Source: http://openjurist.org/293/f3d/392/international-insurance-company-v-caja-nacional-de-ahorroy-y-seguro
Timestamp: 2013-12-07 17:30:06
Document Index: 386405561

Matched Legal Cases: ['§ 1609', '§ 201', '§ 201', '§ 9', '§ 301', '§ 302', '§ 203', '§ 1602', '§ 1603', '§ 1331', '§ 301', '§ 203']

293 F3d 392 International Insurance Company v. Caja Nacional De Ahorroy Y Seguro | OpenJurist
293 F. 3d 392 - International Insurance Company v. Caja Nacional De Ahorroy Y Seguro	Home293 f3d 392 international insurance company v. caja nacional de ahorroy y seguro
293 F3d 392 International Insurance Company v. Caja Nacional De Ahorroy Y Seguro 293 F.3d 392
INTERNATIONAL INSURANCE COMPANY, Plaintiff-Appellee,v.CAJA NACIONAL DE AHORROY Y SEGURO, Defendant-Appellant.
No. 01-3054.
The district court held that the FSIA did not preclude it from requiring Caja to post pre-judgment security. The court reasoned that under the FSIA a foreign state's immunity is "subject to existing international agreements to which the United States is a party at the time of enactment of this Act." 28 U.S.C. § 1609. The court concluded that Argentina is a party to such an "existing" agreement — the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (known as the "New York Convention" and codified by 9 U.S.C. § 201 et seq.). As a result, the court found the FSIA's immunity provisions inapplicable. Specifically, the New York Convention authorizes the courts of each participating country to require other signatory countries to provide "suitable security" upon seeking to set aside or suspend an award rendered within its jurisdiction. See 9 U.S.C. § 201, art. VI.4 The district court further concluded that Caja's affirmative defenses constituted an application to set aside the arbitral award (a conclusion that is not challenged on appeal) and therefore held that the insurer was not immune from posting pre-judgment security under Illinois law. The district court then ordered Caja to post security in the amount of the default judgment and struck its answer and affirmative defenses.5 See International Ins. Co. v. Caja Nacional de Ahorro y Seguro, No. 00C6703, 2001 WL 322005 (N.D.Ill. Apr.2, 2001).
Caja did not post security or file a new answer, but instead, on April 23, 2001, appealed the district court's order to this court. IIC moved to dismiss the appeal for lack of appellate jurisdiction,6 and on July 3, 2001, in an unpublished order, we granted IIC's motion, citing Matter of Carlson, 224 F.3d 716, 718 (7th Cir.2000) (finding that order requiring security, as opposed to denial of security, is not ordinarily immediately appealable). On April 23, 2001, while Caja's appeal was still pending, IIC moved for a default judgment on its petition to confirm the arbitration award since Caja had not posted security and filed a new answer. Caja objected, arguing that it did not wilfully disobey the court's order to post security, but rather had filed a meritorious timely appeal (and that posting security would render the appeal moot). The district court construed this objection as a request to stay the litigation pending appeal, but since Caja failed to file the proper motion or the necessary supersedeas bond under Fed. R.Civ.P. 62(d),7 the court denied its request. On July 6, 2001, the district court granted IIC's motion for default judgment and confirmed the arbitration award in the amount of $4,702,428.12. Caja appeals from that final judgment, and we affirm.
Before addressing the merits of this appeal, we must confirm that we have jurisdiction over this case. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1988). The Federal Arbitration Act ("FAA"), which governs the "enforcement, validity, and interpretation of arbitration clauses in commercial contracts in both state and federal courts," Jain v. de Mere, 51 F.3d 686, 688 (7th Cir.1995), and which permits suits to confirm arbitration awards, see 9 U.S.C. § 9, does not provide an independent basis for federal question jurisdiction. See Moses H. Cone Mem'l Hosp. v. Mercury Const. Corp., 460 U.S. 1, 25, n. 32, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983).
The parties maintain, however, that independent federal question jurisdiction exists. In its initial petition for confirmation of the arbitral award, IIC claimed that the district court had jurisdiction pursuant to the Inter-American Convention on International Commercial Arbitration (known popularly as the "Panama Convention"), codified at 9 U.S.C. § 301 et seq. The Panama Convention grants United States district courts original jurisdiction over proceedings falling thereunder. See 9 U.S.C. § 302 (incorporating 9 U.S.C. § 203). On appeal, in its brief, Caja claims that the district court had jurisdiction under the FSIA, 28 U.S.C. §§ 1602-1611, because it qualifies as a foreign state under the statute. See 28 U.S.C. § 1603. IIC, curiously, found Caja's jurisdictional statement to be "complete and correct." In any event, this court is not bound by the parties' representations regarding the source of our jurisdiction, and we have an independent duty to ensure that it exists. See ITOFCA, Inc. v. MegaTrans Logistics, Inc., 235 F.3d 360, 363 (7th Cir.2000).
We conclude that the Panama Convention provides us with independent federal question jurisdiction under 28 U.S.C. § 1331, which grants district courts original jurisdiction over civil actions "arising under the Constitution, laws, or treaties of the United States." As previously noted, the Panama Convention was codified into federal law at 9 U.S.C. § 301 et seq.8 An action or proceeding "falling under the [Panama] Convention shall be deemed to arise under the laws and treaties of the United States [and] [t]he district courts of the United States ... shall have original jurisdiction over such an action or proceeding, regardless of the amount in controversy." See 9 U.S.C. § 203