[00:00:01] Speaker 01: Page number 20-72113, Holy Enterprises Limited et al. [00:00:05] Speaker 01: Appellants versus Russian Federation. [00:00:07] Speaker 01: Mr. Sheppard for the appellants, Ms. [00:00:09] Speaker 01: Lam for the appellee. [00:00:13] Speaker 04: Good morning, Your Honors. [00:00:14] Speaker 02: Sheppard, please proceed when you're ready. [00:00:17] Speaker 04: Thank you. [00:00:17] Speaker 04: Good morning, Your Honors, and may it please the court, Steven Sheppard, for petitioners' appellants. [00:00:22] Speaker 04: I respectfully request two minutes for rebuttal. [00:00:26] Speaker 04: Your honors, three factors distinguish this case from the typical confirmation proceeding under the New York convention. [00:00:34] Speaker 04: And together, these three make the stay order in this case clearly wrong. [00:00:38] Speaker 02: First, this- Can I just ask you at the outset? [00:00:42] Speaker 02: I'm sure I really, I apologize for interrupting you right at the beginning as you're getting started, but I'm just curious where we are in this case now, because we have a communication from the Dutch Supreme Court saying that it's gonna issue its decision on November 5th. [00:00:58] Speaker 02: which is just a few days from now. [00:01:00] Speaker 02: And the district court stay order expires of its own force when there's a resolution in the Dutch Supreme Court. [00:01:09] Speaker 02: So is there every reason to suppose that this entire matter just goes, this part of the matter goes away on November 5th? [00:01:17] Speaker 04: Your honor, there is a possibility that the Dutch Supreme Court, if it rules as we hope and expect it will, would render moot the petition for mandamus that we have filed directed at the state. [00:01:31] Speaker 04: Of course, your honor, we don't know how the Dutch Supreme Court is going to rule and the communications we've sent to the court don't indicate one way or the other what the ruling will be. [00:01:42] Speaker 02: But in terms of whichever direction it rules, that still ends the state proceeding. [00:01:48] Speaker 02: I mean, the mandamus proceeding. [00:01:49] Speaker 02: I guess if there's a reference to the ECJ or something like that, then it's possible that proceeding continues. [00:01:56] Speaker 02: But apart from that, won't it end the mandamus proceeding? [00:02:01] Speaker 04: Your honor, if we were to if the Dutch Supreme Court were to do as the Dutch Advocate General has advised and dismiss the cassation appeal that would lift the stay under the district court's order. [00:02:16] Speaker 04: If the Dutch Supreme Court were to do as the Russian Federation has urged [00:02:20] Speaker 04: and refer the matter to the Court of Justice of the European Union. [00:02:25] Speaker 04: It is at least debatable as to whether that would lift the stay. [00:02:29] Speaker 04: The stay order in this case refers to resolution of proceedings in the Dutch Supreme Court. [00:02:35] Speaker 04: And the way the mechanism works is the Dutch Supreme Court proceedings go on after such a referral. [00:02:42] Speaker 04: There's years of briefing in the Court of Justice for the European Union, and then the case is sent back to the Dutch Supreme Court for more proceedings. [00:02:51] Speaker 02: If there's a reference, so I guess where you're at is, yes, it could end it. [00:02:55] Speaker 02: If there's a reference to the European Court of Justice, then you think there'd be the argument that the mandamus proceeding continues because there hasn't been a resolution. [00:03:04] Speaker 02: And so the district court wouldn't end its stay. [00:03:08] Speaker 02: But then in that situation, would the reference itself support the proposition that there's no clear and indisputable right to release because that would suggest that the Supreme Court thinks that there's some pretty significant issues? [00:03:20] Speaker 04: I would agree that the Russian Federation could be expected to make that argument, Your Honor. [00:03:25] Speaker 04: We still believe that the mandamus would be appropriate for the reasons that we'd like to address. [00:03:32] Speaker 04: The first factor that distinguishes this case, Your Honor, is the excessive length of time that's been going on. [00:03:40] Speaker 04: 18 years ago, the Russian Federation destroyed Yukos and expropriated my client's investments. [00:03:47] Speaker 04: 16 years ago, the arbitration proceedings began. [00:03:51] Speaker 04: Seven years ago, the awards were handed down and these confirmation proceedings began. [00:03:57] Speaker 04: And yet, after all this time, we still don't have a ruling from the district court in this case as to the threshold issue of the Russian Federation's sovereign immunity. [00:04:07] Speaker 04: We are still effectively near square one in the district court. [00:04:12] Speaker 04: The second factor, Your Honor, is that there is little practical hope that my clients will ever be able to collect prejudgment interest from the Russian Federation during this very long stay. [00:04:24] Speaker 04: In the still ex case this court recognized that prejudgment interest was. [00:04:33] Speaker 04: a dictate of national justice that deters any attempt to benefit from inevitable litigation delay, and which is especially relevant in the arbitration context. [00:04:45] Speaker 04: Here, your honor, $7 billion of prejudgment interest, post award interest, had already accrued at the time of the stay. [00:04:53] Speaker 04: We expect, and we told the district court, an additional $7 billion would accrue during the stay that the district court was contemplating and has ordered [00:05:03] Speaker 04: We have little practical hope of collecting that. [00:05:06] Speaker 04: We'd have to first collect on the $57 billion already owed, which may well exceed the non-immune assets of the Russian Federation in this jurisdiction. [00:05:16] Speaker 04: This is in the face of a debtor who has made plain by its actions that it has no intention of paying the money that's owed and has been ordered by the awards. [00:05:26] Speaker 04: And in the face of what the district court called troubling aspects of the Russian Federation's lack of compliance with orders, [00:05:33] Speaker 04: from courts both here and abroad that should weigh heavily in favor of what the district called a bond, what we call security, in order to protect my clients. [00:05:44] Speaker 04: And the third factor, Your Honor, is the Dutch Court of Appeals opinion. [00:05:48] Speaker 04: It's extraordinary. [00:05:50] Speaker 04: It's a 130-page document based on three days of oral testimony, thousands of pages of briefing, and it comprehensively refutes every relevant defense raised by the Russian Federation. [00:06:02] Speaker 04: The cases that the Russian Federation primarily relies on were state cases in which there had been no decision from the primary jurisdiction. [00:06:12] Speaker 04: Here, the first decision from the Haig District Court decided just one defense that the Russian Federation had raised. [00:06:21] Speaker 04: That was the issue of whether the Russian Federation had agreed to arbitration in the Energy Charter Treaty. [00:06:27] Speaker 04: that turned on Article 45, which deals with the provisional application of the treaty after it had been signed. [00:06:36] Speaker 04: That one issue, Your Honor, has been comprehensively refuted by the Court of Appeals, which did it in two ways, both as an interpretation of the Energy Charter Treaty, but also the Court of Appeals assumed the Russian Federation was right about how to read the Energy Charter Treaty. [00:06:54] Speaker 04: And it then went on [00:06:56] Speaker 04: to make findings of Russian law, finding that provisional application of the arbitration provision would not be inconsistent with Russian law. [00:07:07] Speaker 04: That's section 4.7 of the Court of Appeals opinion. [00:07:13] Speaker 04: And it's in the record, Your Honor, at beginning at page 1496. [00:07:20] Speaker 04: That opinion, that finding of Russian law, is not subject to direct review in the Dutch Supreme Court in the Cassation Appeal. [00:07:29] Speaker 04: The standard of review, which is not in dispute, and it is discussed by Mr. Johoram's declaration, the Dutch counsel of my clients. [00:07:40] Speaker 04: Particularly, I invite the court to review his declaration at page 1681, where he discusses how the Dutch Supreme Court cannot review the legal correctness of this finding. [00:07:50] Speaker 04: and at 1673 where he describes the standard of review that will apply. [00:07:58] Speaker 04: In the face of these three factors, Your Honor, the district court's reasons for the second state were clearly wrong. [00:08:04] Speaker 04: There were essentially three when it boiled down between the discussions of the two standards. [00:08:10] Speaker 04: First, the district court said briefing may be easier after everything is done in the Dutch court. [00:08:19] Speaker 04: Second, litigation quagmire, and third, international comedy. [00:08:24] Speaker 04: Those reasons, in short, Your Honor, would apply in every single confirmation proceeding. [00:08:28] Speaker 04: And if allowed to support the stay here, they would return this jurisdiction to the pre-New York convention regime, the Geneva Convention, in which you always had to exhaust all appeals in the primary jurisdiction before confirmation. [00:08:42] Speaker 00: I see I only have two questions. [00:08:44] Speaker 00: I'm trying to cut this case back. [00:08:46] Speaker 00: There are two questions that are before us, mandamus. [00:08:49] Speaker 00: And you have an extraordinary burden on mandamus in any case, coming to this court in order to be able to get relief and I don't know how you can get relief when when the New York Convention allows a secondary jurisdiction court to issue a stay if the district court judge feels it's appropriate, because the matter is being considered. [00:09:09] Speaker 00: in the court with primary jurisdiction. [00:09:13] Speaker 00: You clearly have that here. [00:09:15] Speaker 00: It's not honestly not compelling to me that the Court of Appeals opinion is extraordinarily favorable to you. [00:09:22] Speaker 00: That begs the point. [00:09:23] Speaker 00: It begs the point that the matter that the district court is waiting for is not yet done because it's at the Dutch Supreme Court. [00:09:30] Speaker 00: So what? [00:09:30] Speaker 00: That the Court of Appeals decision is impressive for your purposes. [00:09:35] Speaker 00: And I'm thinking in terms of mandamus. [00:09:38] Speaker 00: So that's a really compelling consideration against you. [00:09:41] Speaker 00: The court has the authority to issue a stay under the New York Convention. [00:09:47] Speaker 00: It's absolutely clear that they have this authority if you're waiting for another decision. [00:09:52] Speaker 00: And that's all they did. [00:09:53] Speaker 00: And so in terms of mandamus, I don't know how you get over that. [00:09:55] Speaker 00: In terms of the... [00:10:01] Speaker 00: On the other question, I think what the court said was its finding, is it wrong? [00:10:06] Speaker 00: They rested on the conclusion that the Russian Federation has significant US assets that could be seized to satisfy any judgment. [00:10:17] Speaker 00: That's a difficult finding, justifying [00:10:22] Speaker 00: the second point that you're contesting. [00:10:24] Speaker 00: Unless I find that that's completely wrong, I don't know how I get to your second point. [00:10:29] Speaker 00: And I don't understand what you're meaning to say about failure to make a decision on sovereign immunity. [00:10:36] Speaker 00: You're throwing that in as, I'm telling you my impression, it comes in as kind of a, gee, that's unfair. [00:10:46] Speaker 00: you know, maybe it is, but I'm not sure how to weave that into the legal analysis when the court clearly has the right to issue a stay pending disposition in a foreign court. [00:10:59] Speaker 00: So I'm not sure, are you meaning to say that that somehow changes if they fail to issue a decision on sovereign immunity? [00:11:07] Speaker 00: And you mentioned it again today in passing, but I'm not sure where you're putting it. [00:11:14] Speaker 00: They have the right, the district court has the legal authority to issue a stay under the New York Convention. [00:11:23] Speaker 00: And you're asking for mandamus. [00:11:25] Speaker 00: And as a judge, mandamus is, we almost never give mandamus because it sets your hard standard to meet. [00:11:33] Speaker 00: And it seems to me impossible here when the court is acting pursuant to legal authority, which says, I can wait if I think it's appropriate. [00:11:41] Speaker 00: And I think it's appropriate to wait. [00:11:45] Speaker 04: On the mandamus point, Your Honor, we refer to the Belize social case, which noted that mandamus is appropriate in New York convention cases, given the emphatic federal policy in favor of arbitral dispute resolution. [00:12:00] Speaker 04: Turning to the second point, security. [00:12:02] Speaker 00: No, but that doesn't answer it. [00:12:03] Speaker 00: The New York convention I'm looking at as a judge on a panel that has this case where the district court judge, where you're trying to mandamus it says, [00:12:13] Speaker 00: There's another decision pending and the New York Convention says I can issue a stay and wait to see what the other court says. [00:12:20] Speaker 00: How can I give mandamus in that situation? [00:12:22] Speaker 00: And tell you candidly, my view is I can't. [00:12:25] Speaker 00: I know there are other considerations about speed, but we're so far past speed. [00:12:32] Speaker 00: And I say that respectfully. [00:12:34] Speaker 00: We're long past that. [00:12:36] Speaker 00: We'll all be retired before this thing ends, the way it's going. [00:12:40] Speaker 00: But I don't know how you get mandamus. [00:12:42] Speaker 00: And then on the second point, the court is saying, I'm making a finding that there's enough money here to satisfy a judgment. [00:12:49] Speaker 00: in the event that it comes to that. [00:12:52] Speaker 04: So on the second point, Your Honor, respectfully, the court made no finding and received no evidence. [00:12:58] Speaker 04: And in fact, the district court's opinion mentioned incorrect referred to global assets abroad. [00:13:04] Speaker 04: I think, I think we could all assume that the Russian Federation, if you include the assets within that jurisdiction within Russia, [00:13:11] Speaker 04: exceed $57 billion. [00:13:13] Speaker 04: But the district court's authority in this confirmation proceeding, as your honor rightly points out, refers to assets in the United States. [00:13:21] Speaker 04: There's no evidence of assets anywhere close to $57 billion. [00:13:25] Speaker 00: So you're saying it's not a finding that can be credited by us. [00:13:29] Speaker 00: It's simply language and an opinion that has no basis, is your view. [00:13:35] Speaker 04: Yes, your honor, it's not a factual finding. [00:13:37] Speaker 04: The district court received no evidence. [00:13:38] Speaker 04: And moreover, [00:13:39] Speaker 04: The primary reasons for denying security were the erroneous legal presumption against awarding security and the district court's failure to decide its sovereign immunity. [00:13:51] Speaker 04: Does the sovereign immunity question article six of the New York Convention, which your honor is looking at. [00:13:56] Speaker 00: That's where you want the sovereign immunity to be in play. [00:13:59] Speaker 04: Yes, the district court denied us security because it said I've stayed my decision on sovereign immunity on sovereign immunity on waiting to decide sovereign immunity. [00:14:11] Speaker 02: usually there could be a problem with waiting to deny sovereign immunity because the sovereign wants its immunity resolved. [00:14:20] Speaker 02: This is kind of an odd situation because this sovereign actually doesn't want its immunity resolved. [00:14:24] Speaker 02: It's in favor of the stay. [00:14:25] Speaker 02: And so it's a little bit, I mean, this case is either side could accuse the other side of being rich because you both have made a lot of arguments [00:14:36] Speaker 02: at this stage that are exactly contrary to the arguments you both made previously, because the interest in a stay has switched. [00:14:43] Speaker 02: One of you wanted to stay before and the other one wanted to deny it, and now the one who wanted to deny it previously wants it, and the one who previously wanted it wants to deny it. [00:14:51] Speaker 02: But in terms of sovereign immunity where we are now, whatever Russia said initially when it has its initial position, it doesn't want sovereign immunity decided right now, as I understand it, because it wants to stay. [00:15:05] Speaker 02: So I don't know about the force of requiring a court to resolve foreign sovereign immunity when the foreign sovereign doesn't want its immunity resolved. [00:15:17] Speaker 04: Well, Your Honor, to address that point, foreign sovereigns who are facing a confirmation proceeding rarely would like the sovereign immunity or anything else resolved. [00:15:26] Speaker 04: The debtor always seeks a stay and always points to the set-aside proceeding. [00:15:30] Speaker 04: In this particular case, Your Honor, Article 6 of the New York Convention, which Judge Edwards was referencing, not only gives the district court power to enter a stay, but also says that it may order the respondent to give suitable security. [00:15:44] Speaker 00: You're absolutely right on that. [00:15:46] Speaker 00: There's no question that that's there. [00:15:49] Speaker 04: And what we're asking for in our second point, and by the way, this is a collateral order appeal of the denial of security, which everybody agrees, so the mandamus standard does not apply. [00:15:59] Speaker 04: What we're asking for is a fair hearing. [00:16:01] Speaker 00: And I'm not confused on that. [00:16:02] Speaker 00: I understand that point. [00:16:03] Speaker 00: They're different standards of review. [00:16:06] Speaker 04: And there's legal errors that should be reversed and at the very least vacated. [00:16:13] Speaker 04: It's an error to deny us a fair hearing on security based on a sovereign immunity issue that the district court refuses to decide. [00:16:21] Speaker 04: That's going to be the basis. [00:16:22] Speaker 04: It is particularly important to hear that the district court indicated in these two pages of its opinion [00:16:28] Speaker 04: that there are troubling points about this case and the Russian Federation's lack of compliance with orders that weigh heavily, those are the district court's words, in favor of granting a security. [00:16:40] Speaker 04: But it decided that we couldn't have a hearing on that. [00:16:43] Speaker 04: We wouldn't get a chance to exercise our right to ask for this under Article 6 of the New York Convention because the district court didn't want to decide the issue and instead it stated that combined with an incorrect legal presumption against ordering sovereigns to pay security, never adopted by this court, are the two legal errors that are directly before this court and we think can and should be reviewed. [00:17:06] Speaker 04: I see my time is up. [00:17:08] Speaker 04: If there are no further questions. [00:17:10] Speaker 04: Thank you, your honors. [00:17:11] Speaker 02: Thank you, Ms. [00:17:11] Speaker 02: Treppert. [00:17:11] Speaker 02: We'll give you a little bit of time for rebuttal. [00:17:14] Speaker 02: Thank you, your honor. [00:17:15] Speaker 02: Ms. [00:17:15] Speaker 02: Lamb, we'll hear from you now. [00:17:16] Speaker 01: Yes. [00:17:17] Speaker 01: Good morning, your honor. [00:17:18] Speaker 01: Carolyn Lamb with White and Case on behalf of the Russian Federation. [00:17:23] Speaker 01: We have a completely different view, as you might imagine. [00:17:29] Speaker 01: First of all, we are not in a New York convention proceeding. [00:17:35] Speaker 01: were way before that. [00:17:37] Speaker 01: That's merits. [00:17:39] Speaker 01: The court has not decided jurisdiction under the FSIA and the court has not decided the New York Convention issues at all. [00:17:48] Speaker 01: The stay that she issued was a Landis stay, a stay under the Landis decision of the Supreme Court that is preliminary to the jurisdictional determinations [00:18:02] Speaker 01: and the merits determinations. [00:18:05] Speaker 01: And the question is, how do we get here? [00:18:07] Speaker 01: Why has it taken so long that Mr. Shepard complains about? [00:18:12] Speaker 01: We got here at the outset because they asked for it. [00:18:19] Speaker 01: After the, in fact, after the decision of the orbital tribunal, [00:18:30] Speaker 01: they sought a petition here to enforce that decision and in France and in the UK and in six other countries. [00:18:42] Speaker 01: What's wrong with that? [00:18:43] Speaker 01: Pardon me? [00:18:44] Speaker 02: What's wrong with that? [00:18:46] Speaker 01: I'm just explaining it. [00:18:48] Speaker 01: I'm going to tell you what's wrong with what he's saying now. [00:18:50] Speaker 02: But I want to understand you're suggesting [00:18:54] Speaker 02: that seeking enforcement of an arbitration order in multiple jurisdictions is somehow problematic. [00:18:59] Speaker 02: I just thought that's the way these things happen. [00:19:01] Speaker 02: Is there something actually wrong with that? [00:19:03] Speaker 01: Well, it's wrong with it if, in fact, we have immediately a request to set aside the award of the tribunal. [00:19:16] Speaker 01: And at the same time, the Russian Federation wanted its immunity determined. [00:19:24] Speaker 01: We immediately filed motions to dismiss the petition, two on the basis of the foreign status. [00:19:33] Speaker 02: Do you want your immunity decided now? [00:19:38] Speaker 01: Yes, but not at this moment, of course. [00:19:44] Speaker 01: And for good reason. [00:19:46] Speaker 01: For good reason, and we still have immunity to be sure, [00:19:52] Speaker 01: because the Dutch Supreme Court is deciding the energy charter treaty where issue article 45 one whether the Russian Federation was solely a signatory and therefore only agreed provisionally to apply the treaty consistent with its laws and its laws do not permit [00:20:21] Speaker 01: arbitration in tax cases, in public cases, etc. [00:20:29] Speaker 01: It never ratified the treaty. [00:20:33] Speaker 01: It never was a contracting state that offered arbitration. [00:20:39] Speaker 01: It didn't offer arbitration or any of the benefits of the treaty to Russian investors, which they were operating through tax-saving shells, and it never agreed to offer arbitration to have the context here where we've got [00:21:03] Speaker 01: money laundering, tax fraud, fraud and corruption on their part, one of the claimants before you, petitioners before you, in fact we've traced and it's in the motions pending in front of this court, a 600 million dollar payment in the initial privatization to get their shares. [00:21:26] Speaker 01: Now I like to think [00:21:27] Speaker 01: This court is not going to ignore all of that. [00:21:31] Speaker 01: And all of those issues, and then some, are pending in front of the Dutch court on the set-aside. [00:21:40] Speaker 01: He makes light of the Dutch court proceeding saying, oh, we're going to win just like the Advocate General said. [00:21:46] Speaker 01: Well, we already won once on the Article 45 ground. [00:21:51] Speaker 01: We've already won once in the UK court where they continue to stay saying the probability of success on the merits. [00:22:02] Speaker 00: Let me ask, can I ask you something? [00:22:04] Speaker 01: Yeah. [00:22:04] Speaker 00: Your motion to the district court on sovereign immunity is still pending. [00:22:10] Speaker 01: Yes, that's what he moved to stay in the court. [00:22:13] Speaker 00: No, no, no, no. [00:22:13] Speaker 00: And I'm just, I'm just trying to get it straight in my head. [00:22:16] Speaker 00: So your motion for sovereign immunity is I don't understand [00:22:21] Speaker 00: What would be the problem for this court to, with this court sending it back to the district court and answer to that question and say, decide the question of sovereign immunity and then decide the question of security, depending on your answer. [00:22:36] Speaker 01: What's wrong with that? [00:22:37] Speaker 01: Well, we, in fact, your honor, in the term Rio case and in the Gitma v Guinea case, you know that the primary jurisdictions decided in fact [00:22:49] Speaker 01: to annul the awards. [00:22:53] Speaker 01: If that is the result in the Dutch court, why should our- No, no, no. [00:22:58] Speaker 00: I'm being really parochial. [00:23:00] Speaker 00: I just want to be a little minded judge here, take the little case that we have before us on appeal. [00:23:06] Speaker 00: We've got two questions, mandamus and we got the absence of security, which you both are tying to an absence of decision on sovereign immunity. [00:23:17] Speaker 00: Is the answer to the second issue for us to send it back to the district court and say, you cannot continue to hold up the request for security until you've decided that sovereign immunity question, you've got the motion before you decide it. [00:23:32] Speaker 01: Your honor, no. [00:23:33] Speaker 00: Why is that wrong? [00:23:34] Speaker 01: That's wrong because at this point, all of the same issues [00:23:44] Speaker 01: would have to be decided by the district court? [00:23:49] Speaker 00: No, they wouldn't. [00:23:49] Speaker 00: The district court has its own proceeding before it and it is saying with respect to the request for a stay, I'm waiting to see what the Dutch court is doing. [00:23:59] Speaker 03: Exactly. [00:23:59] Speaker 00: I've got another motion before me the district court says for sovereign immunity. [00:24:04] Speaker 00: It is a motion that has to be decided. [00:24:07] Speaker 00: The court's not doubting that. [00:24:09] Speaker 00: And the answer we're getting with respect to the request for security as well as no answer on sovereign immunity. [00:24:15] Speaker 00: Why isn't the appropriate answer for this court to tell the district court to decide it and then decide the question on security? [00:24:22] Speaker 01: Because it is entirely appropriate given the many factors that the court considered. [00:24:32] Speaker 00: With respect to what? [00:24:34] Speaker 00: With respect to refusal to decide the question on sovereign immunity? [00:24:38] Speaker 00: In other words, I honestly don't understand when I first prepared the case and I still don't understand it. [00:24:43] Speaker 00: Why doesn't the district court go ahead and decide the question on sovereign immunity? [00:24:47] Speaker 01: Because she will be deciding the very issues, albeit under US law, that are pending in front of the Dutch court. [00:24:57] Speaker 01: And to go through all of the remaining briefing [00:25:01] Speaker 01: and all of the remaining effort by the parties when in a few weeks it could be thrown out entirely is not what a land is state. [00:25:15] Speaker 00: Why wouldn't our order say in a few weeks when we know what the Dutch, unless everything is gone by virtue of the decision from the Dutch court, decide the question of sovereign immunity? [00:25:26] Speaker 01: Well, Your Honor, it may all be gone. [00:25:29] Speaker 01: It may not all be gone. [00:25:31] Speaker 00: I'm just asking. [00:25:32] Speaker 00: I'm trying to be as practical as I can. [00:25:35] Speaker 00: Why don't we just have it decided? [00:25:37] Speaker 00: No more fooling around on that because that's tying up the question of security. [00:25:41] Speaker 01: Well, actually, Your Honor, it's more complicated than that. [00:25:46] Speaker 00: Oh, I understand it might involve some complicated questions, but I'm still trying to understand why is that inappropriate? [00:25:51] Speaker 01: It's inappropriate because the Dutch court, of course, is part of the EU and the interpretation and application of the energy charter treaty, as you can see from the Kamstroy decision, is something that the ECJ will decide and opine on. [00:26:16] Speaker 02: So at the at the outset, when you initially filed your motion on sovereign immunity, I assume that you wanted a decision that when you didn't say that we're filing a motion for sovereign immunity, but you know, hold on to it because there's a bunch of stuff going on in the Netherlands that are bound up in this. [00:26:32] Speaker 02: So we just want you to take it and hold it. [00:26:33] Speaker 02: I thought at the outset, you actually wanted to decide it at a time. [00:26:36] Speaker 01: We did. [00:26:38] Speaker 01: had confidence in the US courts that they would apply the rule of law and they would in fact decide that there was an absence of any offer of an agreement to arbitrate here, that there was fraud and corruption at the outset, that they were less than candid with the arbitral tribunal in withholding documents and providing false statements. [00:27:07] Speaker 01: so that this is not an award that we ever think will be enforced. [00:27:12] Speaker 01: Why the court [00:27:15] Speaker 01: does have to reach a very high threshold in terms of determining whether the district court exceeded her authority. [00:27:25] Speaker 01: This is exactly the kind of decision that Sinochem contemplates, a preliminary Landis Day. [00:27:34] Speaker 01: They asked for the Landis Day. [00:27:37] Speaker 01: We both- And you opposed it. [00:27:40] Speaker 01: We did oppose it. [00:27:43] Speaker 01: But then, after the Dutch court decided in our favor, we... Is there further review after the Dutch Supreme Court? [00:27:53] Speaker 02: I don't know all the interstices about how that system operates. [00:27:56] Speaker 01: not by a Dutch court, but there could be by the ECJ if certain issues were referred, or there could be other international proceeding. [00:28:12] Speaker 01: So in any event, it is in fact not, [00:28:20] Speaker 01: finished, I'm sure. [00:28:23] Speaker 01: And we also have a variety of issues under the New York Convention. [00:28:29] Speaker 01: But this isn't a New York Convention stay. [00:28:32] Speaker 01: This is under Article 6 at all. [00:28:36] Speaker 01: This is a Landis stay under the Landis Supreme Court decision. [00:28:42] Speaker 01: And she had complete discretion to do what she did on the record that was before her. [00:28:51] Speaker 02: Let me make sure my colleagues don't have additional questions for you, Ms. [00:28:54] Speaker 02: Lam. [00:28:57] Speaker 02: Thank you, Ms. [00:28:57] Speaker 02: Lam. [00:28:58] Speaker 02: We'll give you two minutes for rebuttal, Mr. Shepherd. [00:29:04] Speaker 02: Can I start by just asking one clarification question, which is for the security issue, the request for posting of security was for security pending the resolution of the state. [00:29:16] Speaker 04: Right? [00:29:17] Speaker 04: It's pending confirmation, your honor. [00:29:19] Speaker 04: When security is ordered, it's paid into the registry of the court. [00:29:22] Speaker 04: So it's there that once the awards are confirmed, the money can be paid to the creditor. [00:29:28] Speaker 02: So if the stay evaporates, because let's just suppose on November 5th, the Dutch Supreme Court issues a decision that the district court concludes as a resolution such that the stay goes away. [00:29:38] Speaker 02: What happens to the security part of the case? [00:29:40] Speaker 04: It's a complicated question, your honor, that we need to think about. [00:29:46] Speaker ?: OK. [00:29:48] Speaker 04: The state becomes moot if the case goes away in the Dutch Supreme Court. [00:29:53] Speaker 04: Security, I don't think would become moot. [00:29:59] Speaker 04: So three points, Your Honor, in response to Ms. [00:30:03] Speaker 04: Lam's presentation. [00:30:04] Speaker 04: One, our response brief on the FSIA issues is in the district court record, it's DOC at 63. [00:30:12] Speaker 04: We explain why there is no sovereign immunity under section 1604 from this suit. [00:30:18] Speaker 04: All that's needed to be done is to update that with the STIL-X decision, which makes even more clear that there's no sovereign immunity here. [00:30:27] Speaker 04: The only possible issue would be whether there is an agreement to arbitrate. [00:30:32] Speaker 04: That is the Article 45 question Ms. [00:30:34] Speaker 04: Lamb refers to, and that is the one I referred to in my opening that has been decided already by the Dutch. [00:30:44] Speaker 04: As a matter of Russian law, which is not subject to review. [00:30:48] Speaker 04: Finally, Your Honor, it is simply wrong to say that there's a land to stay different from a New York convention stay. [00:30:55] Speaker 04: That's contrary to the Belize social case, where there was a foreign sovereign immunity defense not ruled on by the district court. [00:31:02] Speaker 04: This court considered that a New York convention issue, the granting of a stay. [00:31:07] Speaker 04: There was no distinction between the two. [00:31:09] Speaker 04: The same was true in Stillex, Your Honor. [00:31:11] Speaker 04: where this court acknowledged the inherent authority doctrine, citing Clinton v. Jones, a Landis case, but also said the district court would abuse its discretion if it were not to consider the two Eurocar factors. [00:31:23] Speaker 04: There aren't two frameworks, your honor. [00:31:24] Speaker 04: There's one framework and this has always been a New York convention case with a pro-enforcement bias. [00:31:30] Speaker 04: I see my time has expired. [00:31:32] Speaker 00: I'm perplexed by your answer to the chief judge that you're confused about [00:31:40] Speaker 00: security issue if the Dutch, depending upon what happens with the state, if the Dutch court goes the wrong way as far as you're concerned and security has been posted, what's the confusion? [00:31:54] Speaker 00: There would be no confusion there, Your Honor. [00:31:56] Speaker 04: In that case, we would have gotten what we're entitled to under the security provision of Article 6. [00:32:01] Speaker 00: And the security would go back. [00:32:02] Speaker 00: I mean, it would not remain available to you. [00:32:05] Speaker 04: No, it would be with the district court, your honor. [00:32:07] Speaker 04: Security would never be paid to us. [00:32:09] Speaker 04: It would be paid to the district court. [00:32:11] Speaker 00: But it's to protect any judgment. [00:32:13] Speaker 00: Isn't the security to protect any judgment that you might get in the district court? [00:32:19] Speaker 04: Yes, your honor. [00:32:20] Speaker 00: OK, if you can't get a judgment. [00:32:22] Speaker 04: That's shown in the more entry. [00:32:25] Speaker 00: Yet if you can't get a judgment because of what happens with the Dutch court, then the security [00:32:30] Speaker 00: is dissolved, whatever the appropriate piece of paper is assigned, it's no longer available. [00:32:37] Speaker 04: Yes, Your Honor. [00:32:38] Speaker 00: Well, I'm not sure what you're confused about then. [00:32:42] Speaker 04: I'm sorry. [00:32:42] Speaker 04: My confusion was whether the appeal of the denial of security would become moot. [00:32:48] Speaker 04: Maybe I misunderstood the Chief Judge's question. [00:32:51] Speaker 04: That's the complication. [00:32:54] Speaker 04: But to your honor's point, absolutely. [00:32:56] Speaker 04: If we lose this confirmation proceeding, the security goes back to the Russian Federation. [00:33:01] Speaker 04: When it comes to us, in the meantime, it stays with the district. [00:33:04] Speaker 00: Okay. [00:33:06] Speaker 00: Thank you. [00:33:07] Speaker 04: Thank you, your honor. [00:33:08] Speaker 02: Thank you, counsel. [00:33:09] Speaker 02: Thank you to both counsel. [00:33:11] Speaker 02: We'll take this case under submission.