Court Opinion

ID: 2739407
Source: CourtListenerOpinion
Date Created: 2014-10-02 18:01:24.743039+00
Date Added: 2024-06-11T10:04:03.359598
License: Public Domain

UNITED STATES DISTRICT COURT
                             FOR THE DISTRICT OF COLUMBIA

ENRON NIGERIA POWER HOLDING,
LTD.,
               Petitioner,

                      v.                          Case No. 1: 1:13-cv-01106 (CRC)

FEDERAL REPUBLIC OF NIGERIA,

                      Respondent.

                                     OPINION AND ORDER

       Before the Court is Respondent Federal Republic of Nigeria’s Motion for Stay of

Proceedings Pending Appeal. Upon consideration of the motion, and the oppositions and reply

thereto, the Court will deny the motion.

       I.      Background

       In 1999, Enron Nigeria Power Holding, Ltd. (“ENPH”) entered into an agreement that was

guaranteed by the Republic of Nigeria to supply three barge-mounted electricity generating units

and later build a gas-fired power plant in the country. After the venture fizzled, ENPH and Nigeria

submitted their dispute over compensation to the International Chamber of Commerce International

Court of Arbitration pursuant to their written agreement. Pet. ¶ 10, Ex. A § 23. The arbitrators

eventually awarded ENPH $11.2 million in damages and $870,000 in legal costs and expenses. Pet.

Ex. B ¶ 175. After Nigeria refused to pay the award, ENPH initiated this action requesting that the

Court order Nigeria to do so. Pet. ¶¶ 17, 22.

       Nigeria moved to quash service and dismiss the Petition, arguing that ENPH failed to

properly effectuate service under Federal Rule of Civil Procedure 4(j) and the relevant provision of

the Foreign Sovereign Immunities Act (“FSIA”), 28 U.S.C. § 1608. The Court agreed that service

was deficient, but found that ENPH had shown good cause for its failure as required under Federal
Rule of Civil Procedure 4(m) and granted ENPH 120 additional days to effect service by alternative

means. Without permission from the Court, Nigeria appealed this interlocutory order to the D.C.

Circuit. Nigeria argues it did not require permission because the Court in effect rendered a final

judgment by noting in its Memorandum and Order that Nigeria “appear[ed] to be using this action

to re-litigate and delay the payment of claims already resolved by the agreed upon arbitration

procedure.” Nigeria’s Mot. for Stay at 8–9. Nigeria now seeks a stay of these proceedings pending

the outcome of its appeal.

       II.     Standard of Review

       “A stay is . . . an exercise of judicial discretion.” Virginian Ry. Co. v. United States, 272
U.S. 658, 672, (1926) (internal citation omitted). The movant bears the burden of proving that a

stay is warranted. Nken v. Holder, 556 U.S. 418, 433–34 (2009). Decisions whether to grant a stay

are governed by four factors: “‘(1) whether the stay applicant has made a strong showing that he is

likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay;

(3) whether issuance of the stay will substantially injure the other parties interested in the

proceeding; and (4) where the public interest lies.’” Id. at 434 (quoting Hilton v. Braunskill, 481
U.S. 770, 776 (1987)). “The first two factors . . . are the most critical.” Id.

       III.    Analysis

       The U.S. Code clearly explains when a party can appeal an interlocutory order:

       When a district judge, in making in a civil action an order not otherwise appealable
       under this section, shall be of the opinion that such order involves a controlling
       question of law as to which there is substantial ground for difference of opinion and
       that an immediate appeal from the order may materially advance the ultimate
       termination of the litigation, he shall so state in writing in such order. The Court of
       Appeals which would have jurisdiction of an appeal of such action may thereupon,
       in its discretion, permit an appeal to be taken from such order, if application is made
       to it within ten days after the entry of the order: Provided, however, That application
       for an appeal hereunder shall not stay proceedings in the district court unless the
       district judge or the Court of Appeals or a judge thereof shall so order.

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28 U.S.C.A. § 1292(b). In this case, the Court explicitly reserved judgment on the merits of

Nigeria’s motion to dismiss. Order Granting in Part and Denying in Part Nigeria’s Mot. to Quash

Service and Dismiss Pet. at 1, July 25, 2014. The Court never stated in writing “that an immediate

appeal from the order may materially advance the ultimate termination of the litigation,” and neither

party asked the Court to do so. 28 U.S.C.A. § 1292(b). Nigeria alleges that the Court’s reasoning

that Nigeria would not be prejudiced because it “appear[ed] to be using this action to re-litigate and

delay the payment of claims already resolved by the agreed upon arbitration procedure”

automatically converted the decision into a final, appealable order. Nigeria’s Mot. for Stay at 8–9;

Nigeria’s Reply 1–2. Nigeria cites a single case, Gillespie v. United States Steel Corporation, 379
U.S. 148, 152 (1964), to support this contention. Gillespie discussed “marginal cases” where

determining “whether a ruling is ‘final’. . . is . . . so close a question that decision of that issue either

way can be supported with equally forceful arguments.” Gillespie v. United States Steel Corp., 379
U.S. 148, 152 (1964). No close question exists here. The Court explicitly reserved judgment on the

merits pending ENPH effecting proper service, making it clear that its order was not a final ruling.

Order Granting in Part and Denying in Part Nigeria’s Mot. to Quash Service and Dismiss Pet. at 1,

July 25, 2014. Under Nigeria’s reasoning, any expression by a court whether one party or another

would be prejudiced would automatically convert an order into a final, appealable judgment. This

is obviously inconsistent with courts’ obligation to consider prejudice as a factor under a wide

variety of legal standards that arise at various points in litigation. Consequently, as ENPH notes,

Nigeria cannot succeed on the merits of its appeal because the District of Columbia Circuit does not

have jurisdiction over it. ENPH’s Opp’n to Nigeria’s Mot. for Stay at 9.

        Nigeria also argues that it will suffer irreparable harm absent a stay because it has not been

properly served and thus the Court has not established personal jurisdiction over it. Nigeria’s Mot.

for Stay at 9–10. But the Court’s interlocutory order addresses precisely this alleged injury.

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Consistent with the Federal Rules and relevant precedent, the Court did not reach the merits of the

matter and extended the deadline for ENPH to serve Nigeria properly. See Fed. R. Civ. P. 4(m);

Mann v. Castiel, 729 F. Supp. 2d 191, 198 (D.D.C. 2010), aff’d, 681 F.3d 368 (D.C. Cir. 2012).

Awaiting proper service for four months—during which nothing is required of or will happen to

Nigeria—in a dispute that is over a decade old is hardly the type of “certain and great” injury that

constitutes irreparable harm. Wisconsin Gas Co. v. F.E.R.C., 758 F.2d 669, 674 (D.C. Cir. 1985).

        In short, Nigeria has failed to demonstrate the two “most critical” factors in determining

whether to grant a stay. Nken, 556 U.S. at 434. The Court will deny its motion.

        IV.    Conclusion

        For the foregoing reasons, it is hereby

        ORDERED that Nigeria’s Motion for Stay of Proceedings Pending Appeal [ECF No. 27] is

DENIED.

        SO ORDERED.

                                                             CHRISTOPHER R. COOPER
                                                             United States District Judge

Date:   October 2, 2014

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