D.C. Circuit Holds that Conversion of Claim Under FSIA Section 1605A Does Not Require Re-Service of Process

D.C. Circuit Holds that Conversion of Claim Under FSIA Section 1605A Does Not Require Re-Service of Process

By Louis M. Solomon

Gates, et al. v. Syrian Arab Republic, et al., No. 08-7118 (D.C. Cir. May 2011) (consolidated with 09-7108), [enhanced version available to lexis.com subscribers / unenhanced version available from lexisONE Free Case Law] involves the appeal from the District Court's treatment of the gruesome case of two murdered U.S. contractors in Iraq by Al-Zarqawi the his terrorist organization, al-Tawid wal-Jihad (know in Iraq as al-Queda). The provisions of the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. § 1604, at issue in the case address the potential for claims against non-U.S. sovereigns that provide material support for hostage taking or state-sponsored terrorism. Syria has been designated a state sponsor of terrorism since 1979.

The Circuit summarized the history of the FSIA, in particular the modification to the statute by the repeal of § 1605(a)(7) and its replacement with § 1605A. In the District Court, the plaintiffs sought by motion in February 2008 to avail themselves of new § 1605A.  Syria did not respond and hence defaulted on the original summons and complaint when the claims were under § 1605(a)(7), which did not provide a federal cause of action, and the question was whether service needed to be made anew when the claim was changed to one under § 1605A, which other courts have stated created a federal cause of action and which, unlike the earlier statute, allowed for punitive damages.

The Court of Appeals addressed the following issues that are of significance to the development of international practice:

First, the Circuit gave short shrift to a welter of arguments found to be foreclosed by prior Circuit and Supreme Court decisions, including that the FSIA was unconstitutional, that the FSIA conflicts with Article 2 of the U.N. Charter, international laws, and international norms, and that the claim presented a non-justiciable political question.

Second, the Circuit held that the plaintiffs could avail themselves of the new statute without serving a new pleading. The Court relied on § 1608, upholding the District Court's finding that Syria had indeed been served initially in a proper manner and that service once the case was converted to one under § 1605A was not a new claim for relief and could be done by motion rather than by service of a new complaint.

Third, in making ruling that § 1605A did not create a new cause of action, the Court drew a distinction between creation of a new federal claim or cause of action and "changes [in] the applicable rule of decision". The Court cited nothing to support that distinction. As the Court explained:

The statutory language suggests the converted claim is not a 'new claim' requiring an amended pleading.   . . . § 1605A changes the applicable rule of decision, it does not create a new cause of action. Section 1605A provides for a federal cause of action, whereas § 1605(a)(7) relied upon state law claims. Both sound in tort, however. And both claims arise from the same underlying acts of terrorism. It is therefore the applicable rule of decision that is new when an action is converted under section 1083, not the claim itself.

The distinction does not seem necessary to the Court's holding.  See also our postings on other § 1605A cases, referring to the statute's creation of a new federal cause of action, by, for example, not requiring reliance on state law and by providing for punitive damages.

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