2003
International Law Update, Volume 9, Number 6 (June)
Legal Analyses published by Mike Meier,
Attorney at Law. Copyright 2017 Mike Meier. www.internationallawinfo.com.
ALIEN
TORT CLAIMS ACT
In
long-pending case involving transborder abduction of Mexican citizen by DEA
agents, Ninth Circuit, sitting en banc, held that abduction itself did not
breach “law of nations” under Alien Tort Claims Act but that unlawful arrest
and detention did and that Federal Tort Claims Act also provided a remedy
against U.S.
The
following case has been litigated in U.S. courts in various forms for over a
decade. It involves the transborder abduction of the Mexican citizen Humberto
Alvarez-Machain (“Alvarez”) by agents of the U.S. Drug Enforcement Agency
(DEA).
In
United States v. Alvarez-Machain, 504 U.S. 655, 669 (1992), the U.S. Supreme
Court held that the abduction did not deprive the district court of criminal
jurisdiction over Alvarez. It had also noted, without deciding, that Alvarez
“may be correct” in claiming that his abduction was “in violation of general
international law principles.”
The
following consolidated appeal addresses the questions remaining in this case.
For example, the Court has to rule on whether the abduction constituted “a
violation of the law of nations.” Such a violation is a predicate to federal
court jurisdiction under the Alien Tort Claims Act (ATCA) [28 U.S.C. Section
1350]. The Court must also examine the DEA’s statutory authority, if any, to
make a warrantless arrest outside U.S. borders.
In
1985, Alvarez, a Mexican national, was a medical doctor practicing in
Guadalajara, Mexico. He allegedly assisted in the torture and murder of DEA
Special Agent Camarena-Salazar in February of that year. Five years later,
without an extradition request or other involvement of Mexican authorities, and
over the protest of the Mexican government, Mexican citizens acting on behalf
of the DEA abducted Alvarez and handed him over to U.S. officials to stand
trial on criminal charges. After his acquittal, Alvarez sued his former
American captors for the abduction.
Francisco
Sosa, a former Mexican policeman who had taken part in the abduction, appealed
the judgment against him, arguing, inter alia, that the district court should
have applied Mexican law to the calculation of damages. He also called for a
narrow reading of the phrase “law of nations” as used in ATCA, equating it with
the non-derogable norms of international law or jus cogens.
In
addition, Alvarez appealed the dismissal of his Federal Tort Claims Act (FTCA)
claims. He also challenged the district court’s substitution of the United States
for the DEA agents, as well as its limitation of his damages to those suffered
during his imprisonment in Mexico.
A
Circuit panel affirmed Sosa’s liability on the ATCA claims. In Alvarez’ case,
it upheld the rulings on damages, the dismissal of his FTCA claims, and the
substitution of defendant. In an en banc opinion by eleven judges, the U.S.
Court of Appeals for the Ninth Circuit affirms in part and reverses in part in
a 6 to 5 vote.
Alvarez
claimed that he had an ATCA remedy for two separate violations of international
law. The first was the U.S. - sponsored abduction within the territory of
another state without its consent. Alvarez branded this as a violation of the
international law of sovereignty and of the customary norms of international human
rights law. Second, he maintained that the arbitrary arrest and confinement was
a distinct violation of international customary law.
The
Court first rules that Alvarez lacked standing to seek redress for the alleged
violations of Mexican sovereignty. “To allow state-on-state injuries like the
one Alvarez alleges here to be vindicated by a third party not only would read
too much into the ATCA, but would lead to the judiciary’s intrusion into
matters that are appropriately reserved for the Executive branch.”
“Although
international human rights litigation under the ATCA inevitably raises issues
implicating foreign relations, sovereigns’ prerogatives are ordinarily and
traditionally handled through diplomatic channels. The right of a nation to
invoke its territorial integrity does not translate into the right of an
individual to invoke such interests in the name of the law of nations.” [Slip
op. 30-31]
Alvarez
next claimed that the act of transborder kidnapping itself had breached
customary international human rights law. That law, he asserted, recognizes a
personal right to be free from abduction under the law of nations. The Court,
however, is not persuaded.
“The
United States claims that unilateral, transborder abductions are a ‘rare’
occurrence. And the notion of sneaking across the border to nab a criminal
suspect surely raises more than a diplomatic eyebrow. Nonetheless, our review
of the international authorities and literature reveals no specific binding
obligation, express or implied, on the part of the United States or its agents
to refrain from transborder kidnapping.”
“Nor
can we say that there is a ‘universal’ consensus in the sense that we use that
term to describe well-entrenched customs of international law. Any agreement
that may exist on this score has failed to surface in the declarations and
accords that commonly manifest the mutual concern of states. ... Because a
human rights norm recognizing an individual’s right to be free from transborder
abductions has not reached a status of international accord sufficient to
render it ‘obligatory’ or ‘universal,’ it cannot qualify as an actionable norm
under the ATCA. This is a case where aspiration has not yet ripened into
obligation.” [Slip op. 40-41].
Alvarez,
however, is not without a remedy because the abduction and confinement were
arbitrary and violation of the law of nations under ATCA. “Unlike transborder
arrests, there exists a clear and universally recognized norm prohibiting
arbitrary arrest and detention. This prohibition is codified in every major
comprehensive human rights instrument and is reflected in at least 119 national
constitutions. ...”
“The
Universal Declaration [of Human Rights], perhaps the most well-recognized
explication of international human rights norms, provides that ‘no one shall be
subjected to arbitrary arrest, detention or exile,’ Universal Declaration, art.
9, and the ICCPR [International Convention on Civil and Political Rights],
which the United States has ratified, ... unequivocally obliges states parties
[in its Article 9] to refrain from ‘arbitrary arrest or detention.’” [Slip op.
43-44]
The
legal standard is thus whether the arrest and detention was “arbitrary,” i.e.,
not based on law. Here, the Court concludes that the DEA had no authority to
arrest and detain Alvarez and that he may seek relief in federal court.
“The
only instrument Sosa can point to as evidence that Alvarez’s abduction was
‘pursuant to law’ is an arrest warrant issued by the United States District Court
for the Central District of California. But a federal arrest warrant, without
more, hardly serves as a license to effectuate arrests world-wide.”
“It
is no accident that the warrant is directed to ‘The United States Marshal and
any Authorized United States Officer’ (emphasis added). The Federal Rules of
Criminal Procedure in effect at the time of Alvarez’s arrest provided that ‘[a]
warrant may be executed ... within the jurisdiction of the United States.’
Fed.R.Crim.P. (4)(d)(2). ... The language could hardly be clearer.” [Slip op.
48-49].
As
for the ATCA damages for Sosa’s actions, the Court must first determine whether
Mexican or U.S. law applies. “The precise issue before us, the choice of law
for damages under the ATCA, is one of first impression. ... Perhaps the most
explicit treatment of the issue was offered by the district court in the
Filartiga litigation. When faced with the question of damages on remand, the
district court decided, in light of the ATCA’s purpose, that federal choice of
law principles should govern the initial determination of the remedy. [See
Filartiga v. Pena-Irala, 577 F.Supp. 860, 863 (E.D.N.Y. 1984)].” [Slip op.
76-78]
Since
ATCA invokes international law principles of universal concern, the Court
observes, the application of federal common law is appropriate. Under that
judge-made law, the federal courts generally guide themselves by the
Restatement (Second) of Conflict of Laws.
Section
145 of the Restatement states that the “rights and liabilities of the parties
with respect to an issue in tort are determined by the local law of the state
which, with respect to that issue, has the most significant relationship to the
occurrence and the parties under the principles stated in Section 6.”
In
Section 6, the Restatement suggests that the courts should consider certain
“contacts” in determining the state with the “most significant relationship,”
e.g., the place of the injury, the domicile of the parties, and the place where
the relationship of the parties is centered.
“After
weighing these factors, we concluded that the relative importance of United
States contacts and interests counsels in favor of applying United States law.
Our ruling today does not foreclose the application of foreign law in another
circumstance; it is simply the appropriate outcome given the factors and
policies present in this suit.” [Slip op. 85]
The
Court next considers whether the FTCA [28 U.S.C. Sections 1346(b)(1) and
2671-2680] furnishes a remedy for the abduction. With certain exceptions, the
FTCA waives the sovereign immunity of the U.S. for certain torts committed by
its employees in the course of their duties. Moreover, the “headquarters
doctrine,” when applied to FTCA issues, imposes liability on the U.S. when
federal employees working from offices in the U.S. guide and supervise the
commission of tortious actions in other countries.
“Alvarez’s
abduction fits the headquarters doctrine like a glove. Working out of DEA
offices in Los Angeles, [DEA agents] made the decision to kidnap Alvarez and
... gave ... precise instructions on whom to recruit, how to seize Alvarez, and
how he should be treated during the trip to the United States. DEA officials in
Washington, D.C., approved the details of the operation.” [Slip op. 97] Thus, Alvarez
may on remand try to establish a remedy under the FTCA.
Citation:
Alvarez-Machain v. United States, 2003 WL 21264256 (9th Cir. June 3, 2003).
COPYRIGHT
In
dispute over copyrights to Mexican movies under Uruguay Round Agreement Act
provisions on copyright restoration, Fifth Circuit holds that, pursuant to
Mexican copyright law, juridical persons can be “authors” and that works
already in Mexican public domain can no longer obtain copyright protection in
U.S.
The
U.S. passed the Uruguay Round Agreement Act (URAA) [Pub.L. 103-465, 108 Stat.
4809 (1994)] and thereby amended the 1976 Copyright Act (see 17 U.S.C. Section
104A). Effective January 1, 1996, the URAA streamlined the obtaining of
copyright protection for foreign works in the U.S. It also allowed for
automatic restoration of copyrights that had fallen into the public domain in
the U.S. for noncompliance with copyright procedures. [See 1996 International
Law Update 59, reporting on publication of list by U.S. Copyright Office for
restoration of copyrights, including Alameda Films SA movies, at 61 Federal
Register 19372.]
Thereafter,
the Authors Rights Restoration Corporation, Inc. and others (defendants)
obtained assignments of “rights” to the films from individual contributors,
such as screen writers and music composers. They failed to obtain assignments
or licenses from 24 Mexican film production companies (plaintiffs), however,
and kept on distributing the films after January 1, 1996.
Defendants
distributed a variety of Mexican films in the U.S., including 88 films which
plaintiffs had produced and released in Mexico during Mexico’s “golden age” of
cinema from the late 1930s to the mid-1950s. Of those films, 69 had lost their
copyright protection in the U.S. since the authors had failed to comply with
U.S. copyright formalities.
In
1998, plaintiffs brought an action against defendants claiming that defendants
have been violating the restored U.S. copyrights in the 88 films. In response,
defendants made two points.
First,
they alleged that, under Mexican law, the term “author” included only natural
persons such as the individual contributors, and not juridical persons such as
film production companies. Second, they contended that seven of the films had
entered the public domain in Mexico and were thus ineligible for U.S. copyright
protection.
The
district court eventually took seven of the 88 alleged infringed films off the
list because they were supposedly in the Mexican public domain. It then held a
jury trial on the plaintiffs’ claims as to the remaining 81 films. The jury
came back with a plaintiffs’ verdict, awarding damages and attorneys fees
totaling almost $3 million. Defendants noted their appeal. The U.S. Court of
Appeals for the Fifth Circuit affirms on the merits.
The
defendants’ main appellate arguments challenged not only the district court’s
finding that production companies, such as the plaintiffs, can hold copyrights
under Mexican law (called “derecho de autor” in Spanish), but also the court’s
allowing the plaintiffs to recover damages for both copyright infringement and
unfair competition.
The
Court first decides that juridical persons can be “authors” under Mexican law.
The URAA sets up two types of foreign copyright owners who can have their U.S.
copyrights restored. First are the “authors,” that is, the creators of works
originally copyrighted in foreign jurisdictions. Second are the initial
rightholders which includes only the owners of a copyright in a “sound
recording.” Plaintiffs can claim restored copyrights under the URAA only if the
law of the work’s source country -- here, Mexico -- treats them as “authors.”
“[T]he
Plaintiffs – and the Government of Mexico, as amicus curiae – urge that the
Defendants’ failure to even mention the Collaboration Doctrine of the Mexican
Civil Code is telling. They note that in Mexican law, the Collaboration
Doctrine covers various provisions regarding copyrights claimed by corporations,
which necessarily create copyrighted works only through the collaboration of
individuals, viz., their agents and employees. Thus, Article 1,198 of the 1928
Mexican Civil Code provides: ‘The person or corporation that imprints or
publishes a work made by various individuals ... will have the property in the
entire work ...’” [Slip op. 10-11]
Later
amendments clarified that physical persons and legal entities who create a work
in “remunerated collaboration” may have author’s rights. See Ley Federal de
Derecho de Autor, art. 59 (1963). Thus, defendants are mistaken in claiming
that Mexican law vests the “author’s right” only in natural persons. Therefore,
plaintiffs can be, and are in fact, “authors” under Mexican law and can hold
Mexican copyrights.
The
Court then turns to the seven films which the district court had delisted. The
plaintiffs had produced and released these films between 1938 and 1946. At that
time, the Mexican Civil Code, Article 1,189, required that, to gain copyright
protection, an author had to register the work within three years of its
release. (Editorial Note: Mexico repealed this requirement in 1947.) Since
plaintiffs indisputably had not timely registered the seven films under the
then applicable demands of Mexican law, they are not eligible for U.S.
copyright restoration under the URAA.
Citation:
Alameda Films SA de CV v. Authors Rights Restoration Corp. Inc., 2003 WL
21142955 (5th Cir. May 19, 2003).
MARITIME
COMMERCE
In
action to recover for damage to printing machinery while on high seas between
England and United States under nonnegotiable or “straight” bill of lading,
English Court of Appeal (Civil Division) applies English law and determines
that such bill came within U. K’s Carriage of Goods by Sea Act of 1971
On
August 25, 1924, the maritime nations meeting in Brussels agreed upon the
International Convention for the Unification of Certain Rules of Law relating
to Bills of Lading for the Carriage of Goods by Sea [51 Stat. 233; T.S. 931; 2
Bevans 430; 120 L.N.T.S. 155]. The parties intended it to regulate the minimum
terms to govern international shipping contracts for carrying goods.
With
some amendments, the Convention arose out of a set of standard rules negotiated
at The Hague in 1922 for inclusion into bills of lading by contract. Coming to
be called “the Hague Rules,” they applied only to contracts of carriage
“covered by a bill of lading or any similar document of title.” Almost 80 years
later, the import of that phrase remains surprisingly controversial.
“The
effect of a negotiable bill of lading has been famously described by Bowen L.J.
in Sanders v. Maclean (1883) 11 Q.B.D. 327 at 341 in this passage: ‘A cargo at
sea while in the hands of the carrier is necessarily incapable of physical
delivery. During this period of transit and voyage, the bill of lading by the
law merchant is universally recognised as its symbol; and the indorsement and
delivery of the bill of lading operates as a symbolical delivery of the cargo.”
“Property
in the goods passes by such indorsement and delivery of the bill of lading,
whenever it is the intention of the parties that the property should pass, just
as under similar circumstances the property would pass by an actual delivery of
the goods ... It is a key which in the hands of a rightful owner is intended to
unlock the door of the warehouse, floating or fixed, in which the goods may
chance to be.’” [¶ 1]
In
the present case, the shipper, Coniston International Machinery Ltd., of
Liverpool (Coniston), consigned four containers of printing machinery to the
claimant, J. I. MacWilliam Company Inc., of Boston, Massachusetts (MacWilliam).
Vessels owned by, or demise chartered to, the defendant, Mediterranean Shipping
Co. S.A., of Geneva (MSC), were to transport the machinery. The bill of lading
issued by the defendant MSC to Coniston at Durban in December 1989 named
MacWilliam as the consignee and declared that the bill was non‑negotiable. That
is, it was a “straight” bill of lading, so that delivery of the goods (rather
than a mere endorsement of the bill) was usually required to transfer the
goods.
One
of defendant’s vessels, The Rosemary, carried the goods uneventfully from
Durban, South Africa to Felixstowe, England. There they were discharged and
later reshipped to their final destination in the United States aboard
defendant’s vessel, The Rafaela S. En route across the Atlantic, however, the
machinery was badly damaged and MacWilliam filed arbitration proceedings in
England.
At
arbitration, the issue arose as to whether the U. K.’s Carriage of Goods By Sea
Act of 1971 (1971 Act) applied or its U.S. counterpart. By Section 1(3), the
1971 Act has the force of law “where the port of shipment is a port in the
United Kingdom.” This led to the question of whether one contract of carriage
or two governed the shipment from South Africa to Boston. If the 1971 Act did
apply, then Section 1(4) (derived from art I(b) of the Hague Rules) had to be
satisfied. It declares that the contract had to “expressly or by implication
[provide] for the issue of a bill of lading or any similar document of title.”
This
led to the further question as to whether a “straight” bill of lading
constituted a “bill of lading or any similar document of title” under the 1971
Act. The arbitrators held that a single contract of carriage governed the
shipment and that, in any event, a straight bill of lading was not a “bill of
lading” under the Act.
With
leave, the claimant next appealed to the Commercial Court. There the judge
concluded, contrary to the arbitrators, that there had been two separate
contracts. On the other hand, the judge did uphold the arbitrators’ ruling that
a straight bill was not a statutory “bill of lading,” and dismissed the appeal.
The
claimant then appealed, urging that a straight bill of lading qualified as a
“bill of lading” within Section 1(4) of the 1971 Act, and also within Article
I(b) of the Hague Rules. The English Court of Appeal (Civil Division) allows
the appeal and reverses the Commercial Court.
The
Court first outlines the issues presented. “The business issue between the
parties is whether the contract of carriage contained in or evidenced by the
bill of lading prescribed a package limitation under the Hague Rules, the Hague‑Visby
Rules, or the U.S. Carriage of Goods by Sea Act of 1936 (USCOGSA).
The
Hague‑Visby Rules are an amended version of the Hague Rules, introduced by the
Protocol signed at Brussels on 23 February 1968. It contains a more liberal package
limitation. On the other hand, USCOGSA reflects the earlier limitation regime
of the Hague Rules and would limit any recovery to US$500 per package.
Secondly,
the appellate court decides whether the parties were acting under one shipping
contract or two. “[The ‘through bill of lading’] clause, when read together
with the relevant boxes on the front of the bill, does not provide for a single
contract of carriage but for two separate contracts, one from Durban to
Felixstowe and the other from Felixstowe to Boston.”
“It
may be true that MSC was entitled to arrange that second contract to be with
itself, but that should not disguise the fact that such an arrangement must be
viewed in exactly the same light as a new contract arranged through MSC’s agency
with a different carrier. If the latter would be a separate contract with a
separate port of shipment, then so must be the former arrangement.”
“If
it arranged on‑carriage with itself, then there would be a single contract for
a voyage from Durban to Boston, with transshipment at Felixstowe, and U.S. law
and jurisdiction would apply under clause 2 and [the U.S.’s Carriage of Goods
by Sea Act of 1936 (USCOGSA)] would apply under the penultimate sentence of
clause 1.”
“If
on the other hand, MSC arranged on‑carriage with another carrier, then the
contract would only be for shipment from Durban to Felixstowe, not to the U.S.,
and London arbitration and English law would apply under clause 2, and there
would be a port of shipment within the U.K. which, subject to the straight bill
of lading issue, would also invoke the compulsory regime of the 1971 Act.” [¶
21]
In
the Court of Appeal’s view, the contract that governed the carriage of the
machinery from Durban to England was distinct from the agreement that
controlled the shipment from England to the U.S. This means that there had been
a “port of shipment” within England so that the lower court had correctly
reasoned that the [English] Act applied.
Thirdly,
the Court tackles the nature and effect of this hybrid bill of lading. It first
holds that a straight bill of lading did constitute a “bill of lading” under
the Hague Rules. These Rules dealt with the content of a carriage contract
where the contract embodied in a bill of lading might turn out to affect the
rights of a third party.
“It
seems to me to be plain as a matter of common‑sense but also on a review of the
material cited in this judgment, that, in this connection, a named consignee
under a straight bill of lading, unless he is the same person as the shipper,
is as much a third party as a named consignee under a classic bill.” [¶ 136]
In
practical usage, the Court notes, the straight bill serves (like a “classic”
bill) as a document against which payment was demanded and the transfer of
which brought about a transfer of property interests in the cargo. The shipper,
along with his bankers and insurers, desire the same protection as the shipper
has under a classic bill.”
“In
addition the consignee itself and its insurers needed to have rights against
the carrier in case of misadventure. The parties typically write the straight
bill on the same form as an otherwise classic bill and mandate production of
the bill on delivery of the goods. Moreover, a straight bill is in principle,
function and form quite a bit closer to a classic negotiable bill than to a
non-negotiable receipt. Article VI of the Rules seems to look upon the latter
as “something far more exotic.” [¶ 139]
A
straight bill of lading also constitutes a document of title since it has to be
produced in order to perfect delivery. Even without express language that
requires production of a particular straight bill to obtain delivery, it is in
principle a document of title.
“Whatever
the history of the phrase in English common or statutory law may be, I see no
reason why a document which has to be produced to obtain possession of the
goods should not be regarded, in an international convention, as a document of
title. It is so regarded by the courts of France, Holland and Singapore.” [¶
143]
As a
final note, the lead opinion voices a complaint. “It seems to me that the use
of these hybrid forms of bill of lading is an unfortunate development and has
spawned litigation in recent years in an area which, for the previous century
or so, has not caused any real difficulty. Carriers should not use bill of
lading forms if what they want to invite shippers to do is to enter into sea
waybill type contracts.”
“It
may be true that ultimately it is up to shippers to ensure that the boxes in
these hybrid forms are filled up in the way that best suits themselves; but in
practice I suspect that serendipity often prevails. In any event, these forms
invite error and litigation, which is best avoided by a simple rule.” [¶ 146]
Citation:
J. I. MacWilliam, Co., Inc. v. Mediterranean Shipping Co., S.A., “The
Rafaela S,” [2003] E.W.C.A. Civ. 556, [2003] All E.R. (D) 289 ( April 16)
(Approved judgment).
SOVEREIGN
IMMUNITY
Second
Circuit vacates dismissal of action against French railroad company for
transporting French civilians to Nazi slave labor and death camps during World
War II because record is insufficient to determine whether application of FSIA
would be impermissibly retroactive
Holocaust
victims and their heirs brought an action against the French railroad company
Societe Nationale de Chemins de Fer Francais (SNCF) because of SNCF’s 1942-1944
operation of trains to transport an estimated 70,000 French Jews and other
“undesirables” to Nazi slave labor and death camps. This was done under
inhumane conditions, often in cattle cars, and many of its passengers died en
route.
SNCF
was created in the late 1930s to consolidate the French regional rail networks.
Today, it is wholly-owned by the French Government. During the events at issue,
however, it was under civilian control and preserved its independence by
collaborating with German authorities in their transportation needs during
World War II.
Defendant
successfully moved to dismiss for lack of subject matter jurisdiction. The
district court ruled that SNCF was an “agency or instrumentality of a foreign
state” as defined in the Foreign Sovereign Immunities Act of 1976 (FSIA) [28
U.S.C. Section 1603(b)] and that none of the FSIA’s exceptions were applicable.
On
appeal, plaintiffs argued that the FSIA did not apply because this case is
based on events that predated the FSIA’s enactment. The U.S. Court of Appeals
for the Second Circuit vacates and remands.
The
Court upholds the district court’s conclusion that SNCF is an agency or
instrumentality of France under the FSIA. On the other hand, it finds the
record insufficient to determine whether retroactive application of the FSIA to
this case would be permissible.
Under
the FSIA, an entity is an “agency or instrumentality” of a foreign state if it
is (1) “a separate legal person, corporate or otherwise,” (2) “an organ of a
foreign state or political subdivision thereof,” and (3) neither a citizen of a
State of the United States ... nor created under the laws of any third
country.” See Section 1603(b).
“In
the case at hand, the complaint and the documents submitted by the parties
clearly establish that SNCF has had the required characteristics ... throughout
the course of this litigation. ... The evidence in the record does not
establish, however, that SNCF also had these three characteristics during World
War II. For example, though the railroad’s brief asserts that the French state
owned 51 percent of the company between 1938 and 1982, no affidavits or
documents in the record support this statement.”
“This
absence of proof regarding the railroad’s status during World War II raises the
question: Is the fact that the defendant entity fits the FSIA’s definition of
an agency or instrumentality of a foreign state at the time of the litigation
sufficient to require the Act’s application to the case, regardless of that
entity’s organization and ownership at the time of the alleged wrongdoing?”
“After
the oral argument, however, the Supreme Court decided Dole Food Co. v.
Patrickson, 155 L.Ed. 2d 643, 123 S.Ct. 1655 (2003) [see 2003 International Law
Update 71] holding unequivocally that an entity’s status as an instrumentality
of a foreign state should be ‘determined at the time of the filing of the
complaint.’ Id. at 1663. Because the record clearly establishes that SNCF was
an agency or instrumentality of France at the time the complain [sic] was
filed, it is [now] an agency or instrumentality of a foreign state as defined
in Section 1603(b).” [Slip op. 18-20]
When
analyzing whether a statute was intended to apply to pre-enactment events, the
first question is whether Congress has expressly prescribed the statute’s
proper reach. If not, the court has to determine whether applying the statute
to pre-enactment events would, e.g., impair rights a party possessed when
he/she acted, increase a party’s liability for past conduct, or impose new
duties with respect to transactions already completed. See Landgraf v. USI Film
Products, 511 U.S. 244 (1994). Here, the Court finds that Congress did not
clearly express its intent to have the FSIA apply to pre-enactment events.
Therefore,
the Court turns to the second Landgraf prong. Plaintiffs argued that to apply
the FSIA to this case would be wrong because, under laws in effect during World
War II, SNCF would not have been immune. Thus enforcing the FSIA to bar their
claims strips them of a right of action they once had and defeats their settled
and legitimate expectation of being able to sue SNCF in the U.S.
“Both
sides overlook one crucial aspect of the pre-FSIA law and practice in the
United States - the State Department’s [historic] role in courts’ foreign
sovereign immunity determinations. The State Department often intervened in
litigation by filing a suggestion of immunity. Further, even in cases where the
State Department did not intervene, courts looked to that agency for guidance
and generally acted in accordance with its policies.”
“The
relevance of the State Department’s policies to our retroactivity analysis is
twofold. First, it appears that the State Department sometimes recognized
immunity claims of corporations owned by foreign governments. ...”
“Second,
and more importantly, the State Department’s treatment of ordinary litigation
with friendly foreign states in times of peace does not necessarily indicate
the position the Department would have taken on claims closely related to
war-time crimes of an enemy, as plaintiffs’ claims [sic] here. ...”
“The
record contains no information with respect to the State Department’s position
during World War II on the significance of the corporate form in foreign
sovereign immunity determinations. Nor is there any indication in the record
whether the State Department would have recognized immunity in a case such as
the one before us. As a consequence, without this information we cannot
determine whether plaintiffs legitimately could have expected to litigate their
claims in the United States.” [Slip op. 41-43]
Citation:
Abrams v. Societe Nationale des Chemins de Fer Francais, 2003 WL 21362345 (2d
Cir. June 13).
TRADEMARKS
Canadian
Federal Court of Appeal expunges trademark on words “Boston Chicken” from its
registry for lack of distinctiveness acquired by usage in Canada but upholds
registration of corresponding logo
Boston
Pizza International, Inc. (Boston Pizza or plaintiff), applied to a British
Columbia federal court to have it expunge the registration of the trade-marks
“Boston Chicken” (registration number TMA398,700) and “Boston Chicken” design
(registration number TMA396,282). Defendant, Boston Chicken, Inc. objected,
persuading the judge to dismiss the application.
He
held that there was no likelihood of confusion between the “Boston Chicken”
design and plaintiff’s trade-mark “Boston Pizza” and therefore confined his
analysis to the “Boston Chicken” trade-mark. Plaintiff’s appeal to the B. C.
Federal Court of Appeal followed.
The
Court rules that, having regard to the learned trial judge’s conclusion that
the [defendant’s] ‘Boston Chicken’ mark lacked inherent distinctiveness, and
considering the scant evidence of the mark’s use in Canada, the [defendant’s]
registration was invalid.
Subsection
18(1)(b) of the Trade-Marks Act, R.S.C. 1985 c. T-13 (the Act) provides : “18.
(1) The registration of a trade-mark is invalid if ... (b) the trade-mark is
not distinctive at the time proceedings bringing the validity of the
registration into question are commenced, ....” [¶ 2]
Plaintiff
contended that the “Boston Chicken” mark was not inherently distinctive and had
not acquired distinctiveness through use. Defendant, however, claimed that it
can show distinctiveness without use in Canada. It relied on the terms of
Section 2 of the Act: “‘distinctive,’ in relation to a trade-mark, means a
trade-mark that actually distinguishes the wares or services in association
with which it is used by its owner from the wares or services of others or is
adapted so to distinguish them;¼”
[¶ 4]
The
Court rejects this argument. To show that defendant’s mark “actually
distinguishes” itself from other marks, it must acquire distinctiveness through
use in Canada. “But the evidence of use is very scant, consisting of very
general statements about spill-over advertising and use of the mark at one
local event in the Windsor area after the expungement application was filed.
...”
“The
evidence as to spill-over advertising consists of little more than an assertion
that the [defendant] did some advertising on American television stations whose
coverage area extended into Canada. There is no evidence as to the nature or
amount of such advertising, nor any evidence as to its effect. ...”
“Before
this Court, the [defendant] conceded that, for purposes of this appeal, there
was no evidence of use of the ‘Boston Chicken’ trade-mark. I am satisfied the
‘Boston Chicken’ mark has not acquired distinctiveness as a result of its use
in Canada.” [¶ 5]
The
Court then examines whether defendant’s mark is adapted to distinguish its
services from those of others. Although defendant maintains that its mark is so
adapted, the Appellate Court approves the finding of the trial judge. “Nadon
J.’s finding that the ‘Boston Chicken’ mark lacked inherent distinctiveness
amounts to a finding that the mark is not adapted to distinguish the
[defendant’s] services from those of other traders. Consequently, since the
mark does not actually distinguish the [defendant’s] services from those of
other traders, and is not adapted to do so, its registration is invalid because
of its lack of distinctiveness.” [¶ 8]
Boston
Chicken also argued that acquired distinctiveness can arise from substantial
use outside of Canada. Moreover, if a party cannot achieve distinctiveness by
foreign use of its mark, then foreign trade-marks will have significant
difficulty in achieving or maintaining registration in Canada.
On
the contrary, the Court finds that this argument ignores the conditions for
registration of foreign registered trade-marks found in Section 14 of the Act.
“The effect of section 14 is that a foreign registered trade-mark must still
satisfy certain threshold conditions in order to be eligible for registration
in Canada. One of those conditions is that the trade-mark must have a
‘distinctive character’. This is a less demanding test than distinctiveness but
it still requires some evidence of use in Canada.” [¶ 11]
Explaining
the term “distinctive character,” the Court further notes that “[w]hile there
may be some difference between distinctive character and the distinctiveness of
a mark, the jurisprudence is consistently to the effect that distinctiveness
can only be acquired by use in Canada. It is not obvious why the demonstration
of ‘distinctive character’ should not be subject to the same condition.” [¶ 13]
The Court concludes that the “Boston Chicken mark is neither inherently
distinctive nor has it acquired distinctiveness through use in Canada. It is
therefore liable to be expunged from the register.”
“The
result is that foreign registered trade-marks which are not inherently
distinctive may well see their registration in Canada at risk in expungement
proceedings unless they can show some degree of acquired distinctiveness
through use in Canada”.
“Since
the date at which distinctiveness is to be assessed for purposes of section 18
is the date at which expungement proceedings are begun, delay in using the
marks following registration works against the registrant. In this case, there
is a gap of some three years between the date of registration and the date of
expungement proceedings. It may well have been possible for the ‘Boston
Chicken’ mark to acquire distinctiveness had it been used in Canada in that
period of time.”
“The
respondent has failed to satisfy me that its ‘Boston Chicken’ mark is either
inherently distinctive, or has acquired distinctiveness by virtue of its use in
Canada. For those reasons, it is to be expunged from the register.
In
contrast, the registration of the “Boston Chicken” design, registration number
TMA396,282, is not subject to the same challenge. “[The lower court’s] finding
that the ‘Boston Chicken’ mark was not inherently distinctive was restricted to
the words ‘Boston Chicken’ alone.”
“He
made no such findings with respect to the ‘Boston Chicken’ logo or design. The
onus is on the [plaintiff] to demonstrate that the design is not distinctive.
There was no argument in this Court directed to whether the logo was adapted to
distinguish. Consequently, there is no basis upon which the ‘Boston Chicken’
design or logo should be expunged.” [¶¶ 14-17]
The
Court allows the appeal in part. It orders that the registration for “Boston
Chicken” number TMA398,700 be expunged from the register.
Citation:
Boston Pizza International, Inc. v. Boston Chicken Inc., 2003 F.C.A. 120
(Fed. Ct. App., B.C. March 7).
UNITED
NATIONS
U.N.
Security Council extends U.S. exemption from I.C.C. jurisdiction and U.S.
discloses signers of ICC Non-surrender Agreements
On
June 12, the U. N. Security Council by a 12-0 vote adopted a Resolution to give
the United States a one-year extension on the exemption of its citizens from
arrest or trial before the International Criminal Court (ICC). France, Germany
and Syria abstained.
All
of the present 15 Member States of the European Union and 75 other nations are
parties to the permanent criminal court. It has jurisdiction to prosecute acts
of genocide, war crimes and crimes against humanity that occur after July 1,
2002.
Article
98(2) of the Treaty of Rome that set up the International Criminal Court (ICC)
provides that “The Court may not proceed with a request for surrender which
would require the requested State to act inconsistently with its obligations
under international agreements pursuant to which the consent of a sending State
is required to surrender a person of that State to the Court, unless the Court
can first obtain the cooperation of the sending State for the giving of consent
for the surrender.”
As
of June 12, 2003, 38 nations have publicly announced that they have signed
“Non-surrender Agreements” with the United States. Alphabetically, these are:
Afghanistan, Albania, Azerbaijan, Bahrain, Bhutan, Bolivia, Bosnia and
Herzegovina, Democratic Republic of the Congo, Djibouti, Dominican Republic,
East Timor, El Salvador, Gabon, Gambia, Georgia, Ghana, Honduras, India,
Israel, Madagascar, Maldives, Marshall Islands, Mauritania, Micronesia, Nauru,
Nepal, Palau, Philippines, Romania, Rwanda, Sierra Leone, Sri Lanka,
Tajikistan, Thailand, Tonga, Tuvalu, Uganda, and Uzbekistan. Several other
countries which have signed similar agreements have asked not to be identified.
According
to the Spokesman, “[w]e seek to protect American citizens and non‑U.S. citizens
serving in the U.S. Armed Forces from the potential danger of being tried by a
court that lacks sufficient safeguards against politically motivated
prosecutions and was established outside the UN system by a treaty to which we
are not a party.”
Citation:
Question Taken at Press Briefing, Office of Spokesman, Washington, D. C.,
June 12, 2003; The Associated Press in New York Times (online), Thursday, June
12, 2003, filed at 1:27 p.m ET.
WORLD
TRADE ORGANIZATION
WTO
arbitrator requires U.S. to implement WTO rulings in Byrd Amendment cases by
December 27, 2003
In a
report issued on June 13, 2003, a WTO arbitrator determined that the U.S. has
until December 27, 2003 to carry out the necessary legal and regulatory changes
to comply with the WTO rulings in the two cases involving the Continued Dumping
and Subsidy Offset Act of 2000 (Disputes DS217 and DS234).
The
Act in essence requires that anti-dumping duties collected from foreign
competitors of U.S. companies be distributed to the affected U.S. companies.
With a report issued on January 16, 2003, the WTO Appellate Body had largely
affirmed the findings of the Panels. See 2003 International Law Update 28.
The
WTO Appellate Body had found that the U.S. must bring the Act in conformity
with its obligations under the Anti-Dumping Agreement, the Subsidies and Countervailing
Measures (SCM) Agreement, and GATT 1994. The WTO Dispute Settlement Body (DSB)
adopted the Report on January 27, 2003. The U.S. requested a “reasonable period
of time” to implement the WTO recommendations.
After
the parties failed to agree on that time period, the Complainants requested a
WTO arbitrator to make that determination. The U.S. asked for 15 months because
the task involves a statute which Congress alone can amend or repeal. The
arbitrator, however, cited the well-established principle under Article 21.3(c)
of the Dispute Settlement Understanding that a reasonable compliance period
should be the shortest time possible within the legal system of the Member
State concerned.
Therefore,
after reviewing the legislative process of the U.S. Congress, the arbitrator
determined that a “reasonable period of time” for the U.S. to implement the WTO
recommendations would be 11 months. That period will expire on December 27,
2003.
Citation:
United States - Continued Dumping and Subsidy Offset Act of 2000 (WT/DS217/14,
WT/DS234/22) (13 June 2003). Report is available on WTO website at
“www.wto.org.”
Texas
company to build Timor Sea gas pipeline. On June 14, 2003, ConocoPhillips,
a Texas-based energy company, reported that the Timor Sea Designated Authority
has ruled in favor of a $1.5 billion natural gas development plan for the
Bayu-Undan beneath the Timor Sea between East Timor and northern Australia.
Last March the Australian government ratified the Timor Sea Treaty between East
Timor and Australia. Regulating the management of petroleum reserves in waters
which East Timor and Australia jointly control, the Treaty’s entry into force
enabled the project to get under way. ConocoPhillips and its partners can now
begin to build a pipeline from the undersea gas fields to Darwin in northern
Australia, and a liquefied natural gas plant at nearby Wickham Point. Other
partners in the project are the Australian unit of ENI of Italy, Santos of
Australia and Inpex of Japan. The group plans to begin selling liquefied
natural gas to Tokyo Electric Power and Tokyo Gas in January 2006. Citation:
Bloomberg News, from New York Times (online), June 16, 2003.
Chile
and U.S. sign Free Trade Agreement. On June 6, 2003, after more than two
years of negotiations, the U.S. and Chile signed a historic Free Trade
Agreement (FTA). This is the first such FTA that the U.S. has signed with a
South American country. The Agreement will eliminate bilateral tariffs, lower
trade barriers, and further economic integration. For example, more than 85
percent of bilateral trade in consumer and industrial products becomes
tariff-free immediately, with most of the remaining tariffs being phased out
within four years. About 75 percent of both U.S. and Chilean farm products will
be tariff-free within four years. Citation: Office of United States
Trade Representative press release 2003-37 (June 6, 2003); Washington Post,
June 7, 2003, page E2. [For full text, see “www.ustr.gov.”]
Singapore
and U.S. sign MOI on environmental matters. On June 13, 2003, the United
States and the Republic of Singapore signed a Memorandum of Intent on
Cooperation in Environmental Matters. The MOI links with the environment
chapter of the recently-signed United States‑Singapore Free Trade Agreement,
which promotes bilateral teamwork to sustain the global environment. The new
MOI will set up a framework for the two countries to work together by sharing
technical information, exchanging experts, training in capacity‑building and
joint research. Specific areas of interaction will probably focus on
improvements in energy efficiency; natural resource management; endangered
species conservation; public/private partnerships; and environmental education
in southeast Asia. Citation: Media Note, Office of Spokesman, U.S.
Department of State, Washington, D. C.; June 13, 2003.
U.S.
Treasury issues new global terrorism sanctions. The U.S. Department of the
Treasury, Foreign Assets Control Office, has issued a new part 594 to chapter V
of 31 CFR in the form of an interim final rule. The purpose is to implement
Executive Order 13224 of September 23, 2001 “Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism.” Section 1 of the Executive Order blocks, with certain exceptions,
all property and interests in property of designated foreign persons. Section 2
prohibits any transaction by a U.S. person to avoid the prohibitions of the
Executive Order. Sections 594.202 and 594.203 of subpart B detail how to handle
blocked property. For example, all expenses for maintaining blocked physical
property are the responsibility of the owners and operators, and will not be
paid out of blocked funds. The effective date of the rule was June 6, 2003. Citation:
68 Federal Register 34196 (June 6, 2003).
U.S.
Department of Commerce expands controls on designated terrorists. The U.S.
Department of Commerce, Bureau of Industry and Security, has issued an interim
final rule to amend the Export Administration Regulations (EAR) by imposing a
license requirement on the export and re-export of any item subject to the EAR
to persons designated based on Executive Order 13224 of September 23, 2001 (15
CFR Parts 744 and 772). The listed persons are Specially Designated Terrorists
(SDTs) and Foreign Terrorist Organizations (FTOs). Citation: 68 Federal
Register 34192 (June 6, 2003).
EU
agrees with U.S. and Canada to modify cereal concessions. The EU Council
has approved the agreement in the form of an Exchange of Letters between the EU
and the U.S. to modify the trade concessions with respect to cereals provided
for in EC Schedule CXL to the GATT 1994. The agreement modifies the rules for
common wheat and barley, and also specifies that the beginning dates for the
tariff quotas for these grains is January 1 of each year. The EU and Canada
have concluded a very similar agreement, also in the form of an exchange of
letters. Citation: 2003 O.J. of European Union (L 95) 36, 40, April 11,
2003.
U.S.
court preliminarily enjoins Chinese company from alleged infringements.
Huawei Technologies is China’s largest technology company. Based in Shenzhen,
China, the company has an office near Dallas. In January 2003, Cisco Systems,
Inc. sued Huawei in a Texas federal court alleging patent and copyright
infringements. Specifically, the complaint charged that Huawei was illegally
copying Cisco’s software, documentation and other products. On June 6 last, the
court issued a preliminary injunction that bars the defendant from selling,
importing, exporting or using Cisco’s proprietary software. It also forbids
Huawei to develop its own products by employing anyone who has worked with
Cisco’s software. The Chinese company is also to stop handing out user manuals
or “help” files that feature parts copied from Cisco documents. According to
the Associated Press, “[Huawei] has been expanding in overseas markets,
challenging Cisco with similar products at lower prices.” Citation: The
Associated Press (from New York Times online), Monday, June 9, 2003.
Citizens
of Italy and other nations face new visa rules. Effective October 1, 2003,
nationals of Italy planning to travel to the United States under the Visa
Waiver Program must tender a machine‑readable passport issued by the Government
of Italy. (This requirement will also apply to citizens of all countries taking
part in the Visa Waiver Program.) Some Italian citizens still possess valid
Italian passports issued before the introduction of the more secure machine‑readable
passport. To use these older passports for travel to the U.S. for tourist or
business reasons after the deadline, a traveler will have to obtain a U.S.
nonimmigrant visa. Entry procedures under the Visa Waiver Program for holders
of machine-readable Italian passports remain unchanged. Travelers with machine‑readable
passports should keep in mind that families and groups need to obtain an
individual passport for each traveler, including infants. This is because
machine‑readable passports generally have biographic data for only one
traveler. The U.S. may refuse visa-free entry to all others whose names are not
included in the machine‑readable zone. The U.S. authorities urge Italian
citizens who prefer to continue using their old‑style passports to plan well in
advance and to apply for their visas early. At present, the nonrefundable visa
application fee is EURO 100. For general information on U.S. visa policies and
procedures, consult http://unitedstatesvisas.gov.Citation: e‑EmbassyRome:
Fri, 20 Jun 2003 02:02:22 ‑0700.
Germany
signs financial support agreement with its Jewish community. On January 27,
the 58th anniversary of the Allied liberation of the Auschwitz death camp,
Chancellor Gerhard Schroeder and Paul Spiegel, Germany’s principal Jewish
leader, signed an historic agreement that makes the nation’s burgeoning Jewish
community legally equal to Germany’s main Christian churches. On Friday, June
6, the German parliament unanimously approved the measure with the required approval
by the upper house anticipated to be a formality. Acknowledging the increasing
significance of Jewish life to German culture, the agreement sets up the first
legal partnership between the government and the Jewish community since World
War II. It resembles similar arrangements with the Roman Catholic and Lutheran
churches wherein the state pays the costs of schools and other religious
institutions. With a tripling of the state’s contribution to the Central
Council of Jews to $3.5 million, the community of 100,000 will be able to
educate more rabbis who can explain Jewish rites and traditions to immigrants.
Most of them grew up under communism in the former Soviet Union and elsewhere,
i.e., without a religious education. Citation: Associated Press, Berlin,
June 6, 2003; 14:21:51 GMT.
Ukraine
no longer “Primary Money Laundering Concern.” The U.S. Department of the
Treasury, Financial Crimes Enforcement Network (FinCEN) has revoked the
December 20, 2002, designation of the Ukraine as a primary money laundering
concern pursuant to 31 U.S.C. Section 5318A. This revocation is based on the
Ukraine’s increased efforts in this regard, such as the amendment to its
anti-money laundering law to allow sharing of intelligence among law
enforcement agencies, as well as the amendment of the criminal code to make
money laundering a crime. Citation: 68 Federal Register 19071 (April 17,
2003).
