By Zoe Tillman, From Legal Times,
D.C. federal judge rejects Guinea’s immunity argument.
The Republic of Guinea must face allegations in a U.S. court that it failed to pay the law firm Dentons more than $10 million in legal fees, a federal district judge in Washington ruled on Tuesday.
Dentons sued the Republic of Guinea last year, claiming it was never paid for work on a large-scale mining and construction effort known as the Simandou Project. U.S. District Judge Royce Lamberth on Tuesday rejected Guinea’s arguments that it was protected against the lawsuit by sovereign immunity and the terms of its contract with the firm.
Foreign governments generally are immune against litigation in U.S. courts under federal law. However, there are a few exceptions, such as cases that involve “commercial activity.” Lamberth found that the type of business Guinea hired Dentons to perform fell under the commercial activity exception.
“The court ultimately sees nothing in the nature of the Simandou Project that is other than of ‘the type of actions by which a private party engages in ‘trade and commerce,’’” Lamberth wrote.
The Republic of Guinea is represented by Schertler & Onorato in Washington. Partner David Dickieson declined to comment. Williams & Connolly represents Dentons. Partner Ana Reyes also was not immediately available on Tuesday.
Guinea had argued that the “commercial activity” exception in the federal Foreign Sovereign Immunities Act did not apply because Dentons was advising “a foreign government on how to exercise its sovereign authority over national assets.” Lamberth said the contract for legal services was commercial activity and “simply inserting some form of the word government” into arguments didn’t change that.
Guinea also argued that under its contract with Dentons, the firm was responsible for finding other sources of funding if Guinea was unable to pay. Lamberth found that the retainer agreement placed the burden on Guinea to come up with the money, not the firm.
Dentons claimed in court papers that it spent more than 10,000 hours on the Simandou Project between May 2012 and June 2013. The firm said that Guinea paid $2 million of the $12 million it owed, but then the payments stopped.
According to the complaint, a team from Dentons traveled to Guinea to discuss the legal fees issue with government officials. The lawyers claimed they were told that Guinea had not budgeted for the money they owed, but would seek funding from the World Bank or find another way to pay. Dentons alleged that Guinea stopped trying to secure funding as of September 2013.
Guinea has yet to respond directly to Dentons’ allegations in court.
Although Lamberth ruled on Guinea’s motion to dismiss, the case in its entirety is before U.S. District Judge Randolph Moss. Moss in August referred Guinea’s motion to Lamberth to decide. Moss didn’t provide a reason for the referral on the public docket, and his chambers declined to comment. Lamberth could not immediately be reached on Tuesday.
Lamberth has experience with disputes over the reach of the Foreign Sovereign Immunities Act and the limits of the court’s authority in cases against foreign governments. In 2013, he determined that the court had authority under the sovereign immunities law to enter contempt sanctions against the Russian Federation for its refusal to comply with an order to turn over a collection of Jewish religious texts seized in the early 20th century. He’s also presided over numerous civil lawsuits seeking to hold Iran liable for sponsoring terrorist attacks.
Photo: Diego M. Radzinschi/NLJ
For more on this story go to: http://www.nationallawjournal.com/legaltimes/id=1202737876574/Dentons-10M-Legal-Fee-Suit-Against-Republic-of-Guinea-to-Proceed#ixzz3mZkYQmXo