Leidos, Inc. v. Hellenic Republic

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 6, 2017 Decided February 2, 2018

No. 17-7082

LEIDOS, INC., FORMERLY KNOWN AS

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION,

APPELLEE

v.

HELLENIC REPUBLIC,

APPELLANT

Appeal from the United States District Court

for the District of Columbia

(No. 1:13-cv-01070)

Neal Goldfarb argued the cause and filed briefs for the

appellant. Max F. Maccoby entered an appearance.

William T. O’Brien argued the cause and filed the brief for

the appellee. Allen B. Green and Ivan W. Bilaniuk were with

him on brief.

Before: HENDERSON, TATEL and KAVANAUGH, Circuit

Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

2

KAREN LECRAFT HENDERSON, Circuit Judge: This case is

a testament to the rise of the dollar—and the precipitous decline

of the euro—over the last four years. In July 2013, Leidos,

Inc. (Leidos)1 won an arbitration award against the Hellenic

Republic 2 resulting from security work it performed in

connection with the 2004 Summer Olympic Games held in

Athens, Greece. The award consisted of €39,818,298 in

damages and $162,500 in costs. Upon receiving the award,

Leidos promptly petitioned the United States District Court for

the District of Columbia to confirm and enforce it. After

approximately three years of intermittent stays, status updates,

motions and parallel litigation in Greek courts, the district court

confirmed the arbitration award and entered judgment—in

euros—in favor of Leidos.

Pursuant to Federal Rule of Civil Procedure 59(e), Leidos

then moved to convert the award into U.S. dollars based on the

exchange rate ($1.3017 to €1) on July 2, 2013, the date of the

original arbitral award. The district court granted the motion.

Because the exchange rate had dropped 19.1 per cent from the

award date to the judgment date ($1.0533 to €1 on January 6,

2017), the total dollar value of the conversion increased the

value of the arbitral award by approximately $11.9 million.

The Hellenic Republic appealed. For the following reasons,

we conclude that the district court mistakenly granted Leidos’s

motion and we reverse.

1

When it entered into the contract with the Hellenic Republic

(and when it initiated this lawsuit), Leidos was named the Science

Applications International Corporation. Its changed name does not

carry any legal significance.

2

The Hellenic Republic is popularly known as Greece.

3

I.

In May 2003, the Hellenic Republic contracted with

Leidos to provide a public-safety infrastructure system for the

2004 Athens Summer Olympics. The contract was written in

Greek and provided for payment in euros. After a series of

disputes regarding the Hellenic Republic’s acceptance of the

infrastructure system, the parties agreed to a contract

modification (Modification No. 5) that included certain

dispute-resolution provisions, specifically:

Any claim or dispute arising from or related to

the current Contract or its interpretation is to be

finally resolved by Arbitration according to the

Rules of Arbitration of the International

Chamber of Commerce (ICC) and shall be tried

under Greek Law. Arbitration shall take place

in Athens, Greece, by three Greek Arbitrators.

Joint Appendix (JA) 101. Modification No. 5 further provided

that Greek was the language of the arbitration and that the result

of the arbitration was final and binding on both parties. Id.

The parties’ contractual disagreements continued after

Modification No. 5 and, on June 16, 2009, Leidos filed a

Request for Arbitration. The arbitral tribunal heard the case

over eight days in May 2012. On July 2, 2013, the tribunal

issued its final award, which ordered the Hellenic Republic to

pay Leidos: (1) €39,818,298 in damages; (2) $162,500 in

arbitration costs; and (3) simple interest of 6 per cent beginning

July 11, 2013, the date the award was served on the Hellenic

Republic. JA 19.

On July 12, 2013, Leidos filed a Petition to Confirm

Arbitration and to Enter Judgment in the district court for the

District of Columbia. On September 5, 2013, the Hellenic

4

Republic filed a parallel suit in the Athens Court of Appeals

seeking to set aside the arbitration award. The Hellenic

Republic subsequently answered Leidos’s complaint in district

court, alleging six affirmative defenses under the Federal

Arbitration Act, 9 U.S.C. §§ 201 et seq. On March 28, 2014,

the district court granted the parties’ joint motion to stay

proceedings pending the resolution of the Greek litigation.

Several months later, Leidos submitted in district court two

proposed orders seeking to confirm the award: one on

September 8, 2014 and the other on December 17, 2014. The

district court did not rule on either of the proposed orders,

instead holding the case in abeyance while the Greek litigation

ran its course.

While the case was stayed in the United States, the Greek

litigation made its way through that judicial system. First, the

Athens Court of Appeals set aside the arbitration award,

reasoning that the parties’ contract was tainted by the

corruption of Leidos’s subcontractor, Siemens. Leidos

appealed that decision to the Greek Supreme Court, which

unanimously reversed the Athens Court of Appeals and, on

September 22, 2016, reinstated the arbitral award.3

On November 3, 2016, the district court asked the parties

their positions on the effect of the Greek Supreme Court

decision. Neither party mentioned currency conversion in

their respective responses. On January 5, 2017, the court

granted Leidos’s Petition to Confirm the Arbitration Award

and to Enter Judgment. The next day, the court clerk entered

judgment in favor of Leidos in the amount of €39,818,298.

3

The Greek Supreme Court remanded the case to the Athens

Court of Appeals for a new hearing consistent with its decision. The

hearing took place on November 16, 2017 and the result remains

pending.

5

The judgment form made no mention of interest or costs.

Thereafter, Leidos moved to correct the judgment under Rule

60(a) and to alter or amend the judgment under Rule 59(e). It

requested $162,500 in costs, as awarded by the tribunal, as well

as pre- and post-judgment interest as to damages and costs. It

further requested that the court alter or amend the entry of

judgment to convert the total award into U.S. dollars.

The district court granted Leidos’s motion in full,

correcting “clerical mistakes” under Rule 60 and curing “clear

error” or “manifest injustice” under Rule 59(e). In re

Arbitration of Certain Controversies between Sci. Applications

Int’l Corp. & Hellenic Republic, 249 F. Supp. 3d 300, 302-03

(D.D.C. 2017). Regarding the clerical mistakes, the district

court amended the judgment to include $162,500 in costs (as

provided in the original arbitral award) plus $34,031.51 in

interest on that sum. The court also awarded €8,115,607.64 in

interest on the damages award itself. Applying Rule 59(e), the

district court converted the entire award into U.S. dollars using

the exchange rate in effect on July 2, 2013, the date of the

arbitral award. The amended judgment totaled

$62,731,104.80. Because the value of the euro had declined

significantly against the dollar over the course of the litigation,

converting the judgment increased its value by approximately

$11.9 million. The Hellenic Republic now appeals only the

conversion of the arbitral award under Rule 59(e).

II.

We review the district court’s decision granting Leidos’s

Rule 59(e) motion for abuse of discretion. Flynn v. Dick

Corp., 481 F.3d 824, 829 (D.C. Cir. 2007). “A district court

by definition abuses its discretion when it makes an error of

law.” Koon v. United States, 518 U.S. 81, 100 (1996).

6

In granting Leidos’s motion, the district court committed

two errors. First, the district court incorrectly concluded that

our Rule 59(e) precedent did not apply to Leidos because it was

not a “losing party.” In re Arbitration of Certain

Controversies between Sci. Applications Int’l Corp. & Hellenic

Republic, 249 F. Supp. 3d at 302-03. Second, the court erred

in concluding that it was manifestly unjust to award Leidos

judgment in euros even though Leidos had expressly sought

relief in euros at least three times and had not asked for dollars

until its post-judgment motion. Id. at 304-05. In addition,

the district court misinterpreted—and thus mistakenly relied

on—our opinion in Continental Transfert Technique Ltd. v.

Federal Government of Nigeria, 603 Fed. App’x 1 (D.C. Cir.

2015) (per curiam), which we address below.

Federal Rule of Civil Procedure 59(e) provides a limited

exception to the rule that judgments are to remain final. See

Derrington-Bey v. Dist. of Colum. Dep’t of Corrs., 39 F.3d

1224, 1225 (D.C. Cir. 1994). Under Rule 59(e), the court may

grant a motion to amend or alter a judgment under three

circumstances only: (1) if there is an “intervening change of

controlling law”; (2) if new evidence becomes available; or (3)

if the judgment should be amended in order to “correct a clear

error or prevent manifest injustice.” Firestone v. Firestone,

76 F.3d 1205, 1208 (D.C. Cir. 1996) (per curiam) (quoting

Nat’l Tr. v. Dep’t of State, 834 F. Supp. 453, 455 (D.D.C.

1993)). Although the court has considerable discretion in

ruling on a Rule 59(e) motion, the reconsideration or

amendment of a judgment is nonetheless an extraordinary

measure. Id.

We have held that Rule 59(e) motions are aimed at

“reconsideration, not initial consideration.” District of

Columbia v. Doe, 611 F.3d 888, 896 (D.C. Cir. 2010) (quoting

Nat’l Ecological Found. v. Alexander, 496 F.3d 466, 477 (6th

7

Cir. 2007)). “Rule 59(e) permits a court to alter or amend a

judgment, but it may not be used to relitigate old matters, or to

raise arguments or present evidence that could have been raised

prior to the entry of judgment.” Exxon Shipping v. Baker, 554

U.S. 471, 486 n.5 (2008) (quoting 11 C. Wright & A. Miller,

Federal Practice and Procedure § 2810.1, pp. 127–128 (2d ed.

1995)). It is “not a vehicle to present a new legal theory that

was available prior to judgment.” Patton Boggs LLP v.

Chevron Corp., 683 F.3d 397, 403 (D.C. Cir. 2012).

In the same vein, manifest injustice “does not exist where

. . . a party could have easily avoided the outcome, but instead

elected not to act until after a final order had been entered.”

Ciralsky v. CIA, 355 F.3d 661, 665 (D.C. Cir. 2004). In

determining whether a decision could result in manifest

injustice, we examine whether it would “upset settled

expectations—expectations on which a party may reasonably

place reliance.” Qwest Servs. Corp. v. FCC, 509 F.3d 531,

540 (D.C. Cir. 2007) (interpreting “manifest injustice” in

context of retroactive FCC ruling). “[M]anifest injustice”

requires “at least (1) a clear and certain prejudice to the moving

party that (2) is fundamentally unfair in light of governing

law.” Mohammadi v. Islamic Republic of Iran, 947 F. Supp.

2d 48, 78 (D.D.C. 2013), aff’d, 782 F.3d 9 (D.C. Cir. 2015).

The district court erred, first, in articulating the Rule 59(e)

standard. In focusing on our statement in Kattan ex rel.

Thomas v. District of Columbia that Rule 59(e) does not permit

a “losing party . . . to raise new issues that could have been

raised previously,” 995 F.2d 274, 276 (D.C. Cir. 1993)

(emphasis added), the court reasoned that, because Leidos was

not a “losing party,” the prohibition on asserting—post-

judgment—a previously available argument did not apply. In

other words, the district court’s articulation of Rule 59(e)

allowed Leidos to assert a previously available legal theory

8

after judgment simply because it was the prevailing party. Its

explanation recites that:

[The Hellenic Republic] is correct that Leidos

expressly asked, at a much earlier point in this

long-running litigation, that the amount of

Judgment . . . be stated in Euros. However, the

fact that Leidos asked for the Judgment to be

stated in Euros at that time does not decide the

issue at this late date.

In re Arbitration of Certain Controversies between Sci.

Applications Int’l Corp. & Hellenic Republic, 249 F. Supp. 3d

at 302. The explanation utterly fails to account for the fact that

Leidos’s request could have—and should have—been made

long “before judgment was entered.” Obriecht v. Raemisch,

517 F.3d 489, 494 (7th Cir. 2008); see Baker, 554 U.S. at 486

n.5. Indeed, the district court’s rationale does not seem to

contemplate any limit on a prevailing party’s doing a post-

judgment volte-face.4 The text of Rule 59(e) plainly does not

differentiate between winners and losers. Fed. R. Civ. P.

59(e). Neither does our precedent. See, e.g., Patton Boggs,

683 F.3d at 403 (“Rule 59(e) is not a vehicle to present a new

legal theory that was available prior to judgment.”). The

benefit of finality applies equally to all litigants. See Plaut v.

Spendthrift Farm, Inc., 514 U.S. 211, 219 (1995) (discussing

historical reasons for promoting finality).

4

Kattan’s “losing party” language is perhaps best interpreted

as merely describing the moving party therein. Kattan, 995 F.2d at

275-76. The reference to a “losing party” also reflects the common-

sense understanding that a losing party will file a Rule 59(e) motion

more frequently than a prevailing party. A prevailing party rarely

desires reconsideration or amendment.

9

Second, we conclude—contrary to the conclusion of the

district court—that the judgment was consistent with

“governing law” and that Leidos did not suffer any “manifest

injustice” in receiving the relief it had explicitly and

consistently requested. Mohammadi, 947 F. Supp. 2d at 78.

Historically, U.S. and English courts were reluctant to

enter judgments in foreign currencies. See In re Oil Spill by

Amoco Cadiz Off Coast of France on Mar. 16, 1978, 954 F.2d

1279, 1329 (7th Cir. 1992) (detailing history of currency

conversion in federal court). In the years since the Congress

amended the Coinage Act in 1982,5 however, that trend has

gradually shifted and courts in both countries now recognize

that it is appropriate to enter judgment in foreign currency

under some circumstances. Id.; see RESTATEMENT (THIRD) OF

THE FOREIGN RELATIONS LAW OF THE UNITED STATES § 823

cmt. b (1987) (explaining shift in U.S. and English courts).

Recent cases have endorsed judgment in a foreign currency if

the petitioner requests payment in that currency. See Cont’l

Transfert, 603 Fed. App’x at 4; see also In re Amoco Cadiz Oil

Spill, 954 F.2d at 1328 (“Judgment in a foreign currency is

5

Section 20 of the Coinage Act of 1792, formerly at 31 U.S.C.

§ 371, provided that the “money of account of the United States shall

be expressed in dollars . . . .” Some courts interpreted this Act to

mean that “American courts are permitted to render judgments only

in dollars.” Int’l Silk Guild v. Rogers, 262 F.2d 219, 224 (D.C. Cir.

1958). In 1982, however, the Coinage Act was reenacted without

the “money of account” language and the legislative history indicates

that it was “omitted as surplus.” H.R. Rep. No. 97-651, 97th Cong.,

2d Sess., at 146-47 (1982). Indeed, even before the 1982

amendment, some courts questioned whether courts were invariably

required to enter judgments in dollars. Baumlin & Ernst, Ltd. v.

Gemini, Ltd., 637 F.2d 238, 244 (4th Cir. 1980) (enforcing consent

order in Swiss francs notwithstanding Coinage Act).

10

especially attractive when the commercial activity took place

in that currency.”). In addition, District of Columbia law

permits—and sometimes requires—a foreign-currency

judgment. See D.C. Code §§ 15-901 et seq. Indeed, both

parties accept that the district court was permitted to enter the

original judgment in euros. Appellee’s Br. 12-13 nn.4-5

(acknowledging that judgment in euros did not amount to

“clear error”); Appellant’s Br. 14 (“[T]he entry of the original

judgment in euros was not erroneous at all, much less clearly

erroneous . . . .”). Thus, the original judgment was not

erroneously entered in euros such that it required Rule 59(e)

correction or amendment.

Nor did the judgment prejudice Leidos. Leidos could

have asked for dollars instead of euros at any time before

judgment; it chose not to. The value of the euro is published

daily on the foreign exchange market;6 it was thus available to

Leidos long before judgment and Leidos does not offer any

reason for its delay in seeking currency conversion.7 Instead,

at least three times, Leidos explicitly requested judgment in

euros: first, in its complaint and the proposed order that

accompanied it, JA 20; next, in its September 8, 2014

submission of a proposed judgment, JA 559-60; and finally, in

6

Current and historic foreign exchange rates are also published

on the Federal Reserve’s website, see Board of Governors of the

Federal Reserve System, Foreign Exchange Rates - H.10,

https://www.federalreserve.gov/releases/h10/current/, and courts

routinely take judicial notice of exchange rates, see In re New Motor

Vehicles Canadian Exp. Antitrust Litig., 522 F.3d 6, 15 n.10 (1st Cir.

2008).

7

Beginning on May 6, 2014, the euro began to fall in value

against the dollar for approximately 10 months until it bottomed out

on March 11, 2015 at $1.0552 to €1.

11

the proposed judgment it submitted on December 17, 2014, JA

561-62.8

Moreover, Leidos’s delay was not without harm to the

Hellenic Republic; it precluded the Hellenic Republic from

effectively hedging against the risk of currency fluctuations.

The fluidity of foreign exchange rates is a recognized feature

of modern macroeconomics. See Molinos Valle Del Cibao, C.

por A. v. Lama, 633 F.3d 1330, 1336 (11th Cir. 2011)

(discussing mechanics of foreign currency exchange contract).

To guard against fluctuation risk, a party can buy a “futures”

contract in a given currency. See In re Amoco Cadiz Oil Spill,

954 F.2d 1279, 1329 (7th Cir. 1992) (discussing hedging

practice). Here, Leidos could have purchased a futures

contract for dollars, promising payment in euros at a later date.

Once the Hellenic Republic satisfied its judgment in euros,

Leidos could have then traded in its futures position on the

foreign exchange market and received the dollar value of the

award. The same is true for the Hellenic Republic; it could

have bought a dollars-to-euros futures contract. But Leidos’s

delay did not give the Hellenic Republic notice of a need to

guard against currency fluctuation. See id. (“Although the

value of the judgment may fluctuate, the parties’ hedging can

undo the effect. The highest objective is predictability.”).

The parties’ contract was in euros, the arbitral award was in

euros and Leidos repeatedly requested judgment in euros.

Accordingly, the Hellenic Republic had a reasonable and

8

As late as November 3, 2016, the district court gave Leidos an

opportunity to request conversion when it asked “what, if anything

[it] should do now that the Supreme Court of the Hellenic Republic

has ruled.” JA 7. Leidos remained mute regarding currency

conversion.

12

“settled expectation[]” that it would satisfy the judgment

against it in euros. Qwest Services, 509 F.3d at 540.

Continental Transfert is not to the contrary. 603 Fed.

App’x 1. In that case, Continental won an arbitral award

against the government of Nigeria. Id. The arbitral award

was in foreign currency—Nigerian naira and British pounds—

and Continental sought to enforce the award in district court.

Id. at 2. Continental’s complaint did not specify which

currency it requested. Id. At summary judgment,

Continental moved to confirm and enforce the award and asked

that the judgment be converted to dollars. Cont’l Transfert

Technique Ltd. v. Fed. Gov’t of Nigeria, 932 F. Supp. 2d 153,

162 (D.D.C. 2013), aff’d, 603 Fed. App’x 1 (D.C. Cir. 2015).

The district court issued an order confirming and enforcing the

arbitration award but failed to grant Continental’s conversion

request. Id. at 157. Promptly thereafter, Continental filed a

post-judgment motion, 9 again seeking to convert the award

into dollars. Id. The district court granted the motion and we

affirmed. Cont’l Transfert, 603 Fed. App’x at 1. Our

reasons for affirming the district court in Continental Transfert

are straightforward and inapplicable to this case. In

Continental Transfert, we converted the arbitral award into

dollars primarily because “a judgment in a foreign currency

should be issued only when requested by the judgment

creditor.” Id. at 4 (emphasis added). Although

Continental had requested confirmation of its award, its

complaint did not specify which currency it sought. Id. In

those circumstances, we concluded “[s]ilence . . . is not a

request” and we upheld the conversion to dollars. Id.

9

Continental labeled its post-judgment motion as a

“correction” under Rule 60(a) but we treated it as a motion to amend

under Rule 59(e). Cont’l Transfert, 603 Fed. App’x at 4.

13

By contrast, Leidos was not silent; it explicitly requested

judgment in euros in its complaint and its proposed orders,

specifying that only costs be computed in dollars. See, e.g.,

JA 22b (requesting €39,818,298 in euros and $162,500 in

dollars). Moreover, unlike Continental, Leidos did not ask for

conversion to dollars at summary judgment. Therefore, unlike

Leidos’s post-judgment motion, the Rule 59(e) motion in

Continental Transfert was directed to “reconsideration, not

initial consideration.” District of Columbia v. Doe, 611 F.3d

at 896. Accordingly, the typical framework of Rule 59(e)

applied and the district court had wide discretion to reconsider

its previous order. Firestone, 76 F.3d at 1208. That is simply

not the case here. As our precedent makes clear, Rule 59(e) is

not available to a party who “could have easily avoided the

outcome, but instead elected not to act until after a final order

had been entered.” Ciralsky, 355 F.3d at 665.

Our opinion today does not require us to plumb the murky

waters of currency conversion in federal court. See Competex,

S.A. v. Labow, 783 F.2d 333, 336-37 (2d Cir. 1986) (discussing

possible conversion dates for foreign currency judgments); see

also RESTATEMENT (FOURTH) OF THE FOREIGN RELATIONS

LAW OF THE UNITED STATES § 420 (updated 2017). We need

only hold that, under Rule 59(e), a district court may not

convert a judgment to dollars if the movant contracted in euros,

received its arbitral award in euros, requested euros in its

complaint and filed three proposed orders seeking euros, before

reversing course post-judgment. Under these circumstances,

it cannot be “manifestly unjust” to preserve Leidos’s judgment

in euros.

For the foregoing reasons, we reverse the district court and

remand with instructions to reenter judgment in accordance

with the arbitral award. In addition, Leidos is entitled to post-

14

judgment interest at the statutory rate set out in 28 U.S.C.

§ 1961.

So ordered.