# Opposition Brief — Guevara v. Republic of Peru

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386017_2503%3A2

## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 2010
- **Citation:** 562 U.S. 1082

## Text

2 @O les

No. 10-389 1 CCFO

IN THE
Supreme Court of the Anited States

JOSE GUEVARA,
Petitioner,
We

REPUBLICA DEL PERU, AND
MINISTERIO DEL INTERIOR DEL PERU,
Respondents.

On Petition for Writ of Certiorari to the
United States Court of Appeals
for the Eleventh Circuit.

BRIEF IN OPPOSITION TO
PETITION FOR WRIT OF CERTIORARI

MARK A. CYMROT
Counsel of Record
LEE H. SIMOWITZ
AMBIKA J. BIGGS
BAKER & HOSTETLER LLP
1050 Connecticut Ave., NW
Washington, DC 20036
(202) 861-1500
October 22, 2010 mcymrot@bakerlaw.com

Counsel for Respondents

ATTEN AE SEE TT ATTA ART IIS MARRIOT AGRE, SS TSMR RAM)
WILSON-EPES PRINTING CO., INC. — (202) 789-0096 — WASHINGTON, D. C. 20002

QUESTION PRESENTED

The petition does not raise an issue of law, but
rather a dispute about the insufficiency of Plaintiff
Jose Guevara’s evidence. The Eleventh Circuit
correctly found that Guevara’s evidence failed to
prove any “direct etfect” in the United States from
Peru’s reward offer for accurate information directly
enabling the capture of an infamous fugitive. With-
out a “direct effect” in the United States—i.e., with-
out any nexus between the conduct and the United
States—the Eleventh Circuit dismissed the case for
want of subject matter and personal jurisdiction
under the Foreign Sovereign Immunities Act (*FSIA”),
28 U.S.C. § 1605(a)(2). The Eleventh Circuit did not
hold that the “direct effect” had to be a “legally signif-
icant act” or satisfy a requirement of “substantiality”
or “foreseeability,” as the petition suggests. These
arguments were not made below and thus, not
addressed by the Eleventh Circuit. Accordingly, they
were not properly preserved for this Court.

Guevara’s evidence of “direct effect” fails to raise
any novel or highly disputed issues. He argues that
his arrest in Miami was “in connection with”
commercial activity of Peru; the Eleventh Circuit
correctly held his arrest was in connection with his
criminal activity. The Eleventh Circuit also correctly
held that Peru’s refusal to pay Guevara in the United
States was not required by the reward offer, thus
distinguishing this case from Republic of Argentina v.
Weltover, 504 U.S. 607 (1992). See Guirlando v. T.C.
Ziraat Bankasi A.S., 602 F.3d 69, 75 (2d Cir. 2010)
(no direct effect where payment in United States not
contractually required).

(i)

ii

The circuit split interpreting the FSIA’s nexus
requirement, that Guevara asserts, is illusory and
immaterial to the outcome of this case. The three
judges of the Eleventh Circuit, including the dissent,
agreed that this case was not appropriate for a
United States court to decide, as argued by the
United States in its amicus brief to the Eleventh
Circuit. And there are numerous additional bases to
support the result.

The petition, thus, should be denied.

TABLE OF CONTENTS

Page
QUESTIONS PRESENTED .....................:..:00000+ i
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Fe ey IED ane rsesnasecsonscncercescesosseccenscsesinis 1
STATEMENT OF THE CASE .......................004 2
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B. Proceedings Below ...................:ccccecceeeeeeeee 5
SUMMARY OF ARGUMENT .................0....0.2.04. 9
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Fe MNPTIILDI secscvaccdsansocsstenssnteptcensasensanniersianes 21
APPENDIX
APPENDIX A: Emergency Decree No. 049-
EE deksnsdensrincéurdensdvensaaneiundienisahebaldésadadionaenens la

APPENDIX B: Federal Bureau of Investiga-
tion’s Response to Plaintiffs Motion to
Compel Compliance with Trial Subpoenas. 12a

APPENDIX C: Brief for the United States
as Amicus Curiae in Support of Republica
BPE FE scsccsiscrscsnceseunsnsssnintexisecsadidessmnanmbbasbitn 20a

(iii)

iV

TABLE OF AUTHORITIES

CASES Page
American Telecom Co., LLC v. Republic of
Lebanon, 501 F.3d 534 (6th Cir. 2007) .... 18
Guevara v. Republic of Peru, 468 F.3d 1289
C2 Sa, HIE vundecssunenutsscrcarecsas 1, 2, 6, 7, 12, 20
Guevara v. Republic of Peru, 608 F.3d 1297
Ce a MP cctesccdsucidiedbideustsccssukeniecoss 2, 12,19
Guirlando v. T.C. Ziraat Bankasi, A.S., 602
FAs Be CAG CP. BAO) cc evccccsncsccsscescescseses: 16
Hanil Bank v. PT. Bank Negara Indone-
sta, 148 F.3d 127 (2d Cir. 1998) ............... 16
Harris Corp. v. Nat'l Iranian Radio & Tele-
vision, 691 F.2d 1344 (11th Cir. 1982)..... 13
Republic of Argentina v. Weltover, 504 U.S.
kt oo ee oe 13, 14, 16, 17, 18
Saudi Arabia v. Nelson, 507 U.S. 349, 362
PT hsanicbabantqnensuasesseeseulesunpensiieedessecnavessooth 14
STATUTES
Re A AEE vide cicscancsnscenecsussavncacsesvatesssoess 4
Be ee OE IED daacetncosnsiesseoivntsesxtnnvtensunays 4
28 U.S.C. § 1605(a)(2).............. 1,11, 12, 14, 16, 17

MISCELLANEOUS
67 Am. Jur. 2nd Rewards § J...............000008.. 10

IN THE
Supreme Court of the United States

No. 10-389

JOSE GUEVARA,
Petitioner,
we

REPUBLICA DEL PERU, AND
MINISTERIO DEL INTERIOR DEL PERU,
Respondents.

On Petition for Writ of Certiorari to the
United States Court of Appeals
for the Eleventh Circuit.

BRIEF IN OPPOSITION TO
PETITION FOR WRIT OF CERTIORARI

OPINIONS BELOW

This case has been before the United States Court
of Appeals for the Eleventh Circuit twice. The
Eleventh Circuit’s first decision in this case held that
“a foreign state’s offer of a reward in return for
information enabling it to locate and capture a fupi-
tive” fell within the FSILA’s commercial activity excep-
tion. 28 U.S.C. § 1605(a)(2). The decision, which
reversed the district court’s dismissal of Guevara’s
lawsuit, is reported at 468 F.3d 1289 (11th Cir. 2006)
(“Guevara I”).

2

On remand, the district court granted partial
summary judgment in favor of Guevara and denied
Peru’s cross motion for summary judgment, finding
Guevara had earned the reward and thus “effectively
preempting the ... evaluation decision” of the Peru-
vian governmental body (Special High Level Commit-
tee or “SHLC”) that determined that Guevara had
not earned the reward. 608 F.3d F.3d 1297, 1305. In
response to Peru’s argument that its conduct had
insufficient nexus to the United States for jurisdic-
tion under the FSIA, the district court held that
the Eleventh Circuit already had decided the juris-
dictional issues in Guevara I. The district court
conducted no further analysis. This decision is
published at 2008 WL 4194839.

The Eleventh Circuit’s secend decision reversed the
district court, holding that: (1) it had not decided
the nexus issue in Guevara I, and (2) the district
court lacked subject matter jurisdiction because
Peru’s reward offer did not cause a direct effect in the
United States under FSIA’s commercial activity
exception. That decision is reported at 608 F.3d 1297
(“Guevara IT’).

STATEMENT OF THE CASE
A. Factual Record

Plaintiff Jose Guevara, a former Venezuelan intel-
ligence officer, provided security and a safe house in
Venezuela for Vladimiro Montesinos, the fugitive
head of Peru’s National Intelligence Agency, who had
purportedly committed a string of crimes, including
arms and drug trafficking, money laundering, extor-
tion, bribery, and multiple murders. 3a-5a_ of
Guevara Appendix A (hereinafter cited as “Guevara
App. A, __”). The first media leaks of Montesinos’

3
videotapes exposing some of his crimes led to the
resignation of Peruvian President Alberto Fujimori,
and created a political and constitutional crisis that
had repercussions in Peru for many years. Guevara
App. A, 3a. Montesinos quickly fled the country and
disappeared.’ Guevara App. A, 3a.

When the trail for Montesinos went cold, Peru’s
interim President Valentin Paniagua Corazao issued
an Emergency Decree providing for a $5 million
reward for “accurate information that will directly
enable the locating and capturing” of Montesinos.
Guevara App. A, 4a; Emergency Decree, Peru Appen-
dix A (hereinafter referred to as “Peru App. A, __”).
If more than one person supplied information, the
reward would be split among them. The reward offer
expressly required that information had to be pro-
vided to the SHLC, and that the SHLC would decide
any reward claims. Guevara App. A, 4a. The decree
authorized the government to take a loan from, and
open an account in, a Peruvian state-owned bank to
pay the reward. Guevara App. A, 4a. The decree
gave the reward recipients no right to determine the
place of payment.

While harboring Montesinos, Guevara and others
extracted at least $55 million from him as protection
money. DE 296-3, pp. 41589-92; DE 295-3, pp. 4544-
45; DE 295-2; p. 45,757; DE 296-6, pp. 68890, 68900.’
When Montesinos was running out of money,

"The Eleventh Circuit recounted the facts in the light most
favorable to Guevara. We include a more complete recitation of
the record before the district court.

* DE refers to the docket entry number on the docket in the
U.S. District Court for the Southern District of Florida, Case
No. 1:04-cv-23223-MGC.

+

Guevara made trips on Montesinos’ behalf to Lima,
Bogota, Miami and Nassau, Bahamas seeking addi-
tional funds. DE 201-2, pp. 35, 36, 94. On June 22,
2000, Guevara was arrested in Miami by the FBI
after attempting to extort a banker to release a
total of $3.7 million from one of Montesinos’ bank
accounts. Guevara App. A, 10a. Guevara was
charged with extortion and fraud against the United
States. 18 U.S.C. $§ 875(b), 371. DE 201-2, p. 108;
DE 201-6.

While in FBI custody, Guevara was told that he
would be released and the charges dropped if he
cooperated in Montesinos’ capture. He also was
informed of Peru’s reward offer, which the FBI was
aware of from published reports. Guevara App. A,
5a-6a. Supervisory Special Agent Kevin Currier
testified that Guevara had agreed to cooperate with
the FBI before he was informed of Peru’s reward.
DE 319-3, pp. 39-42. Currier, who was stationed in
Lima, consulted with Minister of the Interior Antonio
Ketin Vidal and worked out a plan for Montesinos’
capture. DE 201-3, p. 125. In a single telephone
conversation from Lima, Vidal and Currier told FBI
Agent Waldo Longa in Miami to instruct Guevara to
have his accomplices in Caracas deliver Montesinos
to the Peruvian ambassador’s residence. Guevara
App. A, 12a-13a. Vidal also explained the terms of
the reward to Longa who passed the information to
Guevara. Guevara App. A, 13. Guevara then called
his accomplice in Venezuela and supposedly gave the
instructions. Guevara App. A, 13a.

Montesinos never arrived at the Peruvian ambas-
sador’s residence; he was captured that same night
by the Venezuelan authorities. Guevara App. A, 13a.
The next day Venezuelan President Hugo Chavez

3)

announced that Venezuela had found and arrested
Montesinos. DE 201-3, pp. 55, 68; DE 201-4, p. 58.
In a diplomatic flap with both Peru and the United
States, Venezuela said it alone had located Montesi-
nos.” The head of the FBI’s Miami field office stated
publicly he did not know how Montesinos was
arrested, and Guevara told the media that the Vene-
zuelan government had known all along where
Montesinos was _ hiding. DE 285-14, DE 265-1,
DE 201-2, pp. 69-73.

Guevara then submitted a claim for the reward to
the SHLC, which conducted an extensive investiga-
tion, including meetings and correspondence with
FBI Agent Currier and Guevara’s lawyer. DE 326-5,
{ 5. Despite repeated requests over a two-year
period, Currier could not connect Montesinos’ arrest
to Guevara’s purported cooperation. DE 326-5, {J 6,
7, 14. Guevara, who was in the best position to
provide evidence regarding the circumstances of the
arrest, relied only on the coincidence of timing
between his call to Caracas and Montesinos’ subse-
quent arrest. The SHLC, therefore, concluded that
the Venezuelan Government’s intervention was an
independent event that resulted in Montesinos’
arrest, and denied Guevara’s claim. DE 326-5, JJ 16,
19; DE 201-4, pp. 20-21.

B. Proceedings Below

Guevara filed suit against Peru and two ministers
seeking the reward in Florida state court. Guevara
App. A, 6a. After removing the case to federal court,
Peru moved to dismiss on the grounds of sovereign

* Venezuela’s tension with Peru and the United States is
reported in a June 29, 2001 Associated Press Worldstream
article. DE 285-14.

6

immunity. Guevara App. A, 6a-7a. Peru argued that
a reward offer did not constitute “commercial activ-
ity” that had sufficient “nexus” to the United States
under the FSIA. DE 17, 99 10, 11. The district court
dismissed, ruling that a reward offer was not
commercial activity. Guevara App. A, 17a. The court
did not address Peru’s nexus argument. DE 31.

The Eleventh Circuit reversed in Guevara I, hold-
ing that the reward offer was commercial activity.
Guevara App. C. Because it was not a basis for the
district court ruling, the nexus issue was not
presented to the Eleventh Circuit, and the court’s
opinion did not address the issue. Guevara App. A,
17a.

On remand, Peru preserved the nexus issue in its
answer. In the midst of discovery, Guevara moved
for partial summary judgment, and Peru responded,
in part, by again arguing the nexus issue. DE 200,
pp. 17-18. The district court granted Guevara partial
summary judgment on his breach of contract claim,
finding that Guevara had earned the reward. The
court relied principally on its interpretation of a
preliminary SHLC_ resolution that purportedly
acknowledged Guevara’s role in Montesinos’ arrest.
Guevara App. A, 14a. This interpretation was
contested by an affidavit from the SHLC Chairman,
and on reconsideration, by three additional affidavits,
including by the draftsman of the resolution.
DE 201-8, 9 3; 285-15, 7] 12-13; 285-20, J] 4-5; and
285-21, (3-5. The district court also relied upon a
conclusory, hearsay affidavit by FBI Agent Currier
stating that Guevara’s cooperation “indirectly”
resulted in Montesinos’ arrest, which fails on its face
to satisfy the causation requirement in the reward
decree (“directly enabling”). Guevara App. B, 40a-

7

41a; DE 119-3, 7 16. Currier acknowledged in his
deposition that he had no personal knowledge
regarding the circumstances of Montesinos’ capture.

In opposing Guevara’s motion to compel Agents
Longa and Currier to testify at trial, the FBI
disavowed Currier’s affidavit, saying it was unautho-
rized and did not reflect the position of the FBI. Peru
App. B, p. 16a, n.2.

On reconsideration, Peru submitted two sworn
affidavits from the Venezuelan Congressional record
by Guevara’s accomplice, stating that Guevara had
secretly signaled him on the telephone call from FBI
custody to murder Montesinos. DE 297-6, p. 43,
DE 326-3, pp. 4546-47, 4549-50. Guevara did not
dispute these statements, in an affidavit or other-
wise, and they stand uncontested on this record.
DE 319-1, pp. 16, 17. Guevara’s assertion that he
had cooperated with the FBI to bring about Montesi-
nos’ capture thus evaporated, along with any possible
dispute regarding his ineligibility for the reward.

On the nexus issue, the district court found that
the issue had already been decided by the Eleventh
Circuit in Guevara I, and said no more. Guevara
App. A, 13a. After the district court denied reconsi-
deration, Peru appealed. DE 284, 344, 349.

Guevara did not address the nexus issue in his
briefing before the Eleventh Circuit, aside from
asserting that the Eleventh Circuit already had
determined the issue in the previous appeal. At oral
argument, the Eleventh Circuit offered Guevara the
opportunity to identify a nexus between Peru’s
commercial activity and the United States.

After oral argument, the United States submitted
an amicus brief urging reversal of the district court,

8

which the Eleventh Circuit accepted. Brief for the
United States as Amicus Curiae in Support of
Republica Del Peru, Peru App. C. The United States
said:

To protect the prerogatives of the Executive
Branch in its conduct of foreign affairs, both the
act of state doctrine and principles of interna-
tional comity generally preclude U.S. courts from
reviewing and overriding the sovereign decisions
of foreign states and foreign tribunals. Particu-
larly because this judgment against Peru
presents two serious foreign-relations dilemmas
for the United States, the doctrines are fully
applicable here.

Peru App. A, pp. 35a-36a.

In reversing the district court, the Eleventh Circuit
found that it had not previously decided the nexus
issue, which had been properly preserved by Peru.
Guevara App. A, 15a. On this issue, Judge Cox
dissented but suggested, nonetheless, the case might
not be appropriate for resolution by a United States
Court under the doctrine of international comity.
Guevara App. A, 32a.

On the merits of the nexus issue, the Eleventh
Circuit responded to Guevara’s nexus argument by
finding that Guevara’s arrest in Miami was in
connection with his own criminal—not Peru’s com-
mercial—activity. Guevara App. A, 25a-26a. Peru’s
alleged refusal to make payment in the United States
fails as a direct effect because Guevara had no right
to payment in the United States; the Emergency
Decree established a loan and bank account in Peru
for payment. Guevara Appendix A, 4a. The Eleventh
Circuit also found that Peru’s refusal to pay the

9

reward to Guevara was a “negative activity” that
alone did not satisfy the commercial activity excep-
tion. Guevara App. A, 25a.

The Eleventh Circuit held that the “one-off” tele-
phone conversation among the two FBI agents and
the Peruvian Minister did not constitute an act in
connection with commercial activity. Guevara App.
A, 25a. (During oral argument Guevara appeared to
abandon, as evidence of direct effect, that single tele-
phone call. Jd.) The Eleventh Circuit found this call
to be an insufficient basis to exercise personal and
subject matter jurisdiction over a foreign state by
analogy to the minimum contacts test for Due
Process. Guevara App. A, 25a.

SUMMARY OF ARGUMENT

Guevara’s petition founders on two misconceptions:
(1) he misstates the Eleventh Circuit’s holding in
order to argue that a purported circuit split on the
“direct effects” rule under the FSIA is relevant and
case dispositive; and (2) he also misstates the record
in arguing that the FBI and State Department differ
on the handling of this case.

Peru’s reward offer had no effect—legally signifi-
cant or otherwise—in the United States; the Emer-
gency Decree required all material events to occur in
Peru, and Guevara’s claims of a direct effect are
factually inaccurate and legally deficient by any
precedent. Guevara’s case was properly dismissed for
lack of subject matter jurisdiction, and even if subject
matter jurisdiction were present, his case would be
dismissed on principles of international comity (as
even the dissent in the Eleventh Circuit suggested)
and act of state, as well as numerous other grounds

10

including the merits (Guevara did not earn the
reward).

Public policy also supported dismissal. As set forth
in the United States’ amicus curiae brief, assuming
jurisdiction over a foreign reward program would
violate principles of international comity, create
serious diplomatic tensions, and necessarily result in
United States law enforcement and _ diplomatic
decisions regarding our own reward programs being
subjected to review by foreign courts. The United
States stated:

(T]he federal government has a profound interest
in preventing the district court’s judgment from
undermining our nation’s relationship with a
stable democratic partner in South America.
Moreover, the United States operates its own
highly successful international reward programs,
and the judgment here raises the troubling
specter of foreign courts overriding decisions
made by U.S. law enforcement and diplomatic
officials.

Peru App. C, 28a. The United States has at least 15
statutory reward programs, and frequently denies
reward claims. 67 Am. Jur. 2d Rewards §5. As
the United States recognized, any interference by
the United States in Peru’s sovereign decisions
regarding a notorious former government official
would stress an otherwise friendly relationship. The
United States, therefore, urged the Eleventh Circuit
to dismiss Guevara’s case on the alternative grounds
of international comity and act of state.

The question presented, as framed by Guevara, did
not and could not have determined the result of this
case. The single phone call, and Peru’s “negative

11

activity” in failing to pay the reward, had no direct
effect in the United States, regardless of whether
those actions or non-actions are characterized as
“legally significant acts.” The Eleventh Circuit’s
ruling was correct, and numerous other grounds
support dismissal. The petition should be denied.

ARGUMENT

Even if properly preserved for this Court—which it
was not— Guevara’s arguments do not raise the issue
of whether a “legally significant act” must occur in
the United States, as the petition argues.* Guevara
did not raise the issue below, the Eleventh Circuit
did not address the issue, and none of Guevara’s
arguments for direct effect turn on the outcome of
this issue. Under any existing interpretation of the
direct effect clause, Peru’s conduct did not waive
sovereign immunity under the FSIA.

The Eleventh Circuit held that the evidence did not
establish that Peru’s activities fell within any of the
three clauses of FSIA’s commercial activity exception,
including the direct effect clause. Guevara App. A,
20a-26a. In his petition, Guevara concedes the first
two clauses do not apply and challenges only the

* Guevara incorrectly asserts that this issue was raised below
and addressed by the Eleventh Circuit two times. Petition for
Writ of Certiorari, (hereinafter cited as “Pet. _”), pp. 10-11.
Neither opinion addressed whether a “legally significant act”
must occur within the United States under the commercial
activity exception. The Eleventh Circuit’s first opinion address-
ed whether the offer of a reward was commercial activity. Jd. at
48a. The second opinion addressed whether Peru’s acts fell
within any of § 1605(a)X2)’s three clauses. Jd. at 20a-26a.
Guevara did not raise below and the courts did not address
whether a “legally significant act” must occur in the United
States.

12
Eleventh Circuit’s determination that the third
clause—or “direct effect” clause—does not establish

an exception to immunity for Peru. The clause
provides an exception to immunity when:

... the action is based .. . [3] upon an act outside
the territory of the United States in connection
with a commercial activity of the foreign state
elsewhere and that act causes a direct effect in
the United States.

§ 1605(a)(2). Guevara argues that the Court should
grant his Petition so that the Court can resolve a
purported circuit split on “whether the commercial
activity exception’s ‘direct effect’ clause requires
evidence that a ‘legally significant act’ occurred
within the United States in the order to vest Ameri-
can courts with jurisdiction over a foreign sovereign.”
Pet., i-ii, Question Presented.

This case is not appropriate for resolving those
issues. Guevara did not raise in the courts below the
issue of whether Peru’s purported actions involving
the United States were or were not “legally signifi-
cant,” or whether any circuit split on that question
existed. Rather, he merely asserted that the
Eleventh Circuit already had decided the issue of the
court’s subject matter jurisdiction in its 2006
Guevara I opinion. The Eleventh Circuit did not
require Guevara to plead or prove the existence of a
“legally significant act.” Indeed, the Eleventh Circuit
did not address the “legally significant act” issue in
Guevara II at all—understandably so, because
Guevara did not raise it. As this issue has not been
preserved, the Court should deny Guevara’s petition
on this ground alone,

13

As support for his argument that the Eleventh
Circuit applied the “legally significant act” test,
Guevara states that the question the court defined
was whether “the effect was sufficiently ‘direct’ and
sufficiently ‘in the United States’ that Congress
would have wanted an American court to hear the
case.” Pet. 14 (citing Guevara App. A, 23a-24a). This
language clearly shows that the Eleventh Circuit was
concerned about whether the effect was sufficiently in
the United States, not whether the conduct or act
was sufficiently in the United States. In determining
whether Peru fell within the “direct effect” clause of
the commercial activity exception, the Eleventh
Circuit correctly held that “[nJeither of Guevara’s
arguments for a direct effect in the United States
reflects [Republic of Argentina v.| Weltover [504 U.S.
607 (1992)]’s requirement of immediate consequences
or Harris Corp. [v. Nat'l Iranian Radio & Television,
691 F.2d 1344 (11th Cir. 1982)]’s focus on significant
financial consequences in the United States. There-
fore, we cannot conclude that a direct effect occurred
in the United States as a result of Peru’s promise to
pay the reward money.” Guevara App. A, 26a.

The Eleventh Circuit thus was not called on to
assess the nature or quality of Peru’s alleged acts—
“legally significant” or not—because no act was
alleged or proven that could possibly have had a
direct effect in the United States. Equally to the
point, the Eleventh Circuit did not require that
Guevara prove a “legally significant act,” either in
the United States or outside it. Because Guevara did
not have to meet any such legal standard, that test
had no significance to the outcome of this case.

Guevara’s petition consists mostly of an academic
discussion of the “legally significant act” test in the

14
courts; the petition barely attempts to identify Peru’s
acts that supposedly waived its sovereign immunity
under the FSIA. Guevara argues that the reward
“offer itself constituted commercial activity.” Pet. 17-
18. Guevara maintains that he accepted Peru’s offer
by performing in the United States, “1.e., he provided
information and coordinated efforts from the United
States which led to the location and capture of the
fugitive Montesinos[,|!” which presumably provided
the “direct effect” on the United States under the
third branch of § 1605(a)(2). Pet. 18. The record
does not support his argument, and Peru’s reward

offer defined acceptance as the delivery of informa-
tion to the SHLC in Peru.

Guevara’s arrest was not commercial activity
carried on by Peru, in the United States or in Peru.
As the Eleventh Circuit properly held, Guevara’s
arrest and subsequent cooperation was in connection
with Guevara’s criminal activity, not the reward.
Guevara App. A, 25a-26a (“Guevara’s arrest was ‘an
immediate consequence’ of his criminal activity, not
of Peru’s offer of a reward for Montesinos’s capture”
(quoting Weltover, 504 U.S. at 618). Law enforce-
ment activities do not fall within the commercial
activity exception. Saudi Arabia v. Nelson, 507 U.S.
349, 362 (1993) (“Exercise of the powers of police and
penal officers is not the sort of action by which
private parties can engage in commerce.”). Guevara’s
call to Caracas was not a condition of the reward;
it was law enforcement activity which cannot provide
the basis for jurisdiction under the commercial activ-
ity exception.

The factual record also defeats Guevara’s argu-
ment. Guevara was required to make the call to
Venezuela for the much more immediate purpose of

15

obtaining his “get out of jail free card” from the FBI.
DE 319-3, pp. 39-42. Guevara submitted no evidence
suggesting he was motivated to make the Venezuela
call to earn the reward; according to FBI Agent
Currier, Guevara had agreed to cooperate with the
FBI before he knew about Peru’s reward offer.
DE 319-3, pp. 39-42; DE 119-3, J 8. Even assuming
that his purported cooperation would satisfy the
reward offer, the uncontested evidence is that
Guevara was only feigning cooperation while order-
ing Montesinos’s murder from FBI custody. Dk 297-
6, p. 43, DE 319-1, pp. 16, 17, DE 326-3, pp. 4546-47,
4549-50. In addition, Guevara presented no evidence
that his telephone call to Caracas was related to
Montesinos’s capture, except as a post hoc, ergo
procter hoc coincidence of time. He even admitted
that the Venezuelan government did not need his
information; they knew where Montesinos was from
the outset. DE 285-14; DE 201-2, pp. 69-73.

Nor could the reward offer itself have a direct effect
in the United States. Reciting the facts in the light
most favorable to Guevara, the Eleventh Circuit
confronted a record in which the Emergency Decree
defined the operative performance as the receipt of
information by the SHLC in Peru (which never
occurred); Guevara made a claim to the SHLC in
Peru; his counsel met with members of the SHLC in
Peru; the alleged breach of contract occurred when
the SHLC, after an extensive and good faith review,
denied Guevara’s claim in Peru; and Peru declined
to make payment from a bank account authorized
by the Emergency Decree to be opened in Peru.
Guevara App. A, 20a; Peru App. A, pp. la-Ga.
Guevara argued that even though every event in
connection with the offer took place in Peru, a direct
effect sprang from what the Eleventh Circuit de-

16

scribed as “Peru’s failure to make the reward pay-
ment within the United States—a sort of ‘negative
activity[.]” Guevara App. A, 25a. The Eleventh Cir-
cuit observed that no federal court had ever relied on
such “negative activity” to confer subject matter
jurisdiction under § 1605(a)(2), and correctly rejected
Guevara’s argument. See also Guirlando v. T.C.
Ziraat Bankasi A.S., 602 F.3d 69, 76 (2nd Cir. 2010)
(under FSIA, “although the failure to act may have a
legally significant effect in the place where the act
was to have been performed, the failure to act is not
itself an act.”).

Guevara’s argument that he was entitled to
payment in Miami fails because it is factually inaccu-
rate, as the Eleventh Circuit found. Guevara App. A,
23a. The Emergency Decree authorized a loan and
bank account in Peru for payment of the reward. Td.
The decree requires the loan to be taken from Banco
de la Nacion, a state-owned bank, and describes it as
an internal indebtedness operation. Nothing in the
decree requires payment in the United States, or
gives Guevara the power to choose the place of
payment. Thus, Guevara’s case is distinguished from
Weltover, 504 U.S. at 619 (direct effect because
payment due in the United States) and Hanil Bank v.
PT. Bank Negara Indonesia, 148 F.3d 127, 132 (2d
Cir. 1998) (direct effect when plaintiff entitled under
a letter of credit to designate place of payment and it
designated its New York bank account), and similar
to the Second Circuit’s recent decision in Guirlando.

Guevara argued (but abandoned) the proposition
that a direct effect in the United States occurred by
virtue of the single Lima-Miami telephone call in
which Minister Vidal conveyed the terms of the offer
to FBI Agent Longa. The Eleventh Circuit held that

17

Guevara’s acceptance-related activity involved only
this “one-off” telephone communication that was too
de minimis to support subject matter jurisdiction,
using the minimum contacts personal jurisdiction
test as an analogy, as this Court did in Weltover, 504
U.S. at 619. Guevara App. A, 25a. The Vidal call
also was in connection with law enforcement—not
commercial—activities. Jd. The participants were
discussing how to bring about Montesinos’ arrest,
and Minister Vidal did nothing more than repeat the
terms of the reward offer.

In short, the Eleventh Circuit correctly determined
that no act performed by any character in this drama
brought about a “direct effect” in the United States
within the meaning of § 1605(a)(2) of the FSIA. This
conclusion did not turn on whether any act was
“legally significant,” because no act, regardless of how
it could be characterized, produced the requisite
direct effect in the United States. No party, includ-
ing Guevara, raised this issue, and the Eleventh
Circuit had no occasion to consider it.

Even though the “legally significant act” test is
irrelevant to the outcome of this case, Guevara
evidently believes that a circuit conflict is a potential
ticket to review by this Court. He therefore raises
this issue for the first time in his petition, and
devotes the lion’s share of the petition to explication
of a purported circuit conflict on this irrelevant issue.

Guevara argues that some circuits require a
“legally significant act” in the United States under
the direct effect clause, while others do not. He
asserts that the Eleventh Circuit requires a legally
significant act to occur within the United States.

18

Contrary to Guevara’s assertions, the Eleventh
Circuit does not require a legally significant act,
neither within nor without the United States. In this
case, the Eleventh Circuit explicitly followed this
Court’s articulation of the nexus rule in Weltover, 504
U.S. at 618, where the Court held that “an effect is
‘direct’ if it follows ‘as an immediate consequence of
the defendant’s . . . activity.” (ellipses in original).
Guevara App. A, 23a. The Eleventh Circuit did
not mention the legally significant act test at all,
let alone the location of any such act, nor did it
include or make reference to a “substantiality” or
“foreseeability” requirement, which Weltover expressly
rejected.

Here, the Eleventh Circuit adopted the sensible
approach recently exemplified by the Sixth Circuit in
American Telecom Co., LLC v. Republic of Lebanon,
501 F.3d 534 (6th Cir. 2007). Noting that some
circuits adopt the legally significant act formulation,
others reject it, and still others find it “helpful but
not required,” the Sixth Circuit said: “But, while the
circuits have framed the inquiry differently, these
differences have no impact here. The present case is
easily resolved without resort to any legally signifi-
cant act....” Id. at 540. Like the Eleventh Circuit
here, the Sixth Circuit found that the conduct alleged
simply could not have had a direct effect in the
United States, and dismissed the case for want of
subject matter jurisdiction under the FSIA.

Notably, although the Sixth Circuit in American
Telecom catalogued the circuits with regard to their
positions on the “legally significant act” issue, it did
not identify the Eleventh Circuit as yet having taken
any position on the question. That agnosticism
remains unchanged after the Eleventh Circuit’s deci-

19

sion here. Even if there is a circuit conflict on this
issue, the Eleventh Circuit’s non-position is not in
conflict with any other circuit, making this case a
particularly unsuitable vehicle for resolving whatever
conflict may exist.

Guevara also relies on public policy arguments,
none of which are valid.

First, Guevara maintains that because the United
States—like Peru—offers rewards as adjuncts to law
enforcement, United States courts should compel
Peru to pay him the award he contends that he has
earned. Pet. 18-19. To the contrary, the SHLC, a
duly constituted organ of the Peruvian government,
following in good faith the procedures set out in the
reward offer, and with the participation of the FBI
and Guevara’s attorney in the process, determined
that Guevara had not earned the reward. As the
United States explained in its amicus brief to the
Eleventh Circuit, and as Judge Cox noted in his
dissent, the courts of the United States would violate
basic principles of comity if they sat in judgment on
the acts of other sovereign nations in determining
entitlement to reward offers. indeed, public policy
dictates precisely the opposite conclusion from that
urged by Guevara. As the United States also ex-
plained in its amicus brief, if a United States
court can “effectively preempt{] the ... evaluation
decision” of the Peruvian government (Guevara II,
608 F.3d at 1305), courts of other nations would
be encouraged to “preempt the .. . evaluation
decision[s]” of the United States, and order payment
of rewards to claimants that the United States had
determined to be unjustified.

In fact, when Guevara accepted the reward offer,
he also accepted the stipulation that his entitlement

20

to the reward would be decided by the SHLC in Peru.
Guevara is no different from a party who signs a
garden-variety contract that contains a forum selec-
tion clause dictating how and where disputes under
the contract will be resolved. Guevara, having
accepted and participated in that process, cannot now
ask a U.S. court to supplant the Peruvian tribunal
whose decision Guevara agreed to respect.

Second, Guevara reverses course and argues that a
reward offer is not “typical” commercial activity, and
should be evaluated under some unspecified new
FSIA standard “requir[ing] closer scrutiny.” Pet. 21.
(“This is not a typical fact pattern; this case does not
involve the type of commercial activity regularly
considered by the courts in determining whether
an exception to the FSIA’s presumed immunity
applies.”). Guevara cannot have it both ways: hav-
ing persuaded the Eleventh Circuit in Guevara I
that a reward offer is commercial activity potentially
subject to FSIA jurisdiction, Guevara cannot in good
conscience maintain in this Court that a reward offer
is in some way less commercial than the activities
that ordinarily fall within the exception. Indeed, if
Guevara had made this concession to the Eleventh
Circuit in Guevara ]—that a reward offer is not
“typical” commercial activity—this case would have
been over in 2006.

Third and finally, Guevara argues that FBI Agent
Currier’s urging to the Peruvian government to
pay the reward to Guevara exposes a “yawning
conceptual gap” between the FBI and the position
taken by the United States in its amicus brief to the
Eleventh Circuit. Pet. 22. That “gap” is illusory.
The FBI later disavowed Currier’s statements as
unauthorized. Even if the FBI had not disavowed

21

them, Agent Currier’s letters do not contradict the
considered position taken by the United States in
this litigation with regard to the application of the
doctrine of international comity. Agent Currier did
not and could not take a legal position on this issue
on behalf of the FBI.

CONCLUSION

There is no law, no equity and no public policy that
would justify the district court assuming jurisdiction
over Guevara’s reward claim and entering judgment
for Guevara. Guevara invites this Court to second-
guess the decision of an organ of the Peruvian
government, which is an inappropriate undertaking
for a United States court. His petition should be
denied.

Respectfully submitted,

MARK A. CYMROT
Counsel of Record
LEE H. SIMOWITZ
AMBIKA J. BIGGS
BAKER & HOSTETLER LLP
1050 Connecticut Ave., NW
Washington, DC 20036
(202) 861-1500
October 22, 2010 mcymrot@bakerlaw.com

Counsel for Respondents

APPENDIX

la
APPENDIX A

STATUTE LAWS
YEAR XIX - No. 7608
EMERGENCY DECREES
EMERGENCY DECREE NO. 049-2001

ESTABLISHING A FINANCIAL REWARD IN
EXCHANGE FOR ACCURATE INFORMATION
LEADING TO THE LOCATION AND CAPTURE OF
VLADIMIRO MONTESINOS TORRES

THE PRESIDENT OF THE REPUBLIC
WHEREAS:

The authorities of the Peruvian Judiciary, the
Office of the Prosecutor General and the National
Police are concentrating working on prosecuting sev-
eral criminal acts committed by various officials
between 1990 and 2000;

Vladimiro Montesinos Torres stands out among said
officials, who, during the aforementioned period held
the position of Advisor in the National Intelligence
System.

The aforesaid person was involved in serious crimes
which affect the security of the State and society
overall, in accordance with the evidence which has
been obtained in special proceedings and judicial
inquiries which are being conducted pursuant to
Laws Nos. 27378, 27379 and 27380 on organized crime;

Therefore, a warrant for his arrest has been issued
by several Courts as the alleged perpetrator of crimes
against government administration, public corrup-
tion, embezzlement, crimes against persons, aggravated
murder, drug trafficking, national security and others;

2a

There is a need to adopt exceptional economic and
financial measures to grant a financial reward to the
person or persons who provide(s) accurate informa-
tion which will enable locating and capturing
Vladimiro Lenin Montesinos Torres, in accordance with
the procedure set forth in this Emergency Decree;

Said measures will contribute to deciding the
criminal acts under investigation, by virtue whereof
there are matters of national security which justify
its immediate issuance;

Exercising the authority vested under Article 118
paragraph 19) of the Peruvian Political Constitution:
As approved by the Cabinet by way of a vote; and
required to report to the Congress of the Republic;

DECREES:
Article 1-Financial Reward

Establish a financial reward in the amount US
$5,000,000.00 (FIVE MILLION 00/100 UNITED
STATES DOLLARS),- which shall be given to the
person or persons who provide(s) accurate informa-
tion that will directly enable locating and capturing
Vladimiro Lenin Montesinos Torres. In the event
several persons provide the said information, the
financial reward shall be divided among them.

Article 2-Special High Level Committee

Establish a Special High Level Committee in the
Ministry of the Interior /Department of Homeland
Security] for the purpose of evaluating information
received and deciding on granting the financial reward.
The Special High Level Committee shall consist of:

— the Secretary of Homeland Security, who will
preside

— the Undersecretary of Homeland Security

— the Director General of the National Police

3a

— the Director General of Intelligence of the
Department of Homeland Security

Article 3- Accurate Information

For purposes of this Emergency Decree, accurate
information shall be that [information] provided
through any means to the Special High Level Com-
mittee and which enables locating and capturing
Vladimiro Lenin Montesinos Torres, who is wanted.

Article 4-Use of a Pseudonym

The informant or informants may use a pseu-
donym, in which case the Special High Level
Committee shall provide a secret code for subsequent
identification upori receipt of the information in order
to grant the Financial Reward.

Articie 5-Protection and Safety Measures

The Special High Level Committee, in keeping with
the degree of risk or danger, shall adopt the following
measures for the protection and safety of the
informant:

a) Police protection for the informant and his
family, which may include a change of residence;

b) Withhold his identity and other personal infor-
mation during proceedings.

Article 6- Secret Information

All information involving application of this Emer-
gency Decree is secret. Any person who violates this
provision, shall be administratively, civilly or crimi-
nally liable, as the case may be, in accordance with
current law.

Article 7- Scope of the Financial Reward

The Department of Homeland Security shall pay
the Financial Reward 24 hours after the actual

4a

location and capture of Vladimiro Lenin Montesinos
Torres. Said reward, as well as the measures for safety
and protection, shall apply to nationals and foreigners.

Article 8-Government Loan

The Department of the Economy and Finance is
hereby authorized to obtain a Government Loan with
Banco de la Nacién for up to US $5,000,000.00 (FIVE
MILLION 00/100 UNITED STATES DOLLARS), ear-
marked for financing the issuance of the Financial
Reward which is the object of the Emergency Decree;
said funds shall be deposited in an account defined by
the General Directorate of the Treasury for channe-
ling to the Department of Homeland Security in the
same currency as the pertinent disbursement is made.

The government loan shall be paid over a period of
four (4) years, which includes a one-year (1) grace
period and an option for early payment, in consecutive
semi-annual installments, and if possible, in equal
amounts, accruing interest at the LIBOR rate plus 3%.

Article 9- Servicing the debt

Services for pay off, interest and other expenses
relating to this Government Loan shall be handled by
the Department of the Economy and Finance, debited
from funds provided therefore in accordance with
inter-sectoral priorities and goals of the Sector in
each fiscal year budget for Public Debt servicing.

Article 10- Exercise of the early payment option
and charged to recoveries

The first funds recovered from the criminal acts
object of this investigation, as set forth in the whereas
clauses of this Emergency Decree, shall be ear-
marked for early pay off of the debt incurred in the
Government Loan authorized in Article 8, until paid

5a

in full, in exercise of the stipulated early payment
option.

Article 11- Authorization to sign

The Secretary of the Economy and Finance or his
appointee are hereby empowered to sign the loan
contract, and the Director General of National Debt
is also empowered to sign the other government loan
documents authorized in the foregoing article.

Article 12- Schedule and payment

The National Government Budget Administration
and the Public Treasury General Directorate shall
schedule and draw, respectively, payable to the
Department of Homeland Security section, up to the
equivalent in legal tender of the amount indicated in
this Emergency Decree, charged to the Supplemen-
tary Loan that shall be approved by the pertinent law
and/or to the budgetary modifications on closing of
Fiscal Year 2001, as stipulated in Law No. 27209, on
Management of the National Budget.

Article 13-Approval

This Emergency Decree shall be approved by the
Cabinet and the Secretaries of the Economy and
Finance and Homeland Security.

Issued at the Government House in Lima on the
sixteenth of April two thousand one.

VALENTIN PANIAGUA CORAZAO
Constitutional President of the Republic

JAVIER PEREZ DE CUELLAR
Cabinet Council President

JAVIER SILVA RUETE
Secretary, Economy and Finance

6a

ANTONIO KETIN VIDAL HERRERA

Secretary of Homeland Security

22266.

(Translator’s note:] In the U.S., the Department of

Homeland Security is equivalent to the Ministry of
the Interior of the Republic of Peru.

7a
CERTIFICATE OF ACCURACY

I, Esther Cecilia Crespo, an interpreter certified by
the Administrative Office of the United States
Courts, for and on behalf of Liaison Services, Inc.,
hereby certify that the foregoing translation,
attached hereto and consisting of 2 page(s), is a true
and accurate translation of the original document.

/s/ Ksther Cecilia Crespo
Esther Cecilia Crespo
I
U.S. Court Interpreter ¢ Translator

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WULTIMEORA «ROTI CTON

DU. N° 049-2001.- Esta-
ampensacién Econdmica a

(adades de] Poder Judicial. ¢! Ministe
0 y ja/Policia Nacional del Pend, se encuen-
bocadas shesclarccimicniu de lus diversos ilicitos
Penales cn que fabrian currido diferentes funcions-
rins.catre los aifos 1990 y 2000:

Que, entre gichos funcionanos desiaca la persona
de Viadimiro Lenin Monicsinos Torres. que en el
periodo establackie ejcrcid el cargo de Ascsor cn cl
Sistema de Intefigencia Nacional:

Que, Ja persona antes indicada estaria trans en
graves dehtos que alectan. la seguridad del Estado y a
la somedad en s\i conjunto, conforine a las evidencias |
Que $¢ vienen ol¥emicndo en los procedimicnios espe- |
clales ¢ investigactuncs judiciales gue se Hevan a cabo
en aplicacidn de las Leyes N°s. 27378 (T.295,§154}.
27379 [T.298,§1S5] y 27380 (1.295,8156] relauvos a
$s crnunalidad unganizada:

Que, por tai motivo se encucnim mequisitoriado por
diferentes Juzgadas, por ser presunto aulor de delitos
contra 1a Administracién Publica, Corrupcidn de Tun-
Gonanos, Peculado, Conira ta Vida, el Cuerpo y la
Salucl, Homicidio Calificado, Homicidio Agravado,
Trafico Hicito de Drogas, Contra la Seguridad y otras:

Que, resulia necesano adoplar medidas excepcio-
nalts en materia econdmica y financier para el otor-
£amiento de una compensacion ccondmica p favor de
la persona oO personas que proporcionen informacida
veraz que permita 1a ubicacidn y capturm de Viodimiro

Lenin Montesinos Tomes, de contormidad con el pm.

7 SNihek;
cedimienio que cl presente Dex Prin era :
bleee

Que, dichas medidas contnhuirdn con el esc laree:
mento de los slicios penales que s¢ encuentran cn
investiaacron eo virtud de lo cual existen razom’s de

interés nacional que: juslican su expedicidn en tania
iinediata

La uso de las facultades conteridas en elmerso 19)
ct Ardiculo TIS® de da Constitucién Polittea del Peru
{1.241,§213)

Con el vulu aprobatono del Consejo de Minsstras

Con cargo de dar cuenta a! Congreso de la Repo
blica

DECRETA

Articulo 1°.- Compensacion Ecandmica

Establézcase una Compensacidn Econdmica gs
cendente a la suma de USS § 000 00,00 (CINCO
MILLONES Y 00/100 DOLARES AMERICANOS
gue seri olurgade ala persona que proporcione infur-
macion veraz que pernita en forma directa la ubscacion
y captura de Vladimiro Lenin Montesinos Tones Tra
tindose de vanas persanas que proporcionen dicha
informacion, ls commpensacidn coondmica sera distri
buida entre éstas,

Articuln 2°.- Comision Especial de Alto Nive!

Coastituyase en el Minisiceo del Interior una Co
misidn Especial de Alto Nivel con Ja finalidad ok
cvaluar In mformacion recibida y decidir el otorga-
mientu de ta Compensacién Economica. La Comission
Especial de Alto Nivel estard conformada por:

- Muinistro del latevior, quien lo presidirs

- Viceministro del Interior

— Director General de fu Policia Nacional

~ [ircctor General de Inteligencia dei Minisieno de

Interior

Articulo 3°.- Informacién Veraz.

Para fos efectos del presente Deereto de Urgencia
se considers informacidn veraz 1a que se propacciane
por cualquier mecho ala Conusidn Especial de Alte
| Nivel, y que pasihilite fa ubicacidn y captura ded re
quisiionado Viadimiro Lenin Montesinos Tones

Articula 4*.- Uso de Scuddnimo

El informante o los infonnanies podein usar un
scuddnuna, en cuyo caso 19 Comision Especial de Alto
Nivel a la recepcidn de ta infonnacidn te asignard un
cddigo seereto que permita su posteriur ideniificocion
pam efecto del otorgamiento de la Compensacidn Eco-
némica

Articulo $*.- Medidas de Protecclén y Seguridad

LaComisién Especial de Alto Nivel, sega cl vrado
de nesgo 0 peligro, adoptard las siguientes medidas de
protecerdn y seguridad de! informante:

4) Proxescidn palicial para el informante y su fame-
lia, QUe purde encluir Cl cambio de resklena

b) Reserwa ck su icentded y demas datos persony-
les en las dihgesicias que se practiquen

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Articulo 6°. Informacion de Curdcter Secreto

Voda informacion relucronaha con la apheacidi del
presente Decrvto de Urgenciis Gene e} canictey de se-
ered, Los que infrinjan esta disposicidn, weaned en
responsabilidad adminisirativa, civil y/o penal, seguin
conesponda, de confonmidad con lo establecsdo en la
legistacién vigenty,

Articulo 7". Aleance de la Compensaciin keu-
némica

El Ministerio del [nterior bard ctectiva la Compen
sacién Econdmica a las 24 horas de produccion ta
ubivactén y captup¥de Viadimiro Lemn Monicsinos
AsACION asi como las medidas de
1dad, aleanzan anacionales y eaten:

N*/- Operacion de Endeudanucnto In-

f a! Ministerio de Economia y Finanzas a
Qperacién de Endcudamicniv Intemo
Nacidén haste porta sama de USS
‘O MILLONES Y 08100 OLA.

¥ Decreia de Urvencia. dichos recursos seran
Ds crtnia Cucnia que para el efecte detemuine
in General del Tesoro Publice pura su cana-

diente

La operacién de Endeudanuenio lntcmu seni iii
celada en un plazo de cuatro (4) ais, que incluye un
(1) aho de gracia, mediante cuolas semesirtics cin-
culivas ¥en lo posible iguales, devenganda una tasa de
interes anual de Labor mds un mareen adiciorxal de 3%,
con opcion de prepago

Articulo 9.- Servicio de la Deuds

FI servicio de amorizacidn. iniereses y demis gay-
O$ Que OCasiOne fa presenic operacidn de Enmlouds-
micmto Interno serdn atendhdos por el Ministero de
Economia y Finanzas, con cargo a los recursos gue ont
funcidn de las peoridades intersectonales y metas del
Sector le coreespondan en cada Ejecercin Presupuestal
para cl sesvicto de la Deuda Publica

Articula 10°. Ejercicio de li opcian de prepago

con cargo a recuperactones

Las primeras recuperaciones de los recursos prove-
nienies de los ilicitos penales nuterial de investigacion
sciialados en la parte consicterativa del presente Decre-
to de Urgencia serdn destinadas a prepagar Ia douda
Ceavads de la operacién de Endeudamiento Intemo
cue dutoriza eb Articulo 8* hasta su cancelacidn (otal,
cn gjercicid de la opcién de prepago establecida.

Articulo 11° Autorizacion de Suscripcién

Autoriaase al Ministro de Economia y Finanzas 0 a
quien él designe, a susenbir cl contralto de présiaiao,
asi como al Director General de Crédito Publico a
suscribic los demas documentos de la operaciin de

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TATICAES
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JOSE L. MONTOYA VERA: SECRETARIO DEL
COLFGIO DE NOTARIOS DE LIMA. CERTIFICA.

Que la firma v scliu wn DAtecwhk en cela foja corcspooden
“Ate heli

MIMSTTD CE ATLADOMES UxTEMCh ES
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LIMA 09 ASR, 209

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Republic of Peru )
Province and City of Lima )
Embassy Of the )
United States of America )

I certify that the official named below, whose true
signature and official seal are, respectively, sub-
scribed and affixed to the annexed document, was, on
this day, empowered to act in the official capacity
designated in the annexed document, to which faith
and credit are due:

JULIA ADELA MOREANO DE DUENAS

This Embassy assumes no responsibility for the
contents of the attached document.
/s/) JAMARI SALLEH
JAMARI SALLEH

Consul U.S. Embassy
Lima, Peru

April 10, 2008

Date

12a
APPENDIX B

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
[Filed Aug. 15, 2008]

iaciasecitenciloneemmanl
/

Case No. : 04-23223-CIV-COOKE/BANDSTRA

JOSE GUEVARA,
Plaintiff,

Si

REPUBLICA DEL PERU, MINISTERIO DEL
INTERIOR DEL PERU, ANTONIO KETINVIDAL, and
FERNANDO ROSPIGLIOSI,

Defendants.

FEDERAL BUREAU OF INVESTIGATION’S
RESPONSE TO PLAINTIFF'S MOTION
TO COMPEL COMPLIANCE WITH
TRIAL SUBPOENAS

The United States Department of Justice, Federal
Bureau of Investigation (the “FBI”), through the
undersigned Assistant United States Attorney,
responds to Plaintiff, Jose Guevara’s “Motion to

Compel Compliance with Trial Subpoenas or... to

Perpetuate Testimony . . .” of Special Agents Kevin

Currier and Waldo Longa as follows:
INTRODUCTION

Plaintiff Jose Guevara is suing Defendants Peru, et
al., to collect a $5 million reward Defendants allegedly
offered for information leading to the capture and

l3a

arrest of an international fugitive, Vladimir Lenin
Montesinos. Plaintiff has issued subpoenas for testi-
mony at trial by FBI Special Agents Kevin Currier
and Waldo Longa. Those Agents were involved in the
FBI’s search for Montesinos in late 2000 and 2001.
Plaintiff alleges that, in response to a promise from
the government of Peru which was communicated to
him by the Special Agents, he provided information
which led to Montesino’s capture. Plaintiff:seeks to
elicit testimony from the Agents about “the specific
facts leading up [to] the offer and acceptance by
[Plaintiff] of the $5 million reward .. .”. MOTION To
COMPEL, p.3.

Pursuant to the Federal Housekeeping Statute,
5 U.S.C. § 301, and the Supreme Court’s decision in
United States ex rel. Touhy v. Ragen, 340 U.S. 462
(1951),’ the Department of Justice treated the trial
subpoenas issued to Special Agents Currier and
Longa as requests for testimony under the DOdJ’s
Touhy regulations at 28 C.F.R. § 16.21 et seg. As
explained to Plaintiff after careful and thorough
deliberation, the DOJ conciuded that testimony
concerning the FB!’s search for Montesinos would
necessarily reveal the FBI’s theories in that case, its
investigative sources and methods, and the identities
of witnesses. The DOJ expressed its concern that the
testimony sought would thus cempromise ongoing

"In Touhy, the Court upheld the authority of the Attorney
General to prescribe regulations for the custody, use, and pre-
servation of DOJ records. 340 U.S. at 468. As the Court noted,
“(w]hen one considers the variety cf information contained in
the files of any government department and the possibilities of
harm from unrestricted disclosure in court, the usefulness,
indeed, the necessity, of centralizing determination as _ to
whether subpoenas duces tecum will be willingly obeyed or
challenged is obvious.” Jd.

l4a

and future FBI investigations—a potential harm to
the public which outweighed Plaintiffs need for the
testimony in the prosecution of this civil lawsuit. The
DOJ also determined that testimony sought impli-
cated other common law and statutory privileges or
bars on disclosure. For all of these reasons, the DOJ
elected not to authorize the requested testimony.

The DOJ’s denial of Plaintiffs requests for Agents
Currier and Longa’s testimony is subject to review
under the Administrative Procedure Act (the “APA”),
5 U.S.C. § 701, et seg., not Rule 45 of the Federal
Rules of Civil Procedure. The APA requires that
a court defer to an agency’s decision so long as the
decision was not arbitrary or capricious. As demon-
strated below, the DOJ’s decision in this case was
neither arbitrary nor capricious. The Court should
therefore defer to the DOJ’s denial of Plaintiffs’
requests for the Special Agents’ testimony at trial
and deny Plaintiffs Motion to Compel

ARGUMEN™

I. The DOJ’s Decision To Deny Authorization for
Special Agents Currier and Longa’s Testimony
Must Be Upheld Because it Was Not Arbitrary,
Capricious, an Abuse of Discretion, or Otherwise
Not in Accordance With Law

“[A] federal employee may not be compelled to obey
a subpoen contrary to his federal employer’s instruc-
tions under valid agency regulations.” Moore v. Armour
Pharm. Co., 927 F.2d 1194, 1197 (11th Cir.1991)
(quoting Boron Oil Co. v. Downie, 873 F.2d 67, 73
(4th Cir.1989)). The DOJ’s Touhy regulations require
that, in deciding whether to authorize an employee
to testify in response to a subpoena, the DOJ
official should consider “[w]hether such disclosure is

l5a

appropriate under the rules of procedure governing
the case or matter in which the demand arose,” and
“(wlhether disclosure is appropriate under the rele-
vant substantive law concerning privilege.” 28 C.F.R.
§ 16.26(a). Among other things, the DOJ’s Touhy
regulations prohibit the disclosure of information
that “would reveal a confidential source or informant,
unless the investigative agency and the source
or informant have no objection,” or “would reveal
investigatory records compiled for law enforcement
purposes, and would interfere with enforcement
proceedings or disclose investigative techniques and
procedures the effectiveness of which would thereby
be impaired.” Jd. at § 16.26(b)(4), (b)(5).

The DOuJ’s decision not to permit the testimony of
Special Agents Currier and Longa is a final agency
action reviewable under the Administrative Proce-
dure Act. See 5 U.S.C. § 704; see also Moore, 927 F.2d
at 1197. The Court may not overturn the DOJ’s
decision unless it was “arbitrary, capricious, an abuse
of discretion, or otherwise not in accordance with
law.” 5 U.S.C. § 706(2)(A); see also Moore, 927 F.2d at
1197. “To determine whether an agency decision was
arbitrary and capricious, the reviewing court ‘must
consider whether the decision was based on a con-
sideration of the relevant factors and whether there
has been a clear error of judgment.” N. Buckhead
Civic Ass’n v. Skinner, 903 F.2d 1533, 1538 (11th
Cir.1990) (quoting Marsh v. Or. Natural Res. Council,
490 U.S. 360, 378, 109 S.Ct. 1851, 104 L.Ed.2d 377
(1989)).

The DOJ based its denial of Plaintiffs request for
testimony from Special Agents Currier and Longa
upon careful and thorough consideration of its law
enforcement interests and Plaintiffs need for the

16a

testimony. As noted above, the DOJ’s Touhy regulations
prohibit the disclosure of information that “would
interfere with enforcement proceedings or disclose
investigative techniques and procedures the effective-
ness of which would thereby be impaired[.]” 28 C.F.R.
§ 16.26(b)(5). Where a disclosure would result in such
harm, the DOJ cannot authorize such disclosure
unless it determines that “the administration of jus-
tice requires disclosure.” Jd. § 16.26(c).

Applying the foregoing standard, the DOJ concluded
that authorizing the testimony of Special Agents
Currier and Longa would disclose certain investiga-
tory procedures and techniques, thereby impairing
their effectiveness in other investigations. Regardless
of how it is characterized in the Motion to Compel,
the testimony Plaintiff seeks to elicit from the Special
Agents concerns the methods the FBI used in its
search for Vladimir Montesinos. Essentially, Plaintiff
seeks to elicit testimony that the Special Agents
sought permission from the Peruvian government to
convey an offer of reward to Plaintiff, that the Agents
received such permission, that the Agents conveyed
Peru’s reward offer to Plaintiff, and that Plaintiff
provided the information that led to Montesinos’
capture.’ Indeed, in the relevancy statement he sub-
mitted to DOJ in support of his trial subpoenas,
Plaintiff noted that Special Agent Currier would
testify about his formulation of a plan for the capture

2 Presumably, the testimony Plaintiff seeks to elicit from the
two Special Agents mirrors the substance of the “Declaration of
Kevin Currier” attached to the Motion to Compel. That Declara-
tion and the disclosures made therein were not authorized by
the DOJ and do not constitute an official statement of the FBI
or a waiver of the rights and privileges asserted by the DOJ
herein.

17a

of Montesinos, his meeting and discussions with
Peruvian officials for that purpose, and his com-
munications with other FBI agents about the case.
Such testimony would reveal in open court exactly
how the FBI conducted its investigation and search
for Montesinos. That is precisely the kind of disclosure
the DOJ’s Touhy regulations prohibit absent a finding
that “the administration of justice requires disclo-
sure.” Id. § 16.26(c).

The term “administration of justice” refers to the
government’s role in ‘“administlering]” its law
enforcement duties through, for example, “pursul[it]
[of] a civil or criminal prosecution or affirmative
relief, such as an injunction.” 28 C.F.R. 16.26(c).
Assisting Plaintiffs efforts to collect on a foreign
government's offer of a reward for the capture of a
fugitive does not fit within any understanding of
DOJ’s duties to administer justice, or anything
“require(d]” by those duties. The DOJ, therefore,
concluded that disclosure was not required for the
administration of justice and denied Plaintiffs
requests for the Special Agents’ testimoiiy at trial.

Il. Special Agent Currier is located More 100 Miles
Outside of the Court’s Jurisdiction

In addition to the reasons set forth above, the
Court should decline to compel the testimony of Spe-
cial Agent Currier at trial because, as Plaintiff
concedes in his Motion, Agent Currier is located in
Caracas, Venezuela—more than 100 miles outside
of the Southern District of Florida—and, therefore
outside the Court’s jurisdiction to compel his atten-
dance at trial. See Rule 45, Federal Rules of Civil
Procedure.

18a

CONCLUSION

For all of the foregoing reasons, Plaintiffs Motion
to Compel the requested testimony should be denied.

Dated: August 15, 2008
Respectfully Submitted,

R. ALEXANDER ACOSTA
United States Attorney

By

/s/ Carlos J. Raurell
Carlos J. Raurell

Assistant United States Attorney
Florida Bar No. 529893

99 Northeast 4th Street

Miami, Florida 33132

Telephone: (305) 961-9243

Fax: (305) 530-7139

i-Mail: carlos.raurell@usdoj.gov

Counsel for the Department of Justice,
Federal Bureau of Investigation

19a
CERTIFICATE OF SERVICE

| hereby certify that on August 15, 2008, I
electronically filed the foregoing document with the
Clerk of the Court using CM/ECF. I also certify that
the foregoing document is being served this day on all
counsel of record via transmission of Notices of
Electronic Filing generated by CM/ECF or in some
other authorized manner for those counsel or parties
who are not authorized to receive electronically
Notices of Electronic Filing.

/s/) CARLOS RAURELL

CARLOS RAURELL
Assistant United States Attorney

20a
APPENDIX C

IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

No. 08-17213

JOSE GUEVARA,
Plaintiff-Appellee
Cross-Appellant,

LUIS ALFREDO PERCOVICH,
Intervenor-Appellant,

Vv

REPUBLICA DEL PERU and
MINISTERIO DEL INTERIOR DEL PERU,
Defendants-Appellee:
Cross-Appellants

ON APPEAL FROM TH UNITED STATES
DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF FLORIDA

BRIEF FOR THE UNITED STATES
AS AMICUS CURIAE IN SUPPORT OF
REPUBLICA DEL PERU

Zla

HAROLD HONGJU KOH TONY WEST
Legal Adviser Assistant Attorney General
U.S. Department of State JEFFREY H. SLOMAN
2201 © Street N.W. Acting United States
Washington, D.C. 20520 A "6 7
ttorney

DOUGLAS N. LETTER
(202) 514-3602
NICHOLAS BAGLEY
(202) 514-2498
Attorneys, Appellate Staff
Civil Diviston, Room 7226
U.S. Department of Justice
950 Pennsylvania Ave. N.W.
Washington, D.C. 20530

22a
CERTIFICATE OF INTERESTED PERSONS

Pursuant to Eleventh Circuit Rule 26.1-1, the
undersigned counsel certifies that, to the best of his
knowledge, the following persons, in addition to those
listed in appellant’s and appellee’s opening briefs, are
the only ones who may have an interest in the outcome
of this case:

Nicholas Bagley, Attorney, U.S. Department of
Justice;

Harold Hongju Koh, Legal Adviser, U.S. Depart-
ment of State;

Douglas N. Letter, Attorney, U.S. Department of
Justice;

Jeffrey H. Sloman, Acting United States Attorney;

Tony West, Assistant Attorney General, US.
Department of Justice.

/s/ NICHOLAS BAGLEY

23a
TABLE OF CONTENTS

Page
CERTIFICATE OF INTERESTED PERSONS
STATEMENT REGARDING ORAL ARGUMENT

INTEREST OF THE UNITED STATEG............. 1
STATEMENT OF THE CASE. ..........0.00.000000000... 6
BR. FACCUAE TRACE OUING, oo. 5 o.o sc aiiescccsevavcscendocssces 6
Il. Judicial Proceedings in the United
RRS AIRE Mp oe Ties eae Re AOR SAE AE ETA AN ae A
SUMMARY OF ARGUMENT. ........0.000000000ccce. 12
PR IE aoc Vaecietnes bik aci ba ccasanssrsuewstanksaon eos 14

I. International Comity and the Act of State
Doctrine Require Reversal of the District

Court’s Judgment Against Peru................. 14
Pe. SUOTUMTIONIA! COOMBE. 00.5 cicccccsccssccceseecss 15
Be. Act OF Siete Dactrine onic. oo ceccciecccesceseses 26
iy NN gos yaa rea ey enaeatonaiaeesoe is 30

II. This Court Need Not Resolve Whether
Peru’s Reward Offer Had a Sufficient
Commercial Nexus to the United States. ... 32

SRI Aiud uco peicubeisttavsincgomcnasinusstseee cunt 35
CERTIFICATE OF SERVICE
CERTIFICATE OF COMPLIANCE

24a
TABLE OF AUTHORITIES
Cases: Page
Banco Nacional de Cuba v. Sabbatino, 376
U.S. SOS (1BGG) iscscisccursdcnrcneeeeeee 12, 26, 31
Chalabi v. Hashemite Kingdom of Jordan,
543 F.3d 725 (D.C. Cir. 2008).................. 33, 34
Dean Witter Reynolds, Inc. v. Fernandez,
741 F.2d 355 (11th Cir. 1984) ................. 30, 31
F. Hoffmann-La Roche Ltd. v. Empagran
S.A., 542 U.S. 166 @0G@) .........50ee 15
Fortino v. Quasar Co., 950 F.2d 389 (7th
Civ. 1GGL) s occcsicssvescavesxeesnnsnneicde eee 31
Glen v. Club Mediterranee, S.A., 450 F.3d
1251 (Lith Cir. SOG) 0. :.scossesaeenne ee 28
Granberry v. Greer, 481 U.S. 129 (1987)..... 32
Guevara v. Republica del Peru, 468 F.3d
1289 (llth Cir. 2OQ@) ....ssisavecckeseueeeee 6, 10
Harris v. United States, 149 F.3d 1304
(Lith Cir. 1996) .....0.ci<c..<sesesaasae ee 32
Hartford Fire Ins. Co. v. California, 509
U.S. F646. (2GGS) ovnciccsscsnnskcpesernoeaneeeeee 15
Hilton v. Guyot, 159 U.S. 113 (1895)........... 15, 26
Honduras Aircraft Registry, Ltd. v. Hon-
duras, 129 F.3d 543 (11th Cir. 1997)..... 28
Horowitz v. United States, 267 U.S. 458
(BDZ) nc iedcanvssieasevacwnnnntayegls tinea eee 29
International Association of Machinists v.
OPEC, 649 F.2d 1354 (9th Cir. 1981)..... 28
Pravin Banker Associates, Ltd. v. Banco
Popular Del Peru, 109 F.3d 850 (2d Cir.
ROT } 5 ssse<o10000s00nceevweneiyeeeeeeeeaaeena 31

20a
Republic of Argentina v. Weltover, Inc., 504

BP ee WE ChB ssc cceesssasisscecscvasesnconee 29
Society of Lloyd’s v. Siemon-Netto, 457

Pie 94.10. Civ, OCB) caccivcvicccsecesssccsecens 29
Steel Co. v. Citizens for a Better Environ-

ment, 523 U.S. 83 (1998).............ccecceeeeees 33
Tenet v. Doe, 544 U.S. 1 (2005) .....0. ee. 22, 34
Uriderhill v. Hernandez, 168 U.S. 250

EMME Pens ackiassssesssectuiseonsennecacsanelgavonsaraene 28
Ungaro-Benages v. Dresdner Bank AG, 379

F.3d 1227 (11th Cir. 2004). ........00.0.... 16, 19, 20
Victrix S.S. Co., S.A. v. Salen Dry Cargo

A.B., 825 F.2d 709 (2d Cir.1987). ........... 16

W.S. Kirkpatrick & Co., Inc. v. Environ-
mental Tectonics Corp., Int'l, 493 U.S

MOE © BP iis os cecseessxxcipaiuisnnsaxansenccasslien 26, 28
Statutes:
RE AO Mats DB DO Be ossvninsinccnseessenadensvansxeeonsasenesSeen 22
BP 8S 9AS. S UDTD . ncescccscccssescecasesnssseesostenvatees 23
22 U.S.C. 5 EU ee nsecnixpneriystxanavsaiaecienene ee 22, 2a
Be GP APN. © OF 1. seen conscwerssnesensnsesinncscentvedeceionee 1
Be U.S.C. § GOA... ..cccccscosccvevsssseessencseeseserens 10
BO U.S.C. 9 1608.20.00... csccccccccssccenssnccessseesenes 10, 33
Rules:
POG. H. ADD. P. ZH) o50.:.0sc0csssrseecseeseaseecconevs 1

Other Authorities:

Clifford Krauss, Former Spy Chief of Peru
Captured in Venezuela Lair, N.Y. Times,
June 25, ZOO] . .0....... cece scececcececececececscecs |

26a
STATEMENT REGARDING ORAL ARGUMENT

Because the panel already heard oral argument
from the parties on January 13, 2010, the United
States does not request oral argument. Should the
Court schedule a second oral argument in the case,
the United States believes that its participation
would be useful to the Court and would request ten
minutes of argument time.

27a

IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCU-T

JOSE GUEVARA,
Plaintiff-Appellee-
Cross-Appellant,

LUIS ALFREDO PERCOVICH,
Intervenor-Appellant,

V.

REPUBLICA DEL PERU and
MINISTERIO DEL INTERIOR DEL PERU,
Defendants-Appellees-
Cross-Appellants.

ON APPEAL FROM THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF FLORIDA

BRIEF FOR THE UNITED STATES
AS AMICUS CURIAE IN
SUPPORT OF PERU

INTEREST OF THE UNITED STATES

Pursuant to 28 U.S.C. § 517 and Fed. R. App. P.
29(a), the United States files this amicus curiae brief
in order to urge the Court to reverse the district
court’s judgment against the Republic of Peru under
either international comity principles or the act of
state doctrine. These justiciability doctrines are fully
applicable here and foreclosed the district court from

28a

issuing an $8.2 million judgment against Peru that
overrode the decisions of high-level Peruvian govern-
ment officials made in connection with the apprehen-
sion of a corrupt former Peruvian intelligence chief
who had been hiding in Venezuela.

The district court’s substantial judgment against
Peru would, if affirmed, become a serious irritant in
the United States’ bilateral relationship with that
nation. The judgment represents a serious affront to
Peruvian sovereignty and is precisely the type of
ruling that a United States court should not make
because it hamstrings the Executive Branch’s ability
to carry out its foreign-relations responsibilities.
Reversal under these circumstances is entirely con-
sistent with precedent from the Supreme Court, this
Court, and its sister Circuits applying the interna-
tional comity and act of state doctrines.

We have taken the highly unusual step of filing an
amicus brief after oral argument because the federal
government has a profound interest in preventing the
district court’s judgment from undermining our
nation’s relationship with a stable democratic partner
in South America. Moreover, the United States
operates its own highly successful international
reward programs, and the judgment here ruises the
troubling specter of foreign courts overriding decisions
made by U.S. law enforcement and diplomatic officials.

As discussed below, this case arose because the
President of Peru issued a formal executive decree
offering a $5 million reward for information leading
directly to the capture of Viladimiro Lenin Montesinos
Torres, the former head of Peru’s intelligence agency.
The Peruvian President established a Special Com-
mittee of high-ranking officials within the Peruvian
Interior Ministry to implement this reward program.

29a

The committee was vested with exclusive authority to
issue the reward, and provision was made for the
committee to operate confidentially. In addition, the
committee was empowered by the Peruvian President
to make determinations concerning competing claims
to the reward, and to decide how the available funds
should be divided if more than one claimant qualified
for compensation.

Plaintiff-appellee Jose Guevara was a Venezuelan
intelligence official who offered information relating
to Montesinos’ whereabouts while in the temporary
custody of the FBI as part of a federal criminal
investigation of his conduct. Guevara provided this
information while in the United States on a short
trip. Not long after, he filed a claim in Peru for the $5
million reward.

The Peruvian Special Committee rejected Guevara’s
claim, reasoning that Venezuelan authorities had
taken Montesinos into custody and that no evidence
connected Guevara’s information with those authori-
ties. Guevara is now pursuing his claim against Peru
in a United States court.

Notwithstanding the Peruvian government’s
authoritative resolution of Guevara’s claims, the
district court here ruled that the Special Committee’s
determination was incorrect and that Peru must
therefore pay Guevara the entire $5 million reward,
plus $3.2 million in interest. This ruling sets aside
two Peruvian government decisions: (1) the conferral
of exclusive authority on the Special Committee to
administer the reward program; and (2) that commit-
tee’s ultimate conclusion that Guevara had not
demonstrated his entitlement to the reward.

30a

The adjudication in a United States court of the
validity of a sovereign determination by a foreign
administrative tribunal is precisely what the interna-
tional comity and act of state doctrines are meant to
avoid. And, as alluded to already, the district court’s
judgment exposes actions taken by the United States
in implementing parallel reward programs to reversal
by foreign courts. This type of foreign court ruling
would be especially problematic because U.S. officials
make reward decisions on the basis 0. competing con-
siderations such as the nature, quality, and accuracy
of the information provided; how that information
ties in with confidential information that the United
States already had; the degree to which the information
actually assisted the government; the need to protect
sensitive sources and methods; the effect of payment
on our national! security interests; and whether non-
payment would undermine the effectiveness of the
program. Foreign judicial pronouncements on govern-
mental decisions made by U.S. officials concerning
these factors would obviously be inappropriate and
unwelcome.

Thus, drawing either on principles of international
comity or on the act of state doctrine, this Court
should reverse the judgment against Peru. This Court
should do so as an exercise of its discretion, whether
or not Peru presented these arguments adequately to
the district court. Full and proper application of these
principles is of immense importance to the interests
of the United States, and those interests should
override any procedural problems created by Peru’s
litigation strategy.

STATEMENT OF THE CASE

In this brief, except where otherwise expressly
noted, the United States takes the description of the

3la

facts purely from Guevara’s complaint, this Court’s
opinion in Guevara v. Republica del Peru, 468 F.3d
1289 (11th Cir. 2006), and the uncontested facts
described in the district court record.

I. Factual Background.

During the 1990s, Vladimiro Lenin Montesinos
Torres served as an adviser to Peruvian President
Alberto Fujimori and as the head of Peru’s National
Intelligence System. In that capacity, Montesinos
allegedly committed numerous crimes, including (but
not limited to) bribery, influence peddling, drug traf-
ficking, money laundering, unlawful! arms trafficking,
and murder. He was caught on videotape offering a
bribe to a legislator-elect in September 2000, which led
almost immediately to the collapse of the Fujimori
government.

Montesinos went into hiding and an international
manhunt ensued. In April 2001, the President of Peru
issued an Emergency Decree offering a $5 million
reward to “the person or persons who provide(s) accu-
rate information that will directly enable locating and
capturing” Montesinos. DE 119-2, at 2 (Emergency
Decree).' The decree established a Special High Level
Committee within the Peruvian Ministry of the
Interior “for the purpose of evaluating information
received and deciding on granting the financial
reward.” Id. And “accurate information” was defined
to mean information “provided through any means to
the Special High Level Committee and which enables
locating and capturing” Montesinos. Jd. The four-per-
son committee was made up of the Minister of the
Interior, his immediate subordinate, the Director

' “DE” refers to the docket entry number on the district court
docket.

32a

General of the National Police, and the Director
General of Intelligence for the Interior Ministry. /d.
“In the event several persons provide the said infor-
mation,” the decree provides, “the financial reward
shall be divided among them.” Jd. The Special Com-
mittee was charged with taking “measures for the
protection and safety of the informant”; consistent
with that need for confidentiality, “[aJll information
involving application of this Emergency Decree is
secret.” Id. at 2-3.

In the meantime, Montesinos had secretly taken
refuge in Venezeula. A member of the Venezuelan
intelligence service, plaintiff-appellee Jose Guevara,
provided Montesinos with a safe house and a security
detail. As he ran short on money, Montesinos “sent
Guevara on trips to Lima, Bogota, Miami, and Nassau,
Bahamas, in a desperate search for more money.” DE
333, at 3. On Guevara’s third such trip to Miami in
June 2001 to meet with an employee at a Miami bank
on Montesinos’ behalf, the FBI took Guevara into

custody.

According to Peru, Guevara was “charged with
fraud against the United States and extortion of the
family of a bank official * * * in an effort to access $43
million of Montesinos’ deposits at a Miami bank.”
Appellant’s Br. 3. The FBI told Guevara that the case
in the United States would be dropped if he provided
information concerning Montesinos’ whereabouts. The
FBI agents in Miami consulted over the telephone
with a Peruvian official, who confirmed that a $5
million reward for information leading to Montesinos’
capture was available to Guevara. See DE 230, at 3.
In light of his discussions with the FBI and Peru's
reward program, Guevara decided to cooperate, and
he placed a telephone call to a colleague in Venezuela,

33a
Id. Montesinos was arrested the following day by
Venezuelan authorities. Jd.

Guevara then sought to collect the reward in Peru.
In 2002, the Peruvian government’s Special Committee
agreed to process Guevara’s request for the reward.
Guevara was not the only claimant, however: a
handful of others—including the bank employee with
whom Guevara met in Miami—also submitted claims.

In 2005, the Special Committee notified Guevara
that his request for the reward had been denied. DE
201-9. The Peruvian government did not in its notice
provide an explanation for its decision; Peru instead
informed Guevara that, pursuant to the terms of the
Emergency Decree, that information was considered
confidential. Guevara was nevertheless invited “to
read the Resolution related to your request” at a
Peruvian ministry office. Jd. In a declaration submit-
ted to the district court, a former Peruvian Minister
of the Interior and member of the Special Committee
explained that Guevara’s reward claim had been
rejected because “the acts of the Venezuelan military
were an intervening event that broke the chain
of causation” between Guevara’s assistance and
Montesinos’ capture. Costa Decl., DE 326-4 416; see
also Rospigliosi Dep., DE 201-3, at 21.

Il. Judicial Proceedings in the United States.

In 2004, Guevara filed a breach-of-contract action
in a Florida state court against Peru to recover the $5
million reward. The case was removed to the United
States District Court for the Southern District of
Florida, which concluded that Peru was immune from
suit under the Foreign Sovereign Immunities Act
(FSIA), 28 U.S.C. §§ 1604, 1605. In the district court’s
view, offering a reward for the capture of a criminal

34a

was a sovereign, and not a commercial, act. (Shortly
before the district court issued its decision, the
Venezuelan Supreme Court of Justice had rejected a
separate claimant’s suit effort to sue Peru for the
reward in Venezuela on the similar ground that the
Peruvian President’s issuance of the Emergency
Decree was a sovereign act not subject to challenge in
Venezuelan courts. See Decision of February 17, 2004
(available at http://www.tsj.gov.ve/decisiones/jspa/
Febrero/03-1314.htm)).

This Court reversed in November 2006. Guevara uv.
Republica del Peru, 468 F.3d 1289 (11th Cir. 2006).
The Court found that Peru’s reward offer was a
unilateral offer to enter into a contractual relation-
ship. And under the FSIA, this Court held, a contract
for the provision of information is a commercial con-
tract and is not inherently sovereign. The case was
therefore remanded for further proceedings.

On remand, the district court granted summary
judgment against Peru. In the court’s view, the Spe-
cial Committee’s 2002 resolution indicating that
Guevara’s claim had been accepted for consideration
established that Guevara had, in fact, provided
information that led directly to Montesinos’ capture.
DE 230, at 6-7. The court rejected Peru’s argument
that the capture of Montesinos by Venezuelan
authorities, and not by Peruvian authorities, raised
an issue of fact as to whether Guevara's provision of
information had led directly to Montesinos’ arrest.
“In the absence of evidence to the contrary, it appears
that Venezuela learned of Montesinos’s location from
Guevara and would have been unable to capture him
had Guevara not cooperated.” Jd. at 8. The court also
rejected Peru’s evidence regarding the Special Com-
mittee’s deliberations, and it closed its analysis by

criticizing the secrecy of the proceedings, discounting
for that reason the significance of Peru’s formal letter
rejecting Guevara's claim. /d. at 9-10.

The district court subsequently entered final
judgment against Peru. Under that judgment, the
court ordered Peru to pay Guevara the entirety of the
$5 million reward, plus more than $3.2 million in
prejudgment interest. DE 346. Peru appealed. DE
349. In its opening appellate brief to this Court, Peru
argues, among other things, that international
comity and the act of state doctrine should have
prevented the district court from entering a judgment
against Peru contradicting the decision by the
Peruvian government that Guevara was not entitled
to payment of the reward. Appellant’s Br. 40-42.

SUMMARY OF ARGUMENT

In practical effect, Jose Guevara’s lawsuit ayainst
the Peruvian government in the United States is both
a collateral attack in another nation’s courts on the
Special Committee’s decision that he was not entitled
to the reward and a challenge to the authority of the
Peruvian President to delegate to the Special Com-
mittee the exclusive authority to administer the
reward program. Not only would the district court's
order requiring the Peruvian government to pay the
reward violate the act of state doctrine, which the
Supreme Court has held to have “constitutional
underpinnings.” Banco Nacional de Cuba v. Sabbatino,
376 U.S. 398, 423 (1964). It would also, if affirmed,
introduce considerable friction into the United States’
bilateral relationship with Peru. To protect the
prerogatives of the Executive Branch in its conduct of
foreign affairs, both the act of state doctrine and
principles of international comity generally preclude
U.S. courts from reviewing and overriding the

36a

sovereign decisions of foreign states and foreign
tribunals. Particularly because this judgment against
Peru presents two serious foreign-relations dilemmas
for the United States, the doctrines are fully
applicable here.

First, the district court’s entry of a multi-million
djudgment against Peru would, if affirmed, become
an irritant in the United States’ relationship with
that country. Peru justifiably believes that the district
court overstepped its authority when it overrode the
authoritative decision of the Special Committee
denying Guevara’s claim for the reward. Second, the
United States itself administers several reward pro-
grams for the capture of international fugitives. To
preserve the ability of U.S. officials to make delicate
and context-sensitive judgments about whether an
individual is or is not entitled to a reward, decisions
made pursuant to those reward programs are gener-
ally not subject to judicial review even in domestic
courts. Yet the district court’s judgment stands as an
invitation to foreign courts to accept jurisdiction over
litigation challenging decisions by U.S. officials con-
cerning reward claims. The threat of oversight by
foreign courts would not only seriously hamper the
administration of these important reward programs;
it would also present the risk that foreign courts will
demand the release of confidential information
relating to ongoing law enforcement investigations—
or even order the U.S. to disclose classified information.

The United States therefore urges this Court to
reverse the judgment against Peru on the ground
that it accords neither with international comity nor
with the act of state doctrine. We recognize that Peru
has argued in the alternative that its commercial
activity lacked a sufficient nexus to the United States

37a

to fall within the commercial activity exception.
Because resolving the nexus argument in this very
unusual case could have far-reaching implications for
future litigation, we ask the Court to reverse the
judgment on international comity and act of state
grounds, which themselves render the suit non-
justiciable.

ARGUMENT

I. International Comity and the Act of State
Doctrine Require Reversal of the District Court’s
Judgment Against Peru.

As explained above, a high-level committee within
the Peruvian government vested with the exclusive
authority to administer a $5 million reward for
information leading directly to Mcntesinos’ capture
considered and rejected Guevara’s claim for that
reward. In nonetheless ordering Peru to pay Guevara
the entirety of the $5 million reward, plus millions in
interest, the district court contradicted the deter-
mination of a foreign tribunal and arrogated to itself
authority that the President of Peru had delegated to
that tribunal. As we explain below, principles of
international comity demanded that the district court
abstain from overriding the decision of the Special
Committee to reject Guevara’s claim for the reward.
And the act of state doctrine prohibited the district
court from invalidating the Peruvian President’s
establishment of an exclusive mechanism for admi-
nistering the reward.

A. International Comity.

“International comity”"—“the recognition which one
nation allows within its territory to the legislative,
executive or judicial acts of another nation,” Hilton v.
Guyot, 159 U.S. 113, 164 (1895)—has two forms. Pre-

38a

scriptive comity (also called the “comity of nations”) is
a doctrine under which courts construe “ambiguous
statutes to avoid unreasonable interference with the
sovereign authority of other nations.” F. Hoffmann-
La Roche Ltd. v. Empagran S.A., 542 U.S. 155, 164
(2004). The second form—at issue in this case—is the
“comity of courts, whereby judges decline to exercise
jurisdiction over matters more appropriately adjudged
elsewhere.” Hartford Fire Ins. Co. v. California, 509
U.S. 764, 817 (1993) (Scalia, J., dissenting). Although
the comity of courts is an abstention doctrine that is
typically invoked when a U.S. court declines to
exercise jurisdiction in deference to parallel judicial
proceedings in a foreign state, see Victrix S.S. Co.,
S.A. v. Salen Dry Cargo A.B., 825 F.2d 709, 713-14
(2d Cir.1987), it applies equally in cases involving the
decisions of foreign administrative tribunals. See
Ungaro-Benages v. Dresdner Bank AG, 379 F.3d 1227,
1237-40 (11th Cir. 2004) (finding that international
comity required dismissal of domestic claims in
deference to the compensation determinations of a
foreign administrative tribunal).

In deciding whether to defer on comity grounds to
the decision of a foreign tribunal, this Court weighs
at least four factors: “(1) whether the foreign court
was competent and used ‘proceedings consistent with
civilized jurisprudence, (2) whether the judgment
was rendered by fraud, * * * (3) whether the foreign
judgment was prejudicial because it violated Ameri-
can public policy notions of what is decent and just’;
and (4) “whether the central issue in dispute is a
matter of foreign law and whether there is a prospect
of conflicting judgments.” Jd. at 1238. The strength of
the United States’ interests and the interests of the
foreign state are also important to the analysis. Id. at
1239.

39a

These factors compel application of the comity
doctrine to preclude review in U.S. courts of Peru’s
determination that Guevara was not entitled to the
reward. DE 201-9. Of greatest significance, the
district court’s judgment not only “creates a prospect
of conflicting judgments,” but actually does conflict
with the Specia! Committee’s decision. The conflict is
particularly striking because the central issue in
dispute in this case is whether Guevara satisfied the
terms of the Peruvian reward program.

The potential for conflict runs much deeper than
the district court’s decision merely to overturn a
single decision of the Special Committee. The Peru-
vian President’s Emergency Decree caps the total
reward amount at $5 million. In the event that more
than one person provided information leading to
Montesinos’ arrest, the Special Committee was charged
with “divid[ing] among” those persons the $5 million
sum. DE119-2, at 2. The district court’s $8.2 million
judgment against Peru, however, not only exceeds
that $5 million cap. More significantly, it means
that other courts—both in the United States and
elsewhere—could enter another judgment awarding
the same $5 million. That resu!t would thwart the
Peruvian government’s effort to cup the total amount
it disbursed in connection with the Emergency Decree,
and to provide for appropriate divisions where
necessary.

The Special Committee’s determination is precisely
the sort of decision by a foreign governmental body to
which U.S. courts owe deference. its competence is
beyond dispute: the Special Committee comprised four
high-level Peruvian officials from law enforcement
and the Ministry of the Interior, including the
Minister himself. DE 119-2, at 2. Their accumulated

40a

expertise in law enforcement and intelligence put
them in a very strong position to ascertain whether
certain information did or did not lead directly to
Montesinos’ capture. And so far as the evidence in
the record shows, the Special Committee was fully
authorized under Peruvian law to make this
determination and its conclusion lay within its lawful
discretion.

In the district court, Peru submitted a declaration
from a former Peruvian Minister of the Interior who
served on the Special Committee from 2001 to 2003.
That declaration described the Committee’s delibera-
tions, its collection of information, its consideration
of testimony, and its repeated requests for more
information from the FBI and Guevara’s counsel
about Guevara’s assistance. See Second Decl. of G.
Costa Santolalla, DE 326-4. This former minister
stated without contradiction that Guevara’s reward
claim was rejected because the available evidence did
not support the conclusion that Guevara provided the
information leading directly to Montesinos’ capture.
Id. J 16. Instead, “the Special Committee concluded
that the acts of the Venezuelan military were an
intervening event that broke the chain of causation
between Mr. Guevara’s telephone call * * * and the
arrest of Montesinos.” Costa Decl., DE 326-4, J 16.
The Minister’s declaration was corroborated by a
deposition from another former Peruvian Minister of
the Interior who served on the Committee from 2001
to 2002 and from 2003 to 2004. Depo. of Fernando
Rospigliosi, DE 201-3, at 21.

Nothing in the record suggests that the Committee’s
determination was tainted by fraud or otherwise
violated United States public policy. Indeed, it would
be perfectly consistent with U.S. policy to deny a

4la

reward ciaim in a case in which insufficient evidence
connected the information to the eventual arrest, a
third party’s intervention made the proffer of
information irrelevant, or a claimant failed to satisfy
the terms of the reward offer. Just as decisions based
on such factors by U.S. officials are not amenable to
challenge in foreign tribunals, so too should Peru’s
determination be insulated from collateral attack in
U.S. courts.

Deference to the Special Committee’s decision is all
the more appropriate given that the district court’s
invalidation of that decision, if affirmed by this
Court, could adversely affect the United States’ rela-
tionship with Peru. That is particularly true here
because the target of the $5 million reward was not
some common criminal. The Montesinos affair was an
international cause célébre. Montesinos was an
infamous former high-level official accused of (and in
some cases convicted of) “crimes against government
administration, public corruption, embezzlement,
crimes against persons, aggravated murder, national
security and other[ crimes].” DE 119-2, at 2. His
arrest was the precipitating event in the collapse of
the Fujimori presidency, and both Montesinos and
Fujimori have since been convicted in Peruvian
courts of serious abuses of power. See id. (stating in
the Emergency Decree that various officials commit-
ted illegal acts between 1990 and 2000, and that
Montesinos “stands out among said officials” because
of his “involve[ment] in serious crimes which affect
the security of the State and society overall”).

Even the circumstances of Montesinos’ capture
were a source of foreign-relations controversy. Although
President Hugo Chavez and other Venezuelan
officials claimed that Venezuela was single-handedly

42a

responsible for Montesinos’ arrest, many Peruvians
suspected that Venezuelan authorities had knowingly
harbored him. See Clifford Krauss, Former Spy Chief
of Peru Captured in Venezuela Lair, N.Y. Times, June
25, 2001. That the Special Committee’s decision arose
against the backdrop of a sensitive regional political
controversy provides a particularly compelling reason
to defer to Peru’s handling of the reward question.
Given the delicacy of the issue, the Special Commit-
tee was entitled to do its work without second-
guessing from courts in other countries, including the
United States.

Further, and contrary to the district court’s view,
DE 230, at 9-10, the fact that the Special Com-
mittee’s reasoning was confidential provides no
reason to question its conclusions. As the Emergency
Decree makes clear, the evidence presented to the
Committee, its deliberations, and its reasoning were
to be kept secret in order to protect the safety of
claimants. See DE 119-2, at 2-3 (directing the Special
Committee to adopt specific measures “for the
protection and safety of the informant,” authorizing
claimants to use pseudonyms, and requiring “[a]ll
information involving application of this Emergency”
to be kept “secret”). Despite these valid concerns, the
Special Committee expressly invited Guevara to
review the record of its decision within a Peruvian
ministry. DE 201-9.

In any event, the Peruvian government’s interest
in preserving the confidentiality of proceedings
touching on sensitive law enforcement functions
mirrors the United States’ own interest in protecting
informant confidentiality and preserving the secrecy
of classified information. See 5 U.S.C. § 552(b)(1), (7)
(protecting classified information and certain “records

43a

or information compiled for law enforcement purposes”
from disclosure under the Freedom of Information
Act); cf. Tenet v. Doe, 544 U.S. 1, 8 (2005) (holding
that “[p]ublic policy forbids the maintenance of any
suit in a court of justice, the trial of which would
inevitably lead to the disclosure of ti.atters which the
law itself regards as confidential” (internal quotation
and emphasis omitted)).

Over and above these concerns, the United States
has a substantial interest in forestalling reciprocal
litigation in foreign tribunals that would interfere
with the administration of U.S. reward programs.
The State Department, for example, administers
three rewards programs that target some of the most
dangerous classes of international fugitives: Rewards
for Justice, the Narcotics Rewards Program, and
Rewards for Information Concerning Individuals
Sought for Serious Violations of International Huma-
nitarian Law Relating to the Former Yugoslavia or
Rwanda. See 22 U.S.C. § 2708.

These three programs fund payments for informa-
tion leading to the arrest of international terrorists,
narco-traffickers, and war criminals, respectively.
Under the auspices of the reward programs, the
Secretary of State determines, with input from the
Interagency Rewards Committee (a group composed
of Executive Branch officials), whether to pay a
reward and, if so, the amount to be paid. The
Department of Defense administers a similar reward
program for persons providing “information § or
nonlethal assistance” in aid of an operation against
international terrorism. 10 U.S.C. § 127b(a).

Under all of these U.S. reward programs, a decision
to grant or deny a reward is by law “final and
conclusive and is not subject to judicial review.” 22

44a

U.S.C. § 2708(j); 10 U.S.C.§ 127b(g). This policy makes
eminent sense. The federal officials who administer
these reward programs must balance a range of
competing considerations in deciding whether to
grant or deny an individual’s claim. As noted earlier,
those considerations include the nature and quality
of the information provided, the accuracy of the
information, whether the individual providing the
information is eligible for payment under the terms
of the relevant statute or regulation, whether the
same or comparable information was obtained from
other sources, the degree to which that information
actually led to the apprehension of a suspect, the
need to protect sensitive sources and methods, whether
payment is consistent with national security, and
whether nonpayment would undermine the effective-
ness of the rewards program. Major and obvious
problems would arise if these U.S. reward program
decisions were subject to invalidation in foreign courts.

Yet the district court’s judgment here seriously
threatens to expose decisions that Congress insulated
from review in domestic courts to adjudication in
foreign tribunals. The risks of such reciprocal litiga-
tion are manifold. Foreign courts cannot be counted
upon to be sensitive to the wide range of concerns
that U.S. officials must take into account in deciding
whether or not to grant a reward. And federal
officials would likely feel constrained in the exercise
of their duties if their decisions were subject to later
judicial review in a foreign state. In addition, in
attempting to decide whether the terms of a reward
program were satisfied, foreign courts might well
order intrusive discovery into what precisely a
confidential informant told law enforcement officials
and how that information did (or did not) satisfy the
terms of the reward program. And courts in other

45a

countries may be unsympathetic to U.S. efforts to
invoke the law enforcement privilege or to resist the
disclosure of classified information.

As if to illustrate the point, the district court in this
very case was asked by both parties to compel the
FBI to disclose extraordinarily sensitive law enforce-
ment information. See, e.g., DE 289 (providing the
FBI’s response to Peru’s motion to compel discovery).
Foreign courts would certainly be presented with
precisely the same sorts of requests. Furthermore, the
district court rested its decision to grant judgment
against Peru in part on the absence of evidence in the
record to rebut the inference that Guevara provided
information leading to Montesinos’ arrest. See DE
230, at 8 (stating that, “[i]Jn the absence of evidence to
the contrary, it appears that Venezuela learned
of Montesinos’s location from Guevara and would
have been unable to capture him had Guevara not
cooperated”). That line of reasoning suggests that a
domestic law enforcement agency’s resistance to
discovery demands could justify a foreign court’s
decision to overrule a U.S. determination that a
particular claimant is not entitled to a reward.

For all of these reasons, international comity prec-
luded the district court from undertaking a review of
the factual and legal determinations of the Special
Committee. See Hilton, 159 U.S. at 202-03 (holding
that where “comity of this nation” calls for recognition
of a judgment rendered abroad, “the merits of the
case should not * * * be tried afresh”).

B. Act of State Doctrine.

For many of the same reasons, the district court’s
judgment against Peru violates a related but separate
doctrine—the act of state doctrine. “[I)n its traditional

46a

formulation,” the act of state doctrine “precludes the
courts of this country from inquiring into the validity
of the public acts of a recognized foreign sovereign
power committed within its own territory.” Banco
Nacional de Cuba v. Sabbatino, 376 U.S. 398, 401

(1964).

The doctrine was “once viewed * * * as an expres-
sion of international law, resting upon the highest
considerations of international comity and expediency,”
W.S. Kirkpatrick & Co., Inc. v. Environmental Tectonics
Corp., Int’l, 493 U.S. 400, 404 (1990) (internal quota-
tion marks omitted), but was described by Justice
Harlan in Sabbatino as a doctrine with “constitu-
tional’ underpinnings,” reflecting “the strong sense of
the Judicial Branch that its engagement in the task
of passing on the validity of foreign acts of state may
hinder” the conduct of foreign affairs, Sabbatino, 376
US. at 423.

In this case, the district court’s judgment granting
Guevara’s claim for the reward invalidated Peru’s
ultimate decision to deny Guevara’s claim. That by
itself violated the act of state doctrine. But the court’s
judgment also invalidated the President of Peru’s
establishment of a specialized tribunal vested with
sole responsibility for determining in confidential
proceedings whether an individual had satisfied the
condition for receiving the reward.

Peru clearly intended the Special Committee's
determinations to be exclusive. The four-person
Committee was established “for the purpose of
evaluating information received and deciding on
granting the financial reward,” and the reward was
due only if information was “provided through any
means to the Special High Level Committee.” DE
119-2, at 2. Per the Emergency Decree, the Special

47a

Committee alone was charged with assessing the
accuracy of the information and with providing pro-
tection to an informant who was in danger because of
his cooperation. Jd. And the Emergency Decree con-
templated that the Special Committee would divide
the total reward among the claimants entitled to it.
Id. at 2-3.

These provisions are in no sense compatible with
having multiple tribunals in different countries
address a claimant’s entitlement to the reward. Thus,
in assuming the authority to dispense the $5 million
reward, the district court invalidated the President of
Peru’s delegation of exclusive decision-making authority
to the Special Committee. The act of state doctrine
serves to protect against precisely that sort of
invalidation. See Underhill v. Hernandez, 168 U.S.
250, 252 (1897) (holding that “the courts of one country
will not sit in judgment on the acts of the government
of another, done within its own territory”). That is
particularly so where, as here, the Peruvian President’s
delegation involved questions relating to the capture
of an infamous former government official and where
the district court’s judgment would, if affirmed,
create diplomatic friction. See Kirkpatrick, 493 U.S.
at 409 (holding that “the policies underlying the act
of state doctrine should be considered in deciding
whether” it should be applied).

The application of the act of state doctrine here is
in no way undermined by this Court’s prior conclu-
sion that the Peruvian reward offer constituted a
commercial contract. The law of this Circuit is that
“there is no commercial exception to the act of state
doctrine.” Honduras Aircraft Registry, Ltd. v.
Honduras, 129 F.3d 543, 550 (11th Cir. 1997); Glen v.
Club Mediterranee, S.A., 450 F.3d 1251, 1254 n.2

48a

(llth Cir. 2006) (same); see also International Asso
ciation of Machinists v. OPEC, 649 F.2d 1354, 1360
(9th Cir. 1981).

Even assuming that a commercial activity exception
existed, the only potential commercial activity at
issue here was Peru’s extension of the reward offer.
The Peruvian President’s distinct decision to delegate
exclusive authority for deciding who is (and is not)
entitled to the reward was non-commercial sovereign
activity. Cf. Horowitz v. United States, 267 U.S. 458,
461 (1925) (distinguishing between the United States’
“public and general acts as a sovereign” and those
acts undertaken in connection with a commercial
contract). Private parties cannot and do not delegate
to specialized committees composed of high-ranking
government officials the power to adjudicate whether
the conditions of a law-enforcement reward offer have
been satisfied. See Republic of Argentina v. Weltover,
Inc., 504 U.S. 607, 614 (1992) (holding that an act is
commercial only if “the particular actions that the
foreign state performs (whatever the motive behind
them) are the type of actions by which a private party
engages in trade and traffic or commerce” (internal
quotation marks omitted)). Under the act of state
doctrine, that sovereign delegation should not be
subject to review in United States courts. Cf. Society
of Lloyd’s v. Siemon-Netto, 457 F.3d 94, 102-103 (D.C.
Cir. 2006) (holding that the act of state doctrine barred
an argument that an English statute unlawfully
delegated authority to Lloyd’s, a private company).

C. Forfeiture.

The parties dispute whether Peru preserved these
justiciability claims in the district court. Whatever
the merits of that dispute, the principle that an
appellate court will not pass on forfeited arguments

49a

is “not a jurisdictional limitation but merely a rule of
practice, and the decision whether to consider an
argument first made on appeal is left primarily to the
discretion of the courts of appeals, to be exercised on
the facts of individual cases.” Dean Witter Reynolds,
Inc. v. Fernandez, 741 F.2d 355, 360 (Lith Cir. 1984)
(internal quotations, footnotes, elision, and correction
omitted).

As we have explained, upholding the judgment
against Peru could have deleterious consequences
both for the United States’ bilateral relationship with
Peru and for the administration of federal reward
programs. Standing alone, those potential conse-
quences are sufficiently serious that this Court should
exercise its discretion to consider the act of state and
international comity arguments. As the Seventh
Circuit has noted in a related context, “federal-state
comity interests can be considered for the first time
on appeal,” and the case for overlooking waiver is
even “stronger” when the arguments presented touch
on “international comity, amity, and commerce.”
Fortino v. Quasar Co., 950 F.2d 389, 391 (7th Cir. 1991).

The United States has a substantial independent
interest in presenting the act of state and interna-
tional comity arguments to this Court, over and
above what Peru may have argued. The two doctrines
“aris{e] out of the basic relationships between
branches of government in a system of separation of
powers,” Sabbatino, 376 U.S. at 423, and exist in part
“to promote cooperation and reciprocity with foreign
lands,” Pravin Banker Associates, Ltd. v. Banco Popu
lar Del Peru, 109 F.3d 850, 854 (2d Cir. 1997). The
Court should consider and address even late-raised
arguments that serve to protect the Executive

50a

Branch’s prerogatives, whether or not a party has
presented them.

Indeed, even if the United States were not partici-
pating, the exceptional nature of this case would
warrant this Court’s review of any forfeited interna-
tional-abstention arguments. The strictly legal issues
presented by the arguments clearly “presen|[t]
significant questions of general impact or of great
public concern.” Dean Witter Reynolds, Inc., 741 F.2d
at 361; cf. Granberry v. Greer, 481 U.S. 129, 134
(1987) (noting that “principles of comity” may be
“better served by addressing the merits forthwith” of
forfeited arguments). This Court should therefore
exercise its discretion to consider the arguments per-
taining to international comity and the act of state
doctrine.

Il. ‘his Court Need Not Resolve Whether Peru’s
Reward Offer Had a Sufficient Commercial
Nexus to the United States.

As an alternative basis for reversal, Peru has
argued that its reward offer bore an insufficient
relationship to the United States, and that its com-
mercial activity therefore fell outside the commercial
activity exception to the immunity otherwise imposed
in the Foreign Sovereign Immunities Act (FSIA).* As

* When this Court previously held that Peru’s extension of the
reward offer amounted to commercial activity, it did not address
(because it was not asked to) whether the activity bore the
requisite connection to the United States. On remand, the dis-
trict court declined to consider the question because it appeared
to believe that this Court’s prior decision “established” the dis-
trict court’s jurisdiction. DE 230, at 10. The nexus argument,
however, implicates this Court’s subject matter jurisdiction and
thus remains viable. See Harris v. United States, 149 F.3d 1304,
1308 (11th Cir. 1998) (holding that “the parties are incapable of

ola

relevant here, the exception provides that a sovereign
is not immune from suit in any case “in which the
action is based * * * upon an act outside the territory
of the United States in connection with a commercial
activity of the foreign state elsewhere and that act
causes a direct effect in the United States.” 28 U.S.C.
§ 1605(a)(2).

The United States takes no position on the highly
fact-bound question whether any act undertaken by
Peru had a “direct effect in the United States” within
the meaning of the FSIA. Nor need the Court resolve
this issue, which, although it arises here in an
unusual factual setting involving a foreign govern-
ment’s law enforcement reward program, could
materially affect the scope of federal court jurisdiction
over quintessentially commercial disputes between
domestic corporations and foreign states. As noted,
the justiciability grounds discussed above—that the
judgment violates principles of international comity
and the act of state doctrine—provide an alternative
and sufficient basis for reversal.

There is no obstacle to addressing international
comity and the act of state doctrine before resolving
whether this Court has subject-matter jurisdiction.
Steel Co. v. Citizens for a Better Environment, 523 U.S.
83, 94-95 (1998), requires a federal court to “prioritize
la] jurisdictional issue only when the existence
of Article III jurisdiction is in doubt.” Chalabi v.
Hashemite Kingdom of Jordan, 543 F.3d 725, 728
(D.C. Cir. 2008). The Supreme Court, however,
“explicitly recognized [in Steel Co.] the propriety of
addressing the merits where doing so made it possi-

conferring upon us a jurisdictional foundation we otherwise lack
simply by waiver or procedural default”).

52a

ble to avoid a doubtful issue of statutory jurisdiction.”
Id. (internal quotation omitted). And although they
are not jurisdictional in nature, the act of state
doctrine and international comity are “threshold
question[s]” designed “to preclude judicial inquiry,”
and as such can properly be addressed before questions
of statutory jurisdiction. Tenet, 544 U.S. at 6 n.4.

CONCLUSION

For the foregoing reasons, the judgment entered by
the district court against the Government of Peru
should be reversed.

Respectfully submitted,

HAROLD HONGJU KOH TONY WEST
Legal Adviser Assistant Attorney General

U.S. Department of State JEFFREY H. SLOMAN
2201 C Street N.W. Acting United States
Washington, D.C. 20520 Att |

‘torney

/s/
DOUGLAS N. LETTER
(202) 514-3602
/s/
NICHOLAS BAGLEY
(202) 514-2498
Attorneys, Appellate Staff
Civil Division, Room 7226
U.S. Depariment of Justice
950 Pennsylvania Ave. N.W.
Washington, D.C. 20530

MARCH 2010

53a
CERTIFICATE OF SERVICE

I hereby certify that on this 3lst day of March,
2010, I caused an original and six copies of the fore-
going brief to be filed with the Court by Federal
Express. On the same date, I also caused an elec-
tronic copy to be filed with the Court, and caused
copies to be served on the following counsel by
Federal Express and email:

Michael Diaz, Jr.

Brant C. Hadaway

Carlos F. Gonzalez

DIAZ, REUS & TARG, LLP
100 Southeast 2nd Street
2600 Bank of America Tower
Miami, Florida 33131

Karen Curtis

CLARKE SILVERGLATE & CAMPBELL, PA
799 Brickell Plaza

Suite 900

Miami, Florida 33131

Mark A. Cymrot

Ambika J. Biggs

Andrene L.K. Smith

BAKER & HOSTETLER LLP
Washington Square, Suite 1100
1050 Connecticut Avenue, N.W.
Washington, D.C. 20036

o. See
NICHOLAS BAGLEY

MARCH 2010

54a

CERTIFICATE OF COMPLIANCE

As required by Fed. R. App. P. 32(a)(5) and (6),
I certify that this brief has been prepared in a fixed-
spaced typeface using Corel WordPerfect 12 in
12-point Book Antiqua font. I further certify that
pursuant to Fed. R. App. P. 32(a)(7)(B) that the
foregoing brief contains 6,479 words, according to the
word count of Corel WordPerfect 12. I certify that the
information on this form is true and correct to the
best of my knowledge and belief formed after a
reasonable inquiry.

/s/
NICHOLAS BAGLEY

MARCH 2010

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386017_2503%3A2. Public record. Not legal advice.
