New Precedent On Limits of Sovereign Immunity Defense Involving Uzbekistan

George BenaurBusinessLeave a Comment

New York, New York, September 3, 2019

In the world of business with the former Soviet republics, the boundary between government and private business is at times murky.  We are tracking the recent legal developments on the issues of jurisdiction, the doctrine of forum non conveniens and sovereign immunity, and for the benefit of our clients and contacts are sharing this latest development from the summer, which involves Uzbekistan and an appeal pending in District of Columbia.

In Gretton v. Uzbekistan, the petitioner is an assignee of a $13 million arbitration award against Uzbekistan and is seeking to enforce it in the United States. Uzbekistan lost its motion to dismiss the case based on a sovereign immunity challenge and has now appealed the district court decision. The district court reasoned that Uzbekistan was not immune from suit due the exception in the Foreign Sovereign Immunities Act:

“Relevant here is the FSIA exception for actions to confirm certain arbitration awards. See 28 U.S.C. § 1605(a)(6). Specifically, foreign sovereigns are not immune from suits

in which the action is brought[ ] either to enforce an agreement made by the foreign state with or for the benefit of a private party to submit to arbitration all or any differences which have arisen or which may arise between the parties with respect to a defined legal relationship . . . or to confirm an award made pursuant to such an agreement to arbitrate, if . . . the agreement or award is or may be governed by a treaty or other international agreement in force for the United States calling for the recognition and enforcement of arbitral awards.

Id. Notably, once a petitioner produces evidence showing that an FSIA exception applies, “the defendant bears the burden of proving that the . . . allegations do not bring its case within a statutory exception to immunity.” Phoenix Consulting, Inc. v. Republic of Angola, 216 F.3d 36, 40 (D.C. Cir. 2000) (citing Transamerican S.S. Corp. v. Somali Democratic Republic, 767 F.2d 998, 1002 (D.C. Cir. 1985)); accord Chevron Corp. v. Ecuador, 795 F.3d 200, 204 (D.C. Cir. 2015).”

Copies of the district court decision and the notice of appeal are enclosed for review.  We shall be tracking this case for further developments.

 

Gretton Uzbekistan Appeal
Gretton Uzbekistan Decision

 

 

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