Commissions Import Export S.A. v. Republic Congo

• Citation: 757 F.3d 321
• Decision Date: 11 July 2014
• Docket Number: No. 13–7004.,13–7004.
• Parties: COMMISSIONS IMPORT EXPORT S.A., Appellant v. REPUBLIC OF THE CONGO and Caisse Congolaise d'Amortissement, Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

757 F.3d 321

COMMISSIONS IMPORT EXPORT S.A., Appellant

v.REPUBLIC OF THE CONGO and Caisse Congolaise d'Amortissement, Appellees.

No. 13–7004.

United States Court of Appeals, District of Columbia Circuit.

Argued March 14, 2014.

Decided July 11, 2014.

Appeal from the United States District Court for the District of Columbia (No. 1:12–cv–00743).

Francis A. Vasquez Jr. argued the cause for appellant. With him on the briefs was Jack Landman Goldsmith II.

Boaz S. Morag argued the cause for appellees. With him on the brief were Michael R. Lazerwitz and Jesse D.H. Sherrett.

Before: ROGERS, BROWN and MILLETT, Circuit Judges.

Opinion for the Court filed by Circuit Judge ROGERS.

ROGERS, Circuit Judge:

Commissions Import Export S.A. (“the Company”) prevailed in 2000 in an arbitration in Paris, France against the Republic of the Congo and Caisse Congolaise d'Amortissement (collectively “the Congo”). For over eight years, the Company sought with little success to collect on the arbitral award pursuant, in part, to an international treaty known as the New York Convention. After obtaining a judgment in 2009 from a court in England enforcing the arbitral award, the Company sued in the United States to enforce the foreign judgment under state law. The district court denied the Company's motion for summary judgment and dismissed the complaint on the ground that the three-year period to confirm a foreign arbitral award under Chapter 2 of the Federal Arbitration Act (“FAA”), 9 U.S.C. § 207, preempted the longer period to enforce a foreign money judgment under the D.C. Uniform Foreign–Country Money Judgments Recognition Act (“D.C. Recognition Act”), D.C.Code § 15–369.

The Company maintains that FAA Chapter 2 and the D.C. Recognition Act are two entirely separate regimes—one a federal scheme for enforcing foreign arbitral awards, the other a state regime for enforcing foreign court judgments—and that the federal regime does not preempt the longer enforcement period in the D.C. regime because the latter poses no obstacle to the accomplishment of the purposes of the former. We invited the United States to participate as amicus because an international treaty is at issue, and the United States agrees with our conclusion that the Company's attempt to enforce the foreign court judgment by a lawful, parallel enforcement scheme does not stand as an obstacle to accomplishment of the purposes of FAA Chapter 2. Accordingly, we reverse the dismissal of the Company's complaint and remand the case for further proceedings.

I.

As background to the discussion of preemption, we describe FAA Chapter 2 and the particular circumstances of this case.

A.

Chapter 2 of the FAA implements the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, opened for signatureJune 10, 1958, 21 U.S.T. 2517, 330 U.N.T.S. 38, otherwise known as the “New York Convention.” See9 U.S.C. §§ 201–208; Scherk v. Alberto–Culver Co., 417 U.S. 506, 520 n. 15, 94 S.Ct. 2449, 41 L.Ed.2d 270 (1974); TermoRio S.A. E.S.P. Grp., LLC v. Electranta S.P., 487 F.3d 928, 933–34 (D.C.Cir.2007). The Convention is a multilateral treaty that, with exceptions, obligates participating countries to honor international commercial arbitration agreements and to recognize and enforce arbitral awards rendered pursuant to such agreements. See N.Y. Conv'n Arts. I, II, III; see also S. Exec. Rep. NO. 10, at 3–4 (1968) (testimony of Amb. Richard D. Kearney, Office of the Legal Adviser, Dep't of State). The United States did not join the New York Convention when it was opened for signature in 1958, but did finally join in 1970 when Congress enacted the Act To Implement the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, Pub.L. No. 91–368, 84 Stat. 692 (1970) (“Foreign Arbitral Awards Convention Act”), as Chapter 2 of the FAA.

Chapter 2 provides in 9 U.S.C. § 201 that the Convention “shall be enforced in United States courts in accordance with this chapter,” and in section 202 limits the application of the Convention to international commercial disputes. It establishes a federal forum for disputes concerning arbitrations falling under the Convention, see id. §§ 203–204, while providing an optional right of removal by defendants for Convention-related disputes pending in a state court, see id. § 205. It also provides for a court to compel arbitration and appoint arbitrators. See id. § 206. Of significance here, it imposes a time limit for seeking confirmation of an arbitral award. Section 207 provides:

Within three years after an arbitral award falling under the Convention is made, any party to the arbitration may apply to any court having jurisdiction under this chapter for an order confirming the award as against any other party to the arbitration. The court shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in the said Convention.

Finally, Chapter 2 provides that Chapter 1, regarding non-Convention domestic arbitration, has residual application where there is no conflict with Chapter 2 or the New York Convention as ratified. See id. § 208.

B.

In the 1980s, the Company entered into contracts with the Republic of the Congo to perform public works and supply materials. The contracts were financed through supplier credits extended by Caisse Congolaise d'Amortissement (“CCA”) that were formalized through promissory notes issued by CCA and guaranteed by the Republic of the Congo. In 1992, the parties signed an agreement for the repayment over ten years in equal, consecutive monthly payments of certain outstanding debts owed to the Company under the contracts. Article 10 provided that any disputes arising from or relating to the agreement would be resolved by final binding arbitration under the Rules of the International Chamber of Commerce (“ICC”). CCA drew up promissory notes endorsed in favor of the Company, and in 1993 the Republic of the Congo issued a series of commitment letters; each commitment letter contained an irrevocable waiver of immunity from legal proceedings or execution and a commitment to submit all disputes to ICC arbitration in Paris, France, governed by French law.

When the Congo failed to pay the promised amounts as they came due, and did not respond to the Company's formal demand for payment, the Company filed a request in 1998 for arbitration with the International Court of Arbitration of the ICC and the matter was submitted to arbitration. On December 3, 2000, the arbitral tribunal in Paris issued a final award in favor of the Company (“the Award”). The Award included outstanding principal owed under the agreement, interest, penalty interest on various promissory notes, and costs. The Award was summarily confirmed by the Tribunal de Grande Instance of Paris on December 12, 2000, and was upheld on May 23, 2002 by the Court of Appeals of Paris after the Congo appealed to rescind the Award. The Company filed eleven judicial enforcement proceedings to enforce the Award in France, as well as 82 non-judicial bailiff actions.

The Company also obtained judicial recognition of the Award pursuant to the New York Convention in Belgium and Sweden, but obtained no recovery on the amounts owed. On June 17, 2009, the Company initiated proceedings pursuant to the Convention in the Queen's Bench Division of the High Court of Justice, Commercial Court in London, England. The High Court entered an order on July 10, 2009, ruling that the Award was enforceable in the same manner as a judgment under section 101 of the 1996 Arbitration Act of England, and recalculating the amount due to include additional interest and other costs (“the English Judgment”). Under English law, the judgment became final, conclusive, and enforceable on March 2, 2010, and remains enforceable for six years from that date. See Declaration of John Arthur Higham, Q.C. ¶¶ 13, 17. The High Court amended the judgment on November 1, 2011 to account for the Company's successful seizure of French Francs in partial satisfaction of the Award.

Shortly before, on September 2, 2011, the Company filed a complaint in the federal court in the Southern District of New York to recognize and enforce the English Judgment under the New York Uniform Foreign Country Money–Judgments Recognition Act, N.Y. C.P.L.R. Article 53. That court transferred the case to the federal court in the District of Columbia, see9 U.S.C. § 204, and the Company amended and supplemented its complaint to recognize and enforce the English Judgment under the D.C. Recognition Act. The D.C. Recognition Act provides that “[a]n action to recognize a foreign-country judgment” must be commenced before the judgment expires in the rendering country or within 15 years of the judgment's becoming effective in the foreign country, whichever is earlier. D.C.Code § 15–369. “[A] court of the District of Columbia,” subject to limited exceptions, “shall recognize a foreign-country judgment” that “[g]rants or denies recovery of a sum of money” and is final, conclusive, and enforceable where rendered. Id. §§ 15–363(a)(1)–(2); 15–363(b); 15–364(a).

The district court denied the Company's motion for summary judgment and dismissed the complaint on the ground that the three-year period for confirmation of foreign arbitral awards in 9 U.S.C. § 207 preempted the D.C. statute's longer enforcement period for foreign money judgments, D.C.Code § 15–369. See Commissions Import Export S.A. v. Republic of Congo, 916 F.Supp.2d 48, 55 (D.D.C.2013). The Company appeals, and this court has jurisdiction in view of the Congo's waiver of any claim of sovereign immunity in the commitment letters that accompanied the promissory notes. See28 U.S.C. § 1605(a)(1). Our review is de novo. See, e.g., Indep. Bankers Ass'n of Am. v. Farm Credit Admin., 164 F.3d 661, 666 (D.C.Cir.1999); Waterview Mgmt. Co. v. FDIC, 105 F.3d 696, 699 (D.C.Cir.1997).

II.

It is “[a] fundamental ...