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FINAMAR INVESTORS INC. v. REPUBLIC OF TADJIKISTAN

June 20, 1995

In the Matter of the Arbitration Between FINAMAR INVESTORS INC., Petitioner, -against- THE REPUBLIC OF TADJIKISTAN, Respondent.


The opinion of the court was delivered by: MICHAEL B. MUKASEY

 MICHAEL B. MUKASEY, U.S.D.J.

 Petitioner Finamar Investors Inc. commenced this action under the Federal Arbitration Act, 9 U.S.C. § 4, seeking an order compelling respondent, The Republic of Tadjikistan, to arbitrate a dispute arising out of respondent's alleged rejection of a freight transport agreement. On February 4, 1994, this court entered an order compelling respondent to arbitrate the dispute with petitioner. Respondent moves to vacate this order pursuant to Fed. R. Civ. P. 60(b), and to dismiss the petition pursuant to Fed. R. Civ. P. 12(b), for lack of jurisdiction and improper service. Because service of process did not conform to the requirements of the Foreign Sovereign Immunities Act ("FSIA"), 28 U.S.C. § 1608(a), the court did not have jurisdiction over respondent when the February 4 order was entered, and accordingly, it is vacated. However, respondent's motion to dismiss the petition is denied, as petitioner may attempt to perfect service in accordance with the provisions of the FSIA.

 I.

 In September 1993, respondent, through its agent U.S. Agri Corporation, chartered a vessel from petitioner to transport soybean meal to St. Petersburg, Russia. (Pet. P 2) After the contract was executed (hereinafter, the "charterparty"), U.S. Agri purportedly informed petitioner that the freight award was made erroneously, and the freight would be reopened for bidding. (Proios Aff. P 3) Respondent contracted with another vessel, and petitioner made several demands to arbitrate the dispute, as provided by an arbitration clause in the charterparty. (Id. at P 5) On December 23, 1993, petitioner filed a Summons and Petition to Compel Arbitration, and a Notice of Petition in this court. (Id. at P 7) Copies of the summons and notice were sent to respondent by registered, first-class mail via U.S. Agri's offices in Washington, D.C. (Id.) U.S. Agri's counsel informed petitioner that it was not authorized to accept service on behalf of Tadjikistan, and cautioned that proper service had to be effectuated in accordance with § 1608(a) of the FSIA, which governs service of process on a foreign state. (Id. Ex. F; Chandler Aff. P 6)

 Section 1608(a)(3) of the FSIA requires petitioner to translate the summons, complaint, and notice of suit into the "official language" of the foreign state, and send the documents by registered mail to the clerk of the court, who in turn, dispatches them to the head of the ministry of foreign affairs of the respondent nation. Petitioner attempted to translate the documents into Tadjik, which it had identified as the official language of Tadjikistan, but could not find a Tadjik translator. (Proios Aff. P 18) Petitioner then contacted the offices of the Honorary Counsel of Tadjikistan in the United Kingdom, and the Tadjik Development Agency in London, and learned that Russian was also an official language of Tadjikistan. (Id. at P 19) Accordingly, the pleadings were translated into Russian and delivered to the clerk of this court on February 18, 1994, for transmission to Tadjikistan's Minister of Foreign Affairs. (Id. at P 20)

 Service was never acknowledged. On March 22, 1994, petitioner attempted to serve respondent through diplomatic channels, as provided by § 1608(a)(4), by sending the pleadings to the U.S. Secretary of State for transmittal to the U.S. Embassy in Dushanbe, Tadjikistan, and ultimately, to Tadjikistan's Ministry of Foreign Affairs. (Proios Aff. PP 23-24) On April 1, 1994, the U.S. State Department notified petitioner that the documents, translated into Russian, had been received by the embassy for presentation to the Minister of Foreign Affairs in Tadjikistan. (Id. at P 25)

 Respondent contends that the February 4 order should be vacated because process pursuant to the FSIA had not been served. Prior to February 1994, petitioner served U.S. Agri, which allegedly is not an agent designated to accept process on behalf of Tadjikistan. (Pinniger Aff. P 6) Moreover, the documents were not translated into Tadjik, and the acknowledgment form provided respondent with only 20 days to answer, rather than the 60-day period afforded by § 1608(d) of the FSIA. (Resp't Mem. Supp. at 4) Respondent argues that subsequent attempts to serve process cannot cure the jurisdictional defect that existed at the time the order was issued, and in any event, these efforts were unsuccessful because Tadjik, not Russian, is the only official language of Tadjikistan. (Resp't Reply Mem. Supp at 2, 6; Pinniger Aff. P 2)

 II.

 Section 1608(a) prescribes a hierarchy of four alternative procedures to use when serving process on a foreign state or political subdivision. The first two procedures provide for service according to either special arrangements between the parties, or international conventions governing service of process. 28 U.S.C. § 1608(a)(1)-(2). If neither private arrangements nor formal conventions exist, service can be made under § 1608(a)(3),

 
by sending a copy of the summons and complaint and a notice of suit, together with a translation of each into the official language of the foreign state, by any form of mail requiring a signed receipt, to be addressed and dispatched by the clerk of the court to the head of the ministry of foreign affairs of the foreign state concerned,

 or according to § 1608(a)(4), which provides for service,

 
by sending two copies of the summons and complaint and a notice of suit, together with a translation of each into the official language of the foreign state, by any form of mail requiring a signed receipt, to be addressed and dispatched by the clerk of the court, to the Secretary of State in Washington, District of Columbia, to the attention of the Director of Special Consular Services - and the Secretary shall transmit one copy of the papers through diplomatic channels to the foreign state ...

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