Oral Argument Recap: Reid v. Doe Run Resources Corp.
January 11, 2024
On Tuesday, the Eighth Circuit heard oral argument in Reid v. Doe Run Resources Corp., an ad hoc interlocutory appeal limited to the question of whether the district court should have abstained in that case based on foreign policy concerns. The facts of the case are described in a prior post. This post summarizes Tuesday’s oral argument before addressing a preliminary question that was notably missing from it: should the Eighth Circuit even recognize the abstention doctrine asserted by the defendants? This is the question on which Bill Dodge and I submitted an amicus brief, and it is the basis on which I think the Eighth Circuit ought to resolve this appeal.
Where Are the Governments?
The form of international comity abstention asserted by the defendants—what I think would be more aptly labeled “foreign relations abstention”—requires balancing U.S. sovereign interests against the sovereign interests of other relevant countries (here, Peru). Not surprisingly, then, the Eighth Circuit panel (Judges Duane Benton, Ralph Erickson, and Jonathan Kobes) dwelled at oral argument on how they should determine what the interests of the United States and Peru are. In particular, the judges wanted to know why the U.S. government hasn’t submitted a statement of interest in this case and why Peru hasn’t raised stronger objections over the sixteen years that the now-consolidated lawsuits have been pending in U.S. courts.
According to the defendants-appellants, the two countries’ sovereign interests are sufficiently expressed through the precatory language of the U.S.-Peru Trade Promotion Agreement (“TPA”). As Kathleen Claussen has recently and cogently explained, however, that argument fundamentally misreads the TPA. The TPA is focused on intergovernmental relations and did not address purely private litigation. Indeed, as plaintiffs-appellees emphasized before the panel, the U.S. implementing statute explicitly provides that the TPA should not be invoked as a defense in litigation between private parties. Plaintiffs-appellees instead pointed to Peru’s more recent filings in the arbitration that Doe Run has initiated against it, in which Peru has accused Doe Run of using the arbitration to derail the U.S. litigation. Those filings do not suggest that Peru feels its sovereignty is threatened by the Missouri cases.
Choice of Law Concerns
The panel was also concerned about whether Missouri law should be applied to this dispute. The district court (Judge Catherine Perry), applying Missouri’s choice-of-law rules as required by Klaxon, twice concluded that Missouri law applies, though with one limited exception. That choice-of-law determination is not before the court in this limited interlocutory appeal. To the extent the judges were concerned about a federal judge in Missouri interpreting Peruvian law, the plaintiffs-appellees correctly pointed out that federal courts apply foreign law all the time.
The reality is that this case, like most transnational disputes, has connections to more than one country. It isn’t particularly surprising to think that Missouri law might be applied to decisions by Missouri citizens allegedly made in Missouri—particularly as Judge Perry also determined that Peruvian law is not all that different from Missouri law in important respects. One implicit theme of the oral argument is that many different doctrines—like choice of law—help courts balance the regulatory interests of different countries. But the procedural posture of this ad hoc interlocutory appeal means that only the abstention question is currently before the appellate court. Hopefully that limited scope of inquiry does not lead the court to use abstention as a backdoor for addressing choice-of-law concerns.
The Missing Fundamental Question
Absent from the conversation was a critical preliminary question: should the Eighth Circuit adopt a new doctrine of abstention based on foreign relations concerns at all? In the absence of Eighth Circuit precedent on this question, Judge Perry pragmatically reasoned that even if the Eighth Circuit were to adopt such a doctrine, that doctrine would not apply to the facts of this case. She then certified the interlocutory appeal to provide the Eighth Circuit with an opportunity to address the preliminary question of whether it wishes to adopt a doctrine of international comity abstention in the first place. It is important for the Eighth Circuit to address that question head-on.
The closest the oral argument got to addressing this question, however, was the defendants-appellants insistence that The Belgenland (1885) and Canada Malting Co. v. Patterson Steampships (1932) are really cases about international comity abstention. As I have explained before and argue at greater length in this forthcoming article, The Belganland and Canada Malting are cases about forum non conveniens. (The Belganland didn’t use the term “forum non conveniens” because the label hadn’t been invented yet.)
To be clear, the Supreme Court has never recognized a doctrine of international comity abstention. For the Eighth Circuit to dismiss this case based on international comity abstention would require the Eighth Circuit to first adopt a doctrine of international comity abstention. So far only the Ninth and Eleventh Circuits have done so (and the Eleventh has since backpedaled). Nor has any state court that I am aware of adopted such a doctrine. This is, in many ways, uncharted territory.
At oral argument, the defendants-appellants accused the plaintiffs of attempting an “end run” around the Supreme Court’s cases curtailing transnational litigation in U.S. courts. The Supreme Court has indeed made it harder for foreign plaintiffs to bring cases in U.S. courts by narrowing personal jurisdiction, limiting the reach of the Alien Tort Statute, reinvigorating the presumption against extraterritoriality, and encouraging the use of forum non conveniens. But unlike many of the Supreme Court’s cases that express concern about transnational litigation, this isn’t a “foreign-cubed” case: the plaintiffs have sued U.S. defendants in their home court. More importantly, the defendants have failed to use the doctrines already available to them to address the policy concerns that they raise. In particular, as plaintiffs-appellees reminded the court at oral argument, the defendants failed to argue that the case should be dismissed for forum non conveniens.
Meanwhile, adopting a new abstention doctrine to bail out the defendants in this case would put the Eighth Circuit at odds with another line of recent Supreme Court cases: cases that have doubled down on Chief Justice Marshall’s warning back in 1821 that the federal courts “have no more right to decline the exercise of jurisdiction which is given, than to usurp that which is not given.” In often-unanimous opinions, the Supreme Court has curtailed other bases for abstention and prudential doctrines out of concern that broad discretion to decline jurisdiction conflicts with Congress’s constitutional authority to define the jurisdiction of the federal courts. To recognize a new form of abstention—particularly one that is based on judges’ unguided assessments of foreign policy interests—would be a significant assertion of judicial power that runs against the grain of Supreme Court guidance. The Eighth Circuit should decline that invitation.