Foreign Dictators in U.S. Court, Part V

To resolve the dictators’ asymmetry, Congress should adopt a Foreign Sovereign Anti-SLAPP statute and amend the FSIA. Courts should also interpret FSIA exceptions broadly, and reform the act of state doctrine and foreign official immunity.

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My posts this week, based on a forthcoming article excerpted here, have made several arguments against foreign dictators in U.S. court. Courts need not allow foreign authoritarians to take advantage of access to our judicial system. At the very least, courts could change their approach to the foreign privilege to bring suit, act of state, international comity, and even the FSIA. However, yesterday I concluded that an anti-dictatorship standard was not administrable. The question, then, is how to remedy the original asymmetry—foreign dictators have easy access to court as plaintiffs but can take advantage of protective doctrines when they are defendants.

Today, I propose four different ways to weaken dictators' access to court as plaintiffs and the protections they enjoy as defendants:

To resolve the dictators-as-plaintiffs problem (1) Congress should subject the privilege of bringing suit to the robust procedural protections of a federal Anti-SLAPP statute so that defendants can quickly dismiss oppressive political claims. To resolve the dictators-as-defendants problems, courts should (2) reconsider or eliminate the act of state doctrine; (3) limit the scope of foreign official immunity; and (4) interpret the FSIA exceptions as broadly as they are written, allowing more claims against foreign dictators.

My boldest proposal is to adopt a new Foreign Sovereign Anti-SLAPP statute:

[That] statute would mirror state anti-SLAPP statutes and would allow defendants to demonstrate that a foreign government or its proxy has sued them for political purposes or for exercising rights protected by the U.S. Constitution, either at home or abroad. If defendants can prove this, the burden would shift on to plaintiffs to demonstrate they will prevail on the merits, that they are not attempting to abuse legal process, and, in the case of individuals, that they are not a proxy for a foreign dictatorship. In the meantime, anti-SLAPP procedural protections would kick in.

The statute must address two main definitional problems: (1) what counts as a "political" lawsuit? and (2) what counts as a proxy of a foreign government? On the first question, the statute can draw from current anti-SLAPP standards, the political exception to extradition, and the immigration law standards for political asylum. As discussed above, courts in the extradition context consider whether a foreign government has charged a defendant with a crime that is "political in nature."  So called "pure political" offenses involve crimes "like treason, sedition, and espionage, acts directed against the state but which contain none of the elements of ordinary crime."  "Relative" political offenses involve common crimes that are "so connected with a political act that the entire offense is regarded as political."  This latter offense, in turn, depends on the existence of a "political disturbance" and an offense that was incidental to it.  But this standard is still overly narrow and hinges on "violent" uprisings.

An even better model is the political asylum standard, where an applicant "must demonstrate that he faces persecution on account of … political opinion."  Applicants satisfy this by showing that a foreign government harmed them for holding a political opinion, including by participating in "act[s] against the government" or protests.  And applicants only have to show that holding a political opinion was "one central reason" for the mistreatment or persecution.  There are thousands of asylum decisions expounding on this standard, indicating that courts are comfortable defining the existence of "political" acts and subsequent prosecutions (or broader persecution).

These doctrines and case law provide a good starting point for a foreign sovereign anti-SLAPP statute. A pure political lawsuit in the United States results when the defendant is simultaneously sued civilly in U.S. courts and prosecuted abroad for alleged crimes directed against the foreign state. But the statute should go much further by including relative political lawsuits. In dictatorships, political dissidents can oppose the ruling regime through public acts that are closer to the political asylum standard of persecution based on a "political opinion." Therefore, relative political lawsuits in the United States result when there is evidence that the defendant opposed a foreign regime through a legitimate public act—an exercise of free speech, including petitions, peaceful protests, commercial decisions, or statements to local and foreign press—and was thereafter sued in U.S. courts. Crucially, just like in the asylum context, a defendant would only need to show that a political opinion was "at least one central reason" for the civil lawsuit in the United States.  This standard would resolve the problem of proxy plaintiffs filing facially legitimate complaints that are also partially motivated by political persecution abroad.

The statute should also explicitly address the problem of proxies suing to promote the interests of foreign governments. The statute here can draw on analogous inquiries that courts conduct when they pierce the veil of corporate structures, analyze who the "real party in interest" is in a federal case, or scrutinize whether a legal party is merely an agent for someone else.  Defendants would first have the burden to show that a foreign individual is merely a proxy of a foreign government. The statute should err on the side of a broad definition because, at worst, it is merely raising the standards on innocent foreign plaintiffs to file lawsuits in U.S. courts. So, there should be a presumption that state-owned entities and government officials (current or former) are proxies of a foreign government, even if they claim to be suing in their individual capacity. Same, too, for foreign oligarchs closely linked to autocratic regimes. For entities that appear independent, courts should focus on whether a foreign country is the primary beneficiary of the lawsuit or exercises ultimate control over the plaintiff, lawyers, or the legal claim. If met, the burden would shift to plaintiffs to prove otherwise …

A Foreign Sovereign Anti-SLAPP statute would prevent many of the most egregious cases discussed above. It would have stopped Castro's case against the sugar company in Sabbatino; China's array of cases against corruption suspects; Turkey's claim against Gulen; Russia and Venezuela's many claims against dissidents. Such a statute would be a boon for democracy around the world.

For the dictators-as-defendants problem, I propose the following. First, it is time to reconsider the act of state doctrine. The doctrine unduly enables foreign dictatorships to enjoy asymmetrical benefits. While it is justified as a comity-based rule that avoids "inadvertently caus[ing] foreign policy tensions or crises by offending other nations," there is no evidence that it has prevented international tensions and no reason at all to think it does.

Second, courts and Congress should expand exceptions to the FSIA, including the counterclaim exception:

One potential avenue is to expand the implicit waiver and counterclaims exceptions. The FSIA provides in § 1605 (a)(1) that "a foreign state shall not be immune … in any case … in which the foreign state has waived its immunity either explicitly or by implication."  In the face of this broad language, however, courts have been "reluctant to find implied waivers, requiring strong evidence of the foreign state's intent."  It appears that courts have only found implied waivers when "a foreign state has agreed to arbitration in another country … that a contract is governed by the law of another foreign country, or … has filed a responsive pleading in a case without raising the defense of sovereign immunity."  But there is no reason why courts cannot return to a more common-sense reading of the phrase "by implication" that would include other types of waiver.

Moreover, the counterclaim exception in § 1607(b) also removes immunity with respect to any counterclaim "arising out of the transaction or occurrence that is the subject matter of the affirmative claim."  Again, the phrase "transaction or occurrence" can be interpreted broadly, especially because the exception it hinges on how courts read "subject matter."

Combining the counterclaim and waiver exceptions, courts may be able to find that foreign dictators waive immunity for any claims related to cases in which they are plaintiffs. We could refer to this as "subject-matter waiver." For example, if, as in Sabbatino, Cuba sues American companies to enforce expropriations stemming from a particular Cuban executive order, courts may read that action as implicitly waiving immunity for any claims against Cuba arising out of the same executive order. This would operate as a waiver of all claims arising out of the same subject-matter and would draw from both the implicit waiver and counterclaims exceptions. Similarly, if Venezuelan officials sue the Wall Street Journal in U.S. court, courts may read that as waiving sovereign immunity for cases arising out of journalistic activities in Venezuela. Such an approach would end the strange asymmetry that I discussed above. To be sure, these subject-matter waivers may also be difficult to administer. For example, typically counterclaim waiver is specific to any claims by the defendants but here it would allow third-parties to file separate claims. Although problems could arise, this option is worth further exploration.

Without going into details here, I also counsel that courts can limit the scope of foreign official immunity.

Foreign dictators have been litigants in our courts since the beginning of the Republic. But there is no need to grant them the current level of access to court or comity protections. Foreign dictators have no right to benefit from comity doctrines designed in a different time and place. Doctrines like act of state, the privilege of bringing suit, or official immunity can adapt to a modern world under threat from democratic regression. U.S. courts and Congress should take up the baton and, in a careful and targeted way, recalibrate comity in these cases.

 

NEXT: Today in Supreme Court History: May 7, 1873

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  1. If liability is substitute for violence, immunity justifies violence in formal logic. It is in everyone’s interest to end all immunities.

  2. I recall a ludicrous lawsuit by Russia when hockey players fled to the US, where they were claiming a piece of the action for all the money they spent in training.

    Sure, you had captured them in a dictatorship with little freedom, and offered them better housing for their families, if only they danced well on the international stage to make the dictatorship look good.

    They should counter-sue you for a thousand times that for lost professional wages and a million times that for loss of freedom.

  3. I took a course on International relations and one textbook example given of what not to do was the “Shrimp and Turtle” case where the US banned certain fishing nets, Malaysia pursued action in the WTO, US lost and changed its laws and … environmentalist went completely nuts. There were massive protests, and the UN’s trade authority, to the extent it ever existed, was permanently shot.

    Similar plans to create a WTO like agency in the trans-pacific partnership were partially responsible, imo mostly responsible, for the scrapping of the agreement.

    Over fishing nets.

    And the US was totally in the wrong there. The issue wasn’t banning the nets, thats fine, the issue is forcing other countries to ban those nets AND making exceptions for some but not others. Oh and the only alternative to those nets happens to be US patented “trapdoor” technology.

    What went wrong? The US conceived of the the WTO as a way for everyone to remove protectionist barriers, but as soon as its sovereignty was threatened … people reacted.

    The issue being everyone agrees tariffs are protectionist. But as soon as you go beyond that … I can have protectionist policies I dont think are protectionist but you do. US environmental law. EU geographic indicators. So we have the courts figure it out, but people wants to give up everyones sovereignty but their own.

    That was for an international courts. Imagine the outcry when you try appling US, not international, but US law in US courts to foreign countries.

    “Without going into details here, I also counsel that courts can limit the scope of foreign official immunity.”

    I really really don’t think that is a road you want to go down on.

    To give an example, the EU already does not extradite murderers to the US because they face the death penalty here. Can you imagine how much everyone would collectively lose their shit if someone in the EU sued the US over its own policies on the death penalty?

    For the rest, federal anti-SLAPP and asylum immunities … yeah thats fine. But why limit that to foreign soverigns? There ought to be a general anti-SLAPP law.

    1. You’re right about foreign official immunity. Agreed that it is best to handle it extremely carefully if at all.

  4. For now, I have switched my concerns to questions about U.S. dictators in U.S. court.

  5. A generally-applicable federal anti-SLAPP law might be a good idea. It would certainly deal with what is, by case volume and its effects on the system and litigants, the far greater problem. If marketing it as an anti-foreign-dictator measure might shake a few Republican votes loose, then have at it.

  6. You have provided a worthwhile examination of interesting issues, Prof. Zambrano. I enjoyed considering your work. Thank you.

  7. So could congress pass the kind of slapp analog you suggest AND declare it has effect in state law as well or would they need to create some kind of federal removal system…or can they do this at all?

    I know that congress probably couldn’t if this was a purely domestic matter but the foreign affairs aspect would seem to mean congress is on firmer ground regulating how states deal with foreign actors.

    1. Great question. Without getting into the constitutional question here, 36 states or so have anti-SLAPP statutes that are generally applicable so they can cover many of these claims (if filed in state court). So Congress doesn’t have to make it applicable in state court. But I think it probably could.

      1. Yes, with respect to SLAPP suits we don’t even have a federal anti-SLAPP and desperately need one but as the fact that only 36states have such a statue makes me worry that it wouldn’t be universal and that would leave malicious foreign regimes to forum shop to states without one. Still better than nothing but it sure would be great if we could do so universally via a single act of Congress.

      2. Ohh sorry didn’t see your answer at first. Thanks for your opinion there…I’m just a legal amateur 🙂

  8. Does OP have no concern about retaliation? One reason we have nice broad foreign sovereign immunity is because we demand such immunity from other countries. Which is useful considering we are involved in a lot of bad stuff overseas.

    1. You are right that retaliation should be a concern. But keep in mind that the current status quo is heavily imbalanced in the sense that access to U.S. court gives a sovereign-plaintiff weapons they have nowhere else in the world: discovery, relatively low pleading standards, contingency fee lawyers, threat of punitive damages, etc. Moving away from this status quo by slightly restricting access to court would actually balance things out better. And it isn’t that difficult to meet anti-SLAPP standards if you have a legitimate complaint. That’s why it would mostly affect frivolous claims. On the dictators-as-defendants side, a robust counterclaim exception (and subject matter waiver) would not be a dramatic change either.

      1. Those are nice formalistic arguments, but the way retaliation plays out is more brutal. E.g., the People’s Republic of China says “OK, your courts are now less open to claims and defenses by dictators, then we’ll adjust our legal rules to screw the US in our courts in retaliation”.

        Indeed, the very fact that you are targeting dictators means that they aren’t exactly swayed by the logical consistency of arguments in law review articles.

        If you accompanied your proposal with a more isolationist foreign policy where the US was less likely to be hauled into foreign courts, OK, maybe it works, but in the current environment, retaliation is a HUGE issue.

        1. We have bigger problems with the Chinese than this.

          But if they want to get into a p*ssing contest, that’s why we need a President like Donald Trump who is willing to fight back.

  9. I think the best idea here is a general SLAPP law, one not specifically aimed at anyone in particular.

    Thwre are reasons not ro make it easy for US courta to be places for foreigners to air their dirty laundry, and the US has to maintain good relations with foreign sovereigns and ensure the political branches control any mudslinging that occurs. This especially applies to powerful human rights violators like China. It’s important that the political branches, not courts, control actions that can lead to general retaliation and escalation, balancing ideals with pragmatic considerations.

    However, ensuring foreign dictators can’t use US courts to harass their citizens while on our soil is also a US interest, as long as this is done in a way that doesn’t single particular parties out. A statute providing gatekeeping on lawsuits initiated over speech would help that.

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