International Centre for Settlement of Investment Disputes
Global Trading Resource Corp. & Globex Int’l, Inc. v. Ukraine (Dec. 1, 2010)

Click here for document (approximately 20 pages)

An International Centre for Settlement of Investment Disputes tribunal has recently dismissed a claim by several U.S. investors against Ukraine pursuant to Rule 41(5) of the ICSID Arbitration Rules under which a party can file an objection with the tribunal that a claim is “manifestly without legal merit.” According to the tribunal, “this is, to the Tribunal’s knowledge, only the third occasion on which a decision has had to be taken on objection under Rule 41(5).”

The tribunal, acknowledging the relative newness of Rule 41(5)—introduced as part of amendments that came into effect in April 2006—was “particularly conscious” of its precedent-setting role and provided several important guidelines for future parties utilizing Rule 41(5).

The U.S. investors (claimants) and Ukraine (respondent) agreed that the issue before the tribunal was one of law and not of fact. Specifically, Ukraine claimed that the transactions at the center of the dispute—purchase agreements between two U.S. investors and Ukraine to sell poultry in Ukraine—were not “investments” under either the U.S.-Ukraine BIT or the ICSID Convention.

The tribunal, applying Rule 41(5), decided that a balance had to be struck between the respondent’s right to a “pre-preliminary dismissal” and the claimants’ due process rights. Specifically, the tribunal had to decide whether a dismissal at the earliest stage of the proceedings would harm either side, especially since the parties had no real chance to present their case. To reach a balanced answer, the tribunal posed the following question: “[W]hat other materials might either Party (specifically the Claimants) bring to bear if the question at issue were to be postponed until a later stage in the proceedings?” The tribunal was unable to identify any “further materials relevant to the question at issue” and concluded that Rule 41(5) requirements were thus sufficiently satisfied.

The tribunal then went on to determine whether the claimants claim was “manifestly without legal merit.” Here, the tribunal relied on recent cases dealing with the definition of investment and concluded that the transactions between the U.S. investors and Ukraine were of pure commercial nature and therefore could not “qualify as an investment” under either the BIT or the ICSID Convention. The tribunal found the claimants' argument that the Ukrainian government instigated and initially supported the transactions irrelevant.

Strategic Arms Reduction Treaty Approved by U.S. Senate (Dec. 22, 2010)

Click here for press release (approximately 1 page)

On December 22, 2010, the U.S. Senate voted in favor (71-26) of the new Strategic Arms Reduction Treaty between Russia and the United States. The approval by the U.S. government of the landmark arms control treaty is a “major foreign policy victory” for the Obama Administration. President Obama and President Medvedev signed the START treaty and its protocol on April 8, 2010.

U.S. Court of Appeals for the District of Columbia Circuit
ACLU v. U.S. Dep’t of Def. (Jan. 18, 2011)

Click here for document (approximately 23 pages)

The U.S. Court of Appeals for the District of Columbia has upheld a lower court ruling in favor of the U.S. government regarding the release of documents related to fourteen “high value” detainees held at the U.S. Naval Base in Guantanamo Bay. The request for the release of the documents was filed by the American Civil Liberties Union (ACLU) under the Freedom of Information Act (FOIA).

The U.S. government had released redacted versions of the documents requested by the ACLU; however, information regarding the capture, detention, and interrogation of the detainees was not released. The government defended its actions on the basis that the information in question was properly withheld under FOIA exemptions, which allow the withholding of government information related to “intelligence sources and methods.” The district court granted the government’s motion for summary judgment, finding the government in compliance with FOIA. The ACLU appealed.

During the appeal, President Obama issued three Executive Orders on detention and interrogation and declassified and released four Department of Justice memoranda on the legality of enhanced interrogation techniques. In addition, information regarding treatment of “high value” detainees was leaked, and a CIA report on the CIA’s interrogation techniques was released. These changes prompted the Court of Appeals to remand the case back to district court to “provide the CIA with the opportunity to ‘reprocess’ the requested documents.” The result was the release of a complete combatant status review tribunal transcript and revision of redactions of five other transcripts. The government again filed a motion for summary judgment, which the district court granted, and again, the ACLU appealed.

In a detailed discussion of FOIA and the relevant exemptions, the Court of Appeals rejected all of the ACLU’s claims, including that the information requested has already been declassified and is publically available; that the interrogation techniques and confinement methods were “prohibited” by the President; that the government could not classify information “derived from the detainee’s personal observations and experiences;” and that the release would not endanger national security.

International Monetary Fund (IMF) Administrative Tribunal
“EE” v. International Monetary Fund (Dec. 3, 2010)

Click here for document (approximately 80 pages)

The International Monetary Fund (IMF) Administrative Tribunal has issued a judgment finding the Fund partially in violation of the Fund’s internal law and the fair procedures standards as required by recognized principles of international administrative law.  The Tribunal dismissed all other charges against the Fund and awarded the applicant $45,000 in damages as compensation.

The complex facts leading up to this decision can be summarized as follows: A Fund employee (Employee A), who had had a relationship with her immediate supervisor, was placed on paid administrative leave when allegations of misconduct were filed against her by another Fund employee (Employee B), who was also involved with the same supervisor. Allegedly, Employee A had started to harass Employee B because of the long-standing relationship between her and the supervisor. Employee B, claiming that she feared for her safety because of Employee A’s troublesome behavior, had filed a complaint with the Fund’s ethics office. Eventually, the Fund informed Employee A that a formal investigation would be commenced against her and informed her that she was placed on paid administrative leave pending the investigation into her misconduct. Employee A was not given an opportunity to respond to the decision that she was placed on leave.

Employee A filed a complaint challenging both the appropriateness of the investigation and the lack of due process protection afforded to her by the Fund. The Tribunal had to determine whether a Fund employee has the right to present her case before being placed on paid administrative leave pending investigation of misconduct.

The Tribunal first acknowledged that the principle of audi alteram partem (right to be heard) is a general principle of international administrative law, ‘“so widely accepted and well-established in different legal systems that [it is] regarded as generally applicable to all decisions taken by international organizations, including the Fund.’” The Tribunal then added that this doctrine was until now never invoked before it in a case that dealt with misconduct proceedings. After reviewing the Fund’s procedural history relating to the decision to place Employee A on paid leave, the Tribunal concluded that the Fund failed to ensure that Employee A’s due process rights were protected: “The Tribunal concludes, in the circumstances of the case, that the Human Resources Director erred when she failed to afford [Employee A] an opportunity to be heard prior to placing her on administrative leave. While the Tribunal considers that this procedural error is not sufficient to overturn the contested decision, it does merit relief in the form of monetary compensation.”

NAFTA Tribunal Rejects Grand River Claim (Jan. 12, 2011)

Click here for press release (approximately 1 page)

According to a recent U.S. Department of State press release, a three-member North American Free Trade Agreement (NAFTA) arbitration tribunal has rejected a claim filed by a Canadian corporation, Grand River Enterprises Six Nations, Ltd., and three members of Canadian First Nations, challenging certain U.S. legislative measures relating to the 1998 Master Settlement Agreement (MSA) between several U.S. states and major U.S. tobacco companies. The claimants alleged, inter alia, that U.S. MSA-related legislation caused material harm to and impaired the value of their investment in violation of NAFTA.

According to the press release, the Tribunal ruled that it lacked jurisdiction over the claimants’ claims because they did not have an investment in the United States and the measures in questions were not discriminatory nor in violation of the minimum standard of treatment under NAFTA.

Ike Skelton National Defense Authorization Act for Fiscal Year 2011

Click here for document (approximately 383 pages); click here for President Obama’s statement (approximately 1 page)
 
U.S. President Obama signed the Ike Skelton National Defense Authorization Act, a law authorizing funding for military activities in the United States and abroad for 2011.

Notably, President Obama also issued a statement objecting to specific provisions within the Act, in particular Sections 1032 and 1033. These sections prohibit the use of the allocated funds to transfer or release current Guantanamo detainees into the United States or into the custody or effective control of foreign countries, unless specific conditions are met. 

According to President Obama, Section 1032 “represents a dangerous and unprecedented challenge to critical executive branch authority to determine when and where to prosecute Guantanamo detainees.” Moreover, “[t]he prosecution of terrorists in Federal court is a powerful tool . . . to protect the Nation and must be among the options available to us. Any attempt to deprive the executive branch of that tool undermines our Nation’s counterterrorism efforts and has the potential to harm our national security.”

He concluded that the reason why he signed the bill into law is to ensure that necessary funds were authorized for 2011 military activities. He also vowed that his administration will “seek repeal of these restrictions, will seek to mitigate their effects, and will oppose any attempt to extend or expand them in the future.”

United States District Court for the District of South Carolina
Lebron et al. v. Rumsfeld et al. (Feb. 17, 2011)

Click here for document (approximately 32 pages)

The U.S. District Court for the District of South Carolina has dismissed all claims by Jose Padilla against several current and former government officials stemming from his capture, interrogation, and subsequent classification as enemy combatant. Padilla, a U.S. citizen currently serving a prison sentence on various federal charges in connection with his support of Al Qaeda, sued numerous government officials, including former Secretary of Defense Donald Rumsfeld, alleging that his detention as an enemy combatant and the treatment experienced during his detention violated his federal statutory and constitutional rights. The government defendants claimed, inter alia, that there exists no private right of action against them and that they are entitled to qualified immunity.

Padilla was arrested in 2002 at O’Hare International Airport and held thereafter for several years without access to counsel. His case then traveled through the various federal courts, including the U.S. Supreme Court. He was eventually sentenced to seventeen years and four months imprisonment, a sentence he is currently appealing. Padilla is claiming that his detention and designation as an enemy combatant violated his rights to counsel, access to the courts, freedom of religion, freedom of association, due process, and his right against cruel and unusual punishment.

The district court first recognized that Congress “never created a private right of action against federal officials based upon a deprivation of constitutional rights;” however, in Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, the U.S. Supreme Court ruled that a private civil cause of action for money damages was implied in the U.S. Constitution. This ruling was later broadened to include civil claims against other federal agencies. Padilla claimed that Bivens and its progeny encompass his claims against the government officials for the alleged treatment he suffered at their hands.

The district court disagreed, ruling that subsequent jurisprudence by numerous federal circuits and the U.S. Supreme Court clearly demonstrated that Bivens is to be construed narrowly, thus excluding Padilla’s claims.

The district court then went on to discuss the qualified immunity defense espoused by the government officials, concluding that all defendants were protected by the immunity because at the time the challenged governmental actions occurred, there were no “clearly established statutory or constitutional rights which a reasonable person would have known.”

Abduwali Abdukhadir Muse Sentenced in U.S. Court for Hijacking Ships off the Coast of Somalia (Feb. 16, 2011)

Click here for press release (approximately 1 page)

According to Washington Post, U.S. District Judge Loretta Preska sentenced Abduwali Abdukhadir Muse, a Somali pirate, to more than thirty-three years imprisonment after he pled guilty to hostage-taking, kidnapping, hijacking, and conspiracy in the hijackings of three ships off coast of Somalia.

ASIL INSIGHTS

September 11 Inspired Aviation Counter-Terrorism Convention and Protocol Adopted
By Damien van der Toorn
January 26, 2011