Heroth v. Kingdom of Saudi Arabia

• Decision Date: 10 July 2008
• Docket Number: Civil Action No. 05-944 (GK).
• Citation: 565 F.Supp.2d 59
• Parties: Jerry HEROTH, Sr., et al., Plaintiffs, v. KINGDOM OF SAUDI ARABIA, et al., Defendants.
• Court: U.S. District Court — District of Columbia

565 F.Supp.2d 59

Jerry HEROTH, Sr., et al., Plaintiffs, v. KINGDOM OF SAUDI ARABIA, et al., Defendants.

Civil Action No. 05-944 (GK).

United States District Court, District of Columbia.

July 10, 2008.

COPYRIGHT MATERIAL OMITTED

Ronald Alvin Karp, Karp, Frosh, Lapidus, Wigodsky & Norwind, P.A., Rockville, MD, Steven R. Perles, Perles Law Firm, P.C., Washington, DC, for Plaintiffs.

Mark C. Hansen, Priya R. Aiyar, Rebecca A. Beynon, Michael K. Kellogg, Kellogg Huber Hansen Todd & Evans, PLLC, Washington, DC, for Defendants.

MEMORANDUM OPINION

GLADYS KESSLER, District Judge.

On May 12, 2003, terrorists associated with the Al-Qaeda network perpetrated a suicide truck bombing at a residential compound in Riyadh, Saudi Arabia. The compound housed civilian employees of Vinnell Corporation, a defense contractor and Northrop Grumman subsidiary, which was working to train and modernize the Saudi Arabian National Guard ("SANG"), a branch of the Saudi Armed Forces. The bombing tragically resulted in death or serious injury for a number of Vinnell employees.

Plaintiffs, Vinnell employees injured or killed in the attack and their family members, bring this wrongful death and personal injury action against the Kingdom of Saudi Arabia and SANG. They allege that Defendants failed to warn them of the inadequate security at the Riyadh compound and otherwise failed to provide adequate security. Plaintiffs also bring a breach of contract claim, as third party beneficiaries, for the breach of any express or implied duties to secure the compound expressed in any contracts existing between Vinnell and Saudi Arabia¹ or the United States and Saudi Arabia.

This matter is before the Court on Defendants' Motion to Dismiss [Dkt. No. 9] pursuant to Fed.R.Civ.P. 12(b)(1) and 12(b)(6). Upon consideration of the Motion, Opposition, Reply, and the entire record herein, and for the reasons set forth below, Defendants' Motion is granted and this case is dismissed for lack of subject matter jurisdiction.

I. BACKGROUND²

A. The Foreign Military Sales Program

Pursuant to the Arms Export Control Act, 22 U.S.C. §§ 2751 et seq., Congress has created the Foreign Military Sales ("FMS") Program, which provides a mechanism for the United States Government to sell defense articles and services to foreign governments. The United States Government may do so upon a finding by the President that the sale "will strengthen the security of the United States and promote world peace." 22 U.S.C. § 2753(a)(1). Participation in the FMS Program is limited to foreign governments and international organizations. See 22 U.S.C. § 2753(a); Security Assistance Management Manual, DoD 5105.38-M § C4.T2 (available at http://www.dsca.mil/ samm/).

Procurement under the FMS Program is governed by terms and conditions set out in a Letter of Offer and Acceptance ("LOA") between the United States Government and the foreign government. Id. § C5.4.³ Following the execution of the LOA, the United States procures defense articles and services directly from a defense contractor. The U.S. Government then sells these articles and services to the foreign government. Thus, for defense articles procured under the FMS Program, there are contractual relationships between the United States and the foreign government and between the United States and the defense contractor. Notably, there is no contract between the foreign government and the defense contractor.

As described in The Management of Security Assistance, published by the Defense Institute of Security Assistance Management:⁴

[The LOA] states that the foreign purchaser has essentially delegated the entire procurement process to the [Department of Defense ("DoD") ]. In this relationship the DoD[ ] will conduct the procurement on behalf of the customer using the same regulations and procedures that DoD uses to procure for itself. Under traditional FMS, the foreign purchaser is not responsible for any procurement actions following the acceptance of the LOA. ...[T]he DoD takes responsibility for conducting the entire procurement process to include contractor source selection, negotiating the contract terms and conditions, contract administration, quality control, inspection, acceptance and audit functions. As a very broad generalization, the traditional FMS process can be characterized as a foreign purchaser, by means of the LOA, employing the DoD to conduct a defense procurement on its behalf.

Chap. 15 at 9 (available at http://www. disam.dsca.mil/pubs/DR/15&Cumlhapter.pdf).

The FMS Program has certain distinct advantages over direct commercial sales between the foreign government and the defense contractor. Some defense articles may only be purchased through the FMS Program. Id. at 1-2. Participation in the FMS Program may also present political advantages to the foreign government and helps to build strong relationships between the United States military and its foreign counterpart. Id. at 2-3. Additional benefits to foreign governments include shorter procurement delays, lower prices through economies of scale achieved by the Department of Defense, and the opportunity to benefit from the DoD's familiarity with the U.S. defense procurement system Id. at 3-4.

B. Saudi Arabian National Guard Modernization Program

The Saudi Arabian National Guard ("SANG") is a branch of the Saudi Arabian Armed Forces. "Historically, SANG has had the dual mission of maintaining internal stability and defending against external threats." The OPM-SANG Mission, https://www.opmsang.sppn.af.mil/Mission/ Mission.htm. Following the September 11, 2001 terrorist attacks, SANG has increasingly focused on providing internal security within Saudi Arabia. Id.

In 1973, the Saudi and United States Governments signed both an LOA and an MOU to establish a program to assist with the modernization of the SANG. "The modernization program is open ended and includes training, supply, maintenance, operations, medical, construction, equipment fielding, equipment post fielding support, and a host of other related commercial acquisition activities." Compl. ¶ 25. The LOA contained an indemnification provision under which Saudi Arabia would indemnify and hold harmless the United States Government for any loss or liability which might arise in connection with the agreement. The LOA also provided that any disputes that arose under the agreement would be resolved under United States procurement law.

In 1975, Vinnell Corporation was awarded the SANG Modernization Program contract. Vinnell has managed the program for the past three decades under a series of subsequent contracts. The five-year contract awarded in 1998 had an estimated value of $831 million.

C. The May 12, 2003 Bombing

In 2003, a number of Vinnell employees were housed at a SANG residential compound located in Riyadh, Saudi Arabia (the "Vinnell Compound"). The Vinnell Compound was owned and controlled by the Defendants, who were responsible for its security. The Vinnell employees, including the Plaintiffs, were required to live in the Vinnell Compound.⁵

On May 1, 2003, the State Department warned of the possibility of imminent terrorist attacks against American interests in Saudi Arabia. The U.S. Government requested that the Saudi authorities bolster security at residential compounds housing foreign workers, but according to the Complaint, the Saudis failed to act.

At 11:15 p.m. on May 12, 2003, terrorists associated with Al-Qaeda fatally shot two SANG guards at the entrance to the Vinnell Compound in Riyadh. They opened the Compound's sliding metal gate from the then-unoccupied guard booth and drove a truck packed with explosives towards an apartment block located inside the complex. The truck-bomb was detonated next to the apartment block, leading to its destruction and that of several other buildings. The blast from the explosion could be felt several kilometers away. The Saudi Government later acknowledged that security lapses contributed to the success of the attack.

Two of the Plaintiffs, James Carpenter II and Quincy Knox, were killed by the explosion. Plaintiffs Felix Acevedo, James Alford, Eric Garza, Michael W. Luttrell, Nelson Lopez, Raphael A. Maldonado, Stanley C. Shider, Allen Ceruti, Kenneth Hunley, Donald Lam, Erick Nelson, Donald Viner, Terry Young, and Gary Coon all suffered serious physical and psychological injury in the attack. Plaintiff Jerry Heroth, Jr. was physically injured and suffered severe Post Traumatic Stress Disorder from the bombing. As a result, according to the Complaint, he later took his own life.

II. STANDARD OF REVIEW

In challenging a court's, subject matter jurisdiction under the Foreign Sovereign Immunities Act ("FSIA") 28 U.S.C. §§ 1602 et seq., the defendant bears the burden of establishing that none of the exceptions to sovereign immunity under the FSIA apply. Princz v. Fed. Republic of Germany, 26 F.3d 1166, 1171 (D.C.Cir. 1994). "If the defendant challenges only the legal sufficiency of the plaintiffs jurisdictional allegations, then the district court should take the plaintiffs factual allegations as true and determine whether they bring the case within any of the exceptions to immunity invoked by the plaintiff." Phoenix Consulting, Inc. v. Republic of Angola, 216 F.3d 36, 40 (D.C.Cir.2000). When the defendant contests jurisdictional facts alleged in the complaint, however, "the court must go beyond the pleadings and resolve any disputed issues of fact the resolution of which is necessary to a ruling upon a motion to dismiss." Id. A district court retains considerable discretion in "devising the procedures it will follow to ferret out the facts pertinent to jurisdiction." Id.

III. ANALYSIS

A. The Foreign Sovereign Immunities Act, 28 U.S.C. §§ 1602 et seq.

Foreign states are generally immune from suit in American courts, unless one of the exceptions enumerated in the Foreign Sovereign Immunities Act, 28 U.S.C. §§ 1602 et seq., applies. Saudi Arabia...