Africa Growth Corp. v. Republic of Angola, Civil Action No. 17-2469 (BAH)

• Decision Date: 19 July 2019
• Docket Number: Civil Action No. 17-2469 (BAH)
• Parties: AFRICA GROWTH CORPORATION, Plaintiff, v. REPUBLIC OF ANGOLA, et al., Defendants.
• Court: U.S. District Court — District of Columbia

AFRICA GROWTH CORPORATION, Plaintiff, v. REPUBLIC OF ANGOLA, et al., Defendants.

Civil Action No. 17-2469 (BAH)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

July 19, 2019

Chief Judge Beryl A. Howell

MEMORANDUM OPINION

The plaintiff, Africa Growth Corporation ("AFGC"), a U.S.-based, publicly-listed corporation which, through its subsidiaries, builds and manages apartments in Angola's capital city, Luanda, instituted this suit against three Angolan government officials and the Republic of Angola to recover damages for an alleged series of brazen fraudulent actions culminating in the outright seizure and occupation of AFGC's properties by the three individual defendants: Angolan Army General António Francisco Andrade ("General Andrade"), his son, Angolan Army Captain Miguel Kenehele Andrade ("Captain Andrade"), and daughter, Angolan State Prosecutor Natasha Andrade Santos ("Prosecutor Andrade") (collectively, "Andrade Defendants").¹ Angola has filed a Motion to Dismiss, ECF No. 42, for lack of subject matter jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1), arguing that it is immune from suit pursuant to the Foreign Sovereign Immunities Act ("FSIA"), 28 U.S.C. §§ 1602 et seq.² AFGCsubsequently filed a Motion for Voluntary Dismissal Without Prejudice ("Mot. Vol. Dismissal"), ECF No. 67, to dismiss only the claims against Angola, claiming that Angola and AFGC had "negotiated and freely entered into a settlement of all claims," id. at 1, for alleged breach of which AFGC has brought a separate action against Angola in the Southern District of Florida, see Mot. Vol. Dismissal, Ex. A, Complaint, Africa Growth Corporation v. Republic of Angola, Case No. 1:19-cv-21995-KMW (S.D. Fla. May 16, 2019), ECF No. 67-2. For the reasons set forth below, Angola's motion to dismiss for lack of subject matter jurisdiction is granted, and AFGC's motion for voluntary dismissal without prejudice is denied as moot.³

I. BACKGROUND

The factual allegations central to this case were outlined in the Court's Memorandum Opinion denying the plaintiff's Motion for Default Judgment, ECF No. 23, and granting Angola's Motion to Set Aside Default, ECF No. 28, see Africa Growth Corporation v. Republic of Angola (AFGC I), No. 17-cv-2469 (BAH), 2018 WL 6329453 (D.D.C. Dec. 3, 2018), and thus is only briefly summarized here.

AFGC operates in Angola through a series of subsidiaries incorporated in countries other than the United States.⁴ The Angolan apartment buildings named Isha 1, Isha 2, Isha 2.5, andPina, Compl. ¶¶ 27-29, ECF No. 1, allegedly seized by the Andrade Defendants, are owned and operated by AFGC's Angolan subsidiaries, see AFGC I, 2018 WL 6329453, at *1. Allegedly, "[u]nder color of his official position within the Angolan government," Compl. ¶ 41, the individual defendant General Andrade used both threats of violence, id. ¶¶ 41-45, and fraudulent Powers of Attorney, id. ¶ 35, to appoint himself as the director and General Manager of AFGC's three Angolan subsidiaries, AGPV, Illico, and Maximilio, in August 2017, id. ¶ 49. The individual defendant Prosecutor Andrade allegedly used her official position as a prosecutor to bring "a patently frivolous, false, baseless, and abusive criminal claim against various AFGC representatives," id. ¶ 62, "stat[ed] that she would have [an AFGC representative] killed," id. ¶ 63, and "facilitated the fraudulent transfer of the surface rights to [AFGC's properties] into her own name by personally appearing at the Angolan Property Registry and ordering that the change be made by and through a transfer of title," id. ¶ 97. The defendant Captain Andrade allegedly "threatened the safety of" AFGC's accountants in Angola, id. ¶ 108, instructing them "to send all the corporate records" to the Andrade Defendants' "personal accountant," id. ¶ 106, and "sent a false and defamatory complaint against AFGC to the Chairman of the SEC," id. ¶¶ 67-68, "aimed at discrediting and undermining AFGC and its shareholders with respect to its investment in Angola," id. ¶ 146(b). Thus, with limited exception, all of the conduct alleged in the complaint took place in Angola, all of the individual defendants are Angolan nationals residing in Angola, and all of the disputed property is located in Angola.

II. LEGAL STANDARD

A. Motion to Dismiss for Lack of Subject Matter Jurisdiction

To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1), the plaintiff bears the burden of demonstrating the court's subject matter jurisdiction over his claim. Arpaio v. Obama, 797 F.3d 11, 19 (D.C. Cir. 2015). "'Federal courts are courts of limited jurisdiction,' possessing 'only that power authorized by Constitution and statute.'" Gunn v. Minton, 568 U.S. 251, 256 (2013) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). Indeed, federal courts are "forbidden . . . from acting beyond our authority," NetworkIP, LLC v. FCC, 548 F.3d 116, 120 (D.C. Cir. 2008), and, therefore, have "an affirmative obligation 'to consider whether the constitutional and statutory authority exist for us to hear each dispute,'" James Madison Ltd. by Hecht v. Ludwig, 82 F.3d 1085, 1092 (D.C. Cir. 1996) (quoting Herbert v. Nat'l Acad. of Scis., 974 F.2d 192, 196 (D.C. Cir. 1992)). Absent subject matter jurisdiction over a case, the court must dismiss it. See Arbaugh v. Y & H Corp., 546 U.S. 500, 506-07 (2006); FED. R. CIV. P. 12(h)(3).

When considering a motion to dismiss under Rule 12(b)(1), the court must accept as true all uncontroverted material factual allegations contained in the complaint and "' construe the complaint liberally, granting plaintiff the benefit of all inferences that can be derived from the facts alleged' and upon such facts determine jurisdictional questions." Am. Nat'l Ins. Co. v. FDIC, 642 F.3d 1137, 1139 (D.C. Cir. 2011) (quoting Thomas v. Principi, 394 F.3d 970, 972 (D.C. Cir. 2005)). The court need not accept inferences drawn by the plaintiff, however, if those inferences are unsupported by facts alleged in the complaint or amount merely to legal conclusions. See Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002).

In evaluating subject matter jurisdiction, the court, when necessary, may "undertake an independent investigation to assure itself of its own subject matter jurisdiction," Settles v. U.S.Parole Comm'n, 429 F.3d 1098, 1107 (D.C. Cir. 2005) (quoting Haase v. Sessions, 835 F.2d 902, 908 (D.C. Cir. 1987)), and consider "facts developed in the record beyond the complaint," id. See also Herbert, 974 F.2d at 197 (concluding that in disposing of motion to dismiss for lack of subject matter jurisdiction, "where necessary, the court may consider the complaint supplemented by undisputed facts evidenced in the record, or the complaint supplemented by undisputed facts plus the court's resolution of disputed facts."). To do so, "the district court may consider materials outside the pleadings." Jerome Stevens Pharm., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005); see also Belhas v. Ya'Alon, 515 F.3d 1279, 1281 (D.C. Cir. 2008) (examining materials outside the pleadings in ruling on a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction); Coal. for Underground Expansion v. Mineta, 333 F.3d 193, 198 (D.C. Cir. 2003) (noting that courts may consider materials outside the pleadings in ruling on a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction).

B. The Foreign Sovereign Immunities Act

Under the FSIA, a foreign state and its political subdivisions, agencies, and instrumentalities are presumed to be immune from the jurisdiction of the United States courts. See TMR Energy Ltd. v. State Prop. Fund of Ukr., 411 F.3d 296, 299 (D.C. Cir. 2005) (citing Saudi Arabia v. Nelson, 507 U.S. 349, 355 (1993)); see also 28 U.S.C. § 1604. The "presumption is overcome only if the plaintiff shows that one of the exceptions to immunity provided in 28 U.S.C. §§ 1605-07 applies." TMR Energy, 411 F.3d at 299.

The FSIA's commercial activity exception sets out, in three separate clauses, three circumstances under which a foreign state is not "immune from the jurisdiction of courts of the United States," 28 U.S.C. § 1605(a)—when "the action is based upon" (1) "a commercial activity carried on in the United States by the foreign state," (2) "an act performed in the United States in connection with a commercial activity of the foreign state elsewhere," or (3) "an actoutside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect in the United States," id. § 1605(a)(2). "[C]ommercial activity" is "a regular course of commercial conduct or a particular commercial transaction or act." Id. § 1603(d). An activity's "commercial character" is "determined by reference to the nature of the course of conduct or particular transaction or act, rather than . . . to its purpose." Id. A foreign state's acts are "commercial" within the FSIA's meaning "when a foreign government acts, not as regulator of a market, but in the manner of a private player within that market." Republic of Argentina v. Weltover, Inc., 504 U.S. 607, 614 (1992). In other words, "the question is not whether the foreign government is acting with a profit motive or instead with the aim of fulfilling uniquely sovereign objectives," but "whether the particular actions that the foreign state performs (whatever the motive behind them) are the type of actions by which a private party engages in trade and traffic or commerce." Id. (emphasis in original) (citation and internal quotation marks omitted). The Supreme Court has explained that "an action is 'based upon' the 'particular conduct' that constitutes the 'gravamen' of the suit." OBB Personenverkehr AG v. Sachs, 136 S. Ct. 390, 396 (2015); see also Fry v. Napoleon Cmty. Sch., 137 S. Ct. 743, 755 (2017) ("[A] court's jurisdiction under the Foreign Sovereign Immunities Act turns on the 'grav...