F.3d 228, 234 (D.C. Cir. 2003) (describing the approach as “categorical”). If the core
function is governmental, then the entity is a foreign state or political subdivision; if the core
function is commercial, then the entity is an agency or instrumentality Ia'. Courts in this circuit
have found that a_nation’s air force, its embassy, its Ministry of Foreign Affairs, and its cities are
`` governmental functions See, e.g., td. at 234-35; Transaero, Inc. v. La Fuerza Aerea Boliviana,
30 F.3d 148, 150 (D.C. Cir. 1994); Howe v. Embassy ofltaly, 68 F. Supp. 3d 26, 33 (D.D.C.
2014); Malewicz v. Cily ofAnisferdam, 362 F. Supp. 2d 298, 306 (D.D._C. 2085). The Defendant
does not-argue that its status is as unambiguously governmental as those examples,‘ but rather '
contends that its function is “governmental in nature."’ Memo. in Support of Def.’s l\/lot. to
Dismiss 5. _This is because the Defendant Was created through a presidential decree under a
South Korean statute, and its function to “protect, preserve, popularize, and enhance South
Korean cultural heritage and develop traditional South Korean life-style and culture . . . serve[s] .
a national purpose that is traditionally performed by a government.” Id. The Defendant also
emphasizes that the property has great cultural significance to South Korea. Memo. of P. & A.
in Support of Def.’s Reply Memo. 3.
Although the Defendant’s interests and objectives may align With, or be directed by, a
foreign state, l must look to the “nature” of the acth rather than its “purpose.” See Repubfic of
Argentina v. Weltover, Inc., 504 U.S. 607, 614 (1992). At its core, the Defendant’s act is to build
and operate a museum. This is anact that sovereigns may accomplish,,but it is not an act that -
only a sovereign power can do. Museums can be privately built and operated, even if' they may
be focused on promoting a particular culture or tradition2 Whether the Defendant intends to
operate the museum for profit also does not impact the inquiry. As the Supreme Court has stated
in the context of defining"‘commercial” for purposes of FSIA, “the question is not whether the
foreign government is acting With a profit motive or instead With the aim of fulfilling uniquely
sovereign obj ectives. Rather, the issue is Whether the government’s particular actions (whatever
the motive behind them) are the type of actions by Which a private party engages in commerce.”
-Id. As the Defendant’s actionebuilding and operating a museum-is the type of action by
Which a private party can engage in commerce, the Defendant’s act is commercial in nature See
id.; see also Malewicz, 362 F. Supp. 2d'at 313 (“‘Commercial’ means only ‘not sovereign,’ as
long as there is some example of private action of a similar type connected With ‘tra``de and trach
or commerce.”’). This makes the Defendant an ‘-‘agency or instrumentality” of a foreign state
. 2 For instance, Within the last few months, a private foundation started by the Green family
opened “The Museum of the Bible” in this District. l\/lichell``e Boorstein, D.C.' Oj€cially Gets A
New Major Bible Museum - And Pmyers At lrs Dedicationfor Evangelization, Wash. Post (Nov.
. 17, 2017), https://WWW.Washingtonpost.com/neWS/acts-of-faith/Wp/Z0l 7/1 l/ l 7/d-c-officially-
gets-a-new-rnajor-bible-museum-and»prayers-at-its-dedication-for-
evangelization/?utm_term=.fe99bf58b326.
and service properly accomplished upon delivery of the complaint and summons to an authorized
agent. See 28 U.S.C. § l608(b)(2).
Furthermore, the commercial nature of the Defendant’s activity defeats its claim of -
`` sovereign immunity_, as actions “based upon a commercial activity carried on in the United States
by the foreign state”3 are excepted from the jurisdictional immunity of a foreign state. See 28
U.S.C. § l605(a)(2). As courts have recognized, if the activity can similarly be accomplished by
a private party, the action is “commercial” Within the meaning of FSIA. 8ee, e.g., Republic of
Argentina, 504 U.S. at 614-15 (“[A] contract to buy army boots or even bullets is a ‘commercial"
activity, because private companies can similarly use sales contracts to acquire goods”);
Malewicz, 362 F. Supp. 2d at 314 (“Ther_e is nothing ‘sovereign’ about the act of lending art
pieces, even though the pieces themselves might belong to a sovereign.”). In this case, the
' establishment and operation of a cultural museum, While rooted in policy interests promulgated
by the government of South l{orea, isn an act in Which both public and private entities may
engage. Therefore, the act is “commercial.”
Next, Plaintiff seeks to strike an affidavit submitted in support of the Defendant’s notice
of removal.' Plaintiff argues that the affidavit cannot be accurate because it Was signed onl March
28, 20l7, seven days prior to the filing of the Defendant’s notice of removal on Aplil 4, 2017'.
Plaintist Mot.lto Strike Affidavit of``Soo-Dong -O in Support of Def``.’s Notice of Removal. The
Defendant responds that it initially included the affidavit With its removal notice filed in Superior
Court on March 30, 2017, and filed the same affidavit in federal court on April 4, 2017, adding
the' federal case number assigned Merno. _of P. & A. in Support of Def_``.’s Opp’n to-Pl.’s Mot. to
' 3 Here, “foreign state” is defined both as a “political subdivision of a foreign state or an agency
or instrumentality of a foreign state.” See 28 U.S.C. § l'603(a).
Strike Afiidavit 3. l find that this non-substantive change is not “redundant, immaterial,
impertinent, or scandalous” to require striking the affidavit. See Fed. R. Civ. P. l2(f) (describing
content that Would be appropriate to strike from'a pleading).
Finally, because the Defendant’s Motion_ to Stay Discovery Was based on the Defendant’s
outstanding dispositive motion, this motion is now moot and should be dismissed
IV. Conclusion
For the foregoing reasons, it is hereby ORDERED that the Defendant’s l\/Iotion to
Dismiss is DENIED, the Plaintiff’ s l\/[otion to Strike Affidavit is DENIED, and the Defendant’s
Motion to Stay'Discovery is DENIED as moot. A separate order vvill issue.
SO ORDERED.
Dated: January 2, 2018 TREVOR N. MCFADDEN
United States District Judge