Nemariam v. Federal Democratic Republic, Ethiopia

• Citation: 315 F.3d 390
• Decision Date: 24 January 2003
• Docket Number: No. 01-7142.,01-7142.
• Parties: Hiwot NEMARIAM, et al., Appellants, v. THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA and The Commercial Bank of Ethiopia, Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

315 F.3d 390

Hiwot NEMARIAM, et al., Appellants, v. THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA and The Commercial Bank of Ethiopia, Appellees.

No. 01-7142.

United States Court of Appeals, District of Columbia Circuit.

Argued October 18, 2002.

Decided January 24, 2003.

Appeal from the United States District Court for the District of Columbia (No. 00cv01392).

Donald Francis Donovan argued the cause for appellants. With him on the briefs was Katherine Birmingham Wilmore.

W. DeVier Pierson argued the cause for appellees. With him on the brief was Knox Bemis.

Before: GINSBURG, Chief Judge, HENDERSON, Circuit Judge, and WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Chief Judge GINSBURG.

GINSBURG, Chief Judge:

Hiwot Nemariam and others appeal the district court's dismissal of their suit against Ethiopia seeking recovery for property damage they suffered during the border war between Ethiopia and Eritrea. The district court determined that the Ethiopia/Eritrea Claims Commission was a more appropriate forum for the plaintiffs' claims, and dismissed their case on the ground of forum non conveniens. We reverse the judgment of the district court because the Commission does not offer the plaintiffs an adequate remedy.

I. Background

In May 1998 a long-standing border dispute between Eritrea and Ethiopia erupted into a general armed conflict. Nemariam, who was living in Ethiopia at that time, claims that shortly thereafter the government of Ethiopia began expelling persons who, like her, were Ethiopian citizens of Eritrean descent, and confiscating any property they left behind. To take but one example, Nemariam claims that her account at the Commercial Bank of Ethiopia (CBE), an agency or instrumentality of the government, was effectively expropriated when she was expelled from the country because Ethiopian banking regulations permit withdrawal of funds only when an account holder presents a passbook in person at the bank.

In December 2000 Ethiopia and Eritrea signed a Peace Agreement, which formally ended the conflict. It also created the Ethiopia/Eritrea Claims Commission:

The mandate of the Commission is to decide through binding arbitration all claims for loss, damage or injury by one Government against the other, and by nationals (including both natural and juridical persons) of one party against the Government of the other party or entities owned and controlled by the other party that are (a) related to the conflict that was the subject of the Framework Agreement, the Modalities for its Implementation and the Cessation of Hostilities Agreement, and (b) result from violations of international humanitarian law, including the 1949 Geneva Conventions, or other violations of international law.

Art. 5, ¶ 1. The decisions of the Commission are made by a panel of five arbitrators, two chosen by each country and one chosen by the other four. Art. 5, ¶ 2. The Commission, which is based in the Hague, "may hold hearings or conduct investigations in the territory of either party, or at such other location as it deems expedient." Art. 5, ¶ 3.

Ethiopia and Eritrea are the only two parties permitted to appear before the Commission, but they may bring claims "on behalf of [their] nationals, including both natural and juridical persons." Art. 5, ¶ 8. Eritrea or Ethiopia may also "file claims on behalf of persons of Ethiopian or Eritrean origin who may not be its nationals." Art. 5, ¶ 9. The Agreement vested in the Commission exclusive jurisdiction over all claims arising from the conflict "[e]xcept for claims submitted to another mutually agreed settlement mechanism in accordance with paragraph 16 or filed in another forum prior to the effective date of this Agreement." Art. 5, ¶ 8. Therefore, any claim not filed in another forum prior to December 12, 2000, the effective date of the Agreement, could be filed only with the Commission. Paragraph 16 of Article 5 allows Eritrea and Ethiopia to "agree at any time to settle outstanding claims, individually or by categories, through direct negotiation or by reference to another mutually agreed settlement mechanism."

In June 2000 Nemariam filed a two-count complaint against Ethiopia and the CBE in the District Court for the District of Columbia, asserting that Ethiopia's actions amounted to a taking of her property in violation of international law. Nemariam invoked the jurisdiction of the court under the international takings provision of the Foreign Sovereign Immunities Act, 28 U.S.C. § 1605(a)(3).

Ethiopia moved to dismiss the case on the ground that the district court was a forum non conveniens, pursuant to the four-step test we outlined in Pain v. United Technologies Corp.:

As a prerequisite, the court must establish whether an adequate forum exists which possesses jurisdiction over the whole case. Next, the trial judge must consider all relevant factors of private interest, weighing in the balance a strong presumption against disturbing plaintiff's initial forum choice. If the trial judge finds this balance of private interests to be in equipoise or near equipoise, he must then determine whether or not factors of public interest tip the balance in favor of a trial in a foreign forum. If he decides that the balance favors such a foreign forum, the trial judge must finally ensure that plaintiffs can reinstate their suit in the alternative forum without undue inconvenience or prejudice.

637 F.2d 775, 784-85 (D.C.Cir.1980) (emphases in original); but see Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241, 102 S.Ct. 252, 258, 70 L.Ed.2d 419 (1981) (overruling the third part of the Pain test by stating that dismissal is appropriate if the plaintiff's "chosen forum [is] inappropriate because of considerations affecting the court's own administrative and legal problems").

The district court granted the motion. The court first determined that the Commission was an adequate alternative forum; it had five distinguished arbitrators, all well versed in international law, and it was authorized to hold hearings and to resolve claims. Although Nemariam could not bring a claim herself, the district court found that Eritrea could bring a claim on her behalf, that the Commission had jurisdiction to hear that claim, and that Eritrea "has no incentive not to espouse as many meritorious claims as possible before the Commission."

The district court rejected Nemariam's argument that the remedy provided by the Commission was inadequate because Eritrea and Ethiopia might negotiate a set-off of each other's claims, thereby denying her an award even if she had a meritorious claim. The district court stated, "nothing in the record ... suggest[s] that the Commission contemplates a `set off' remedy;" and "even if compensation under the Claims Commission proves different than it might be in a U.S. court, this is not a case where the `remedy provided by the alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all.'" (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254, 102 S.Ct. 252, 265, 70 L.Ed.2d 419 (1981)). Next, the court found the private and public interest factors heavily favored the Commission. Finally, the court dismissed the case without prejudice and provided that "the case is subject to reinstatement for good cause shown if named plaintiffs' claims are not submitted to the Claims Commission by the government of Eritrea despite affirmative, timely request therefore [sic] by plaintiffs."

In the time since the district court dismissed the case, the Commission has implemented procedures and begun the adjudication of claims submitted to it. Eritrea's submissions cover the claims made by Nemariam and the other plaintiffs in this suit. And the Commission has ordered the filing of evidence for those claims and has scheduled a 13-day hearing to begin on June 16, 2003.

II. Analysis

On appeal Nemariam first argues that the Commission is an inadequate forum because, even if her claim is valid, she has no personal right to a remedy from the Commission. Second,...