Sovereign immunity
Pages | 26-31 |
26 Volume 20, April–June 2014 international law update
© 2014 Transnational Law Associates, LLC. All rights reserved. ISSN 1089-5450, ISSN 1943-1287 (on-line) | www.internationallawupdate.com
infer that Congress included the ‘representative’
provision in order to prevent foreign government
entities from evading the Foreign Government
Entity Exception by ling FOIA requests through
agents, not to create a separate and independent
class of disfavored FOIA requesters.” [Slip op. 3]
e Court concludes that FOIA requesters
who have authority to le requests on behalf of
foreign government entities are “representatives” of
such entities when they le requests that they have
governmental authority to le. In this case, the
FOIA requesters are not such “representatives” and
the requested records must be released.
citation: All Party Parliamentary Group on
Extraordinary Rendition v. United States Department
of Defense, No. 13-5176 (D.C. Cir., June 17, 2014).
SOVEREIGN IMMUNITY
Where European Community alleges
private U.S. company’s participation
in international money laundering,
Second Circuit finds that the European
Community is an organ and agency of a
foreign state, and thus there is diversity
jurisdiction under 28 U.S.C. Section
1332; RICO applies extraterritorially
if liability or guilt could attach to
extraterritorial conduct under the
relevant RICO predicate
e European Community and 26 of its
member states (“Plaintis”) sued RJR Nabisco,
Inc. and related entities (jointly “RJR”) in the U.S.
District Court for the Eastern District of New York.
Plaintis alleged that RJR directed, managed and
controlled a global money laundering scheme in
violation of the “Racketeer Inuenced and Corrupt
Organizations” (RICO) Statute, 18 U.S.C. Section
1961.
Simply put, Plaintis claim that Colombian
and Russian crime groups smuggle drugs into
Europe, sell them in Euros, and then sell the Euros at
discounted rates to cigarette importers to purchase
RJR cigarettes. RJR allegedly took an active role in
this scheme by concealing the true purchasers of
the cigarettes, for example by shipping cigarettes
through Panama to take advantage of Panama’s
secrecy laws and by ling fraudulent documents
with the U.S. Customs Service.
e District Court concluded that RICO has
no extraterritorial application. Further, the District
Court dismissed the related state law claims because
the European Community is not an organ of a
foreign state under 28 U.S.C. Sections 1332, 1603.
us, its participation in the lawsuit destroyed
complete diversity and deprived the District Court
of jurisdiction over the state law claims.
Plaintis appeal the dismissal of their Second
Amended Complaint (“Complaint”). e main
issues on appeal are: (1) Whether the Plaintis’ claims
under RICO are impermissibly extraterritorial, and
(2) whether the European Community qualies as
an organ of a foreign state for purposes of diversity
jurisdiction under 28 U.S.C. Sections 1332, 1603.
e U.S. Court of Appeals for the Second
Circuit reverses. While there is a presumption
against extraterritorial application of a U.S.
statute (unless Congress clearly indicated that the
statute applies extraterritorially), Congress has
clearly intended extraterritorial application for the
oenses at issue in this case. Also, the European
Community qualies as an organ and agency of a
foreign state under Section 1332(a)(4), so that the
lawsuit against “citizens of a State or of dierent
States” creates diversity jurisdiction.
e Court rst reviews the extraterritorial
application of RICO. Because the alleged RICO
enterprise was located outside the U.S., the District
Court failed to nd an actionable RICO claim. e
Court disagrees.
“… We now confront an argument about
the extraterritorial reach of RICO … Congress
manifested an unmistakable intent that certain of
the federal statutes adopted as predicates for RICO
liability apply to extraterritorial conduct. is
appeal requires us to consider whether and how
RICO may apply extraterritorially in the context of
claims predicated on such statutes.”
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