Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-07-07141/USCOURTS-caDC-07-07141-0/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 

---

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 10, 2008 Decided October 24, 2008 

No. 07-7141 

AHMAD CHALABI, ET AL., 

APPELLANTS

v. 

HASHEMITE KINGDOM OF JORDAN, ET AL., 

APPELLEES

Appeal from the United States District Court 

for the District of Columbia 

(No. 04cv01353) 

John J.E. Markham II argued the cause and filed the 

briefs for appellants. 

Christopher M. Curran argued the cause for appellees. 

With him on the brief were Nicole E. Erb and Antonia R. 

Soares. 

Before: RANDOLPH, ROGERS, and TATEL, Circuit Judges. 

Opinion for the Court filed by Circuit Judge TATEL. 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 1 of 10
2 

TATEL, Circuit Judge: On August 11, 2004, Ahmad 

Chalabi sued the Hashemite Kingdom of Jordan in federal 

court, alleging a civil RICO conspiracy and various torts 

related to Jordan’s seizure of his bank some fifteen years 

earlier. Finding that Chalabi had alleged facts supporting 

jurisdiction over a foreign sovereign, the district court 

dispensed with jurisdictional discovery and dismissed 

Chalabi’s claims as time-barred. We agree with both the 

approach and the result, and so affirm. 

 

I. 

 Because the district court granted Jordan’s motion to 

dismiss, Chalabi’s allegations must be taken as true. E.g., 

Rasul v. Myers, 512 F.3d 644, 654 (D.C. Cir. 2008). Read 

with that uncritical eye, the complaint relates the following. 

 

 Ahmad Chalabi, an opponent of Saddam Hussein’s 

regime in Iraq, founded Petra Bank in Jordan in 1977. 

Compl. ¶ 15. Over the next twelve years, he grew Petra into 

Jordan’s second-largest bank, with a net worth of thirty 

million Jordanian dinars or about $42,000,000 at today’s 

rates. Id. ¶¶ 26-28. As Chalabi’s status as an international 

financier grew, so too did his vociferous criticism of Saddam 

Hussein and the Jordanian government, which he charged 

with complicity in Saddam’s wrongdoings. Id. ¶¶ 31-33. 

 According to Chalabi, his political enemies in Jordan 

returned to power in the spring of 1989 when Mudhar Badran 

reassumed the prime ministership and appointed Muhammed 

Saeed El-Nabulsi governor of the central bank. Compl. ¶ 21. 

Nabulsi had occupied this position until 1985, having spent 

the intervening period in Iraq associating with the “notorious” 

Iraqi security agency known as the “Mukhabarat.” Id. ¶¶ 20-

21. Chalabi alleges that his public criticisms of Saddam and 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 2 of 10
3 

the Jordanian government angered Nabulsi and Badran, 

leading them to plot a state takeover of Petra Bank under false 

pretenses. Id. ¶¶ 34, 38. At the same time, one of Nabulsi’s 

deputies delivered an explicit threat, telling Chalabi that 

Nabulsi’s sole purpose in returning to Jordan was “getting” 

him. Id. ¶ 38. 

 Jordan swiftly laid the groundwork for seizing the bank. 

In June 1989, the government circulated a denunciatory 

leaflet entitled “Save What Remains of Petra Bank,” designed 

to discredit Chalabi and to undermine the confidence of 

Petra’s depositors. Compl. ¶ 39. According to the complaint, 

Nabulsi simultaneously convinced other Jordanian banks to 

cease overnight deposits with Petra, reducing its operating 

reserves. Id. ¶ 40. Nabulsi then closed the central bank’s 

discount window to Petra, preventing it from obtaining 

operating cash and precipitating a liquidity crisis. Id. ¶ 41. 

The following day, acting under a martial law decree from 

Jordan’s Economic Security Committee, the state seized the 

bank by military force. Id. ¶¶ 42-45. Nabulsi ordered 

Chalabi to remain in Jordan and to serve on the bank’s new 

management committee, but according to Chalabi, this was a 

pretext to facilitate his kidnapping by the Mukhabarat. 

Warned of the plot, Chalabi fled Jordan on August 7, 1989, 

never to return. Id. ¶¶ 46-47. 

 Jordan’s management rapidly—and, Chalabi says, 

intentionally—decimated the bank’s balance sheet. Two 

weeks after the takeover, the new management committee 

foreswore responsibility for the actions of prior management, 

effectively eliminating the bank’s ability to do business. 

Compl. ¶¶ 50-51. Chalabi alleges that chicanery with the 

books created an appearance of insolvency, allowing Nabulsi 

to exploit his role as regulator in order to loot Petra of its 

assets. Id. ¶¶ 52-54. From its pre-seizure capital of 30 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 3 of 10
4 

million dinars, Petra suddenly spiraled at least 157 million 

dinars into the red. Id. ¶ 52. Its United States subsidiary, 

PIBC, suffered a similar fate. Id. ¶ 55. Then, according to 

Chalabi, Nabulsi parlayed the cooked books into an Arthur 

Andersen audit report confirming massive shareholder debt, 

id. ¶ 59, which he later used as fodder for final liquidation of 

Petra Bank, id. ¶ 60. 

 Less than one year after the takeover, Jordan issued a 

liquidation decree circumventing all ordinary Jordanian 

bankruptcy law, giving Nabulsi “unlimited power and 

discretion” as liquidator and completely wiping out Petra’s 

shareholders by dissolving the bank under the purported 

condition of massive debt. Compl. ¶¶ 59, 62-64 (citing ESC 

Resolution No. 4/90 (July 15, 1990), as amended by ESC 

Resolution No. 7/90 (Sept. 20 1990)). That decree set an 

order of priority and provided that “the balance of the assets 

shall be divided pari passu among the creditors.” ESC 

Resolution No. 4/90 ¶ 17(a)(5). Although some debts were to 

be paid, the decree made no provision of any kind for equity 

holders such as Chalabi. At the same time, Chalabi was tried 

in absentia for embezzlement. Following what he describes 

as a “sham trial” premised on evidence obtained through 

torture, intimidation, and fraud, Chalabi was convicted in 

April 1992. Compl. ¶¶ 68-75. 

 The complaint alleges that Nabulsi has since used his 

power as liquidator to shuttle Petra’s assets to himself, his 

friends, and the politically connected. Compl. ¶¶ 65-66. 

Other than the continued mismanagement of the assets that 

Jordan seized and allotted to creditors in 1990, however, the 

complaint alleges little else since Chalabi’s conviction. It 

does charge that Jordan sought Chalabi’s extradition in 2004 

and that it smeared him as an “embezzler” and “thug,” id. ¶ 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 4 of 10
5 

78, but it brings no claim for defamation amongst its other 

common-law tort and civil RICO claims. 

 Satisfied that Chalabi had alleged—if not shown—facts 

sufficient to overcome Jordan’s sovereign immunity under the 

“commercial activity” exception to the Foreign Sovereign 

Immunities Act, 28 U.S.C. § 1605(a)(2), the district court 

nonetheless held that the statutes of limitation applicable to 

Chalabi’s claims provided a straightforward, “non-merits 

ground” for resolving the case. Chalabi v. Hashemite 

Kingdom of Jordan, 503 F. Supp. 2d 267, 273 (D.D.C. 2007). 

According to the district court, Chalabi missed the deadline 

by more than a decade: the three-year period for common law 

torts and the four-year period for civil RICO began running in 

1989 when, according to the complaint itself, Chalabi became 

aware of the seizure, the planned kidnapping, and Nabulsi’s 

designs on his destruction. Id. at 273-74. The district court 

thus dismissed Chalabi’s claims as untimely, obviating any 

need for jurisdictional discovery. 

 On appeal, Chalabi does not dispute that the limitations 

clock began running on his claims in 1989. Instead, he argues 

that those claims are saved from staleness by the continuing 

tort doctrine. 

 

II. 

 We must first satisfy ourselves whether, in deferring final 

resolution of Jordan’s claim of foreign sovereign immunity, 

the district court properly moved the timeliness issue to the 

head of the line. Jordan’s immunity claim implicates our 

jurisdiction, see 28 U.S.C. § 1604 (“[A] foreign state shall be 

immune from the jurisdiction of the courts of the United 

States and of the States except as provided in . . . this 

chapter.”), and under the rule in Steel Co. v. Citizens for a 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 5 of 10
6 

Better Environment, 523 U.S. 83, 94-95 (1998), we may not 

assume jurisdiction even to follow a better-marked path to 

disposition. But this rule is not absolute. As the district court 

explained, “‘a federal court has leeway to choose among 

threshold grounds for denying audience to a case on the 

merits.’” Chalabi, 503 F. Supp. 2d at 273 (emphasis added) 

(quoting Sinochem Int’l Co. v. Malay. Int’l Shipping Corp., 

127 S. Ct. 1184, 1191 (2007)). The district court decided that 

because timeliness in this case represented a threshold ground 

for denying audience rather than a judgment on the merits, it 

could be reached before a final decision on the jurisdictional 

question of foreign immunity. Chalabi, 503 F. Supp. 2d at 

273. 

 As timeliness has both threshold and merits 

characteristics, we would face a difficult question if Steel Co. 

actually applied to this case. But it doesn’t. Steel Co.

requires that we prioritize the jurisdictional issue only when 

the existence of Article III jurisdiction is in doubt; that 

decision “explicitly recognized the propriety of addressing the 

merits where doing so made it possible to avoid a doubtful 

issue of statutory jurisdiction.” Kramer v. Gates, 481 F.3d 

788, 791 (D.C. Cir. 2007) (citing Steel Co., 523 U.S. at 96-97 

& n.2). There is no Article III question here: Jordan’s claim 

of immunity concerns only the limits of our statutory 

jurisdiction under the Foreign Sovereign Immunities Act. 

Thus, even if a decision on timeliness qualifies as a 

“‘judgment on the merits,’” Sinochem, 127 S. Ct. at 1192 

(quoting Intec USA, LLC v. Engle, 467 F.3d 1038, 1041 (7th 

Cir. 2006)), Steel Co.’s bar on hypothetical jurisdiction poses 

no obstacle to resolving it first. 

 This outcome conforms to both common sense and 

congressional intent. It would hardly respect Jordan’s 

sovereignty to require it to pay for jurisdictional discovery on 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 6 of 10
7 

claims plainly barred. In one foreign immunity case before 

Steel Co., we exercised pendent appellate jurisdiction and 

resolved a statute of limitations question precisely in order to 

avoid a difficult question of statutory jurisdiction. See 

Rendall-Speranza v. Nassim, 107 F.3d 913, 917 (D.C. Cir. 

1997). Nothing in the Supreme Court’s recent cases requires 

us to depart from that sensible course. 

III. 

 Turning to the timeliness issue, which we review de 

novo, see Jung v. Mundy, Holt & Mance, P.C., 372 F.3d 429, 

432 (D.C. Cir. 2004), we have no trouble agreeing with the 

district court that Chalabi’s claims are time-barred. 

 Chalabi admits that the statute of limitations for his 

common-law tort claims is three years, and he does not 

dispute that his claim accrued when he learned of the plot 

against him in 1989. Nonetheless, he maintains that he 

properly pled a “continuing tort.” In the District of Columbia, 

this doctrine requires that Chalabi allege “(1) a continuous 

and repetitious wrong, (2) with damages flowing from the act 

as a whole rather than from each individual act, and (3) at 

least one injurious act within the limitation period.” Beard v. 

Edmondson & Gallagher, 790 A.2d 541, 547-48 (D.C. 2002) 

(internal quotation marks and ellipsis omitted). And even on 

the continuing tort theory, Chalabi recognizes that, because he 

was aware of his injury as of 1989, his recovery is limited to 

injuries sustained within the limitations period that 

immediately preceded the filing of his complaint. Appellants’ 

Reply Br. 2 (citing Beard, 790 A.2d at 547-48). Thus, to have 

any prospect of even limited recovery, Chalabi must at a 

minimum show that he was injured within that time frame. 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 7 of 10
8 

 Chalabi’s own complaint, and the liquidation decree that 

it quotes, preclude such a showing. See Abhe & Svoboda, Inc. 

v. Chao, 508 F.3d 1052, 1059 (D.C. Cir. 2007) (“In 

determining whether a complaint states a claim, the court may 

consider the facts alleged in the complaint, documents 

attached thereto or incorporated therein . . . .” (internal 

quotation marks omitted)). Chalabi’s claim of continuing 

injury relates to the ongoing dispersal of Petra’s assets “at a 

fraction of their actual worth, to cronies.” Appellants’ Reply 

Br. 2; see also Compl. ¶ 66. Although these allegedly 

fraudulent sales might harm Petra’s creditors, who were 

allocated “the balance of the assets” in the 1990 liquidation 

decree, see ESC Resolution No. 4/90 ¶ 17(a)(5), they do not 

harm Chalabi, who lost whatever interest he had in the bank 

on liquidation. His complaint itself states that the bank was 

seized and liquidated by an extraordinary decree that gave 

Nabulsi “unlimited power and discretion to carry out the 

liquidation and to do so without regard to any law.” Compl. ¶ 

63. The decree stated that “[a]ll Petra Bank assets and funds 

shall be attached by the liquidator,” ESC Resolution No. 4/90 

¶ 6(a), and made no provision for equity holders like Chalabi 

in distributing the balance of Petra’s assets. Id. ¶ 17(a)(5). It 

thereby extinguished Chalabi’s interest as a shareholder as of 

the date of the decree. Chalabi’s position is akin to that of a 

car-theft victim who alleges that his vehicle was stolen a 

decade ago and now complains that the thief is leasing it at 

below-market rates. Any current mismanagement is being 

visited upon someone else’s asset. 

 To be sure, Chalabi alleges that he “is a shareholder” of 

Petra Bank. Compl. ¶ 14 (emphasis added). But given the 

contradictory elements of his own complaint recited above, 

that allegation is without consequence. See Kaempe v. Myers, 

367 F.3d 958, 963 (D.C. Cir. 2004) (“Nor must we accept as 

true the complaint’s factual allegations insofar as they 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 8 of 10
9 

contradict exhibits to the complaint or matters subject to 

judicial notice.”). What Chalabi once held was a partial 

ownership stake in Petra; the stock certificates he may still 

hold are but meaningless paper. As with the tardy car-theft 

victim described above, the fact that a shareholder still has 

paper title to the long-stolen property does not make the claim 

of theft any less stale, nor does it create injury from the 

property’s misuse when the plaintiff’s actual interest is long 

gone. 

 The absence of recent injury likewise bars Chalabi’s 

RICO claim. See Klehr v. A.O. Smith Corp., 521 U.S. 179, 

190 (1997) (dismissing RICO claim where plaintiffs had not 

“shown how any new act could have caused them harm over 

and above the harm that the earlier acts caused,” even though 

they alleged predicate acts that occurred within the limitations 

period). And on neither count do we see merit in Chalabi’s 

contention that he is injured by Jordan’s “ongoing failure to 

return” the wrongfully seized property, Appellant’s Br. 21. 

“[T]he mere failure to right a wrong and make plaintiff whole 

cannot be a continuing wrong which tolls the statute of 

limitations, for that is the purpose of any lawsuit and the 

exception would obliterate the rule.” Fitzgerald v. Seamans, 

553 F.2d 220, 230 (D.C. Cir. 1977). 

 Although Chalabi’s complaint does allege recent smears 

and defamations, Compl. ¶¶ 76-78, it presses them not as new 

injuries, but as “wire communications” for purposes of the 

RICO claim. Id. Nowhere does Chalabi claim that these 

actions alone would rehabilitate the prior claims as continuing 

torts. Nor could he. These acts would be discrete wrongs, not 

part of “a continuous and repetitious wrong . . . with damages 

flowing from the act as a whole,” as required by the 

continuing tort doctrine. Beard, 790 A.2d at 548 (internal 

quotation marks omitted). 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 9 of 10
10 

 As a final effort to claim recent injury, Chalabi argues 

that this is in part a derivative suit and that Jordan’s 

continuing mismanagement is injuring the bank. Oral Arg. at 

6:17. We doubt that the holder of long-valueless stock 

certificates can properly bring such a claim, but we decline to 

consider this argument in any event because Chalabi failed to 

brief any “contentions,” “reasons” or “authorities” to support 

it. Fed. R. App. P. 28(a)(9)(A); see also Duncan’s Point Lot 

Owners Ass’n v. FERC, 522 F.3d 371, 377 (D.C. Cir. 2008) 

(“[W]e will not address an asserted but unanalyzed argument 

because appellate courts do not sit as self-directed boards of 

legal inquiry and research . . . .” (internal quotation marks 

omitted)). 

 

IV. 

 The district court found the easiest path to resolving this 

case and was right to follow it, saving the plaintiff and the 

foreign sovereign the unnecessary expense of jurisdictional 

discovery. We affirm. 

So ordered. 

USCA Case #07-7141 Document #1145642 Filed: 10/24/2008 Page 10 of 10