Owens v. Republic of Sudan, 072817 FEDDC, 14-5105

Docket Nº:14-5105, 14-5106, 14-5107, 14-7124, 14-7125, 14-7127, 14-7128, 14-7207, 16-7044, 16-7045, 16-7046, 16-7048, 16-7049, 16-7050, 16-7052
Opinion Judge:Ginsburg, Senior Circuit Judge.
Party Name:James Owens, et al., Appellees v. Republic of Sudan, Ministry of External Affairs and Ministry of the Interior of the Republic of the Sudan, Appellants
Attorney:Christopher M. Curran argued the cause for appellants. With him on the briefs were Nicole Erb, Claire A. DeLelle, and Celia A. McLaughlin. Bruce E. Fein entered an appearance. Stuart H. Newberger and Matthew D. McGill argued the causes for appellees James Owens, et al. With them on the brief were...
Judge Panel:Before: Henderson and Rogers, Circuit Judges, and Ginsburg, Senior Circuit Judge.
Case Date:July 28, 2017
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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James Owens, et al., Appellees

v.

Republic of Sudan, Ministry of External Affairs and Ministry of the Interior of the Republic of the Sudan, Appellants

Nos. 14-5105, 14-5106, 14-5107, 14-7124, 14-7125, 14-7127, 14-7128, 14-7207, 16-7044, 16-7045, 16-7046, 16-7048, 16-7049, 16-7050, 16-7052

United States Court of Appeals, District of Columbia Circuit

July 28, 2017

Argued October 11, 2016

Appeals from the United States District Court for the District of Columbia (No. 1:01-cv-02244) (1:08-cv-01377) (1:10-cv-00356) (1:12-cv-01224) (1:08-cv-01349) (1:08-cv-01361) (1:08-cv-01380)

Christopher M. Curran argued the cause for appellants. With him on the briefs were Nicole Erb, Claire A. DeLelle, and Celia A. McLaughlin. Bruce E. Fein entered an appearance.

Stuart H. Newberger and Matthew D. McGill argued the causes for appellees James Owens, et al. With them on the brief were Clifton S. Elgarten, Aryeh S. Portnoy, Emily Alban, John L. Murino, Jonathan C. Bond, Michael R. Huston, Steven R. Perles, Edward B. MacAllister, John Vail, Thomas Fortune Fay, Jane Carol Norman, Michael J. Miller, and David J. Dickens. Annie P. Kaplan, John D. Aldock, and Stephen A. Saltzburg, entered appearances.

Before: Henderson and Rogers, Circuit Judges, and Ginsburg, Senior Circuit Judge.

OPINION

Ginsburg, Senior Circuit Judge.

Table of Contents

I. Background 5

A. The FSIA Terrorism Exception 6

B. History of this Litigation 11

II. Extrajudicial Killings 19

A. Textual Arguments 21

1. State action requirements under international law 21

2. International law and the TVPA 24

3. State action requirements in the TVPA and the FSIA terrorism exception 27

B. Statutory Purpose 31 C. Statutory History 33

III. Sufficiency of the Evidence Supporting Jurisdiction 36

A. The Evidentiary Hearing 39

1. The sources of evidence presented 39

2. The district court's findings of fact 42

B. Standard of Review 48

C. Admissibility of the Evidence 52

1. The expert testimony 53

2. The State Department reports 63

D. Sufficiency of the Evidence 66

1. Proximate causation 67

2. Sudan's specific intent 76

IV. Timeliness of Certain Claims 78

V. Jurisdiction and Causes of Action for Claims of Third Parties 88

A. Jurisdiction 89

B. Causes of Action 94

C. Intentional Infliction of Emotional Distress 98 VI. Punitive Damages 103

A. Whether to Review the Awards of Punitive Damages 104

B. Retroactivity of Punitive Damages Under § 1605A(c) 107

1. Section 1605A operates retroactively 108

2. Clear statement of retroactive effect 111

C. Retroactivity of Punitive Damages Under State Law 114

VII. Vacatur Under Rule 60(b) 115

A. Excusable Neglect Under Rule 60(b)(1) 116

B. Extraordinary Circumstances Under Rule 60(b)(6) 127

On August 7, 1998 truck bombs exploded outside the United States embassies in Nairobi, Kenya and in Dar es Salaam, Tanzania. The explosions killed more than 200 people and injured more than a thousand. Many of the victims of the attacks were U.S. citizens, government employees, or contractors.

As would later be discovered, the bombings were the work of al Qaeda, and only the first of several successful attacks against U.S. interests culminating in the September 11, 2001 attack on the United States itself. From 1991 to 1996, al Qaeda and its leader, Usama bin Laden, maintained a base of operations in Sudan. During this time, al Qaeda developed the terrorist cells in Kenya and Tanzania that would later launch the embassy attacks. This appeal considers several default judgments holding Sudan liable for the personal injuries suffered by victims of the al Qaeda embassy bombings and their family members.

I. Background

Starting in 2001 victims of the bombings began to bring suits against the Republic of Sudan and the Islamic Republic of Iran, alleging that Sudan, its Ministry of the Interior, Iran, and its Ministry of Information and Security materially supported al Qaeda during the 1990s. Specifically, the plaintiffs contended Sudan provided a safe harbor to al Qaeda and that Iran, through its proxy Hezbollah, trained al Qaeda militants. In bringing these cases, the plaintiffs relied upon a provision in the Foreign Sovereign Immunity Act (FSIA) that withdraws sovereign immunity and grants courts jurisdiction to hear suits against foreign states designated as sponsors of terrorism. 28 U.S.C. § 1605(a)(7). This provision and its successor are known as the "terrorism exception" to foreign sovereign immunity.

Initially, neither Sudan nor Iran appeared in court to defend against the suits. In 2004 Sudan secured counsel and participated in the litigation. Within a year, its communication with and payment of its attorneys ceased but counsel continued to litigate until allowed to withdraw in 2009. In the years that followed, several new groups of plaintiffs filed suits against Sudan and Iran. The sovereign defendants did not appear in any of these cases, and in 2010 the district court entered defaults in several of the cases now before us. After an evidentiary hearing in 2010 and the filing of still more cases, the court in 2014 entered final judgments in all pending cases. Sudan then reappeared, filing appeals and motions to vacate the judgments. The district court denied Sudan's motions to vacate, and Sudan again appealed.

Today we address several challenges brought by Sudan on direct appeal of the default judgments and collateral appeal from its motions to vacate. Most of Sudan's contentions require interpretation of the FSIA terrorism exception, to which we now turn.

A. The FSIA Terrorism Exception

Enacted in 1976, the FSIA provides the sole means for suing a foreign sovereign in the courts of the United States. Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 439 (1989). A foreign state is presumptively immune from the jurisdiction of the federal and state courts, 28 U.S.C. § 1604, subject to several exceptions codified in §§ 1605, 1605A, 1605B, and 1607.

When first enacted, the FSIA generally codified the "restrictive theory" of sovereign immunity, which had governed sovereign immunity determinations since 1952. Under the restrictive theory, states are immune from actions arising from their public acts but lack immunity for their strictly commercial acts. Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480, 487-88 (1983). Thus, the original exceptions in the FSIA withdrew immunity for a sovereign's commercial activities conducted in or causing a direct effect in the United States, 28 U.S.C. § 1605(a)(2), and for a few other activities not relevant here. See 28 U.S.C. § 1605(a)(1)-(6).

None of the original exceptions in the FSIA created a substantive cause of action against a foreign state. Rather, the FSIA provided "the foreign state shall be liable in the same manner and to the same extent as a private individual under like circumstances" except that it prohibited the award of punitive damages against a sovereign. 28 U.S.C. § 1606. As a result, a plaintiff suing a foreign sovereign typically relied upon state substantive law to redress his grievances. In this way, the FSIA "operate[d] as a 'pass-through' to state law principles, " Pescatore v. Pan Am. World Airways, Inc., 97 F.3d 1, 12 (2d Cir. 1996), granting jurisdiction yet leaving the underlying substantive law unchanged, First Nat'l City Bank v. Banco Para El Comercio Exterior de Cuba, 462 U.S. 611, 620 (1983).

Until 1996 the FSIA provided no relief for victims of a terrorist attack. Courts consistently rebuffed plaintiffs' efforts to fit terrorism-related suits into an existing exception to sovereign immunity. See, e.g., Saudi Arabia v. Nelson, 507 U.S. 349 (1993); Cicippio v. Islamic Republic of Iran, 30 F.3d 164 (D.C. Cir. 1994); Smith v. Socialist People's Libyan Arab Jamahiriya, 886 F.Supp. 306 (E.D.N.Y. 1995). This changed with the passage of the Antiterrorism and Effective Death Penalty Act (AEDPA) of 1996, Pub. L. No. 104-132, 110 Stat. 1214, which added a new exception to the FSIA withdrawing immunity and granting jurisdiction over cases in which money damages are sought against a foreign state for personal injury or death that was caused by an act of torture, extrajudicial killing, aircraft sabotage, hostage taking, or the provision of material support or resources . . . for such an act if such act or provision of material support is engaged in by an official, employee, or agent of such foreign state while acting within the scope of his or her office, employment, or agency.

Id. at § 221, 110 Stat. at 1241-43 (codified at ...

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