Chamber of Commerce
In its amicus brief, the Chamber of Commerce of the United States of America argues that Judge Kaplan did not abuse his discretion when he issued a preliminary injunction after being presented with credible evidence of an imminent plan to utilize an “unlawfully procured foreign judgment” to freeze the worldwide assets of a U.S. corporation in order to extort a settlement. Noting the “deep roots” for the “modern-day American antisuit injunction,” the Chamber of Commerce argues that the Second Circuit should continue to utilize the equitable factors developed in this Circuit and others for evaluating a foreign antisuit injunction action. Br. at 4, 6-8. However, to use the rigid approach urged by Appellants, rather than a functional approach to analyzing these factors, “would create tension within this Circuit’s doctrine, would be inconsistent with the equitable underpinnings of antisuit injunctions and would throw this Circuit out of alignment with the prevailing contemporary view among other federal courts.” Br. at 10-11. In examining the application of these factors to this case, the brief notes that the “evidence provides compelling proof of the need for an injunction to protect Chevron from ‘trumped-up’ multi-billion dollar claims.” Br. at 21 (emphasis in original). Specifically, the Invictus Memorandum cited by Chevron in its district court filings supplies “critical evidence” both that the Appellants “were poised to execute a strategy” that would undermine the ability of the U.S. court to arrive at a final judgment (by extorting a settlement from Chevron) and that “the injunction is necessary to prevent vexatious litigation in foreign forums.” Br. at 21-22.
The Chamber further argues that Appellants’ assertion that the current non-enforcement action is inconsistent with a position Chevron took in the mid-1990s, when it sought to dismiss the Aguinda action filed in New York in 1993 on forum non conveniens grounds, is flawed factually and legally. The Chamber argues that Appellants’ position, if accepted, would create bad policy in the form of perverse incentives for parties to “engage in all sorts of questionable and corrupt behavior to secure a favorable legal result in the foreign forum” following a dismissal on forum non conveniens grounds, just as the Appellants have done here. Br. at 29.
The Chamber of Commerce is represented by Professor Peter B. Rutledge of the University of Georgia School of Law.
Business Roundtable and International Law Scholars
In their amicus brief, the Business Roundtable, joined by a distinguished group of international law scholars, argue that antisuit injunctions do not violate international law or principles of comity, and that such injunctions are widely recognized by civil and common law countries as a reasonable method of preventing the enforcement of fraudulent judgments. The amici, noting that non-intervention has typically only applied to actions involving “either military force or other physically coercive measures that put pressure on a State to change its practices or policies,” argue that the principle of non-intervention is inapplicable in this case. Br. at 6. The amici explain that, because “[t]he underlying policy [of requiring exhaustion of local remedies] is to give the State an opportunity to remedy any violation before a claim is put forward against it on the international level,” “the invocation of the principle of exhaustion of local remedies is entirely inapposite here,” as the litigation is between two private parties, and not against the State. Br. at 9–10.
The amici further argue that principles of international comity as applied by the Second Circuit, not non-intervention, are most applicable here. Br. at 12. Accordingly, the amici explain that, although “courts are cautious in issuing such injunctions,” the antisuit injunction in this case does not offend principles of international comity because there is no “true conflict” between American law and Ecuadorian law, and adjudication by the district court does not offend “amicable working relationships of other countries;” indeed, no other country has been affected by, or objected to, the district court’s actions. Br. at 13–15.
The amici also observe that jurisdictions around the world widely recognize and accept the use of antisuit injunctions. Br. at 15–29. The amici note that, while “[e]very major common law system . . . authorizes the use of antisuit injunctions to prevent injustice,” courts in civil law jurisdictions typically do not. Br. at 15–16. They do, however, recognize “the use of antisuit injunctions by courts in common law countries to restrain proceedings in civil law countries,” and have thus “developed other tools to achieve the equivalent of an antisuit injunction.” Br. at 16–17. Finally, the amici explain that, although European Union (EU) law prohibits the use of antisuit injunctions between EU member states, it does allow EU member states freedom to recognize such injunctions issued by non-member states. Br. at 27–29.
The Business Roundtable is represented by Professor Roger Alford of Pepperdine Law School. The International Law Scholar amici include: Professor Rudolf Dolzer (Professor of Law and Director, Institute of International Law, University of Bonn); Professor Burkhard Hess (Professor of Law and Executive Director, Institute for Foreign and International Private and Commercial Law, University of Heidelberg); Professor Herbert Kronke (Dean and Professor of Law and Director, Institute for Foreign and International Private and Commercial Law, University of Heidelberg); The Honorable Davis Robinson (Former Legal Adviser to the United States Department of State); Professor Christoph Schreuer (Former President of International Law, University of Vienna, Of Counsel, Wolf Theiss Rechtsanwalte); and Professor Janet Walker (Professor of Law, Osgoode Hall School of Law, York University). They are represented by Professor Julian Ku of Hofstra Law School.
In their amicus brief, the National Association of Manufacturers and the National Foreign Trade Council explain their strong interest in ensuring the fair and predictable application of legal standards governing anti-foreign-suit injunctions under international law. They emphasize that Steven Donziger and the other Appellants have not only abused the Ecuadorian court system, but are attempting to disable U.S. courts from preventing that abuse from spreading to courts worldwide. They argue that, under the prevailing legal standard, the preliminary injunction currently in place respects the shared jurisdiction of Ecuador and the U.S. over the controversy under international law—known as “concurrent prescriptive jurisdiction”—because the injunction only applies to outside nations known as “bystanders”; it does not purport to enjoin Ecuadorian courts from enforcement. Moreover, they further explain that even under the legal standard articulated by the Second Circuit in the China Trade case that Appellants say they prefer, the district court has already found—correctly—that the applicable test is satisfied because, among other things, the Appellants intend to pursue a vexatious multi-jurisdictional litigation strategy and the S.D.N.Y.’s resolution will be dispositive. Finally, the amici note that principles of international comity do not require U.S. courts to sit on their hands and wait for courts in bystander nations to determine enforcement in the first instance when the United States shares primary jurisdiction over the dispute under international law.
The NAM and NFTC are represented by Joseph Guerra and James Owens of Sidley Austin LLP.
Dow Chemical, Shell Oil, and Dole
In their brief, amici Dow Chemical Company, Shell Oil Company, and Dole Food Company, Inc., all major international companies in their respective industries, report that they have each faced similar litigation challenges around the world and been subject to suit in the U.S. for events transpiring abroad, including proceedings to enforce judgments entered in foreign courts. As such, each of these corporations has a distinct interest in the meticulous, exacting, and stable application of the doctrine of forum non conveniens and the standard for enforcement of foreign judgments. These companies explain that, given the vitality of international commerce and its ever increasing sensitivity to the effects of foreign judgments, sometimes, as here, totaling in the billions of dollars, the role of the U.S. courts in ensuring that foreign judgments are born of a system embodying the fundamental tenets of due process, impartiality, and fair play is increasingly crucial. The amici further explain that their recent experience in Nicaragua litigating claims alleging injury to farmworkers exposed to the pesticide DBCP is a chilling example of “litigation in a judicial system that has become so politicized and corrupt that it no longer provides a forum for impartial adjudication of disputes.” There, “[t]he poisonous combination of political influence and outright fraud…allowed plaintiffs and their counsel to secure billions of dollars in judgments against U.S. corporations, none of which received meaningful process in the Nicaraguan courts.” Moreover, these amici explain that, for the purposes of a motion under forum non conveniens, a court’s limited, front-end inquiry into the adequacy of a forum as a realistic situs for plaintiff to litigate its claims does not, and cannot, provide assurance that the ultimate judgment produced there will reflect the hallmarks of a true adversary proceeding evidencing adequate due process safeguards and adjudication before an impartial tribunal. These amici also argue that, while the Appellants and their amicus, EarthRights International, would prefer that the Court “conflate two judicial inquiries,” a determination on forum non conveniens grounds is not to be employed as a rubber stamp of approval when it comes to the question of enforcing a foreign judgment in U.S. courts. These amici explain that political winds blow in drastically different directions, often in a short period of time, leading to substantially changed circumstances, including corruption, in many foreign fora. Thus, any meaningful and searching judicial inquiry into whether a foreign judgment is worthy of international recognition must be targeted to the sufficiency of process and impartiality at the time the judgment was rendered. These amici argue that decisions originating in foreign courts should be held to the same standards of fair play and substantial justice as domestic decisions in order to ensure stability, safeguard independence and the rule of law, and promote international comity and reciprocity. These amici, still facing $15 billion in claims pending in Nicaraguan courts today, urge that “where the potential for corruption of judicial officers is significant, the enormous financial stakes make unjust outcomes all but inevitable in the absence of well-established traditions and mechanisms of judicial independence.”
The amici are represented by David W. Ogden, Edward C. DuMont, Jeffrey W. Gutchess, and Patrick F. Philbin.
Washington Legal Foundation
In its amicus brief, the Washington Legal Foundation (the “Foundation”), an organization dedicated to maintaining the integrity of the judicial process, argues that (1) the anti-suit injunction entered by Judge Kaplan did not violate international comity, (2) this is an appropriate case for declaratory relief, and (3) the Ecuadorian judgment is likely unenforceable under New York’s Recognition Act. The Foundation first argues that comity is not offended where, as here, parties “who do not seriously dispute that they have been engaged in a massive fraudulent exercise” attempt to enforce that judgment. Br. at 6. The injunction in this case “simply prevents Appellants from continuing to engage in their fraudulent scheme” until a trial on the merits. Id. at 7. The Foundation further argues that the district court properly exercised its broad discretion to enter declaratory judgments, because the declaratory judgment will “completely resolve” the dispute in the United States and prevent Appellants from perpetrating their fraud in numerous courts around the world. Id. at 8. Finally, the Foundation argues that, “[g]iven the district court’s numerous findings regarding the woeful shortcomings of the Ecuadorian court system” and the “largely uncontested” findings that “Appellants actively defrauded the Ecuadorian court,” the district court rightly determined that Chevron would succeed in proving that the Ecuadorian judgment is unenforceable under New York’s Recognition Act. Id. at 8-9. Here, the “evidence is overwhelming that the entire proceedings before the Ecuadoran court” were “infected by Appellants’ fraudulent activities.” Id. at 18.
The Washington Legal Foundation is represented by Daniel J. Popeo, Richard A. Samp, and Michael Wilt.