Tidewater Inv. SRL v. Bolivarian Republic of Venezuela, No. 17-1457 (TJK) (D.D.C. Dec. 17, 2018) [click for opinion]
Plaintiffs Tidewater Investment SRL and its subsidiary Tidewater Caribe, C.A. (collectively “Tidewater”), were investors in oil- and gas-related ventures in Venezuela. Following an alleged expropriation of Tidewater’s investments, Tidewater instituted an arbitration against Venezuela under the ICSID Convention. The ICSID tribunal ultimately issued an award in favor of Tidewater in the principal amount of $46.4 million plus interest.
After Venezuela failed to comply with its pecuniary obligations under the award, Tidewater filed suit in federal court to enforce the award, and attempted to serve Venezuela with the complaint through several of the accepted methods of service under the Foreign Sovereign Immunities Act (the “FSIA”). Ultimately, Tidewater served Venezuela via diplomatic service through the Department of State. Venezuela failed to respond to the complaint within sixty days and Tidewater filed a motion for default judgment.
In considering Tidewater’s motion, the district court first found that there was personal jurisdiction over Venezuela under the FSIA, because Tidewater had properly effected service. The court explained that there are four acceptable methods of service under the FSIA, and that a party “must attempt service by the first method (or determine that it is unavailable) before proceeding to the second, and so on.” Tidewater, the court found, complied with the statute’s instructions, and seeing that the first three methods were unsuccessful, proceeded to the fourth method. Service was therefore adequately completed in accordance with the statute when the Clerk of Court filed a letter from the Department of State verifying that the summons, complaint, and supplementary documents had been served on Venezuela’s Ministry of Foreign Affairs under cover of diplomatic note.
The court then found that there was sufficient evidence that Tidewater was the creditor of a final ICSID amount. Tidewater provided the court with documents sufficient to prove that the arbitral award was valid, and the court found no uncertainty in those documents as to the amount of Venezuela’s pecuniary obligations under the award. The court held that, consistent with 28 U.S.C. § 1608(e), Tidewater established its claim to relief by evidence satisfactory to the court.
Thus, the district court granted Tidewater’s motion for default judgment against Venezuela, entitling Tidewater to the final ICSID award.
A version of this post originally appeared in the March 2019 edition of Baker McKenzie’s International Litigation & Arbitration Newsletter, which is edited by David Zaslowsky.
