(PS) Rhuma v. State of Libya

[7] 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA [10] 11 TAHER RHUMA, et al., No. 2:20-cv-02366 JAM AC PS 12 Plaintiffs, 13 v. ORDER TO SHOW CAUSE (DIRECTED TO PLAINTIFFS) 14 STATE OF LIBYA, 15 Defendant. [16] 17 Plaintiffs are proceeding in this action pro se, and the matter was accordingly referred to 18 the undersigned for pretrial proceedings by E.D. Cal. R. 302(c)(21). At the status conference on 19 October 27, 2021, all three plaintiffs were present but defendant did not appear. ECF No. 16. At 20 the hearing, the court inquired about service and the status of defendant’s appearance in the case. 21 This order follows. 22 I. PROCEDURAL BACKGROUND 23 This case was filed on December 1, 2020. ECF No. 1. Plaintiffs are attempting to sue the 24 State of Libya under the Foreign Sovereign Immunities Act for events that transpired in Libya 25 decades ago; they seek compensation for the expropriation of a family business by the previous 26 regime, and for the death in custody of a family member. Id. On January 12, 2021, plaintiffs 27 filed a certificate of service. ECF No. 4. The return of service document states that personal 28 service was completed upon defendant at “Ministry of Foreign Affairs and International 1 Cooperation – Ash Shatt St, Tripoli, Libya. Received by Ramzi Mohammed Muktar.” Id. at 2. 2 The document is signed (presumably by server Younes Ahweej, although the signature itself is 3 illegible) and dated December 24, 2020. Id. The Declaration of Server portion of the return form 4 identifies the services provided as “special arrangements.” Id. 5 On January 29, 2021, the court received an unsigned document from defendant that 6 responded to the summons and was construed and docketed as an answer. ECF No. 5. It states, 7 in relevant part, that “Service of Process was served through a special agreement between the 8 State of Libya and the Plaintiffs; Taher Rhuma, Khadija Kanoun, and Mohamad Laham. The 9 service of the documents was delivered to the Foreign Affairs Office located in Ash Shatt ST, 10 Tripoli, Libya.” Id. at 4. 11 At the October 27, 2021 status conference, the court questioned plaintiffs about the 12 “special agreement” regarding service. Plaintiffs explained that service had been arranged with 13 the Libyan Ministry of Foreign Affairs by a Libyan attorney acting on plaintiffs’ behalf. 14 Plaintiffs stated that they do not know the identity of the individual or individuals within the 15 Libyan government who had been party to the service arrangement, and that they had no direct 16 communication with representatives of the State of Libya regarding the effectuation of service. 17 The Libyan lawyer, Mohammed Al-Mayat (phonetic), handled all arrangements regarding 18 service. 19 II. ADEQUACY OF SERVICE 20 The court is concerned that the defendant, the State of Libya, may not have been properly 21 served. It is fundamental that before a federal court may exercise personal jurisdiction over a 22 defendant, the procedural requirement of service of summons must be satisfied. Direct Mail 23 Specialists, Inc. v. Eclat Computerized Techs., Inc., 840 F.2d 685, 688 (9th Cir. 1988) (stating 24 that “[a] federal court does not have jurisdiction over a defendant unless the defendant has been 25 served properly” under Federal Rule of Civil Procedure 4, which requires service of summons 26 and complaint)). Although the rule is liberally construed, “substantial compliance” is required 27 and neither simply naming the defendant in the complaint or the defendant having actual notice is 28 sufficient. Id. 1 Pursuant to Federal Rule of Civil Procedure 4(j), a foreign state must be served in 2 accordance with 28 U.S.C. § 1608 . The reference to Section 1608 of the Judicial Code 3 incorporates the specific modes of service provided for in the Foreign Sovereign Immunities Act, [4] 28 U.S.C. § 1330 , et seq., which is “the exclusive source of subject matter jurisdiction over all 5 suits involving foreign states or their instrumentalities.” Gupta v. Thai Airways Int’l, Ltd., 487 6 F.3d 759, 763 (9th Cir. 2007) (citation and quotation omitted); 28 U.S.C. § 1603 (a). Section 7 1608(a) provides that service upon a foreign state shall be made in one of the four following 8 ways: 9 (1) by delivery of a copy of the summons and complaint in accordance with any special arrangement for service between the 10 plaintiff and the foreign state or political subdivision; or 11 (2) if no special arrangement exists, by delivery of a copy of the summons and complaint in accordance with an applicable 12 international convention on service of judicial documents; or 13 (3) if service cannot be made under paragraphs (1) or (2), by sending a copy of the summons and complaint and a notice of suit, together 14 with a translation of each into the official language of the foreign state, by any form of mail requiring a signed receipt, to be addressed 15 and dispatched by the clerk of the court to the head of the ministry of foreign affairs of the foreign state concerned; or [16] (4) if service cannot be made within 30 days under paragraph (3) by 17 sending two copies of the summons and complaint and a notice of suit, together with a translation of each into the official language of 18 the foreign state, by any form of mail requiring a signed receipt, to be addressed and dispatched by the clerk of the court to the Secretary 19 of State in Washington, District of Columbia, to the attention of the Director of Special Consular Services—and the Secretary shall 20 transmit one copy of the papers through diplomatic channels to the foreign state and shall send to the clerk of the court a certified copy 21 of the diplomatic note indicating when the papers were transmitted. [22] 28 U.S.C. § 1608 (a). 23 The proof of service filed in this case states that service was accomplished by “special 24 arrangements,” ECF No. 4 at 2, suggesting service under § 1608(a)(1). However, no details of 25 the special arrangement are provided, and subsequent events cast significant doubt on the efficacy 26 of service. Although the court received a document responsive to the complaint and summons, 27 which appears on its face to come from the Libyan Ministry of Foreign Affairs, ECF No. 5, the 28 document is unsigned, does not specify the name or title of the official who submitted it, does not 1 appear to have been prepared by counsel licensed to practice in this court, and is not in the form 2 of an answer. When a foreign state has been effectively served with a complaint under the 3 Foreign Sovereign Immunities Act, that complaint is generally transmitted by the receiving entity 4 (here, according to the proof of service, the Ministry of Foreign Affairs) to the governmental 5 entity formally designated to appear in litigation on behalf of the government (typically the 6 Department or Ministry of Justice), which then retains counsel to represent it in the forum 7 country. Absent any appearance through counsel of the Libyan designated entity, it is far from 8 clear that service was effective. Moreover, a court order mailed to defendant at the address 9 provided for service was returned as undeliverable, and the time for defendant to submit a notice 10 of change of address has expired. See Docket entry dated August 25, 2021. 11 Service in this case cannot be considered adequate under any alternative subsection of the 12 statute. Section 1608(a)(2) authorizes service in accordance with an applicable international 13 convention. The Convention on the Service Abroad of Judicial and Extrajudicial Documents in 14 Civil or Commercial Matters typically governs international service of process, including service 15 on a foreign sovereign defendant, but the State of Libya is not a contracting party. See Hague 16 Conf. on Private Int’l Law, http://www.hcch.net/index_en.php?act=conventions.status&cid=17. 17 The complaint and summons were not dispatched by the clerk of the court to the head of the 18 ministry of foreign affairs for the State of Libya pursuant to § 1608(a)(3), or to the Secretary of 19 State in Washington, D.C. for service through diplomatic channels pursuant to §1608(a)(4). 20 Accordingly, so that the court can evaluate the adequacy of service and determine whether 21 it may exercise jurisdiction over the State of Libya, plaintiffs will be directed to provide 22 additional information about the “special arrangement” for service. 23 III. CASE OR CONTROVERSY REQUIREMENT 24 At the status conference, the undersigned also raised the question whether this case 25 presents an active case or controversy for the court to resolve. Article III of the Constitution 26 limits jurisdiction in federal courts to “cases” and “controversies.” U.S. Const., Art. III, § 2. The 27 document construed by the Clerk’s Office as an answer, which is on letterhead bearing the name 28 Government of National Accord, Ministry of Foreign Affairs, states that the Libyan State waives 1 sovereign immunity, admits all factual allegations of the complaint, acknowledges full liability 2 for all damages alleged in the complaint, and agrees with plaintiffs’ position on interest and 3 adjustment for inflation. ECF No. 5 at 2-3. When asked why plaintiffs were pursuing litigation 4 rather than settling directly with defendant if there was complete agreement between the parties 5 as to both liability and the measure of damages, plaintiff Mr. Rhuma stated that federal court 6 intervention was needed to access Libyan funds frozen in the United States for payment of the 7 agreed upon compensation. The document purportedly submitted on behalf of Libya “agrees to 8 the request by the plaintiffs in allowing the Libyan state assets frozen in the United States to be 9 used as a method of compensation.” ECF No. 5 at 3. 10 Assuming that this court has jurisdiction to approve a stipulated judgment in an 11 appropriate case, and that such judgment is a necessary predicate for plaintiffs to pursue frozen 12 assets,1 the case cannot proceed without the appearance through counsel of the Libyan designated 13 entity. Only private individuals such as the plaintiffs may appear without a lawyer. C.E. Pope 14 Equity Trust v. United States, 818 F.2d 696 (9th Cir. 1987). A foreign state, like any other entity 15 defendant, must be represented by counsel who is licensed to practice in this court. See Rowland 16 v. Cal. Men’s Colony, Unit II Men’s Advisory Council, 506 U.S. 194, 201-202 (1993) (entities 17 may appear in federal courts only through licensed counsel). This court therefore cannot accept 18 representations by Libyan officials that are not made through counsel. These considerations 19 dovetail with the required inquiry into the adequacy of service, because neither justiciability nor 20 the availability of relief can be assessed absent proper appearance by the defendant. 21 IV. ORDER TO SHOW CAUSE 22 In accordance with the above, IT IS HEREBY ORDERED that plaintiffs must show cause 23 in writing within 60 days of this order why this case should not be dismissed for lack of proper 24 service. Because plaintiffs requested at the status conference clear directions about what they 25 should submit to the court, the following detailed guidance is provided. Plaintiffs’ response [26] 27 1 See, e.g., Bennett v. Islamic Republic of Iran, 927 F. Supp. 2d 833, 843 (N.D. Cal. 2013), aff'd, 799 F.3d 1281 (9th Cir. 2015), opinion withdrawn and superseded, 817 F.3d 1131 (9th Cir. 2016), 28 and aff'd, 817 F.3d 1131 (9th Cir. 2016), and aff'd, 825 F.3d 949 (9th Cir. 2016). 1 should include, but is not limited to, sworn declarations from individuals with personal 2 knowledge, whether plaintiffs themselves and/or the Libyan attorney who arranged service of the 3 complaint,2 that address the following questions: 4 1. What communications, if any, have the plaintiffs had (personally or through a third 5 party) with Libyan government officials regarding the pursuit, filing, and/or service of 6 this lawsuit? Please identify such officials by name and title.3 7 2. How was service of the summons and complaint arranged? 8 3. What were the terms of the arrangement for service? If the arrangement was put in 9 writing, or is reflected in written communications including email, please provide 10 copies (translated into English if necessary). 11 4. With what Libyan official(s) was the special arrangement made? Please identify any 12 such official by name and title. 13 5. The proof of service form identifies Ramzi Mohammed Muktar as the individual who 14 received the summons and complaint from the process server. Do plaintiffs or their 15 Libyan attorney know Mr. Muktar’s position at the Ministry of Foreign Affairs, and by 16 what authority he accepted service? 17 6. The docket for this action lists Modammed [sic] Ammah Al-Shraidi as the contact 18 person for defendant, presumably because he signed a form that was returned to the 19 court with the response to the summons.4 Do plaintiff or their Libyan attorney know 20 who this individual is, including his title, and have they been in contact with him 21 2 As noted, Mr. Rhuma represented that the Libyan attorney rather than any of the plaintiffs made the arrangements for service. It therefore appears that the lawyer’s declaration is necessary for [22] determination of the terms of the agreement, with whom it was negotiated, and related matters 23 going to the legal effectiveness of service. If such a declaration is written in a language other than English, both the original and an English translation must be provided. If plaintiffs require 24 additional time for this purpose, they may request an extension of time. 3 The record is already replete with documentation of plaintiffs’ attempts to secure compensation [25] from the Libyan government over many years. This question is limited to communications 26 regarding the intent to file and serve this lawsuit. 4 This name does not appear on the document that was filed as an answer. The undersigned has 27 been informed by the Clerk’s Office that the name was obtained from an administrative form that was included with the response to the summons but to which the undersigned does not have 28 access. See ECF No. 6. ] regarding service of and/or response to the complaint? 2 7. In making arrangements for service, what constitutional or statutory authority (if any) 3 did plaintiffs rely on for the belief that the person who accepted service on behalf of 4 the State of Libya is legally authorized to do so? Do plaintiffs know whether that 5 person is the officially designated entity for purposes of representing the State of 6 Libya in international litigation? 7 Plaintiffs are free to present any other facts or legal authority that is directly relevant to 8 | the questions whether service was effective and defendant’s appearance legitimate. 9 | ITIS SO ORDERED. 10 | DATED: December 20, 2021 thin Chane ALLISON CLAIRE 12 UNITED STATES MAGISTRATE JUDGE