Court Opinion

ID: 9401582
Source: CourtListenerOpinion
Date Created: 2023-06-13 17:02:09.084088+00
Date Added: 2024-06-11T17:19:53.654259
License: Public Domain

FOR PUBLICATION

      UNITED STATES COURT OF APPEALS
           FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,           No. 21-56228
          Plaintiff-Appellee,
                                       D.C. No.
                                    2:20-cv-08466-
 v.                                    DSF-PLA

PETROSAUDI OIL SERVICES               OPINION
(VENEZUELA) LTD.,
          Claimant-Appellant,

 v.

ALL FUNDS HELD IN ESCROW
BY CLYDE AND CO. IN THE
UNITED KINGDOM AS DAMAGES
OR RESTITUTION IN
PETROSAUDI V. PDVSA
UNCITRAL ARBITRATION,
          Defendant,

CLYDE & CO LLP,
          Real-party-in-interest.
2            UNITED STATES V. PETROSAUDI OIL SERV.

UNITED STATES OF AMERICA,                    No. 22-55025
          Plaintiff-Appellee,
                                               D.C. No.
    v.                                      2:20-cv-08466-
                                               DSF-PLA

PETROSAUDI OIL SERVICES
(VENEZUELA) LTD.,
          Claimant-Appellant,

    v.

ALL FUNDS HELD IN ESCROW
BY CLYDE AND CO. IN THE
UNITED KINGDOM AS DAMAGES
OR RESTITUTION IN
PETROSAUDI V. PDVSA
UNCITRAL ARBITRATION,
          Defendant,

CLYDE & CO LLP,
          Real-party-in-interest.

         Appeal from the United States District Court
            for the Central District of California
          Dale S. Fischer, District Judge, Presiding

           Argued and Submitted October 3, 2022
                   Seattle, Washington

                     Filed June 13, 2023
              UNITED STATES V. PETROSAUDI OIL SERV.                3

Before: William A. Fletcher, Mark J. Bennett, and Jennifer
                 Sung, Circuit Judges.

                 Opinion by Judge W. Fletcher

                          SUMMARY*

                        Civil Forfeiture

    The panel affirmed the district court’s interlocutory
orders entered as part of a civil forfeiture suit brought by the
United States against a $380 million arbitration award fund,
the majority of which is held in the United Kingdom.
    The fund belongs to PetroSaudi Oil Services
(Venezuela) Ltd., a private oil company incorporated in
Barbados, which PetroSaudi won the award in an arbitration
proceeding against Petroleos de Venzuela, S.A., a
Venezuelan state energy company. The portion of the fund
held in the United Kingdom is held in an account controlled
by the High Court of England and Wales. The Government
sought forfeiture of the fund on the ground that it derived
from proceeds of an illegal scheme to steal one billion
dollars from the Malaysian sovereign wealth fund.
    PetroSaudi challenged two district court orders: a
warrant authorizing the arrest and seizure of any money
released from the fund by the High Court, and a protective

*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4           UNITED STATES V. PETROSAUDI OIL SERV.

order directing PetroSaudi to deposit in the district court any
money released to it from the fund after entry of the order.
    Ordinarily, federal courts of appeals have appellate
jurisdiction to review only “final decisions of the district
courts.” 28 U.S.C. § 1291. Under the collateral order
doctrine, the court has appellate jurisdiction to review an
interlocutory order by a district court denying a defense of
sovereign immunity. The panel held that PetroSaudi’s
appeal from the district court’s order denying its motion to
dismiss on the basis of foreign sovereign immunity and
authorizing the arrest and seizure of the fund fell within this
exception. In addition, 28 U.S.C. § 1292(a)(1) provides
appellate jurisdiction to review interlocutory orders
concerning injunctions. The panel held that PetroSaudi’s
appeal from the district court’s protective order under 18
U.S.C. § 983 fell within this exception. Accordingly, the
court had jurisdiction to consider the appeals of the two
orders.
    PetroSaudi argued that both of the district court’s orders
were inconsistent with the sovereign immunity of the United
Kingdom. The panel assumed arguendo that PetroSaudi,
though not itself a sovereign, could assert as a defense the
sovereign immunity of the United Kingdom. Relying on the
Foreign Sovereign Immunities Act (“FSIA”), PetroSaudi
argued that the sovereign immunity of the United Kingdom
prevented the district court from exercising jurisdiction over
the arbitration award fund and issuing its two orders. The
panel held that PetroSaudi’s argument failed. The FSIA
specifies a number of exceptions to immunity. The parties
disagreed on the proper reading of 28 U.S.C. § 1609, but
both parties agreed that FSIA only protected from
“attachment arrest and execution” property that is owned by
a foreign sovereign. The panel held that PetroSaudi’s
             UNITED STATES V. PETROSAUDI OIL SERV.            5

premise that the fund was the property of the United
Kingdom or of the High Court was unfounded. The panel
held that PetroSaudi rather than the United Kingdom owned
the arbitration fund. The panel concluded that the sovereign
immunity of the United Kingdom, as codified in the FSIA,
did not protect the arbitration award fund from the two
orders issued by the district court.
    In the alternative, PetroSaudi argued that the doctrine of
prior exclusive jurisdiction precluded the district court from
issuing the two orders. The doctrine allows the court that
has first acquired jurisdiction over the res to adjudicate
rights to that res without interference from another court that
might later seek to acquire jurisdiction over it and to
adjudicate rights to it. The panel held that the doctrine did
not apply to these appeals because there was only one in rem
suit—the civil forfeiture suit in the United States district
court. The High Court proceedings were not themselves, nor
were they part of, an in rem or quasi in rem suit. The panel
concluded that because the doctrine of prior exclusive
jurisdiction did not apply, the High Court’s present control
of the arbitration fund was irrelevant.
    Finally, PetroSaudi argued that the district court did not
have jurisdiction to issue the protective order on December
9, 2021, requiring PetroSaudi to deposit in the court any
money released from the fund to PetroSaudi after the date of
that order. The panel held that because the district court had
in rem jurisdiction over the fund, it did not need in personam
jurisdiction over PetroSaudi to issue an order preserving the
fund. It followed that under its broad in rem jurisdiction in
civil forfeiture suits, a district court could issue injunctions
to preserve the availability of property subject to civil
forfeiture. The district court could order PetroSaudi to
deposit in the district court any money released to it from the
6            UNITED STATES V. PETROSAUDI OIL SERV.

fund. Second, PetroSaudi’s appeal of the district court’s
October 14, 2021, order, issuing a warrant authorizing
attachment and seizure of any portion of the fund that has
been or may be released by the High Court, did not deprive
the district court of jurisdiction to issue the protective order
on December 9. The panel held that at the time of the filing
of the appeal from the district court’s October 14 order, the
district court had already issued an order whose purpose was
to prevent improper dissipation of the res. The purpose of
its subsequent protective order issued on December 9, was
to further the purpose of its October 14 order. The district
court therefore had authority under its in rem jurisdiction to
issue the 18 U.S.C. § 983(j) protective order requiring
PetroSaudi to deposit any funds that might be released to
them or come into their possession.
    The panel concluded that the district court had the
authority to exercise in rem jurisdiction over the arbitration
award fund. In the exercise of this jurisdiction, the district
court had the authority to issue the arrest warrant authorizing
the attachment and seizure of any portion of the fund
released by or retained pursuant to the orders of the High
Court and to issue the §983 protective order preserving
assets of the fund.
            UNITED STATES V. PETROSAUDI OIL SERV.        7

                        COUNSEL

Richard B. Raile (argued), David B. Rivkin Jr., Jonathan R.
Barr, Kendall E. Wangsgard, Mark W. DeLaquil, and Lee A.
Casey, Baker & Hostetler LLP, Washington, D.C.; Jonathan
B. New, Baker & Hostetler LLP, New York, New York;
Dyanne J. Cho, Baker & Hostetler LLP, Los Angeles,
California; for Claimant-Appellant.
Joshua L. Sohn (argued) and Barbara Y. Levy, Trial
Attorneys; Deborah Connor, MLARS Chief; Kevin
O’Driscoll, Deputy Assistant Attorney General; Kenneth A.
Polite Jr., Assistant Attorney General; United States
Department of Justice; Washington, D.C.; Jonathan Baum,
Trial Attorney; Office of the United States Attorney; Los
Angeles, California; for Plaintiff-Appellee.
8            UNITED STATES V. PETROSAUDI OIL SERV.

                          OPINION

W. FLETCHER, Circuit Judge:

     The United States (“the Government”) initiated a civil
forfeiture suit in federal district court against a $380 million
arbitration award fund, the majority of which is held in the
United Kingdom. The fund belongs to PetroSaudi Oil
Services (Venezuela) Ltd. (“PetroSaudi”), a private oil
company incorporated in Barbados. PetroSaudi won the
award in an arbitration proceeding against Petróleos de
Venezuela, S.A. (“PDVSA”), a Venezuelan state energy
company. The portion of the fund held in the United
Kingdom (“the fund”) is held in an account controlled by the
High Court of England and Wales (“the High Court”). The
Government seeks forfeiture of the fund on the ground that
it derives from proceeds of an illegal scheme to steal one
billion dollars from the Malaysian sovereign wealth fund
1Malaysia Development Berhad (“1MDB”).
    In separate interlocutory appeals, PetroSaudi challenges
two orders entered by the district court. One is a warrant
authorizing the arrest and seizure of any money released
from the fund by the High Court. The other is an order
directing PetroSaudi to deposit in the district court any
money released to it from the fund after entry of the order.
The appeals have been consolidated in our court.
    We affirm the district court in both appeals.
                   I. Factual Background
     The following narrative relies on factual allegations in
the Government’s Third Amended Complaint and on matters
of which we take judicial notice. At this stage of the
litigation, the district court accepted the allegations as true
            UNITED STATES V. PETROSAUDI OIL SERV.            9

and construed them in the light most favorable to the non-
moving party, the Government. See Faulkner v. ADT Sec.
Servs., Inc., 706 F.3d 1017, 1019 (9th Cir. 2013). We do the
same.
               A. Money Stolen from 1MDB
    The Government seeks forfeiture of the arbitration award
fund under 18 U.S.C. § 981. Section 981 subjects property
to forfeiture if it was “involved in a transaction or attempted
transaction in violation of [18 U.S.C. § 1956],” id.
§ 981(a)(1)(A), or if it “constitutes or is derived from
proceeds traceable to a violation of [18 U.S.C. § 1956],” id.
§ 981(a)(1)(C). The arbitration award fund is traceable to
money stolen from 1MDB and laundered through
PetroSaudi in violation of § 1956, a federal anti-money
laundering statute.
     PetroSaudi International Ltd. (“PSI”) is a private oil
services company incorporated in Saudi Arabia. Tarek
Obaid is a co-founder and CEO of PSI who initially held a
fifty percent stake in the company. In 2013, Obaid became
PSI’s sole stockholder.         Through PSI and various
subsidiaries of PSI, Obaid worked with 1MDB insiders to
steal one billion dollars from 1MDB.
    In September 2009, 1MDB agreed to participated in a
joint drilling venture with PetroSaudi Holdings (Cayman)
Ltd., a wholly-owned subsidiary of PSI. 1MDB agreed to
contribute $1 billion in cash, and PSI agreed to contribute
drilling rights worth $2.7 billion it claimed to own in
Turkmenistan and Argentina. PSI fraudulently represented
both the value and the ownership of the drilling rights.
     Obaid transferred to PSI $300 million of 1MDB’s $1
billion contribution to the joint venture. He subsequently
10          UNITED STATES V. PETROSAUDI OIL SERV.

transferred $185 million of that $300 million from PSI to
PetroSaudi Oil Services Ltd. (“PSOSL”). PSOSL used at
least $179.6 million of this money to fund the Mariscal Sucre
project, an oil-and-gas drilling project with PDVSA in
Venezuela. Obaid also used additional amounts of 1MDB’s
contribution to purchase assets for himself and others,
including luxury real estate properties located in the United
States.
    PSOSL operated a drillship, the Discoverer, during the
Mariscal Sucre project. Obaid later purchased a second
drillship, the Saturn, to expand the scope of the project. The
Saturn was purchased using funds from the Discoverer’s
operations and from proceeds of a bond issue secured by the
Discoverer and Saturn. Appellant PetroSaudi, a newly
created PSI subsidiary, operated the Saturn and assumed
control over the Discoverer contract with PDVSA.
                B. The Arbitration Dispute
    In 2015, PDVSA challenged the adequacy of
PetroSaudi’s performance in the Mariscal Sucre project. At
multiple points, PDVSA ordered the Saturn to stop
operations and refused to pay PetroSaudi’s drilling invoices.
As provided by the joint venture contract, the parties
submitted their dispute to a Paris-based arbitration tribunal.
    While the arbitration was pending, the arbitration
tribunal ordered the parties to create an escrow account
controlled by Clyde & Co., a United Kingdom-based law
firm that was representing PetroSaudi in the arbitration. The
tribunal ordered PDVSA to place $500 million—
representing the amount of PetroSaudi’s unpaid invoices
under the drilling contract—into the escrow account. On
July 17, 2020, PetroSaudi prevailed in the arbitration and
was awarded approximately $380 million. At the time of the
            UNITED STATES V. PETROSAUDI OIL SERV.           11

ruling, the escrowed amount was approximately $329
million. The arbitration decision required that all of the
escrowed fund be used in partial satisfaction of the
arbitration award.
  C. Subsequent Litigation Over the Arbitration Decision
     On July 22, 2020, PDVSA applied to the Paris Court of
Appeal to set aside the arbitration decision. In August 2020,
PDVSA obtained an interim injunction from the High Court
in the United Kingdom preventing Clyde & Co. from making
payments to PetroSaudi while the Paris litigation was
ongoing. On October 23, 2020, the High Court discharged
the interim injunction. Relying on the arbitration tribunal’s
decision, the High Court found that the “credit balance [of
the escrow account] is confirmed as belonging to
[PetroSaudi].” The High Court did not consider PDVSA’s
pending application in the Paris Court of Appeal to be a
sufficient ground on which to delay implementation of the
arbitration award.
    However, on September 16, 2020, the Government had
begun a civil forfeiture proceeding against the arbitration
award fund in the U.S. District Court for the Central District
of California. The Government alleged that the fund, the
defendant res in the suit, was subject to forfeiture because it
was the proceeds of “(i) a foreign offense involving the
misappropriation of public funds”; “(ii) wire fraud”; or “(iii)
international transportation or receipt of stolen or
fraudulently obtained property . . . and receipt of stolen
money . . . , each of which is a specified unlawful activity
under [18 U.S.C. § 1956], and a conspiracy to commit such
offenses.” The district court had federal subject matter
jurisdiction pursuant to 28 U.S.C. § 1355 because the
Government plausibly alleged that “acts or omissions giving
12          UNITED STATES V. PETROSAUDI OIL SERV.

rise to the forfeiture” took place in the Central District of
California. 28 U.S.C. § 1355(b)(1)(A). In particular, the
Government alleged that money stolen from 1MDB had
been laundered through the Central District of California and
had been used to purchase luxury properties located there.
    On October 14, 2020, the district court issued a warrant
authorizing the arrest and seizure of “all funds held in escrow
by Clyde & Co. in the United Kingdom as damages or
restitution” in the arbitration between PetroSaudi and
PDVSA. On November 13, 2020, PetroSaudi filed a claim
in the district court pursuant to Rule G of the Federal Rules
of Civil Procedure’s Supplemental Rules for Admiralty or
Maritime Claims and Asset Forfeiture Actions and 18 U.S.C.
§ 983(a)(4)(A), asserting a “vested ownership interest” in the
fund.
    The district court’s warrant was served on Clyde & Co.
in London. The Government threatened to prosecute Clyde
& Co. if it transferred the fund to PetroSaudi. Fearing
criminal and civil liability in the United States, Clyde & Co.
refused to disburse any of the funds from the escrow
account. PetroSaudi asked the High Court to order Clyde &
Co. to disburse money from the fund, consistent with that
court’s October 2020 decision. In the alternative, PetroSaudi
asked the High Court to order Clyde & Co. to transfer the
fund to the High Court. On February 26, 2021, the High
Court denied PetroSaudi’s requested relief.
    On March 9, 2021, the district court granted PetroSaudi’s
motion to dismiss the Government’s First Amended
Complaint. The court recalled the outstanding arrest warrant
and denied the Government’s motion for a protective order.
PetroSaudi then began a new proceeding in the High Court
against Clyde & Co. Because the district court had recalled
             UNITED STATES V. PETROSAUDI OIL SERV.           13

its warrant, Clyde & Co. was no longer at risk of criminal
and civil liability in the United States. On March 23, 2021,
the High Court granted PetroSaudi’s motion to transfer the
fund from Clyde & Co.’s escrow account to the Court Funds
Office. It also granted PetroSaudi’s motion to disburse
money from the fund to cover PetroSaudi’s legal and
business expenses.
    Meanwhile, the civil forfeiture suit continued in the
district court. On October 14, 2021, the court denied a
motion to dismiss the Government’s Third Amended
Complaint. On that same date, the district court issued a new
warrant authorizing arrest and seizure of “any portions of the
Defendant Assets that have been or may be released by the
High Court of Justice.” On December 9, 2021, the district
court issued a protective order under 18 U.S.C. § 983,
requiring PetroSaudi and its agents “to deposit [in the district
court] any of the Defendant funds that might be released to
them” after the issuance of the court’s protective order. The
protective order did not require PetroSaudi and its agents to
deposit in the court any funds that had been released from
the fund before the issuance of the order.
    On November 4, 2021, PetroSaudi filed a new
application in the High Court asking for an interim
declaration that PetroSaudi’s “legal representatives,
Armstrong Teasdale, have lawful authority under the laws of
England and Wales to continue to comply with the [March
23, 2021, order]” from the High Court. The Government
engaged the United Kingdom’s National Crime Agency
(“NCA”), and on December 15, 2021, the NCA filed a
request for a prohibition order that would freeze the fund.
   On April 13, 2022, the High Court granted its own
prohibition order. The purpose of such a prohibition order
14           UNITED STATES V. PETROSAUDI OIL SERV.

is to “assist an overseas authority by freezing property which
may become the subject of an external (recovery) order in
that country.”       The High Court’s prohibition order
“prevent[s] [PetroSaudi] from taking money out of the
Fund” and “diminishing its value or granting an interest in
it.” Justice Griffiths of the High Court noted that “[he did]
not think . . . that [the High Court] should seek actively to
protect the Fund from friendly foreign authorities with
whom [the U.K.] has a Treaty obligation of mutual
assistance and from which a Request in proper form has been
received.” Although the High Court was “willing in
principle for exclusions for legal and business expenses to
be considered,” it was not satisfied that the evidence before
it justified disbursements for such expenses.
    The High Court subsequently moved the fund out of the
Court Funds Office and placed it with a receiver. Initially,
the receiver was directed to hold the fund “as agent for the
Court Funds Office.” The High Court later changed its order
to direct that the receiver hold the fund as “an officer” of the
court, rather than as its “agent.”
    PetroSaudi appealed from the district court’s order
issuing a warrant authorizing arrest and seizure, issued on
October 14, 2021. It separately appealed from the district
court’s protective order, issued on December 9, 2021. We
have consolidated the appeals and heard them together. We
affirm the district court in both appeals.
                   II. Standard of Review
    “The existence of sovereign immunity and subject matter
jurisdiction under the [Foreign Sovereign Immunities Act
(“FSIA”)] are questions of law which we review de novo.”
Corzo v. Banco Cent. de Reserva del Peru, 243 F.3d 519,
522 (9th Cir. 2001); see also Britton v. Co-op Banking Grp.,
             UNITED STATES V. PETROSAUDI OIL SERV.           15

916 F.2d 1405, 1409 (9th Cir. 1990) (“We review
jurisdictional challenges de novo.”).
                 III. Appellate Jurisdiction
    Ordinarily, federal courts of appeals have appellate
jurisdiction to review only “final decisions of the district
courts.” 28 U.S.C. § 1291. There are exceptions, however,
that permit parties to appeal before a final judgment. Under
the collateral order doctrine, we have appellate jurisdiction
to review an interlocutory order by a district court denying a
defense of sovereign immunity. See Compania Mexicana
De Aviacion, S.A. v. U.S. Dist. Ct. for the Cent. Dist. of Cal.,
859 F.2d 1354, 1358 (9th Cir. 1988) (holding that the denial
of a motion to dismiss for sovereign immunity is an
appealable collateral order). PetroSaudi’s appeal from the
district court’s order denying its motion to dismiss on the
basis of foreign sovereign immunity and authorizing the
arrest and seizure of the fund falls under this exception.
Additionally, 28 U.S.C. § 1292(a)(1) gives us appellate
jurisdiction to review interlocutory orders “granting,
continuing, modifying, refusing or dissolving injunctions, or
refusing to dissolve or modify injunctions.” PetroSaudi’s
appeal from the district court’s protective order under 18
U.S.C. § 983 falls under this exception. Accordingly, we
have jurisdiction to hear the consolidated appeals.
                         III. Analysis
    PetroSaudi makes several arguments. We address them
in turn.
              A. Foreign Sovereign Immunity
    PetroSaudi argues that both of the district court’s orders
are inconsistent with the sovereign immunity of the United
Kingdom. We are willing to assume arguendo that
16           UNITED STATES V. PETROSAUDI OIL SERV.

PetroSaudi, though not itself a sovereign, can assert as a
defense the sovereign immunity of the United Kingdom. Cf.
Peterson v. Islamic Republic of Iran, 627 F.3d 1117, 1123–
24 (9th Cir. 2010) (holding that a district court can raise the
issue of foreign sovereign immunity sua sponte). We note
that the Second Circuit took a different approach in United
States v. Assa Co., 934 F.3d 185, 188–190 (2nd Cir. 2019),
holding that the FSIA does not apply in cases where a
foreign state is not the party being sued, including in in rem
forfeiture suits brought directly against property. Id. at 189.
Accordingly, the Second Circuit held that “[t]he FSIA does
not create jurisdiction over, and does not immunize a foreign
state’s property from, in rem civil-forfeiture actions.” Id. at
190. We need not decide if the Second Circuit’s approach
was correct, as we reject PetroSaudi’s argument on a
different ground.
    Relying on the FSIA, PetroSaudi argues that the
sovereign immunity of the United Kingdom prevents the
district court from exercising jurisdiction over the arbitration
award fund and issuing its two orders. For the reasons that
follow, PetroSaudi’s argument fails.
    The background assumption of the FSIA is that a foreign
sovereign and its assets are immune from suit in state and
federal courts in the United States. See 28 U.S.C. §§ 1604,
1609. Against this background assumption, the FSIA
specifies a number of exceptions to immunity. In the words
of the Supreme Court:

        The [FSIA] establishes a comprehensive
        framework for determining whether a court
        in this country, state or federal, may exercise
        jurisdiction over a foreign state. Under the
        Act, a “foreign state shall be immune from
             UNITED STATES V. PETROSAUDI OIL SERV.           17

        the jurisdiction of the courts of the United
        States and of the States” unless one of several
        statutorily defined exceptions applies. [28
        U.S.C.] § 1604.

Republic of Argentina v. Weltover, Inc., 504 U.S. 607, 610–
11 (1992); see also Verlinden B. V. v. Cent. Bank of Nigeria,
461 U.S. 480, 488–89 (1983) (same).
    The FSIA’s “statutorily defined exceptions” to immunity
from suit are found in 28 U.S.C. § 1605 (inter alia, waiver
by the foreign state, commercial activity of the foreign state),
§§ 1605A and 1605B (terrorism by a foreign state), and
§ 1606 (extent of liability). Separately, 28 U.S.C. § 1609
provides that the property of a foreign state held in the
United States is immune from attachment, arrest and
execution, except as provided in § 1610 (property involved
in commercial activity) and § 1611 (property of the foreign
central bank or of the military).
    The parties disagree on the proper reading of § 1609.
PetroSaudi contends that only foreign-sovereign-owned
property in the United States is eligible for attachment,
arrest, and execution under § 1609 and that property outside
the United States enjoys complete immunity.             The
Government, on the other hand, contends that § 1609
protects from attachment, arrest, and execution only
property that is owned by a foreign sovereign and is located
in the United States. Thus, according to the Government,
property owned by a foreign sovereign and held outside the
United States enjoys no protection under the FSIA.
    We need not decide this particular question because both
parties agree that FSIA only protects from “attachment arrest
and execution” property that is owned by a foreign
18          UNITED STATES V. PETROSAUDI OIL SERV.

sovereign. The essential premise of PetroSaudi’s sovereign
immunity argument is that the arbitration award fund is the
property of the United Kingdom, or—what amounts to the
same thing—the property of the High Court. PetroSaudi’s
sovereign immunity argument in its brief begins:

       The district court erred in failing to dismiss
       this civil-forfeiture action on sovereign-
       immunity grounds. It is settled in this Circuit
       that    sovereign     immunity      forecloses
       jurisdiction over property owned by a foreign
       sovereign that is “located outside the United
       States.”

    Blue Brief at 16 (emphasis added); see also, e.g., Blue
Brief at 27 (“The district court ignored that before it was a
motion to dismiss the Third Amended Complaint, and that
complaint sought—and still seeks—to forfeit property
owned by the United Kingdom.”); id. at 31 (“But sovereign
immunity precludes service of the arrest warrant on the High
Court, which owns defendant.”); id. at 34 (“The laws of the
United Kingdom establish the High Court’s ownership of the
funds . . . .”).
    PetroSaudi’s premise that the fund is the property of the
United Kingdom or of the High Court is unfounded. In the
district court, the Government was willing to concede
arguendo that the fund is the property of the United
Kingdom. But, as explained in its brief to us, the
Government was responding to an expert declaration on
United Kingdom law filed by PetroSaudi only two weeks
before the scheduled hearing date in the district court.
According to that declaration, W.A. Sherratt Ltd v. John
Bromley (Church Stretton) Ltd. [1985] 1 QB 1038, stands
            UNITED STATES V. PETROSAUDI OIL SERV.          19

for the proposition that a party paying money into court
relinquishes ownership of the money. Therefore, according
to the declaration, the arbitration award fund became the
property of the United Kingdom when it was deposited with
the High Court. Refuting the declaration on this point would
have required the Government to retain and present a
declaration of its own expert, and to seek a postponement of
the hearing in the district court. Instead of seeking to rebut
the expert declaration, the Government relied on a different
argument to defeat PetroSaudi’s claim of sovereign
immunity in the district court.
    The Government has now had sufficient time to respond
to PetroSaudi’s argument that the United Kingdom owned
the arbitration award fund once PetroSaudi deposited the
fund in the High Court. The Government points out that
PetroSaudi’s expert declaration relied on dictum in Sherratt
to support the proposition that United Kingdom became the
owner of the fund. The declaration failed to mention a later-
decided case that limits Sherratt’s dictum to the
unexceptional proposition that a party paying money into the
custody of the court gives up control of the property.
However, that party does not relinquish any ownership rights
it may have. See Crumpler & Anor v. Candey Ltd, [2018]
EWCA (Civ) 2256 [87]–[88], [2019] WLR 2145. Based on
Crumpler, we have no doubt that PetroSaudi rather than the
United Kingdom owns the arbitration award fund. Indeed,
the High Court repeatedly and unambiguously specified that
the arbitration award fund is “undoubtedly the property of
[PetroSaudi] alone,” and that the fund “belongs to
[PetroSaudi].”
    We therefore conclude that the sovereign immunity of
the United Kingdom, as codified in the FSIA, does not
20           UNITED STATES V. PETROSAUDI OIL SERV.

protect the arbitration award fund from the two orders issued
by the district court.
               B. Prior Exclusive Jurisdiction
    In the alternative, PetroSaudi argues that the doctrine of
prior exclusive jurisdiction precludes the district court from
issuing the two orders. Stated broadly, the doctrine provides
that “when a court of competent jurisdiction has obtained
possession, custody, or control of particular property, that
possession may not be disturbed by any other court.” State
Eng’r of Nev. v. S. Fork Band of Te-Moak Tribe of W.
Shoshone Indians of Nev., 339 F.3d 804, 809 (9th Cir. 2003)
(internal quotation omitted).
    The doctrine allows the court that has first acquired
jurisdiction over a res to adjudicate rights to that res without
interference from another court that might later seek to
acquire jurisdiction over it and to adjudicate rights to it. The
doctrine applies to suits “brought to marshal assets,
administer trusts, or liquidate estates, and in suits of a similar
nature, where, to give effect to its jurisdiction, the court must
control the property.” United States v. Bank of N.Y. & Trust
Co., 296 U.S. 463, 477 (1936) (citations omitted). “If the
two suits are in rem or quasi in rem, so that the court must
have possession or control of the res in order to proceed with
the cause and to grant the relief sought, the jurisdiction of
one court must of necessity yield to that of the other.” Id.
(citation omitted).
    The government argues that the doctrine of prior
exclusive jurisdiction does not apply because 28 U.S.C. §
1355(b)(2), which governs federal court jurisdiction in civil
forfeiture cases, displaces the doctrine by expressly
authorizing U.S. courts to exercise jurisdiction over property
that has been seized by a foreign government.
            UNITED STATES V. PETROSAUDI OIL SERV.          21

    We need not decide if the government is correct, as even
assuming the doctrine is applicable here, we reject it for a
different reason. The doctrine does not apply to the appeals
before us because there is only one in rem suit—the civil
forfeiture suit in the United States district court. The High
Court proceedings are not themselves, nor are they part of,
an in rem or quasi in rem suit. In rem suits “involv[e] or
determin[e] the status of a thing, and therefore the rights of
persons generally with respect to that thing.” In Rem,
Black’s Law Dictionary (11th ed. 2019). Quasi in rem suits
“involv[e] or determin[e] the rights of a person having an
interest in property located within the court’s jurisdiction.”
Quasi In Rem, Black’s Law Dictionary (11th ed. 2019). In
the High Court proceedings, no party has asked the High
Court to determine the status of the arbitration award fund or
the rights of parties with respect to the fund. The parties
have deposited the money in the High Court solely to
preserve the fund while other proceedings determine rights
to the fund.
    In the August 2020 proceeding before the High Court,
PDVSA applied for an interim injunction that would prevent
Clyde & Co. from disbursing the fund while PDVSA’s
appeal from the arbitration decision was pending in the Paris
Court of Appeal. The Paris Court of Appeal, not the High
Court, was responsible for deciding the merits of the
underlying arbitration proceedings that determined
substantive rights with respect to the fund. In the February
and March 2021 proceedings before the High Court,
PetroSaudi wanted Clyde & Co. to release money from the
escrow account. But Clyde & Co. did not refuse to release
money from the fund because it disputed PetroSaudi’s
ownership of the fund. Rather, it was worried that a transfer
might violate United States law. The High Court acted to
22           UNITED STATES V. PETROSAUDI OIL SERV.

preserve the fund. It did not seek to decide for itself the
merits of claims to the fund. Finally, in the April 2022
proceedings before the High Court, the NCA applied for, and
the High Court granted, a Prohibition Order to freeze the
fund in order to facilitate the Government’s civil forfeiture
suit in the district court. The NCA did not dispute that
PetroSaudi owns the arbitration award fund, subject to
possible claims by others.
    In short, the High Court did not take possession and
control of the arbitration award fund, as a “subject of [an in
rem or quasi in rem suit] in order to proceed with the [in rem
or quasi in rem] cause and to grant the relief sought.” Penn
Gen. Cas. Co. v. Pennsylvania ex rel. Schnader, 294 U.S.
189, 195 (1935). Because there is only one in rem case, the
doctrine of prior exclusive jurisdiction does not apply, and
the High Court’s present control of the arbitration award
fund is irrelevant.
               C. Protective Order Jurisdiction
     Finally, PetroSaudi argues that the district court did not
have jurisdiction to issue the protective order on December
9, 2021. The district court’s protective order required
PetroSaudi to deposit in the court any money released from
the fund to PetroSaudi after the date of the order. First,
PetroSaudi argues that the district court did not have in
personam jurisdiction over PetroSaudi and therefore could
not order it to deposit in the district court any money released
to it from the fund. Second, PetroSaudi argues that its appeal
of the district court’s October 14 order deprived the district
court of jurisdiction to issue the protective order on
December 9. For the reasons that follow, both arguments
fail.
            UNITED STATES V. PETROSAUDI OIL SERV.           23

     1. Lack of Personal Jurisdiction over PetroSaudi
    Because the district court had in rem jurisdiction over the
fund, it did not need in personam jurisdiction over
PetroSaudi to issue an order preserving the fund. The court
could therefore require PetroSaudi to deposit in the district
court any money improperly released from the fund to
PetroSaudi after the date of its order. The court’s in rem
jurisdiction gave it the authority “against the world” to
protect the fund against improper dissipation. That is, in
civil forfeiture actions, a court exercises in rem jurisdiction
and must “adjudicate the rights of the government to the
property as against the whole world.” United States v. 51
Pieces of Real Prop., Roswell, N.M., 17 F.3d 1306, 1309
(10th Cir. 1994). To do so, courts need jurisdiction to issue
orders protecting and preserving the res.
    In rem civil forfeiture jurisdiction “is predicated on the
‘fiction of convenience’ that an item of property is a person
against whom suits can be filed and judgments entered.”
United States v. Approximately $1.67 Million (US) in Cash,
Stock & Other Valuable Assets, 513 F.3d 991, 996 (9th Cir.
2008) (citing United States v. Ten Thousand Dollars
($10,000) in U.S. Currency, 860 F.2d 1511, 1513 (9th Cir.
1988)). “The fictions of in rem forfeiture were developed
primarily to expand the reach of the courts and to furnish
remedies for aggrieved parties.” Republic Nat’l Bank of
Miami v. United States, 506 U.S. 80, 87 (1992).
     Traditionally, “the court must have actual or constructive
control over the res when an in rem forfeiture suit is
initiated.” Approximately $1.67 Million, 513 F.3d at 996
(citing United States v. James Daniel Good Real Prop., 510
U.S. 43, 58 (1993)). However, 28 U.S.C. § 1355 relaxed this
requirement. Constructive or actual control of the res is no
24           UNITED STATES V. PETROSAUDI OIL SERV.

longer necessary. Id. at 997–98. Section 1355 provides for
the exercise of jurisdiction by a federal court over property
subject to forfeiture, including property located in a foreign
country, in any judicial district “in which any of the acts or
omissions giving rise to the forfeiture occurred.” 28 U.S.C.
§ 1355(b)(1)(A). As we explained in Approximately $1.67
Million, “Where an act or omission giving rise to the
forfeiture occurs in a district, the corresponding district
possesses jurisdiction over the forfeiture action regardless of
its control over the res.” Id. at 998.
    We held in United States v. Obaid, 971 F.3d 1095, 1100–
01 (9th Cir. 2020) (quoting Tenn. Student Assistance Corp.
v. Hood, 541 U.S. 440, 453 (2004)), that “in an in rem [civil
forfeiture] action, ‘jurisdiction over the person [who owns
the property] is irrelevant if the court has jurisdiction over
the property.’” We explained, “In an in rem action, the focus
for the jurisdictional inquiry is the [property]. . . , rather than
[the property owner’s] personal contacts with the forum.”
Id. at 1106.
    Read together, Approximately $ 1.67 Million and Obaid
establish that a district court has in rem jurisdiction over
property not within its actual or constructive control, even
when it lacks personal jurisdiction over the property’s
owner. It follows that under its broad in rem jurisdiction in
civil forfeiture suits, a district court may issue injunctions to
“preserve the availability of property subject to civil
forfeiture.” 18 U.S.C. § 983(j)(1). We recognize that
PetroSaudi may refuse to comply with the order and that the
district court may have difficulty enforcing compliance. But
limitations on the ability of the court to enforce compliance
“determines only the effectiveness of the forfeiture orders of
the district courts, not their jurisdiction to issue those
            UNITED STATES V. PETROSAUDI OIL SERV.            25

orders.” United States v. All Funds in Acct. in Banco
Espanol de Credito, Spain, 295 F.3d 23, 27 (D.C. Cir. 2002).
  2. Effect of PetroSaudi’s Appeal of the District Court’s
                     October 14 Order
    On November 4, 2021, PetroSaudi appealed the district
court’s October 14 order issuing a warrant authorizing
attachment and seizure of any portion of the fund that has
been or may be released by the High Court. PetroSaudi
argues that this appeal precluded the district court from
issuing its protective order on December 9. PetroSaudi relies
on the general rule that “[t]he filing of a notice of appeal
‘confers jurisdiction on the court of appeals and divests the
district court of its control over those aspects of the case
involved in the appeal.’” United States v. Ortega-Lopez, 988
F.2d 70, 72 (9th Cir. 1993) (quoting Griggs v. Provident
Consumer Disc. Co., 459 U.S. 56, 58 (1982)).
    This general divestment rule is a “judge-made doctrine
designed to avoid the confusion and waste of time that might
flow from putting the same issues before two courts at the
same time.” Cal. Dep’t of Toxic Substances Control v. Com.
Realty Projects, Inc., 309 F.3d 1113, 1120 (9th Cir. 2002)
(quoting Kern Oil & Ref. Co. v. Tenneco Oil Co., 840 F.2d
730, 734 (9th Cir. 1988)). It “is a rule of judicial economy
and not one that strips the district court of subject matter
jurisdiction.” Id. at 1121.
    The divestment rule is subject to exceptions. For
example, “[a] district court may retain jurisdiction when it
has a duty to supervise the status quo during the pendency of
an appeal, or in aid of execution of a judgment that has not
been superseded.” Stein v. Wood, 127 F.3d 1187, 1189 (9th
Cir. 1997) (internal citation omitted). A version of this
exception exists here. PetroSaudi appealed from the district
26           UNITED STATES V. PETROSAUDI OIL SERV.

court’s October 14 order granting the Government’s
application for a warrant authorizing attachment and seizure
of “any portions of the Defendant Assets that have been or
may be released by the High Court of Justice.” That is, at
the time of the filing of the appeal from its October 14 order,
the district court had already issued an order whose purpose
was to prevent improper dissipation of the res. The purpose
of its subsequent protective order, issued on December 9,
was to further the purpose of its October 14 order. The
district court thus had authority under its in rem jurisdiction
to issue the § 983(j) protective order requiring PetroSaudi
and any agents “to deposit any of the Defendant funds that
might be released to them . . . , or that they otherwise come
into possession.”
                          Conclusion
    We hold that the district court had the authority to
exercise in rem jurisdiction over the arbitration award fund.
The sovereign immunity of the United Kingdom is in no way
affected by the district court’s exercise of jurisdiction. In the
exercise of this jurisdiction, the district court had the
authority to issue the arrest warrant authorizing the
attachment and seizure of any portion of the fund released
by or retained pursuant to the orders of the High Court and
to issue the § 983 protective order preserving assets of the
fund.
     AFFIRMED.