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Litigation | MONDAY, DECEMBER 12, 2016 | S5
care, its consistency, formality, and relative expertness, and to the persuasiveness of the agency’s position.” Id.
That is not unlike the task facing a court presented with a foreign state’s interpretation of its own law. When a court asks whether that interpretation is “reasonable under the circumstances,” we believe it will, as courts have done in the past, consider various fac- tors that inform the reasonableness of the interpretation and grant deference accord- ingly. Relevant factors here should include, similar to Mead: the persuasiveness of the opinion (e.g., whether the state has proffered “documentary evidence” or a “speci c ref- erence of law”); the relative expertness of the entity submitting the opinion (e.g., the identity and role of any government entity submitting an opinion, and whether the law at issue involves terms of art within a legal regime vastly different from our own); the formality of the opinion (e.g., whether the opinion is presented through a formal govern- ment statement or the opinion of a private expert); and whether any concern with bias is present (e.g., the status of the sovereign as a party or an amicus curiae).
Vitamin C itself shows how a con uence of factors can lead to the highest degree of deference. That court essentially deferred on the basis of the relative expertness of the Ministry and the formality of its opinion. The proffered interpretation came from the entity responsible for the regulation of foreign trade,
and the law at issue involved terms of art in a legal regime very different from our own.
Not every case calls for such deference. Take for example the decision that gave the Vitamin C panel pause, Karaha Bodas Co. v. Pertamina, 313 F.3d 70, 91-92 (2d Cir. 2002). Karaha Bodas was a suit against a state-owned company in Indonesia in which the Indonesian
‘Vitamin C’ already has been recognized as a “landmark for comity” and one that has “boosted international comity.”
Ministry of Finance joined and proffered an interpretation of several aspects of Indone- sian law. The court accepted the Ministry’s interpretation of an “ambiguous” Indonesian regulation, holding that “[w]here a choice between two interpretations of ambiguous foreign law rests nely balanced, the sup- port of a foreign sovereign for one interpre- tation furnishes legitimate assistance in the resolution of interpretive dilemmas.” The Vitamin C panel viewed this as consistent with its holding, and this makes sense when viewed through the factors listed above— the proffer came from an expert ministry and it was persuasive. The court, however,
declined to adopt the Ministry’s interpreta- tion on another issue in the case because no speci c Indonesian law on the point had been identi ed—the Ministry’s opinion lacked persuasiveness.
We recently litigated a case in which the circumstances called for substantially less deference and led to a full rejection of the sov- ereign’s proffered interpretation of its laws. In Themis Capital v. Democratic Republic of Congo, No. 09-cv-1652, Dkt. 213 (S.D.N.Y.), we represented holders of debt issued by the Democratic Republic of Congo (DRC) in a suit seeking to recover $85 million in defaulted debt from the DRC. At issue was whether the signatories to an acknowledgment of the debt and extension of the statute of limitations had authority under DRC law to bind their principals, or whether a particular DRC law required that they obtain prior approval from the DRC’s Council of Ministers. The DRC presented the interpretation of its laws not through any state agency, but through a private DRC attorney, who asserted that the DRC law required prior approval. Faced with competing opinions from private experts, Judge Paul A. Engelmayer declined to accept the DRC’s interpretation; he found that the DRC’s explanation simply wasn’t persuasive. Looking at the circumstances of the case, we believe this was a very different case from Vitamin C: The DRC was a party with a great interest in the outcome; it presented its evi- dence through a private expert rather than
a formal state entity; and its interpretation simply was not reasonable. Less deference was therefore appropriate.
Final Thoughts
While Vitamin C certainly provides a valu- able element of clarity to courts considering statements from foreign states regarding the interpretation of their laws, we do not believe it stands for a rule of absolute deference in all cases, as many commentators have sug- gested. Instead, the decision ts in with the cases that preceded it, which look to the circumstances of the case and various rel- evant factors in determining what deference to afford the state’s interpretation.
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