Crystallex International Corporation v. Bolivarian Republic of Venezuela

Filing 68

MEMORANDUM ORDER re questions to be answered in preparation for oral argument on 8/3/18. Signed by Judge Leonard P. Stark on 7/30/18. (ntl)

IN THE UNITED ST ATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
CRYSTALLEX
INTERNATIONAL CORPORATION,
Plaintiff,
C.A. No. 17-mc-151-LPS

V.

BO LIV ARIAN REPUBLIC OF VENEZUELA,
Defendant.

MEMORANDUM ORDER
At Wilmington this 30th day of July, 2018 :
In preparation for the oral argument to be held on Friday, August 3, IT IS HEREBY

ORDERED that the parties shall, no later than 2:00 p.m. on Thursday, August 2, submit letter
briefs, not to exceed ten (10) pages single spaced, addressing the following questions:
1.

Is PDVSA' s motion to dismiss a facial or factual challenge, or both? Is the

answer the same for jurisdictional immunity and for execution immunity?
2.

To the extent the Court must resolve a facial challenge, where does it look for the

well-pled factual allegations it must take as true? No complaint or petition has been filed by
Crystallex in this case.
3.

In determining whether the writ should issue (as opposed to whether, if issued,

Crystallex may execute on the writ), must the Court determine whether Crystallex has rebutted
the Bancec presumption of separateness by probable cause or by some other, higher standard?
4.

Does Crystallex contend that if an independent basis for subject matter

jurisdiction is required with respect to PDVSA - that is, if the Court agrees with PDVSA's

interpretation of the applicability of Peacock- that it has identified such an independent basis for
jurisdiction? If so, what is it?
5.

Address the applicability, if any, of Gambone v Lite Rock Drywall, 288 Fed.

App 'x. 9 (3d Cir. July 25, 2008), to the issue of whether the Court must have an independent
basis for exercising subject matter jurisdiction over PDVSA.
6.

Is this case a Rule 69 garnishment action, like that involved in IFC Interconsult,

or is it something else?
7.

Does IFC Interconsult establish that where, as here, a party proceeds under an

alter ego theory, it is attempting to impose "primary" liability on a new party (i.e., PDVSA) for a
debt of another party (here, Venezuela), as opposed to a Rule 69 action, which seeks to impose
"secondary liability" on, for example, an indemnitor?
8.

Does Delaware law require that the only way to execute on shares of a Delaware

corporation is to sell those shares?
9.

What is the status of any "license" or advice Crystallex holds, has requested, or

intends to request from OFAC?
IT IS FURTHER ORDERED that the parties shall be prepared to discuss the following

questions and updates at the oral argument on Friday, August 3, but need not address them in
their written submissions:
1.

In PDVSA' s supplemental letter of February 26, 2018 (D.I. 60 at 2), PDVSA

writes: "Because a non-state actor could never be found liable on an arbitral award as an alter ego
without any evidence that it was involved in the events giving rise to the award or in the
arbitration itself, neither could a foreign state' s agency or instrumentality be subjected to liability
' in like circumstances. "' No authority is cited in support of this assertion. What is the basis for

this assertion?
2.

What is the status of the settlement (see DJ. 38)?

3.

Are there additional OFAC FAQs relevant to the Court's decision that have not

yet been identified by the parties?
4.

Provide an update as to any other courts in which Crystallex has registered its

judgment and whether any such court has issued any rulings of any relevance to any of the issues
before this Court.
5.

If the Court accepts Crystallex' s position on the pending motions, does that mean

PDVSA is liable (formally or at least effectively) for all of Venezuela's debts, in all cases in
which judgments have been registered in U.S. courts against Venezuela?

HONORABLE LEON
P. STARK
UNITED STATES DISTRICT COURT