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Suraleb Inc. v. Production Associates "Minsk Tractor Works"

United States District Court, E.D. Wisconsin

December 18, 2017

SURALEB, INC., Plaintiff,
v.
PRODUCTION ASSOCIATES "MINSK TRACTOR WORKS, " REPUBLIC OF BELARUS, Defendant.

          ORDER DENYING WITHOUT PREJUDICE PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT (DKT. NO. 5) AND REQUIRING THE PLAINTIFF TO FILE AN AMENDED COMPLAINT BY FEBRUARY 2, 2018

          HON. PAMELA PEPPER UNITED STATES DISTRICT JUDGE

         I. Introduction

         On April 27, 2016, the plaintiff filed a complaint against defendant Minsk Tractor Works Republic of Belarus, alleging that the defendant is a company owned and operated by the Republic of Belarus. Dkt. No. 1. On May 18, 2017, the plaintiff filed a five-page document, much of it in Cyrillic, which appears to be a certificate of service; the documents states that whoever signed the certificate did so on June 28, 2016 “in conformity with article 6 of the Hague Convention.”[1] Dkt. No. 4. Four days later, the plaintiff filed a motion for default judgment. Dkt. No. 5. On August 9, 2017, the clerk's office-without being asked to do so-entered default. To date, the defendant has not entered a notice of appearance.

         II. Plaintiff's Motion for Default Judgment

         A. Jurisdiction

         The complaint alleges that the court has jurisdiction over the lawsuit under 28 U.S.C. §§1603(a) and (b). Dkt. No. 1 at 1. Neither of those statutes- which are part of the series of statutes known collectively as the Foreign Sovereign Immunities Act, or “FSIA”-provide bases for federal court jurisdiction. Rather, they define the terms “foreign state” and “agency or instrumentality of a foreign state.”

         The complaint also states that the court has jurisdiction under 18 U.S.C. §2334; this is a venue statute, not a grant of jurisdiction. It provides that United States nationals injured by international terrorism may file suit for such an injury in the district court for, among others, the district in which the defendant resides, is served or has an agent, or in the district where the plaintiff resides. The complaint does not allege that the plaintiff was injured by international terrorism; §2334 is inapplicable.

         Although the complaint does not state a basis for jurisdiction, 28 U.S.C. §1330(a) may provide one. That statute states that district courts have original jurisdiction, without regard to the dollar amount in controversy, over “any nonjury civil action against a foreign state as defined in section 1603(a) of this title as to any claim for relief in personam with respect to which the foreign state is not entitled to immunity either under sections 1605-1607 of this title or under any applicable international agreement.”

         In order for this court to have jurisdiction under §1330, the lawsuit must meet several criteria. First, it must be “a civil nonjury action.” Second, it must be “against a foreign state as defined in section 1603(a) of [Title 28].” Third, it must involve an in personam claim for relief-that is, it must be a suit against a specific individual or entity, as opposed to an in rem proceeding against property. Fourth, the defendant foreign state must not be entitled to immunity under either sections 1605 through 1607 of Title 28, or under any “applicable international agreement.”

         The complaint appears to meet the first criterion: it states a civil cause of action, and the plaintiff does not request a jury trial. It appears, then, that this case is a “nonjury civil action.”

         With regard to the second criterion, the complaint alleges that defendant Production Associates “Minsk Tractor Works” is “an agency or instrumentality of the Republic of Belarus, as it is wholly owned and operated by the Republic of Belarus.” Dkt. No. 1 at 1, ¶3. Under 28 U.S.C. §1603(b), an “agency or instrumentality of a foreign state” meets §1330's definition of a “foreign state.” Section 1603(b) defines an “agency or instrumentality of a foreign state” as “a separate legal person, corporate or otherwise, ” “a majority of whose shares or other ownership interest is owned by a foreign state” and “which is neither a citizen of a State of the United States . . . nor created under the laws of any third country.” The plaintiff's allegation that the defendant is a corporate entity wholly owned by the Republic of Belarus appears to satisfy this criterion.

         The complaint also appears to satisfy the third criterion-it is a suit against a specific entity, Production Associates “Minsk Tractor Works, ” and not an in rem suit against property.

         As to the last criterion, however, the complaint is silent. It makes no mention of 28 U.S.C. §§1605 through 1607, and does not address whether the defendant is entitled to immunity under those statutes or any applicable international agreement. Section 1604 of the FSIA provides that, absent any international agreements to the contrary as of the time FSIA was enacted, “a foreign state shall be immune from the jurisdiction of the courts of the United States and of the States except as provided in sections 1605 to 1607 of this chapter.” Section 1605 provides a laundry list of exceptions to §1604's general immunity provision. Section 1610(a) provides an additional exception: property of a foreign state (as defined by §1603(a)) that is in the United States and is used for a commercial activity in the United States, is not immune from attachment in aid of execution, or execution, of a judgment entered by a federal or state court, if the property meets one of seven possible criteria.

         In the prayer for relief, the plaintiff asks the court for an order of attachment and execution “as provided for pursuant to 28 USC 1610(c) involving the property owned by [the defendant] situated in Milwaukee, Wisconsin.” Dkt. No. 1 at 5. This request implies that the property the plaintiff seeks to attach, and upon which it seeks to execute judgment, falls into one of those seven categories and thus is not immune from suit. But ...


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