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Havlish v. Royal Dutch Shell PLC

The Judge was almost certainly unaware that Shell global management plotted to exploit the tragic 9/11 terrorist attack in New York City? Had the judge known about this fact and had seen the relevant Shell internal emails, it may have made him less susceptible to the arguments advanced by Shell’s lawyers.  Likewise, I would be surprised if the Judge knew just how far Shell had been prepared to go to evade sanctions against Iran. 

By John Donovan

Havlish v. Royal Dutch Shell Plc was the case heard in the US courts whereby victims of the 9/11 terrorist attack on the World Trade Centre twin towers attempted to obtain $2.1 billion from Shell that Shell rightfully owed to Iran, but could not pay because of sanctions. Havlish had obtained a $6.1 billion judgement against Iran but had no way of getting payment from the extremist Iranian regime.

A detailed article is printed below. Shell successfully resisted the claim and the case was terminated on May 25, 2016.

I have provided links to the opening petition and a 152 page transcript capturing the sometimes heated exchanges at the final court hearing. Shell lawyers used the jurisdiction issue to their advantage, as Shell did when it suited them in a number of other US court cases i.e. Esther Kiobel v Royal Dutch Petroleum; James G. Wood / Deepwater Slender Wells Limited / Preda Consultants litigation all brought against Shell in the US courts. All also involving jurisdictional issues.

Shell’s lawyers also maintained that Shell subsidiary companies are independent and act independently of Royal Dutch Shell Plc. Shell staff will know the truth about that issue.

The Judge was almost certainly unaware that Shell global management plotted to exploit the tragic 9/11 terrorist attack in New York City? Had the judge known about this fact and had seen the relevant Shell internal emails, it may have made him less susceptible to the arguments advanced by Shell’s lawyers.  Likewise, I would be surprised if the Judge knew just how far Shell had been prepared to go to evade sanctions against Iran.

IOrrick.com: Court of Appeals Rejects, on Jurisdictional Grounds, Effort to Circumvent U.S. Sanctions to Satisfy Judgment Against Iran

The World in U.S. Courts: Fall 2014 – Personal Jurisdiction | September.24.2014

Havlish v. Royal Dutch Shell PLC, U.S. District Court for the Southern District of New York, September 24, 2014

Plaintiffs represent victims of the September 11 terrorist attacks in New York who obtained a judgment of approximately $6.1 Billion against the National Iranian Oil Company (“NIOC”).  Defendant Royal Dutch Shell PLC (“RDS”) is the parent holding company for two non-U.S. subsidiaries that, though unrelated commercial transactions, owe NIOC approximately $2.1 billion, but which are unable to make that payment because of EU and UK sanctions.  This suit seeks an order requiring the RDA subsidiaries to make the payment directly to the plaintiffs in order partially to satisfy the judgment.

RDS, a UK company based in the Netherlands, argued that it is not subject to general personal jurisdiction in the U.S. (the claims do not arise out of contacts between any Shell company and New York, and so the question of specific personal jurisdiction was not presented).  The U.S. District Court in New York first reviewed the New York jurisdictional statute, observing that it required a non-NY corporation to be conducting “continuous and systematic” business in the state for jurisdiction to attach.  The Court found this test was not satisfied because RDS itself did not conduct business in New York, and that its U.S. subsidiaries were not located in New York.  Nor was the Court willing to impute to RDS the New York contacts of the subsidiaries on a theory that they were so directly managed by their foreign parent that their separate legal status should be ignored.  The District Court added, without having to decide the issue, that such a theory of agency that had been used in New York to attribute the actions of a New York subsidiary to a foreign parent might no longer be good law under as a result of the U.S. Supreme Court’s 2014 ruling in Daimler AG v. Bauman.  The Court also rejected the argument that the listing of RDC’s securities on the New York Stock exchange was tantamount to conducting business in New York and thus did not support a finding of general personal jurisdiction.

The District Court also addressed the argument that general personal jurisdiction was alternatively available under a rule of federal civil procedure authorizing jurisdiction over a non-U.S. defendant where i) the case involves a claim under federal law, ii) the defendant cannot otherwise be sued in any U.S. state, and iii) the defendant’s contacts with the U.S. as a whole would be sufficient to establish jurisdiction.  The Court concluded that the plaintiffs’ claim here—for execution of an award—arose under New York law, and that RDS was not even a party to the underlying federal lawsuit that gave rise to the $6.2 Billion judgment.

ORRICK SOURCE ARTICLE

HavlishvRDSDoc 1: 25 Page Petition filed 4 October 2013

HavlishvRDS 152 Page Transcript: Filed 3 December 2014

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