CAPITALKEYS, LLC v. DEMOCRATIC REPUBLIC OF CONGO et al
Filing
76
MEMORANDUM OPINION granting Defendant Central Bank's 63 Motion to Dismiss. Signed by Judge Ketanji Brown Jackson on 6/3/2021. (lckbj2)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
CAPITALKEYS, LLC,
Plaintiff,
v.
DEMOCRATIC REPUBLIC OF
CONGO, et al.,
Defendants.
)
)
)
)
)
)
)
)
)
)
)
)
No. 15-cv-2079 (KBJ)
MEMORANDUM OPINION
Plaintiff CapitalKeys, LLC (“CapitalKeys”), a Washington, D.C.-based lobbying
firm, alleges that it executed a contract in which the firm agreed to provide five years of
unspecified “government relations and strategic communications services” to the
Democratic Republic of the Congo (“the Congo”) and the Central Bank of the
Democratic Republic of the Congo (“the Central Bank,” and, collectively,
“Defendants”) in exchange for $16.6 million. (Compl., ECF No. 4, ¶¶ 15–16.) The
terms of the six-page retainer agreement—which the outgoing Governor of the Central
Bank allegedly executed on April 18, 2013, while in CapitalKeys’s D.C. offices—
required the Central Bank to pay the entire five-year service contract price to
CapitalKeys upfront and upon the contract’s signing. (See id. ¶¶ 14–17.) 1 CapitalKeys
maintains that the total fee was not paid when the agreement was signed, however, such
According to CapitalKeys, the Congo made a “good faith payment” of $600,000 toward the contract
price in March of 2013, approximately one month prior to the contract’s execution. (Compl. ¶ 13.)
The subsequent written agreement specified that the total service fee was “payable in one payment of
$16,602,000 due upon signing.” (App. A at A-4.)
1
that Defendants breached the agreement from the outset. (See id. ¶ 18.) Yet,
CapitalKeys allegedly commenced working for the benefit of the Congo and the Central
Bank pursuant to the contract nonetheless, in light of the Congo’s oral promise to pay,
and for the next five years the firm purportedly “counsel[ed] Congolese officials on . . .
how to work with” international organizations and “assist[ed] the Central Bank in
modernizing their internal infrastructure[,]” among other things, without any payment
from Defendants at all. (Id. ¶¶ 19, 22, 27, 39.) In the complaint that CapitalKeys filed
in this Court two years into the five-year service contract period, the firm maintains that
Defendants now owe more than $16.2 million, representing the unpaid portion of the
contract price plus interest. (See id. ¶¶ 49, 58; see also Pl.’s Mot. to Modify Default J.,
ECF No. 50, at 1.) 2
Before this Court at present is a motion that the only defendant to have entered
an appearance in this legal action after a prior default—the Central Bank—has filed,
seeking dismissal of CapitalKeys’s complaint under Federal Rules of Civil Procedure
12(b)(1) and 12(b)(6). (See Def.’s Mot. to Dismiss (“Def.’s Mot.”), ECF No. 63.) The
Central Bank asserts that the outgoing Governor was not actually authorized to enter
into any service contract on behalf of the Central Bank, much less one that required the
Central Bank to pay CapitalKeys millions of dollars (see id. at 11, 17; see also Mot. to
Dismiss Hr’g Tr., ECF No. 75, at 31:8–18), and that, in any event, CapitalKeys did not
actually perform any services pursuant to that alleged agreement or otherwise (see
Def.’s Mot. at 12, 17). Moreover, as a threshold matter, the Central Bank’s motion
contends that the Central Bank has sovereign immunity from suit as an agency of the
Page number citations to the documents that the parties and the Court have filed refer to the page
numbers that the Court’s electronic filing system automatically assigns.
2
2
Congo, and that, as a result, this Court lacks subject-matter jurisdiction over
CapitalKeys’s claims against the Central Bank under the Foreign Sovereign Immunities
Act (“FSIA”). (See id. at 14.)
For the reasons explained fully below, this Court agrees that the Central Bank
has sovereign immunity, because neither of the identified statutory exceptions to
foreign sovereign immunity applies with respect to CapitalKeys’s claims against the
Central Bank. Moreover, and for that same reason, the Court likewise concludes that it
lacks subject-matter jurisdiction over CapitalKeys’s claims against the Congo itself.
Therefore, the Central Bank’s motion to dismiss CapitalKeys’s complaint must be
GRANTED, and CapitalKeys’s complaint will be DISMISSED in its entirety. A
separate Order consistent with this Memorandum Opinion will follow.
I.
BACKGROUND
A.
Factual Background 3
CapitalKeys is a lobbying and public affairs company based in the District of
Columbia. (See Compl. ¶ 5.) According to CapitalKeys’s complaint, in February of
2013, “[a]fter six (6) months of protracted negotiations, . . . the Central Bank, acting as
an agent for the Congo, entered into an oral agreement to retain the services of
CapitalKeys[,]” and the following month, “in March of 2013, the Congo made a good
faith payment of $600,000 as consideration” for that agreement. (Id. ¶¶ 12–13; see also
Ex. B to Compl., ECF No. 4-3, at 2.) Then, on April 18, 2013, CapitalKeys allegedly
executed a written service contract with the Central Bank and the Congo aimed at
Unless otherwise noted, the following allegations of fact are drawn from CapitalKeys’s complaint and
the attached exhibits.
3
3
improving the Congo’s image abroad and bolstering the Congo’s economy over a fiveyear period. (See Compl. ¶¶ 14–17.)
Under the “Retainer Agreement” (which was filed as an exhibit to CapitalKeys’s
complaint and is attached to this Memorandum Opinion as Appendix A), CapitalKeys
agrees to provide the Central Bank with “government relations and strategic
communications services” (App. A at A-2), and to do so over a five-year timeframe,
starting in November of 2013, and extending through November of 2018 (id. at A-4).
CapitalKeys specifically promises to “[a]ssist [the] Central Bank in strategies to reduce
inflation and stabilize the currency” (id. at A-2); to “[a]dvise [the] Central Bank on the
creation of a new stock market for a stronger economy” (id.); and to “[a]ssist the
Central Bank to modernize its internal infrastructure” (id. at A-3). The agreement also
provides that CapitalKeys will help “[s]trengthen the Central Bank’s relations,
creditability, and integrity with financial institutions, global asset managers, private
equity, NGO’s, and decision makers”; will “[w]ork with the media to redefine the image
of the Central Bank and present this redefined good image around the globe”; and will
“[c]reate an ‘echo chamber’ with specific emphasis on agencies such as the World Bank
and IMF to raise issues critical to the Central Bank.” (Id. at A-2–A-3.) Furthermore,
“at no additional cost[,]” CapitalKeys promises to introduce the Central Bank’s
Governor to “high level persons in certain foreign governments[,]” thereby purportedly
assisting the Central Bank with “[g]eneral [r]elationship [b]uilding[,]” and the firm also
commits to “supplying strategy resulting from many years of domestic and international
advising.” (Id. at A-3–A-4.) 4
In this regard, the Retainer Agreement further asserts that, with the introductions that CapitalKeys is
promising to facilitate, the Central Bank “potentially may find dealing with the CEO, Executive Vice
4
4
With respect to the fee payments that are due in exchange for CapitalKeys’s
myriad services, the Retainer Agreement states:
4. Fee Amount, Expenses and Payment Schedule. Client agrees to pay
[CapitalKeys] $276,700 per month for professional services (the “Retainer
Fees”) for a total of $3,320,400 per year which is $16,602,000 for 5 years
payable in one payment of $16,602,000 due upon signing.
(Id. at A-4.) Under the terms of the agreement, this day-one lump-sum payment was to
be sent to CapitalKeys “by bank wire” and directed to a delineated Wells Fargo Bank
account. (Id.) And the agreement specifically anticipates the consequences if such
payment is not made timely and in the indicated fashion. Indeed, immediately after the
payment provision quoted above, the contract states that “[f]ailure by Client to pay
subsequent professional service and expense fees, if required by this agreement and
according to the schedule outlined above, will result in suspension of work[.]” (Id.)
And the agreement later suggests that CapitalKeys would take legal action to enforce
the contract terms if necessary, by specifying that “[t]his Agreement will be governed
by the laws of the District of Columbia without regard to principles of conflicts of law
and a court in said place shall be the exclusive location for any suit or proceeding
relating to this Agreement.” (Id. at A-6.)
It is significant for present purposes that the Retainer Agreement just described
and attached hereto appears to have been signed by only two individuals: the President
of CapitalKeys, Adam Falkoff, and Jean-Claude Masangu Mulongo, who was the
President, etc., of some major companies here and overseas, may result in major deals, solutions, or
contracts[,]” and that the Central Bank “may find that having the reference of [CapitalKeys] and [its]
Washington D.C. office presence” will “strengthen [the Central Bank’s] credibility in dealing and
relationships here and abroad[.]” (App. A at A-3–A-4.) Notably, however, the terms of the agreement
also restrict the Central Bank’s ability to use CapitalKeys’s name freely, or to tout the consulting
relationship that the contract establishes, by specifying that “[n]o public release or communication”
naming CapitalKeys “may be undertaken without [CapitalKeys’s] prior review and approval.” (Id. at
A-5.)
5
outgoing Governor of the Central Bank. (See Compl. ¶ 17; App. A at A-1, A-6.) 5 In the
complaint, CapitalKeys alleges that, while it was Governor Masangu who executed the
agreement on behalf of the Central Bank, “all parties understood that the Central Bank
was acting as the agent and alter ego of Congo and that Congo would be bound by the
agreement.” (Compl. ¶ 14.) The complaint also maintains that, rather than tendering
the “the remaining agreed upon payment of $16,002,000” (representing the contract
price minus the previous $600,000 good-faith payment) at the time of signing, Governor
Masangu signed the agreement with an accompanying oral promise “that payment
would be made shortly.” (Id. ¶ 18.)
CapitalKeys alleges that, rather than cancelling the agreement pursuant to the
express terms of the contract as a result of Defendants’ failure to pay, the firm accepted
the Congo’s oral promise that payment would be forthcoming and “commenced
providing their services to” the Central Bank and the Congo. (Id. ¶ 19.) Moreover,
according to CapitalKeys, unidentified Congo representatives repeatedly made
additional promises to pay in the years that followed (see, e.g., id. ¶¶ 23, 25–26, 31,
33–34, 38), but neither the Congo nor the Central Bank paid any of the remainder of the
contract price (see id. ¶ 38). Nevertheless, CapitalKeys allegedly continued to fulfill its
end of the bargain, by rendering the agreed-upon aid to the Central Bank and the Congo
According to the Central Bank, Governor Masangu’s term as Governor of the Central Bank was set to
expire on May 14, 2013, less than one month after the date on which he signed the Retainer Agreement.
(See Ex. 2 to Def.’s Reply (“Nyembo Decl.”), ECF No. 67-2, ¶ 2.) CapitalKeys neither disputes nor
relies upon this fact when addressing the Central Bank’s contention that Governor Masangu was not
authorized to enter into the agreement with CapitalKeys.
5
6
nonetheless, in reliance on what CapitalKeys describes as the Congo’s repeated (and
presumably oral) promises to pay. (See, e.g., id. ¶¶ 24, 27, 39.) 6
CapitalKeys’s complaint also includes various allegations regarding the services
that CapitalKeys purportedly provided to the Central Bank and the Congo pursuant to
the Retainer Agreement between 2013 and 2018 (i.e., during the lengthy period of
Defendants’ alleged non-compliance). For instance, the complaint states that “[o]ne
month after the parties signed the Retainer Agreement, the International Monetary Fund
(‘IMF’) canceled all cash disbursements to Congo, claiming that Congo failed to
publish sufficient detail on the sale of a state-owned copper mine.” (Id. ¶ 20.) Yet,
“[a]s a result of CapitalKeys’ relationships and expertise,” CapitalKeys was “able to
counsel Congolese officials on exactly how to work with the IMF to solve the issues,
resulting in a disbursement of $225,000,000 to the Congo.” (Id. ¶ 22.) Similarly,
according to the complaint, “in 2014, CapitalKeys was able to impart critical strategies
for [the] Congo to use when negotiating with the United States Agency for International
Development (‘USAID’), resulting in approximately $127,000,000 in humanitarian aid
being sent to the Congo.” (Id. ¶ 28.) CapitalKeys also alleges—without elaboration or
explanation—that it helped to “elevat[e] the global image of the Congo” (id. ¶ 27); that
it “assist[ed] the Central Bank in modernizing their internal infrastructure” (id.); and
that it also “connect[ed] the Congo with high-powered individuals in other foreign
governments and institutional leaders” (id. ¶ 29). 7
6
To date, CapitalKeys has not provided any contemporary documentary evidence, outside of what is
stated in the contract, to support its assertion that the Central Bank or the Congo made promises to pay
the contract fee after the execution of that agreement.
CapitalKeys has not provided any contemporary documentary evidence that details or documents any
of the services that the firm allegedly provided to Defendants pursuant to the Retainer Agreement.
7
7
B.
Procedural History
On December 1, 2015, approximately two years into the alleged five-year
contract term, CapitalKeys filed the instant four-count complaint against the Central
Bank and the Congo, asserting claims against both Defendants for breach of contract
(id. ¶¶ 42–49), unjust enrichment (id. ¶¶ 50–58), loss of business opportunities (id.
¶¶ 59–64), and “account stated” (id. ¶¶ 65–71). With respect to these claims,
CapitalKeys sought more than $23 million in monetary damages. (Id., Relief
Requested.) CapitalKeys served process on the Central Bank and the Congo in
February of 2016 (see Proof of Service, ECF Nos. 18, 19), but the Central Bank and the
Congo failed to enter an appearance or respond to the complaint in any respect.
Consequently, on April 14, 2016, the Clerk of this Court declared that Defendants were
in default. (See Entry of Default, ECF Nos. 22, 23.)
Less than two weeks later, CapitalKeys filed a motion for a default judgment in
the amount of $21,618,000, in addition to prejudgment interest and costs. (See Pl.’s
Mot. for Default J., ECF No. 24, at 1.) This Court referred CapitalKeys’s motion to a
magistrate judge for a report and recommendation (see Min. Order of June 14, 2016),
and on September 16, 2016, Magistrate Judge Kay held an evidentiary hearing at which
Falkoff testified about CapitalKeys’s alleged performance under the Retainer
Agreement and the damages that CapitalKeys purportedly sustained as a result of
Defendants’ breach of the contract. (See Mot. for Default J. Evid. Hr’g Tr., ECF No.
26.) The report and recommendation that Magistrate Judge Kay issued on November
21, 2016, concluded, among other things, that Defendants were not entitled to sovereign
immunity under the FSIA, CapitalKeys, LLC v. Democratic Republic of Congo, 278 F.
Supp. 3d 265, 282–83 (D.D.C. 2017); that they were liable for breach of contract, id. at
8
285–86; and that CapitalKeys should be awarded $16,002,000 in compensatory
damages, $881,207.45 in prejudgment interest, and $827.60 in costs, totaling
$16,884,035.05, id. at 293. 8
On October 6, 2017, after another hearing and supplemental briefing regarding
several aspects of CapitalKeys’s claimed damages, this Court adopted in part
Magistrate Judge Kay’s report and recommendation and granted in part CapitalKeys’s
motion for a default judgment. Id. at 277. Based on the uncontested facts in the record
as it existed at that time, the Court “agree[d] with the Magistrate Judge that this Court
has . . . subject matter jurisdiction over this case[,]” id. at 271, but disagreed with
Magistrate Judge Kay’s recommendation regarding the amount of damages and
prejudgment interest, see id. at 272. For instance, the Court determined that “the proper
measure of CapitalKeys’s damages” at that point was $12,671,598.80, rather than
$16,002,000, because the service period had not yet expired; the former figure
represented the unpaid portion of the service contract price as of the date of the Court’s
judgment minus CapitalKeys’s remaining alleged costs to complete its performance. Id.
at 274. Thus, this Court entered a default judgment in the amount of $12,919,554.66.
(Order, ECF No. 35, at 1.) 9 The Court also stated that it would “retain jurisdiction of
this case during the pendency of the five-year contract period, which will end on
November 17, 2018[,]” and that CapitalKeys could seek to recover the remainder of its
damages at that time. (Id. at 1–2.) The Court further noted that, “[o]n or before
8
Magistrate Judge Kay rejected CapitalKeys’s contention that it was entitled to $5,016,000 in damages
for lost business opportunities, and thus declined to award CapitalKeys the full $21,618,000 in
compensatory damages that it sought. CapitalKeys, 278 F. Supp. 3d at 288.
This figure represented $12,671,598.80 in compensatory damages to date, plus $247,128.26 in
prejudgment interest and $827.60 in costs. CapitalKeys, 278 F. Supp. 3d at 277.
9
9
December 17, 2018, any party may move for an order modifying or setting aside this
default judgment for good cause pursuant to Federal Rule of Civil Procedure 55(c).”
(Id. at 1.)
The Central Bank and the Congo were each served with this Court’s default
judgment on February 26, 2018. (See Affidavits of Service, ECF Nos. 44, 45.)
Approximately ten months later, on December 13, 2018, counsel for the Central Bank
(but not the Congo) entered an appearance in this matter (see Notice of Appearance,
ECF No. 48), and filed a motion to set aside the default judgment under Rule 55(c) (see
Def.’s Mot. to Set Aside Entry of Default J., ECF No. 55). The Central Bank contended
that it had meritorious defenses to CapitalKeys’s claims, and it attached the motion to
dismiss that it intended to file if the default judgment were set aside. (See Ex. 1 to
Def.’s Mot. to Set Aside, ECF No. 55-3.) The Central Bank also argued that
CapitalKeys would not be prejudiced if the default judgment were set aside and
litigation proceeded with respect to its motion to dismiss the complaint, and that the
Central Bank’s default was not willful, but had instead been caused by “internal
confusion regarding how the litigation would be handled and by whom.” (Def.’s Mem.
in Supp. of Mot. to Set Aside, ECF No. 55-2, at 18–19.) This Court granted the Central
Bank’s motion to set aside the default judgment on February 14, 2020 (see Mem. Op. &
Order (“Order Setting Aside Default J.”), ECF No. 62, at 8), and directed the Clerk of
Court to docket the Central Bank’s motion to dismiss separately (see id.), which was
accomplished by order of the Court on February 14, 2020 (see Def.’s Mot.).
In the motion to dismiss, the Central Bank primarily seeks dismissal of the
instant lawsuit for lack of subject-matter jurisdiction under Rule 12(b)(1), arguing that
10
neither of the exceptions to foreign sovereign immunity invoked in CapitalKeys’s
complaint applies with respect to the Central Bank. (See id. at 15 (citing Compl. ¶ 9).)
In particular, the Central Bank argues that the FSIA’s waiver exception, 28 U.S.C.
§ 1605(a)(1), is inapplicable, because the Retainer Agreement was “invalid and
unlawful” under Congolese law, and because Governor Masangu “acted ultra vires in
purporting to enter the contract with CapitalKeys.” (Id. at 15–16.) 10 The Central Bank
also maintains that the commercial-activity exception of the FSIA, 28 U.S.C.
§ 1605(a)(2), does not apply, because “CapitalKeys has not alleged—let alone
submitted any evidence of—commercial activity carried on by the [Central] Bank in the
United States.” (Def.’s Reply in Supp. of Mot. to Dismiss (“Def.’s Reply”), ECF No.
67, at 15; see also Def.’s Mot. at 17 n.4.) In the alternative, the Central Bank asserts
that CapitalKeys’s complaint should be dismissed under Rule 12(b)(6), because
CapitalKeys’s allegations do not state a viable claim for relief. (See Def.’s Mot. at 17–
19.)
In its opposition brief, CapitalKeys points to the Retainer Agreement’s choiceof-law clause and maintains that it constitutes an implicit waiver of the Central Bank’s
sovereign immunity under the FSIA. (See Pl.’s Opp’n to Mot. to Dismiss (“Pl.’s
Opp’n”), ECF No. 66, at 10.) CapitalKeys further insists that Governor Masangu
possessed both actual and apparent authority to enter into the Retainer Agreement on
behalf of the Central Bank. (See id. at 11, 14.) And CapitalKeys asserts, in passing,
that “[a]uthorized representatives from the Congo traveled to [CapitalKeys’s] office in
The Central Bank has submitted supporting declarations from Valentin Ramazani, the head of the
Central Bank’s Legal Department, and Deogratias Mutombo Mwana Nyembo, the current Governor of
the Central Bank. (See Ex. 1 to Def.’s Reply (“Ramazani Decl.”), ECF No. 67-1, ¶ 3; Nyembo Decl.
¶ 5.)
10
11
Washington, D.C. to formalize the parties’ agreement in writing” and that “[t]he
contract was both executed and performed within the United States[,]” and thus the
FSIA’s commercial-activity exception applies. (Id. at 11 (internal quotation marks and
citation omitted).) Finally, CapitalKeys maintains that the complaint contains legally
sufficient allegations with respect to its claims for breach of contract, unjust
enrichment, and account stated (see id. at 14–16; see also id. at 16 n.1 (conceding that
“lost business opportunities are a potential element of damages and not a separate cause
of action”)), and argues that, if all else fails, CapitalKeys should be “permitted to
conduct limited jurisdictional discovery related to the Central Bank’s claim of
sovereign immunity” (id. at 17).
This Court held a hearing on the Central Bank’s motion to dismiss on February
19, 2021 (see Min. Entry of Feb. 19, 2021), and the motion is now ripe for decision.
II.
STATUTORY FRAMEWORK AND LEGAL STANDARDS
A.
The Foreign Sovereign Immunities Act
The FSIA “provides the sole basis for obtaining jurisdiction over a foreign state
in the courts of this country[.]” Argentine Republic v. Amerada Hess Shipping Corp.,
488 U.S. 428, 443 (1989); see also Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S.
480, 488 (1983) (observing that the FSIA establishes “a comprehensive set of legal
standards governing claims of immunity in every civil action against a foreign state or
its political subdivisions, agencies or instrumentalities”). The statute defines a “foreign
state” to include “a political subdivision of a foreign state or an agency or
instrumentality of a foreign state.” 28 U.S.C. § 1603(a). Moreover, under the FSIA,
“foreign nations are presumptively immune from the jurisdiction of United States
12
courts” unless one of “several specific exceptions” laid out in that statute applies. Fed.
Republic of Ger. v. Philipp, 141 S. Ct. 703, 707 (2021); see also 28 U.S.C. § 1604 (“[A]
foreign state shall be immune from the jurisdiction of the courts of the United States
and of the States except as provided in sections 1605 to 1607 of this chapter.”). This
means that “a district court has subject matter jurisdiction over a suit against a foreign
state if—and only if—the plaintiff’s claim falls within a statutorily enumerated
exception.” Odhiambo v. Republic of Kenya, 764 F.3d 31, 34 (D.C. Cir. 2014).
The FSIA’s “waiver” and “commercial activity” exceptions are the two bases
upon which CapitalKeys relies in seeking to advance the claims it has brought against
the Congo and the Central Bank in this case. (Compl. ¶ 9 (citing 28 U.S.C.
§ 1605(a)(1)–(2)).) The FSIA’s “waiver” exception provides, in relevant part, that “[a]
foreign state shall not be immune from the jurisdiction of courts of the United States or
of the States in any case . . . in which the foreign state has waived its immunity either
explicitly or by implication[.]” 28 U.S.C. § 1605(a)(1). The statute “does not define an
implied waiver[,]” but “implicit in § 1605(a)(1) is the requirement that the foreign state
have intended to waive its sovereign immunity.” Creighton Ltd. v. Gov’t of State of
Qatar, 181 F.3d 118, 122 (D.C. Cir. 1999) (emphasis added). 11 And in addition to
having the intent to waive its sovereign immunity, the statute requires that the foreign
state itself effect the waiver, in the sense that any waiver must be authorized by the
foreign state; if “the foreign state has not empowered its agent to act, the agent’s
11
The “intentionality requirement” is “reflected in the examples of implied waiver set forth in the
legislative history of § 1605(a)(1), all of which arise either from the foreign state’s agreement (to
arbitration or to a particular choice of law) or from its filing a responsive pleading without raising the
defense of sovereign immunity.” Princz v. Fed. Republic of Ger., 26 F.3d 1166, 1174 (D.C. Cir. 1994)
(citing H.R. Rep. No. 94-1487, at 18 (1976)).
13
unauthorized act [of waiver] cannot be attributed to the foreign state[.]” SACE S.p.A. v.
Republic of Para., 243 F. Supp. 3d 21, 35 (D.D.C. 2017) (quoting Phaneuf v. Republic
of Indon., 106 F.3d 302, 308 (9th Cir. 1997)). Thus, to trigger the FSIA’s waiver
exception, “the waiver of sovereign immunity must have been made by someone who
has, or at the very least appears to have, the authority to act on behalf of the foreign
sovereign with respect to such a waiver.” Id. at 32.
The FSIA’s “commercial activity” exception is yet another basis for exercising
jurisdiction over a foreign state despite sovereign immunity. In this regard, the FSIA
provides that
[a] foreign state shall not be immune from the jurisdiction of courts of the
United States or of the States in any case . . . in which the action is based
[1] upon a commercial activity carried on in the United States by the foreign
state; or [2] upon an act performed in the United States in connection with
a commercial activity of the foreign state elsewhere; or [3] upon an act
outside the territory of the United States in connection with a commercial
activity of the foreign state elsewhere and that act causes a direct effect in
the United States[.]
28 U.S.C. § 1605(a)(2). This exception reflects the “restrictive theory of foreign
sovereign immunity[,]” under which “immunity is confined to suits involving the
foreign sovereign’s public acts, and does not extend to cases arising out of a foreign
state’s strictly commercial acts.” Verlinden, 461 U.S. at 487; see also Republic of Arg.
v. Weltover, Inc., 504 U.S. 607, 614 (1992) (“[W]hen a foreign government acts, not as
regulator of a market, but in the manner of a private player within it, the foreign
sovereign’s actions are ‘commercial’ within the meaning of the FSIA.”).
As relevant here, with respect to the first clause of the commercial-activity
exception, the FSIA further clarifies that a “commercial activity carried on in the
United States by a foreign state” refers to “commercial activity carried on by such state
14
and having substantial contact with the United States.” 28 U.S.C. § 1603(e) (emphasis
added). The FSIA offers no further guidance about the meaning of the second and third
clauses, but all three prongs of the commercial-activity exception require that the
commercial conduct or its impact be substantially connected to the United States. See
Verlinden, 461 U.S. at 490 (noting that the FSIA’s “substantive provisions requir[e]
some form of substantial contact with the United States” in order to “protect[] against
th[e] danger” that “our courts might be turned into small international courts of claims,
open to all comers to litigate any dispute which any private party may have with a
foreign state anywhere in the world” (internal quotation marks, citation, and alterations
omitted)).
Like the FSIA’s other enumerated exceptions, the waiver and commercialactivity exceptions to foreign states’ sovereign immunity are “narrowly drawn[,]”
McKesson Corp. v. Islamic Republic of Iran, 672 F.3d 1066, 1075 (D.C. Cir. 2012), and
“should be construed as such[,]” Azima v. RAK Inv. Auth., 305 F. Supp. 3d 149, 159
(D.D.C. 2018), rev’d on other grounds, 926 F.3d 870 (D.C. Cir. 2019); see also, e.g.,
Creighton, 181 F.3d at 122 (observing that the D.C. Circuit has “followed the ‘virtually
unanimous’ precedents construing the [FSIA’s] implied waiver provision narrowly”
(citation omitted)). And “the FSIA’s presumption of immunity serves to cut off
litigation against foreign states at the earliest possible moment[,]” Azima, 305 F. Supp.
3d at 158, both because United States courts must “respect the independence and
dignity” of foreign states, Bolivarian Republic of Venez. v. Helmerich & Payne Int’l
Drilling Co., 137 S. Ct. 1312, 1319 (2017) (internal quotation marks and citation
omitted), and because “defer[ring] the question” of sovereign immunity would
15
“frustrate the significance and benefit of entitlement to immunity from suit[,]” Phoenix
Consulting Inc. v. Republic of Angl., 216 F.3d 36, 39 (D.C. Cir. 2000) (internal
quotation marks and citation omitted).
B.
Motions To Dismiss For Lack Of Subject-Matter Jurisdiction Under
The FSIA
A motion to dismiss for lack of subject-matter jurisdiction in a case that
implicates the FSIA is governed by a “nuanced” legal standard. SACE, 243 F. Supp. 3d
at 32. “By moving to dismiss, the defendant may challenge either the legal sufficiency”
of the allegations on the face of the complaint “or the factual underpinning of [the]
exception” upon which the plaintiff relies. Phoenix Consulting, 216 F.3d at 40. And in
this regard, “[a] facial challenge attacks the factual allegations of the complaint that are
contained on the face of the complaint, while a factual challenge is addressed to the
underlying facts” pertaining to the allegedly applicable FSIA exception. SACE, 243 F.
Supp. 3d at 32 (internal quotation marks and citation omitted).
Consequently, the appropriate standard for evaluating such a motion to dismiss
“depends upon whether the motion presents a factual challenge” or a facial challenge.
Phoenix Consulting, 216 F.3d at 40. When a defendant brings a facial challenge, the
court applies a standard “similar to that of Rule 12(b)(6),” Price v. Socialist People’s
Libyan Arab Jamahiriya, 294 F.3d 82, 93 (D.C. Cir. 2002), in that “the court must
accept as true the allegations in the complaint and consider the factual allegations of the
complaint in the light most favorable to the non-moving party[,]” SACE, 243 F. Supp.
3d at 32–33 (internal quotation marks and citation omitted). And the court is permitted
to consider “the facts alleged in the complaint, documents attached as exhibits or
incorporated by reference in the complaint, or documents upon which the plaintiff’s
16
complaint necessarily relies even if the document is produced not by the plaintiff in the
complaint but by the defendant in a motion to dismiss[.]” Azima, 305 F. Supp. 3d at
159 (internal quotation marks and citation omitted). To withstand such a facial
challenge to subject-matter jurisdiction, the complaint’s allegations, accepted as true,
“must show that the defendant’s conduct falls within the ambit of at least one of the
FSIA’s exceptions to sovereign immunity.” Agrocomplect, AD v. Republic of Iraq, 524
F. Supp. 2d 16, 21 n.8 (D.D.C. 2007).
By contrast, when a defendant brings a factual challenge to the complaint, the
court evaluates the motion using a standard that “more closely resembles a motion to
dismiss brought under Rule 12(b)(1).” Azima, 305 F. Supp. 3d at 159. Under that
standard, the court “must go beyond the pleadings and resolve any disputed issues of
fact the resolution of which is necessary to a ruling upon the motion to dismiss[.]”
Phoenix Consulting, 216 F.3d at 40. Further, “factual challenges relating to the FSIA
employ a burden-shifting framework for determining whether or not an FSIA exception
applies[.]” Azima, 305 F. Supp. 3d at 159. The plaintiff seeking to invoke the court’s
subject-matter jurisdiction “bears the initial burden to overcome” the FSIA’s
presumption of immunity “by producing evidence that an exception applies[.]” Bell
Helicopter Textron, Inc. v. Islamic Republic of Iran, 734 F.3d 1175, 1183 (D.C. Cir.
2013). However, once the plaintiff has met that initial burden of production, “the
sovereign bears the ultimate burden of persuasion to show the exception does not
apply[.]” Id.
C.
Determinations Of Foreign Law
Finally, the allegations in CapitalKeys’s complaint and the arguments made in
the Central Bank’s motion implicate certain legal standards that pertain to a federal
17
court’s consideration and application of foreign law. Rule 44.1 of the Federal Rules of
Civil Procedure provides that a United States federal court’s determinations regarding
the law of another country “must be treated as a ruling on a question of law” rather than
as a factual issue. Fed. R. Civ. P. 44.1. And “[i]n determining foreign law, the court
may consider any relevant material or source, including testimony, whether or not
submitted by a party or admissible under the Federal Rules of Evidence.” Id.
Notably, when a federal court undertakes to decide a question of foreign law
pursuant to Rule 44.1, “and the foreign government whose law is in contention submits
an official statement on the meaning and interpretation of its domestic law,” the court
“should accord respectful consideration to [the] foreign government’s submission, but
is not bound to accord conclusive effect to the foreign government’s statements.”
Animal Sci. Prods., Inc. v. Hebei Welcome Pharm. Co., 138 S. Ct. 1865, 1869 (2018).
Moreover, “the appropriate weight in each case will depend upon the circumstances[.]”
Id. at 1873. For instance, “[w]hen a foreign government makes conflicting statements
or . . . offers an account in the context of litigation, there may be cause for caution in
evaluating the foreign government’s submission.” Id. (citation omitted). Other
“[r]elevant considerations include the statement’s clarity, thoroughness, and support; its
context and purpose; the transparency of the foreign legal system; the role and authority
of the entity or official offering the statement; and the statement’s consistency with the
foreign government’s past positions.” Id. at 1873–74.
III.
ANALYSIS
At this stage of the instant case, the parties are primarily engaged in a vigorous
debate over whether the Central Bank is immune from suit under the FSIA; CapitalKeys
18
and the Central Bank disagree, in particular, over whether the FSIA’s waiver and
commercial-activity exceptions apply. See 28 U.S.C. § 1605(a)(1)–(2). With respect to
the waiver exception, this Court construes the Central Bank’s motion as raising a facial
challenge to the allegations in CapitalKeys’s complaint: the Central Bank argues that,
even if accepted as true, CapitalKeys’s assertions do not establish that Governor
Masangu had actual authority to enter into the Retainer Agreement on behalf of the
Central Bank, and, therefore, his alleged assent to the agreement is not properly
construed as a waiver of the Central Bank’s sovereign immunity. (See Def.’s Mot. at
14–17; Def.’s Reply at 11–15.) The Central Bank also seems to be asserting a factual
challenge to CapitalKeys’s breach-of-contract claim and related claims, to the extent
that it argues, with respect to the commercial-activity exception, that CapitalKeys has
failed to produce any evidence that connects the alleged performances under the
Retainer Agreement to the United States for purposes of that exception to the FSIA.
(See Def.’s Mot. at 16–17 & n.4; Def.’s Reply at 6, 15–17.)
For the reasons explained below, this Court concludes that neither the waiver
exception nor the commercial-activity exception is applicable to CapitalKeys’s
complaint, and as a result, CapitalKeys’s legal action must be dismissed in its entirety
for lack for subject-matter jurisdiction.
A.
The Central Bank Has Not Waived Its Sovereign Immunity Because
Governor Masangu Lacked Actual Authority To Bind The Central
Bank To The Retainer Agreement
The primary arrow in CapitalKeys’s FSIA quiver with respect to the Central
Bank’s assertion of sovereign immunity is a clause in the Retainer Agreement that
plainly operates as a choice-of-law provision and a forum selection clause; according to
CapitalKeys, that particular provision also qualifies as an implicit waiver of sovereign
19
immunity for section 1605(a)(1) purposes. (See Pl.’s Opp’n at 10.) The relevant
sentence states: “[t]his Agreement will be governed by the laws of the District of
Columbia without regard to principles of conflicts of law and a court in said place shall
be the exclusive location for any suit or proceeding relating to this Agreement.”
(App. A at A-6.) It appears indisputable that this language constitutes at least an
implicit waiver of the Central Bank’s sovereign immunity with respect to the instant
lawsuit. See 28 U.S.C. § 1605(a)(1) (providing that a foreign state can “waive[] its
immunity either explicitly or by implication”); see also Ashraf-Hassan v. Embassy of
Fr., 40 F. Supp. 3d 94, 100 (D.D.C. 2014) (“[A]n implied waiver may arise where a
foreign state concludes a contract that contains a choice-of-law clause designating the
laws of the United States as applicable.” (citing World Wide Minerals, Ltd. v. Republic
of Kaz., 296 F.3d 1154, 1161 n.11 (D.C. Cir. 2002))), aff’d, 610 F. App’x 3 (D.C. Cir.
2015); H.R. Rep. No. 94-1487, at 18 (listing a foreign state’s “agree[ment] that the law
of a particular country should govern a contract” as an example of an “implicit waiver”
for FSIA purposes).
Thus, the key question is whether then-Governor Masangu, who allegedly signed
the Retainer Agreement in CapitalKeys’s D.C. office on behalf of the Central Bank, had
the requisite authority to bind the Central Bank to this implied agreement to waive its
sovereign immunity with respect to the agreement’s obligations. See SACE, 243 F.
Supp. 3d at 32 (explaining that a “waiver of sovereign immunity must have been made
by someone who has, or at the very least appears to have, the authority to act on behalf
of the foreign sovereign with respect to such a waiver” (emphasis omitted)); see also
supra Part II.A. And as explained below, the Court concludes that the factual
20
allegations of CapitalKeys’s complaint are insufficient to demonstrate that Governor
Masangu possessed the requisite authority, for several reasons. 12
To start, it is necessary to establish the level of authority that must exist for a
waiver of sovereign immunity for FSIA purposes, and in that regard, this Court has
previously determined that “apparent authority is insufficient to waive sovereign
immunity” under the FSIA, as a matter of law. SACE, 243 F. Supp. 3d at 38 (emphasis
added). In other words, for FSIA purposes, actual authority to waive sovereign
immunity is required. See id. (explaining that “the FSIA’s waiver exception plainly
evinces Congress’ intent to require ‘the foreign state’ to act, and when that provision is
considered in light of statute as a whole, the best reading of that term is that it[]
encompasses only those representatives who are actually authorized to act on behalf of
the state”). 13 This means that even if one assumes, arguendo, that CapitalKeys could
satisfy the apparent authority standard under the circumstances presented in this case—
e.g., by showing, first, that the Central Bank manifested to CapitalKeys that Governor
Masangu was authorized to enter into the Retainer Agreement on behalf of the Central
To be precise, the requisite authority that an agent such as Governor Masangu must have for purposes
of the FSIA’s waiver exception is the “authority to waive [the foreign state’s] sovereign immunity[,]”
SACE, 243 F. Supp. 3d at 34, not the mere power to enter into an agreement that contains a waiver
provision. One can imagine a circumstance in which Governor Masangu may have had the authority to
enter into the underlying service contract on behalf of the Central Bank under Congolese law, but was
still not authorized to waive the Central Bank’s sovereign immunity. Compare Belize Soc. Dev. Ltd. v.
Gov’t of Belize, 794 F.3d 99, 102 (D.C. Cir. 2015) (noting that the FSIA’s arbitration exception “only
requires a valid agreement . . . to submit to arbitration,” which is “separate from the obligations the
parties owe to each other under the remainder of the contract” (internal quotation marks and citations
omitted)). CapitalKeys has not pointed to any provision of Congolese law that purports to authorize the
Governor of the Central Bank to waive the Central Bank’s sovereign immunity with or without the
Central Bank’s express consent, and the parties appear to have assumed that the applicability of the
FSIA’s waiver exception turns on Governor Masangu’s authority to enter into the Retainer Agreement
as a whole. This Court’s analysis follows that assumption.
12
The Court is not aware of any contrary D.C. Circuit precedent, and CapitalKeys has not even
acknowledged this holding, let alone provided a reason for this Court to revisit it.
13
21
Bank, and, second, that CapitalKeys reasonably believed that Governor Masangu had
that authority in light of the Central Bank’s manifestations, see id. at 39; see also
Transamerica Leasing, Inc. v. La Republica de Venez., 200 F.3d 843, 850 (D.C. Cir.
2000)—such a demonstration would still fall short of demonstrating the applicability of
the FSIA’s waiver exception. 14
To clear the actual authority bar, the party seeking to attribute an agent’s act to
the principal must show that “the agent ha[d] the power ‘to affect the legal relations of
the principal by acts done in accordance with the principal’s manifestations of consent
to him.’” Makins v. District of Columbia, 277 F.3d 544, 548 (D.C. Cir. 2002) (quoting
Restatement (Second) of Agency § 7); see also SACE, 243 F. Supp. 3d at 39 (noting that
the Restatement of Agency “is a useful beginning point for a discussion of general
agency principles” when “applying agency principles to federal statutes” such as the
FSIA (internal quotation marks and citation omitted)). Put another way, actual
14
For what it’s worth, CapitalKeys’s apparent-authority arguments (see Pl.’s Opp’n at 14) would fail
even if apparent authority is sufficient to effect a waiver, because the contentions CapitalKeys makes in
this regard are either legally insufficient or wholly implausible. For example, CapitalKeys touts “the
Governor[’s] represent[ation] that he had the authority to sign a contract on behalf of the Central Bank”
(id.), but apparent authority requires a manifestation of authorization by the principal (the Central
Bank) rather than the agent (Governor Masangu), see SACE, 243 F. Supp. 3d at 39. Moreover,
CapitalKeys’s bare assertion that “it was reasonable for CapitalKeys to rely on [Governor Masangu’s]
representation” (Pl.’s Opp’n at 14) lacks any factual basis from which one might conclude that it was
reasonable to rely on that representation. This Court also sees nothing in CapitalKeys’s complaint or
the scant evidence it has submitted that could possibly give rise to a reasonable belief that Governor
Masangu had the authority to act on behalf of the Central Bank. The alleged facts that “authorized
representatives from the Congo came to the offices of CapitalKeys in Washington D.C. to formalize the
parties’ agreement in writing” (Compl. ¶ 14); that Governor Masangu signed the Retainer Agreement
“[w]ith authorization from the President of Congo” (id. ¶ 17); and that “the Congo made an initial
payment of $600,000 towards the total” contract price prior to the agreement’s execution (id. ¶ 46)
indicate, at most, that the Congo authorized the agreement—they say nothing about apparent authority
to bind the Central Bank itself. Nor does the self-serving declaration of CapitalKeys’s president
concerning the alleged fact that the Central Bank “arrived at an agreement with CapitalKeys to retain
our services after approximately six months of negotiations” (Decl. of Adam Falkoff (“Falkoff Decl.”),
ECF No. 24-29, ¶ 2) suffice to establish that any such negotiations took place, especially in the absence
of details or documentary evidence that would substantiate those alleged negotiations and potentially
establish the reasonableness of CapitalKeys’s alleged reliance upon them.
22
authority “is created by a principal’s manifestation to an agent that, as reasonably
understood by the agent, expresses the principal’s assent that the agent take action on
the principal’s behalf.” Restatement (Third) of Agency § 3.01; see also, e.g., A-J
Marine, Inc. v. Corfu Contractors, Inc., 810 F. Supp. 2d 168, 175 (D.D.C. 2011).
Moreover, and notably, when the principal is an organization, the principal “manifests
its assent to be bound by the acts of individuals through the observable connections
between the individual and the organization[,]” such as by “appointing that person to a
position defined by the organization.” Restatement (Third) of Agency § 1.03 cmt. c;
see also Uhar & Co. v. Jacob, 840 F. Supp. 2d 287, 291 (D.D.C. 2012) (observing that
“[t]he scope of a corporate agent’s actual authority is generally defined by the
corporation’s articles of incorporation and bylaws”).
Significantly for present purposes, “[w]ithin public-sector organizations, the
authority associated with a position is often defined by legislation or by administrative
regulation.” Restatement (Third) of Agency § 1.03 cmt. c. Consequently, when
assessing whether a government official had actual authority to act on behalf of a
foreign state for FSIA purposes, courts typically examine whether the official’s action
was consistent with the foreign state’s statutes and regulations concerning the official’s
position and the activity in question. See, e.g., TJGEM LLC v. Republic of Ghana, 26
F. Supp. 3d 1, 9–10 (D.D.C. 2013) (holding that a Ghanaian government official lacked
actual authority to enter into a binding contract on behalf of Ghana because “all
government contracts require approvals” from the Ghanaian parliament and “cabinet
level members” of the Ghanaian government under Ghana’s constitution and certain
Ghanaian statutes), aff’d, No. 14-7036, 2015 WL 3653187 (D.C. Cir. June 9, 2015);
23
Packsys, S.A. de C.V. v. Exportadora de Sal, S.A. de C.V., 899 F.3d 1081, 1089 (9th
Cir. 2018) (concluding that the director of a Mexican state-owned corporation lacked
actual authority to enter into a contract on behalf of the corporation because the
contract “required board approval under both Mexican federal law and [the
corporation’s] internal policies”).
Even a cursory examination of the respective statutory powers and
responsibilities of the Governor and the Board of the Central Bank under Act No.
005/2002—the Congolese law that established the Central Bank—demonstrates that
Governor Masangu lacked actual authority to enter into the Retainer Agreement
unilaterally on behalf of the Central Bank. 15 The Act describes the Board of the Central
Bank as “the highest body with the most extensive powers to conceive and direct the
Bank’s policy and supervise the management thereof.” Act No. 005/2002 art. 18. 16
Indeed, according to Act No. 005/2002, “[w]ithout prejudice to the other provisions of
this act, the Board oversees all activities of the Bank, in particular . . . the definition
and implementation of the monetary policy[,]” “credit and exchange regulations[,]” “the
drafting of the budget and preparation of the annual accounts[,]” and “the definition of
staff regulations, in particular the conditions for travel and terms of office for all staff
15
In this analysis, the Court has given relatively little weight to the Central Bank’s declarations
regarding the proper interpretation of Act No. 005/2002 (see Ramazani Decl. ¶¶ 3–10; Nyembo Decl.
¶¶ 5–7), which largely repeat the arguments in the Central Bank’s briefs. (See Def.’s Mot. at 15–16;
Def.’s Reply at 11–14.) These declarations appear to have been created “in the context of litigation,”
and thus warrant a degree of “caution[.]” Animal Sci. Prods., 138 S. Ct. at 1873. The declarations also
refer only to the text of the Congolese statute, and as a result, they “shed little light on the meaning of
[its] law as it would be interpreted by that nation’s courts.” In re Grand Jury Subpoena, 912 F.3d 623,
634 (D.C. Cir. 2019); see also id. (discounting foreign declarations that “contain[ed] no citations to
authority or [the foreign country’s] case law” and that “were plainly prepared with this particular
proceeding in mind”).
The text of Act No. 005/2002 has been translated from its original language of French. (See Ex. 3 to
Def.’s Reply, ECF No. 67-3, at 9.)
16
24
members.” Id. (emphasis added). The Act further provides that “[t]he Board takes all
the actions that it deems necessary for the due execution of the primary and secondary
duties entrusted to the Central Bank of the Congo under this act.” Id. art. 19.
By contrast, the Governor of the Central Bank “manages the Bank” and “prepares
and implements the actions of the Board.” Id. art. 29. Thus, “[t]he Governor has all the
powers necessary to perform the day-to-day management of the Bank” and “gives
instructions regarding said management and supervises its implementation.” Id.
art. 30. 17 The Act also specifically provides that the Governor must “submit[] draft[]
acts that he deems necessary to accomplish the Bank[’]s mission and policy to the
Board for their approval.” Id. art. 31.
Given this clear and established delineation of the relative duties of the Board
and the Governor, as an initial matter, it does not appear that the Governor has the
authority to bind the Central Bank to any contract without input from the Board or
another Bank official, not to mention an agreement of the scope and scale of the
contract at issue in this case. The only statutory provision that could conceivably grant
the Governor contracting authority is Article 31, but that provision authorizes the
17
In this regard, the Act specifies that
[t]he Governor represents the Bank in all its interactions and relationships with third
parties, including the Government and as such has the following powers:
a- To solely sign banknotes and currency issued by the Bank; the annual reports, balance
sheets and results analysis table;
b- To solely or jointly sign contracts concluded by the Bank, the Banks’ correspondence
and other documents;
c- [T]o sign, in accordance with the Bank’s staff regulations, staff employment contracts,
promotions and dismissals;
d- To represent the Bank in legal proceedings;
e- To delegate the powers conferred on him by the provisions of paragraphs b and d of
this article to Bank officials[.]
Act No. 005/2002 art. 31.
25
Governor to “sign contracts concluded by the Bank,” id. (emphasis added), and the use
of this past participial phrase suggests that a contract must have been approved by the
Bank, acting through the Board or another Bank official to whom authority has been
delegated by statute or regulation, before the Governor “sign[s]” the contract to give it
legal effect, see Fla. Dep’t of Revenue v. Piccadilly Cafeterias, Inc., 554 U.S. 33, 39
(2008) (noting that the “past participle” verb form “indicat[es] past or completed
action” (internal quotation marks and citation omitted)). This interpretation is
consistent with the other powers of the Governor that are enumerated in Article 31,
such as the power to “sign banknotes and currency issued by the Bank” and “sign . . .
staff employment contracts,” which appear to be largely ministerial functions. Act
No. 005/2002 art. 31. And in light of this crucial textual context, it would be
exceedingly odd to conclude that the Governor has the power to bind the Bank to
contractual obligations unilaterally (i.e., without the Board’s assent), which is, in
essence, what CapitalKeys argues here.
In any event, even assuming the Governor has the authority to act unilaterally
with respect to binding the Central Bank to some contracts, it is clear to this Court that
the Retainer Agreement falls well outside that contract category. Article 30 plainly
provides that the Governor “has all the powers necessary to perform the day-to-day
management of the Bank[,]” Act No. 005/2002 art. 30, and the final clause of Article 31
establishes that the Governor must “submit[]” any “draft[] acts that [the Governor]
deems necessary to accomplish the Bank[’]s mission and policy to the Board for their
approval[,]” id. art. 31. In this Court’s view, the Governor’s execution of a
multimillion-dollar Retainer Agreement for a broad suite of significant services such as
26
“[a]ssist[ing] the Central Bank to modernize its internal infrastructure” (App. A at A-3)
far transcends the Bank’s day-to-day management, and is much more akin to a “draft[]
act[]” that requires Board approval. The contract that Governor Masangu allegedly
executed while visiting CapitalKeys’s offices contemplated that CapitalKeys would
provide services with transformational significance for the Congolese economy (see,
e.g., id. at A-2 (promising that CapitalKeys would “[a]ssist [the] Central Bank in
strategies to reduce inflation and stabilize the currency” and “[a]dvise [the] Central
Bank on the creation of a new stock market”)); therefore, whatever the precise scope of
the Governor’s unilateral contracting authority may be, given the Governor’s relatively
limited mere-management authority, the Retainer Agreement plainly transcended the
scope of any such authority.
In its quest to persuade the Court otherwise, CapitalKeys relies heavily on a
district court decision from another jurisdiction, Themis Capital, LLC v. Democratic
Republic of Congo, 35 F. Supp. 3d 457 (S.D.N.Y. 2014), aff’d in part, rev’d in part,
and remanded, 626 F. App’x 346 (2d Cir. 2015), but in this Court’s view, that decision
is based on facts that are materially different from the facts at issue here. Themis
Capital addressed whether the Central Bank’s Governor and the Congo’s Vice Finance
Minister had authority to enter into a debt acknowledgment letter on behalf of the
Congo. See id. at 473. Notably, in that case, the Congo’s President had signed an
ordinance that expressly authorized those two individuals to sign the underlying credit
agreement and also charged them with implementing the agreement, see id. at 461–62,
and under those circumstances, there was little doubt that the Governor and the Vice
Finance Minister had been granted actual authority to bind the Central Bank and the
27
Congo to the debt acknowledgement letter, see id. at 474–75, 478. Thus, the Second
Circuit affirmed the district court’s actual authority determination, specifically holding
that the district court had “properly concluded, as a matter of law, that the Finance
Minister and the Governor of the Central Bank had actual authority to sign the [debt
acknowledgment letter] pursuant to [the President’s ordinance], which charged those
very officials with implementing the Credit Agreement until all outstanding debt was
fully paid.” Themis Cap., LLC v. Democratic Republic of Congo, 626 F. App’x 346,
348 (2d Cir. 2015).
To be sure, in a footnote, the district court in Themis Capital had acknowledged
that the plaintiffs also relied on Article 31 of Act No. 005/2002 “as a separate basis for
the Central Bank Governor’s authority to sign the 2003 Acknowledgment Letter[,]”
Themis Cap., 35 F. Supp. 3d at 475 n.12, and in that regard, the district court “agree[d]
with plaintiffs that Article 31 authorized the Central Bank Governor to enter into
contracts on the Central Bank’s behalf[,]” id. But the court saw “no need here to rely
on Act No. 005/2002’s general grant of contracting authority,” because the ordinance
and credit agreement “gave both the Finance Minister and the Central Bank Governor
the necessary authority to sign the . . . debt acknowledgment letters.” Id.
Consequently, Themis Capital’s brief discussion of Article 31 is dicta, insofar as the
district court’s actual authority determination was based on the existence of another
source of law (the President’s ordinance and the credit agreement), whereas no such
alternative font of authority appears in the record of the instant case. Moreover, and in
any event, neither the district court nor the Second Circuit grappled with the text of
Article 31.
28
This all means that Themis Capital is not persuasive authority concerning the
scope of the Governor’s contracting authority under Article 31. And as discussed
above, a thorough consideration of that statute leads inexorably to the conclusion that
the Governor is not authorized to engage in the unilateral execution of any and all
contracts on behalf of the Central Bank. Therefore, in the absence of any other law that
speaks persuasively to Governor Masangu’s powers, this Court has little trouble
concluding that CapitalKeys’s complaint and the accompanying documents—which do
not allege that Governor Masangu sought or obtained the Board’s approval before or
after signing the Retainer Agreement (see Compl. ¶¶ 14, 17), much less provide any
evidence for that proposition, and do not identify any other Congolese statute,
regulation, or other law that purports to authorize Governor Masangu to bind the
Central Bank to the Retainer Agreement—fail to demonstrate that Governor Masangu
had actual authority to enter into the Retainer Agreement on behalf of the Central Bank.
And because the contract was not authorized, its choice-of-law provision is insufficient
to qualify as an implicit waiver of the Central Bank’s sovereign immunity for FSIA
purposes. See SACE, 243 F. Supp. 3d at 34.
B.
CapitalKeys Has Not Established That The Commercial-Activity
Exception Applies
CapitalKeys also argues, albeit in significantly less detail, that this Court can
exercise subject-matter jurisdiction over its contract-based legal claims against the
Central Bank under the FSIA’s exception for commercial activity. (See Compl. ¶ 9; see
also Pl.’s Opp’n at 11.) In this regard, CapitalKeys relies on the first clause of the
commercial-activity exception (see Pl.’s Opp’n at 11), which permits the court to
exercise jurisdiction in spite of a foreign-state defendant’s sovereign immunity when
29
“the action is based upon a commercial activity carried on in the United States by the
foreign state[,]” 28 U.S.C. § 1605(a)(2); see also id. (authorizing suit when the action is
based upon “an act performed in the United States in connection with a commercial
activity of the foreign state elsewhere” (clause two) or “an act outside the territory of
the United States in connection with a commercial activity of the foreign state
elsewhere and that act causes a direct effect in the United States” (clause three)).
Courts assessing whether a plaintiff’s legal claims fall within the first prong of
section 1605(a)(2) apply what can fairly be characterized as a four-part test that tracks
the statutory language: the court (1) identifies the specific conduct that the plaintiff’s
claims are “based upon[,]” and then determines (2) whether that conduct qualifies as a
“commercial activity”; (3) whether that conduct was “carried on in the United States”;
and (4) whether that conduct was carried on “by the foreign state[.]” Id.; see, e.g.,
Friedman v. Gov’t of Abu Dhabi, 464 F. Supp. 3d 52, 67–70 (D.D.C. 2020); Jam v. Int’l
Fin. Corp., 442 F. Supp. 3d 162, 171 (D.D.C. 2020); Rosenkrantz v. Inter-Am. Dev.
Bank, No. 20-cv-3670, 2021 WL 1254367, at *9 (D.D.C. Apr. 5, 2021).
Applying this framework, this Court finds that the first two aspects of the prong
one inquiry are satisfied, because the gravamen of CapitalKeys’s claims is Defendants’
failure to pay for the firm’s commercial services in accordance with the terms of the
Retainer Agreement. But for the reasons that follow, the Court concludes that the
commercial-activity exception does not apply, because CapitalKeys has failed to carry
its burden of production with respect to establishing the remaining requirements of
clause one—i.e., that the conduct upon which its claims are based was carried on in the
United States and by the foreign state.
30
1.
CapitalKeys’s Claims Are Based Upon Defendants’ Alleged Breach
Of The Retainer Agreement, Which Qualifies As “Commercial
Activity” For The Purpose Of Prong One Of The FSIA’s
Commercial-Activity Exception
Starting with the question of what activity CapitalKeys’s claims are “based
upon,” the Supreme Court has explained that the statutory phrase “based upon” is “read
most naturally to mean those elements of a claim that, if proven, would entitle a
plaintiff to relief under his theory of the case.” Saudi Arabia v. Nelson, 507 U.S. 349,
357 (1993). But the Supreme Court has also made clear that “the mere fact that” an act
performed in the United States “would establish a single element of a claim is
insufficient to demonstrate that the claim is ‘based upon’ that [act] for purposes of” the
commercial-activity exception. OBB Personenverkehr AG v. Sachs, 577 U.S. 27, 34
(2015). Instead, “an action is based upon the particular conduct that constitutes the
gravamen of the suit[,]” id. at 35 (emphasis added) (internal quotation marks omitted);
thus, a reviewing court must “zero[] in on the core of [the plaintiff’s] suit[,]” id.—i.e.,
the foreign state’s conduct that “actually injured” the plaintiff, id. at 34.
As relevant here, several courts have recognized that the “core” or “gravamen”
of breach-of-contract and associated equitable claims is generally the foreign state’s
breach of its contractual obligations to the plaintiff, since that is the conduct that
“actually injured” the plaintiff. See, e.g., Friedman, 464 F. Supp. 3d at 68 (concluding
that “[t]he gravamen of [plaintiff’s] equitable claims” in breach-of-contract suit was
that “Abu Dhabi broke its promise . . . to pay [plaintiff] in exchange for valuable
services rendered”); Petersen Energía Inversora S.A.U. v. Argentine Republic, 895 F.3d
194, 207 (2d Cir. 2018) (holding in a breach-of-contract case that the plaintiff’s
“lawsuit [was] ‘based on’ Argentina’s breach of a commercial obligation”);
31
Devengoechea v. Bolivarian Republic of Venez., 889 F.3d 1213, 1223 (11th Cir. 2018)
(determining that “[t]he conduct that actually injured [plaintiff]—and therefore that
makes up the gravamen of [his] lawsuit—is Venezuela’s failure to return [certain
artwork] to [him] or to pay him for it” in breach of a bailment agreement). Consistent
with these holdings, it would seem that the gravamen of CapitalKeys’s claims is the
Central Bank’s alleged refusal to pay CapitalKeys the remainder of the contract price
under the Retainer Agreement on day one of the contract term or at any time thereafter.
(See, e.g., Compl. ¶¶ 48–49 (asserting as basis for breach-of-contract claim that
Defendants “failed to make the agreed upon payment, and ha[ve] yet to pay on the
outstanding balance”).) 18 Therefore, as far as the FSIA’s commercial-activity exception
is concerned, CapitalKeys’s legal “action” is “based upon” the Central Bank’s
nonpayment of the remaining $16,002,000 allegedly owed to CapitalKeys pursuant to
the agreement, 28 U.S.C. § 1605(a)(2), which means that the first aspect of prong one
of the commercial-activity exception is satisfied.
It is also undisputed that the second criteria—i.e., that the conduct that is the
basis for the legal action qualifies as commercial activity—is present here as well. (See
Pl.’s Opp’n at 11; Def.’s Reply at 15.) The FSIA defines “commercial activity” as
“either a regular course of commercial conduct or a particular commercial transaction
or act.” 28 U.S.C. § 1603(d). And the Central Bank’s alleged breach of its payment
Of course, at the time of signing, CapitalKeys had yet to render any services, making its implicit
claim of injury doubtful at best. But District of Columbia law recognizes expectation damages as a
permissible “measure of actual damages arising from a breach of contract[.]” CapitalKeys, 278 F.
Supp. 3d at 272 (citing, e.g., United House of Prayer for All People v. Therrien Waddell, Inc., 112 A.3d
330, 339–40 (D.C. 2015)). So, at least in theory, the gravamen of CapitalKeys’s complaint arose out of
the circumstances of the initial breach for FSIA purposes. Moreover, as explained below,
CapitalKeys’s legal claims are also seemingly based upon Defendants’ continued nonpayment after the
contract term began. See infra Part III.B.2.
18
32
obligations under the Retainer Agreement unquestionably qualifies as a “commercial
activity” for FSIA purposes. See Weltover, 504 U.S. at 614 (concluding that a “foreign
sovereign’s actions are ‘commercial’ within the meaning of the FSIA” when the
“foreign government acts, not as regulator of a market, but in the manner of a private
player within it”). Indeed, the Supreme Court has long explained that the relevant
inquiry “is not whether the foreign government is acting with a profit motive or instead
with the aim of fulfilling uniquely sovereign objectives[,]” but rather “whether the
particular actions that the foreign state performs (whatever the motive behind them) are
the type of actions by which a private party engages in trade and traffic or commerce[.]”
Id. (internal quotation marks and citation omitted); see also id. at 614–15 (contrasting,
on the one hand, “a foreign government’s issuance of regulations limiting foreign
currency exchange[,]” which is “a sovereign activity, because such authoritative control
of commerce cannot be exercised by a private party[,]” with “a contract to buy army
boots or even bullets[,]” on the other, which qualifies as “a ‘commercial’ activity,
because private companies can similarly use sales contracts to acquire goods”).
Consequently, even though the purpose of the Retainer Agreement involves the
Central Bank’s sovereign objectives—such as “reduc[ing] inflation[,]” “stabiliz[ing] the
currency[,]” and “creat[ing] . . . a new stock market for a stronger economy” (App. A at
A-2)—contracts for services, including strategic communications services like those at
issue here (id.), are the types of actions often undertaken by organizations engaged in
commerce, see, e.g., Kettey v. Saudi Ministry of Educ., 53 F. Supp. 3d 40, 50 (D.D.C.
2014) (observing that “[c]ontracts for services are generally considered commercial
activities”); Friedman, 464 F. Supp. 3d at 70 (holding that a contract “to lobby the U.S.
33
government to advance [the foreign state’s] interests in exchange for payment”
qualified as commercial activity under the FSIA). And it follows that the breach of any
such contract qualifies as a commercial activity as well. See de Csepel v. Republic of
Hung., 714 F.3d 591, 599 (D.C. Cir. 2013) (“[A] foreign state’s repudiation of a
contract is precisely the type of activity in which a private player within the market
engages.” (internal quotation marks and citation omitted)).
2.
CapitalKeys Has Not Demonstrated That The Conduct Upon Which
Its Legal Claims Are Based Occurred In The United States Or That
The Alleged Breach Is Actually Attributable To The Central Bank
That said, in order to satisfy the first prong of the commercial-activity exception
fully, CapitalKeys must produce evidence that demonstrates that the commercial
activity at issue was “carried on in the United States[,]” 28 U.S.C. § 1605(a)(2), and
that the foreign state itself is the responsible actor, see id. (requiring that the
commercial activity be carried on “by the foreign state”). And it is well established
that it is not sufficient for the foreign state’s conduct to have “isolated or transitory
contacts with the United States[.]” Zedan v. Kingdom of Saudi Arabia, 849 F.2d 1511,
1513 (D.C. Cir. 1988). Rather, the FSIA itself provides that the exception only pertains
to claims based on “commercial activity carried on by such state and having substantial
contact with the United States.” 28 U.S.C. § 1603(e) (emphasis added); see also
Nelson, 507 U.S. at 356.
Notably, courts generally deem a foreign state’s nonpayment in breach of a
contractual obligation to have been “carried on” in the country in which the foreign
state is located. See, e.g., Kettey, 53 F. Supp. 3d at 51 (noting that Saudi government
entities’ “non-payment” in breach of a contract “occurred in Saudi Arabia”); Lempert v.
Republic of Kaz., 223 F. Supp. 2d 200, 203 (D.D.C. 2002) (observing that Kazakhstani
34
government agency’s “non-payment” in violation of a contractual obligation occurred
“in Kazakstan”), aff’d, 62 F. App’x 355 (D.C. Cir. 2003); cf. Devengoechea, 889 F.3d
at 1224 (observing that “Venezuela’s decision not to pay [plaintiff] for the Collection or
to return the Collection to him” in violation of their agreement “occurred outside the
United States” for purposes of clause three of the commercial-activity exception). So,
too, here: as suggested in the complaint itself, the Central Bank’s allegedly deliberate
nonpayment occurred in the Congo rather than the United States. (See, e.g., Compl.
¶ 25 (“[W]hen the [Congo’s] delegate returned to the Congo, they failed to make the
payment to CapitalKeys.”).)
CapitalKeys cannot now successfully revert to claiming that it is the locus of the
execution of the contract, rather than the breach, that matters after all, because it is
reasonably clear that the mere execution of a contract in the United States is precisely
the sort of incidental connection to the United States that does not satisfy the statute’s
“substantial contact” requirement. Cf. Kettey, 53 F. Supp. 3d at 51 (holding that clause
one of the commercial-activity exception was not satisfied when plaintiff’s performance
and defendants’ nonpayment “occurred in Saudi Arabia[,]” even though plaintiff “was
interviewed in the United States and signed his contract in the United States”). Nor
does it matter that Governor Masangu allegedly effected a breach of the contract when
he signed the Retainer Agreement without contemporaneously paying the full contract
price. (See Compl. ¶¶ 14, 17–18.) Under the terms of the agreement, payment was to
be made by wire transfer directly into CapitalKeys’s Wells Fargo bank account, not by
Governor Masangu’s tender of cash or check at the scene of the signing (see App. A at
A-4), and, regardless, CapitalKeys allegedly excused that initial breach by accepting the
35
Central Bank’s promise of future payment and beginning work under the contract
nevertheless (see Compl. ¶¶ 18–19). See also 13 Williston on Contracts § 39:31 (4th
ed. 2021) (“A party to a contract may waive . . . a breach of the contract’s provisions[]
by conduct manifesting a continued recognition of the contract’s existence after
learning of the breach . . . , such as by continuing to perform[.]”). Thus, even if the
initial breach of the Retainer Agreement arguably occurred in the United States,
CapitalKeys’s claims actually rest upon the Central Bank’s subsequent nonpayment
despite its alleged repeated promises to pay (see, e.g., Compl. ¶¶ 25–26, 37–38), which,
by all accounts, occurred in the Congo.
To be sure, a foreign state’s commercial conduct can still have the requisite
“substantial contact with the United States” even if that conduct does not itself occur in
the United States, 28 U.S.C. § 1603(e), and, as a result, some courts have determined
that a foreign state’s nonpayment in breach of a contract can satisfy prong one of the
commercial-activity exception if the plaintiff performed its contractual obligations in
the United States, see Friedman, 464 F. Supp. 3d at 68 (concluding that foreign state’s
“failure to pay [plaintiff] ha[d] ‘substantial contacts’ with the United States” where “the
services [plaintiff] provided[] all occurred in the United States”); Lanny J. Davis &
Assocs. LLC v. Republic of Eq. Guinea, 962 F. Supp. 2d 152, 159 (D.D.C. 2013)
(holding that substantial-contact requirement was satisfied where the court had “no
reason to doubt” that “the majority of [plaintiff’s] work was performed . . . in
Washington, D.C.”). However, for present purposes, CapitalKeys has not demonstrated
that the firm performed any services whatsoever pursuant to the Retainer Agreement,
much less that it served the Central Bank and the Congo by providing the contracted-for
36
services inside the United States. (See Def.’s Reply at 15 (raising a factual challenge
with respect to CapitalKeys’s allegations regarding its performance).)
First of all, nothing in the Retainer Agreement speaks to where CapitalKeys’s
services will be performed; the contract merely states that CapitalKeys “intend[s] to
work through our Washington, DC resources and country-based resources on these
matters from our Washington, DC offices[.]” (App. A at A-5 (emphasis added).) Thus,
the terms of the contract did not require CapitalKeys to perform its obligations in the
United States. Even more importantly, it bears stressing and repeating that, throughout
the pendency of this litigation, CapitalKeys has never produced a single iota of
documentary evidence that establishes that it performed any tasks or provided any
services under the Retainer Agreement, despite being asked repeatedly for such
evidence by the Court. (See Mot. to Dismiss Hr’g Tr. at 8:11–13, 10:3–10 (“THE
COURT: . . . [D]o you have any objective evidence, internal documents demonstrating
work on the—on this contract? . . . [A]ll I’m asking is what documentary evidence do
you have concerning the work that your clients have actually done? [CapitalKeys’s
counsel]: We certainly have in the complaint—and . . . it hasn’t been disproved or even
refuted—that the Congo got hundreds of millions of dollars through our client’s efforts.
Now, the other side may say prove it, but it hasn’t been disproved[.]”); see also, e.g.,
Mot. to Set Aside Default J. Hr’g Tr., ECF No. 61, at 52:13–22 (“THE COURT: And
surely you have receipts and documentation and records of those meetings? You have
minutes? You have some sort of, he came here, we paid for his hotel. . . . MR.
FALKOFF: I have probably in my calendar when he’s coming. I have my passport
stamps when I would go over there[.]”); Mot. for Default J. Hr’g Tr., ECF No. 31, at
37
16:6–12 (“THE COURT: . . . But is there any record, documentation of a letter from the
Congo that says, We’re going to pay you, don’t worry? [CapitalKeys’s counsel]: Well,
again, I had the same questions you did. And I was told that the Congo, they don’t
really write letters, they don’t write emails. They don’t do phones.”).)
Indeed, the only evidence that CapitalKeys has ever produced concerning its
purported work to benefit the Congo and the Central Bank is the self-serving testimony
of CapitalKeys’s president (see, e.g., Falkoff Decl. ¶ 18; Mot. for Default J. Evid. Hr’g
Tr. at 10:9–17), and that testimony is surprisingly generic: Falkoff uses only the
broadest terms to discuss the services CapitalKeys purportedly rendered, and he
provides little to no information about where and how the alleged services were
performed. For example, in his declaration, Falkoff avers that CapitalKeys
“counsel[ed] Congolese officials . . . on exactly how to work with the IMF to solve”
issues regarding disbursements (Falkoff Decl. ¶ 13); “instruct[ed] [Congolese]
government officials . . . on how to elevate the global image of the Congo” (id. ¶ 18);
“assist[ed] the Central Bank in modernizing their internal infrastructure” (id.);
“impart[ed] critical strategies for representatives from the Congo to use when
negotiating with the United States Agency for International Development” (id. ¶ 19);
and “connect[ed] representatives from the Congo (including the Central Bank) with
high-powered individuals in other foreign governments and institutional leaders” (id.
¶ 20). These statements provide no insight whatsoever into the all-important who,
what, when, and where of these alleged events, nor do they address whether
CapitalKeys’s employees provided those services in the United States, traveled to the
Congo themselves, or hired subcontractors in the Congo to perform those tasks.
38
To be fair, with respect to two of the services that the firm purportedly rendered
pursuant to the Retainer Agreement during the five-year contract term—its alleged
“counsel[ing]” of the Central Bank’s Governor and the Congolese President’s counsel
regarding the IMF (id. ¶ 13), and its purported “moderniz[ation]” of the Central Bank’s
internal infrastructure (id. ¶ 18)—CapitalKeys does provide additional details. But
from the standpoint of explaining the locus of these activities, and who from
CapitalKeys was involved, and what exactly was done, CapitalKeys’s description of
these services is similarly defective. During the evidentiary hearing that Magistrate
Judge Kay held during the default-judgment stage, for example, Falkoff merely testified
that CapitalKeys “strategized with” the Governor of the Central Bank “and his team on
what they were doing wrong and who they should talk to [in order] to hopefully rectify
[the IMF issue] when several other members of their government failed.” (Mot. for
Default J. Evid. Hr’g Tr. at 40:8–11.) Once again, this testimony fails to establish what
services CapitalKeys actually provided and whether any such service occurred inside
the United States. And CapitalKeys’s evidence with respect to its purported work in
modernizing the Central Bank’s internal infrastructure suggests that these services
actually took place in the Congo. (See, e.g., id. at 10:9–17 (Falkoff testifying that “we
need feet on the ground, because I didn’t intend to be flying back and forth constantly
to the Congo. . . . [W]e hired a few people over there who had set up . . . the IT for their
cellphone network and the towers there who were very knowledgeable about technology
and systems that . . . had good relations with the Central Bank. And people that also
had relations with vendors in India who would provide the technology to put it all
together.”); id. at 12:6–10 (Q. “You went out and you hired subcontractors, you put the
39
government in touch with other vendors so they could purchase computers and things
like that directly?” A. “Correct.”); Decl. of Adam Falkoff in Supp. of Mot. to Modify
J., ECF No. 50-1, ¶¶ 3–4 (stating that “work related to the infrastructure modernization
project ceased in mid-September 2018” when CapitalKeys was “informed by
subcontractors [it] had hired who were working in Kinshasa, DRC, that it had become
impossible to continue to perform work because the Congo’s employees with whom the
subcontractors had been working had left their posts in Kinshasa”).)
Given the surprising lack of documentation and detail in the record concerning
what, if anything, CapitalKeys has done to fulfill its obligations under the Retainer
Agreement, it is not surprising that the Central Bank maintains that “CapitalKeys has
never come forward with any credible evidence that it did anything for the Bank” or the
Congo. (Def.’s Reply at 6; see also Ramazani Decl. ¶¶ 11–13 (head of the Central
Bank’s legal department averring that he “ha[s] not seen any work CapitalKeys has
done to modernize the Central Bank’s infrastructure” and that “CapitalKeys has
likewise not completed any other projects for the Central Bank”).) As relevant here,
CapitalKeys’s abject failure to document its performance in any respect means, at the
very least, that CapitalKeys has not adequately demonstrated that any services it
allegedly provided to Defendants under the contract took place inside the United States
such that its legal claims can properly be construed as being based on commercial
activity “having substantial contact with the United States[,]” so as to satisfy the first
clause of the FSIA’s commercial-activity exception. 28 U.S.C. §§ 1603(e), 1605(a)(2).
The Court notes further that, even if CapitalKeys could somehow be credited
with having satisfied its initial burden of production concerning the first three hurdles
40
of the first prong of the commercial-activity exception, it would still fall short at the
fourth requirement, because, like the FSIA’s waiver exception, the FSIA’s commercialactivity exception is predicated on certain conduct of “the foreign state[.]” See 28
U.S.C. § 1605(a)(2) (stating that a legal action can be maintained against a foreign state
when “the action is based upon a commercial activity carried on in the United States by
the foreign state” (emphasis added)). And courts have long held that “the commercial
activity exception may be invoked against a foreign state only when its officials have
actual authority.” SACE, 243 F. Supp. 3d at 35 (quoting Velasco v. Gov’t of Indon., 370
F.3d 392, 400 (4th Cir. 2004)); see also, e.g., TJGEM, 26 F. Supp. 3d at 9–10 & n.5
(concluding that plaintiff “failed, at the outset, to meet its burden of showing the
commercial activity exception applies” because plaintiff’s claims were “based upon the
alleged actions of [a] single Ghanaian official” who “lacked the authority” to “enter
into a binding contract on behalf of Ghana”). This Court has already examined whether
acts in connection with the execution of the Retainer Agreement qualify as activity by
the Central Bank, and for the reasons explained in Part III.A, supra, the Court has
concluded that Governor Masangu did not have actual authority to act on the Central
Bank’s behalf. It follows from well-established agency principles that any breach of
that obligation also cannot be attributed to the Central Bank. See, e.g., Packsys, 899
F.3d at 1089 (concluding that plaintiff “could not invoke the commercial activity
exception” based on foreign state’s failure to pay for goods in alleged breach of
contract where official who executed contract “lacked actual authority to enter the
contract with [plaintiff] on behalf of [the foreign state]”); see also Restatement (Third)
of Agency § 6.01 cmt. b (noting that a principal may be subject to liability on a contract
41
entered into by the principal’s agent only when the agent “acted with actual or apparent
authority”). Therefore, the Central Bank’s alleged nonpayment cannot form the basis
for application of the FSIA’s commercial-activity exception. 19
C.
CapitalKeys Has Not Demonstrated That Jurisdictional Discovery Is
Warranted Or That The Central Bank’s Sovereign Immunity
Argument Is Precluded
CapitalKeys’s last-ditch effort to sustain its legal action despite the Central
Bank’s invocation of sovereign immunity—by requesting that CapitalKeys “be
permitted to conduct limited jurisdictional discovery related to the Central Bank’s claim
of sovereign immunity” (Pl.’s Opp’n at 17), and by attempting to sidestep the
jurisdictional issue altogether on preclusion grounds (see id. at 9)—is baseless and is
therefore similarly unavailing.
For example, while CapitalKeys insists that “limited jurisdictional discovery
would show that the Governor of the Central Bank had both actual and apparent
authority to sign the relevant contract” (id. at 17), “[w]hether to permit jurisdictional
discovery rests in the discretion of the district court[,]” In re Papst Licensing GMBH &
CapitalKeys has made no argument that the second or third clauses of the FSIA’s commercial-activity
exception apply here (see Pl.’s Opp’n at 11); therefore, any such argument is waived, and the Court
need not, and does not, address those alternative bases for establishing that the conduct in question fits
the commercial-activity exception. For what it’s worth, all three clauses of the commercial-activity
exception involve similar assessments, and nothing about the second or third clauses indicates that
CapitalKeys would be any more successful in attempting to demonstrate that its legal claims are either
“based upon . . . an act performed in the United States in connection with a commercial activity of the
foreign state elsewhere[,]” or are “based upon . . . an act outside the territory of the United States in
connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect
in the United States[.]” 28 U.S.C. § 1605(a)(2); see also Kettey, 53 F. Supp. 3d at 50 (“In order to have
subject matter jurisdiction under clause two, the Court must find (1) the plaintiff’s action is based upon
an act performed in the United States, and (2) that it was taken in connection with a commercial
activity of the defendants.”); Valambhia v. United Republic of Tanz., 964 F.3d 1135, 1139 (D.C. Cir.
2020) (“Clause three requires a plaintiff to show that her lawsuit is (1) based . . . upon an act outside
the territory of the United States; (2) that was taken in connection with a commercial activity of [a
foreign government] outside this country; and (3) that cause[d] a direct effect in the United States.”
(internal quotation marks and citation omitted)).
19
42
Co. KG Litig., 590 F. Supp. 2d 94, 101 (D.D.C. 2008), and CapitalKeys has not come
close to demonstrating that such discovery is warranted. It is clear beyond cavil that
“[a] plaintiff may not use jurisdictional discovery to conduct a fishing expedition in the
hopes of discovering some basis of jurisdiction,” Trump v. Comm. on Ways & Means,
415 F. Supp. 3d 98, 112 (D.D.C. 2019) (internal quotation marks and citations omitted),
and it is also well established that a plaintiff seeking jurisdictional discovery “must
make a detailed showing of what discovery it wishes to conduct or what results it thinks
such discovery would produce[,]” id. (internal quotation marks and citations omitted).
Yet, CapitalKeys has made no attempt to describe any specific information bearing on
Governor Masangu’s authority that it believes exists; instead, it apparently seeks any
information that could possibly support its theory that Governor Masangu possessed
authority to bind the Central Bank to the Retainer Agreement. “Such generalized
predictions are not enough to justify jurisdictional discovery.” Atlantigas Corp. v.
Nisource, Inc., 290 F. Supp. 2d 34, 53 (D.D.C. 2003).
Moreover, jurisdictional discovery is seemingly unnecessary here, because any
evidence that could possibly cure the factual deficiencies this Court has identified
above would be in the possession of CapitalKeys, not the Central Bank. See
Agrocomplect, 524 F. Supp. 2d at 34 n.17 (explaining that “the discretion of a district
court to allow jurisdictional discovery in FSIA cases” is generally “limited to those
instances where the facts sought are peculiarly within the knowledge of the party
against whom discovery is sought” (internal quotation marks and citation omitted)). As
to waiver authority, for instance, CapitalKeys must already be aware of any
manifestations made by the Central Bank to CapitalKeys concerning Governor
43
Masangu’s authority to enter into the Retainer Agreement. And, with respect to the
commercial-activity exception, CapitalKeys surely does not need discovery from the
Central Bank to be able to prove that CapitalKeys performed its obligations under the
contract in the United States. Thus, this Court sees no basis for subjecting the Central
Bank to any discovery before dismissing CapitalKeys’s complaint.
CapitalKeys’s preclusion argument fares no better. In this regard, CapitalKeys
repeatedly suggests that this Court’s prior determination that it had subject-matter
jurisdiction at the default-judgment stage, see CapitalKeys, 278 F. Supp. 3d at 282–83,
is somehow preclusive of the jurisdictional objections that the Central Bank now raises
in its motion to dismiss. (See, e.g., Pl.’s Opp’n at 9 (asserting that this Court’s
adoption of the magistrate judge’s conclusions regarding jurisdiction “means that
CapitalKeys met its burden to establish jurisdiction under the FSIA”).) This Court
emphatically rejects this contention for several reasons. First of all, this argument
ignores the fact that this Court has now set aside the default judgment (see Order
Setting Aside Default J. at 1), and a vacated judgment has no preclusive effect, see
United States v. Sci. Applications Int’l Corp., 958 F. Supp. 2d 53, 70 (D.D.C. 2013)
(“Vacated judgments are not law of the case.”). Furthermore, with respect to subjectmatter jurisdiction in particular, it is well established that a court “must dismiss the
action” if it “determines at any time that it lacks subject-matter jurisdiction,” Fed. R.
Civ. P. 12(h)(3) (emphasis added), which means that “there is no such thing as law of
the case when it comes to subject-matter jurisdiction,” Mohammadi v. Islamic Republic
of Iran, 947 F. Supp. 2d 48, 79 n.2 (D.D.C. 2013) (rejecting plaintiff’s argument that,
“by ordering the entry of default against Defendants, this Court has recognized its
44
jurisdictional powers over Defendants and, thus, had essentially conceded that subject
matter jurisdiction exists” (internal quotation marks and citation omitted)), aff’d, 782
F.3d 9 (D.C. Cir. 2015); see also Price v. Socialist People’s Libyan Arab Jamahiriya,
389 F.3d 192, 197 (D.C. Cir. 2004) (explaining that a district court’s resolution of
factual disputes bearing on subject-matter jurisdiction “is not a conclusive
determination but is instead subject to change in light of further development of the
facts” (internal quotation marks and citation omitted)). And, even so, the Court’s prior
conclusion was reached in the context of default-judgment proceedings, which lack “the
full benefits of adversarial litigation[.]” Murphy v. Islamic Republic of Iran, 740 F.
Supp. 2d 51, 58 (D.D.C. 2010). Courts are loathe to bind themselves and the previously
defaulted party to determinations made in the course of entering a default judgment, as
a practical matter, see Weinstein v. Islamic Republic of Iran, 175 F. Supp. 2d 13, 20
(D.D.C. 2001) (concluding that “findings of fact made during the course of this type of
one-sided hearing should not be given a preclusive effect”), and the instant
circumstances present those same concerns.
The bottom line is this: with the benefit of arguments from both sides of this
legal action, this Court has now carefully assessed whether the complaint and the
accompanying evidence is sufficient to establish that either the FSIA’s waiver or
commercial-activity exceptions to the Central Bank’s sovereign immunity apply, and it
has determined, in Parts III.A and III.B, that CapitalKeys has failed to satisfy its burden
in this regard. CapitalKeys has not identified any potential evidence not already in its
own possession that would justify jurisdictional discovery. And with its vacatur of the
prior default judgment, the Court is entirely free to revisit the issue of its own subject-
45
matter jurisdiction under the FSIA based on the arguments that the Central Bank has
raised in its motion to dismiss, which were not presented to the Court at the defaultjudgment stage. Having now considered both parties’ arguments and the entire record
in this case, the Court is firmly convinced that it lacks subject-matter jurisdiction over
CapitalKeys’s claims against the Central Bank.
D.
The Court Also Lacks Subject-Matter Jurisdiction With Respect To
CapitalKeys’s Claims Against The Congo
Finally, even though the Congo has not entered an appearance in this case and
thus did not join the Central Bank’s motion to dismiss for lack of subject-matter
jurisdiction (see Def.’s Mot. at 1), this Court’s jurisdictional determinations compel the
conclusion that CapitalKeys’s claims against the Congo must be dismissed as well.
This is because subject-matter jurisdiction “involves a court’s power to hear a case,”
and a federal court has “an independent obligation to determine whether subject-matter
jurisdiction exists, even in the absence of a challenge from any party.” Arbaugh v.
Y&H Corp., 546 U.S. 500, 501 (2006) (internal quotation marks and citation omitted).
And when “subject matter jurisdiction is premised on the existence of an exception to
foreign sovereign immunity, a district court considering a claim against a foreign state
must decide whether an exception to immunity applies ‘even if the foreign state does
not enter an appearance to assert an immunity defense.’” Worley v. Islamic Republic of
Iran, 75 F. Supp. 3d 311, 323 (D.D.C. 2014) (quoting Verlinden, 461 U.S. at 493 n.20).
When addressing whether this Court has subject-matter jurisdiction to proceed to
consider CapitalKeys’s claims against the Congo, the Court first observes that there is
no distinction between the claims that CapitalKeys brings against the two defendants:
the firm seeks monetary damages against both defendants for the alleged breach of the
46
Retainer Agreement (see Compl., Relief Requested), and maintains that both defendants
have either waived their sovereign immunity or that the legal claims are based on
commercial activity by the foreign state that has taken place inside the United States
(see id. ¶ 9). The Court has already explained why neither of these FSIA exceptions
apply to divest the Central Bank of its sovereign immunity under the circumstances
presented in this case. See supra Parts III.A–B. And the Court is even more certain
that the Congo retains sovereign immunity vis-à-vis the claims that CapitalKeys has
brought for the very simple reason that the Congo is not a party to the Retainer
Agreement, and thus cannot possibly be considered to have waived its immunity or have
performed any commercial acts under that agreement for FSIA purposes.
In essence, as it pertains to the Congo, the Court’s analysis begins, and ends,
with an examination of the contract’s terms. In the very first sentence, CapitalKeys
states plainly that “[w]e are pleased that the Central Bank is retaining CapitalKeys . . .
to provide services on its behalf.” (App. A at A-1 (emphasis added).) Similarly, the
Retainer Agreement is addressed solely to “the Governer [sic] of the Central Bank of
Congo” (id.), and, throughout the text, the contract references the promised
performances by and for a singular “Client”: the Central Bank. And nothing in the
agreement even remotely suggests that the Congo itself is a party, nor has CapitalKeys
pointed to anything in Act No. 005/2002, or any other provision of Congolese law, that
authorizes the Governor of the Central Bank to bind the Congo to contracts or to waive
the Congo’s sovereign immunity. Again, the Retainer Agreement is the sole alleged
basis for CapitalKeys’s contention that this Court has jurisdiction; there is no other
basis in the briefs or the record for concluding that the Congo otherwise waived its
47
sovereign immunity, or has otherwise engaged in any authorized commercial activity
that injured CapitalKeys.
CapitalKeys’s bald assertion that “representatives from the Congo” (who are
largely unnamed and unidentified) told the firm that the Retainer Agreement was
properly authorized by Congolese officials (Falkoff Decl. ¶ 4) is entirely implausible.
One would reasonably expect a foreign state’s willingness to be bound by a
multimillion-dollar, multi-year service agreement for the restructuring of its economic
infrastructure to be memorialized in writing. No representative of the Congo signed the
Retainer Agreement. Moreover, outside of the testimony of CapitalKeys’s president,
there is no evidence that the Congo even knew about the $16 million contract that
Governor Masangu was signing on the eve of his departure from the Central Bank.
CapitalKeys’s assertion that the firm “would not have entered into the Retainer
Agreement if representatives from the Congo . . . had not represented that the Congo
would be bound by the agreement in addition to [the] Central Bank” (id. ¶ 5) is
similarly irrelevant, because CapitalKeys had every opportunity to clarify in writing
who was to be bound by the contract when it drafted the agreement, and, other than
CapitalKeys, the agreement as written binds one and only one other entity: the Central
Bank.
Falkoff’s averments that “the Central Bank is dependent on and dominated by the
[Congolese] government” (Falkoff Decl. ¶ 5), and that he “understood that CapitalKeys’
obligations under the agreement would be performed under the control and at the
direction of [the Congo]” (id. ¶ 4)—even if true—are also patently insufficient to bind
the Congo to the Retainer Agreement (as is necessary to bring that defendant into the
48
plausible orbit of that contract’s terms or provisions). As far as sovereign immunity is
concerned, there is a rebuttable presumption of separateness between a foreign state and
its instrumentalities. Foremost-McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d
438, 440 (D.C. Cir. 1990). And CapitalKeys has done nothing to show that the Central
Bank is “so extensively controlled by its owner that a relationship of principal and
agent [was] created[.]” Transamerica, 200 F.3d at 848 (internal quotation marks and
citation omitted); see also Foremost-McKesson, 905 F.2d at 448 (observing that, where
“conclusory allegations” regarding control “are challenged by the sovereign, the
plaintiff must provide further proof of government involvement in order to overcome
the presumption of juridical separateness”). Moreover, and in any event, the purported
(oral) representations of Congolese officials to Falkoff concerning Governor Masangu’s
authority to bind the Congo to the Retainer Agreement would, at most, establish
apparent authority, which is insufficient to waive a sovereign’s immunity for FSIA
purposes. See supra Part III.A; see also SACE, 243 F. Supp. 3d at 38. 20
In the final analysis, then, this Court finds that the record evidence comes
nowhere close to establishing that Governor Masangu was authorized to enter into the
Retainer Agreement on behalf of the Congo, and that finding speaks conclusively to the
inapplicability of both the waiver and commercial-activity exceptions for purposes of
CapitalKeys’s claims against that foreign state. That is, in the absence of proof that the
Congo itself entered into the Retainer Agreement with CapitalKeys, none of the terms
Truth be told, CapitalKeys’s evidence misses the mark on demonstrating even apparent authority,
because nothing in Falkoff’s declaration or testimony indicates that it was reasonable for CapitalKeys
to rely on any oral representations concerning the extent to which the Congo would be bound, given the
plain terms of the agreement, which contradict any notion that Governor Masangu was entering into the
contract on behalf of the Congo as well as the Central Bank.
20
49
of that agreement—including its choice-of-law provision and the terms that relate to the
scope and circumstances of the parties’ respective performances—can possibly have
any bearing on this Court’s consideration of whether the Congo retains its sovereign
immunity. And because CapitalKeys has offered nothing else, the Court easily finds
that no exception to the FSIA applies with respect to the instant claims against the
Congo, and, therefore, the Court lacks subject-matter jurisdiction over the claims that
CapitalKeys has brought against the Congo, such that those claims must be dismissed.
See Mwani v. bin Laden, 417 F.3d 1, 15 (D.C. Cir. 2005).
IV.
CONCLUSION
CapitalKeys has filed the instant action against a foreign state, claiming that an
outgoing official bound the foreign government to a multimillion-dollar services
contract with the lobbying firm. Setting aside the exceedingly strange circumstances of
a six-page Retainer Agreement that is devoid of any detail concerning CapitalKeys’s
actual services and that requires the foreign entity to make an upfront payment of the
entire fee for five years’ worth of performance, this Court must evaluate whether there
is subject-matter jurisdiction to consider CapitalKeys’s claims concerning Defendants’
alleged breach of the agreement, as a threshold matter.
Now that the Central Bank has appeared in its own defense (after an initial
default) and has presented persuasive arguments concerning its right to sovereign
immunity under the FSIA, it is clear to this Court that not only did the agent who signed
the Retainer Agreement ostensibly on behalf of the Central Bank lack actual authority
to do so, but CapitalKeys also did not actually perform any services for the benefit of
the Central Bank and the Congo pursuant to the commercial contract inside the United
50
States, as would be necessary to conclude that either the waiver exception or the
commercial-activity exception to a foreign state’s sovereign immunity applies.
Therefore, this Court lacks subject-matter jurisdiction over the claims that CapitalKeys
has brought against the Central Bank in the context of the instant lawsuit, which means
that the Central Bank’s motion to dismiss (ECF No. 63) must be GRANTED. The
Court further concludes sua sponte, for the reasons explained herein, that there is
likewise no subject-matter jurisdiction with respect to CapitalKeys’s claims against the
Congo. Accordingly, as set forth in the accompanying Order, CapitalKeys’s entire
complaint will also be DISMISSED WITHOUT PREJUDICE. See N. Am. Butterfly
Ass’n v. Wolf, 977 F.3d 1244, 1253 (D.C. Cir. 2020) (explaining that “a dismissal for
want of subject-matter jurisdiction can only be without prejudice”).
DATE: June 3, 2021
Ketanji Brown Jackson
KETANJI BROWN JACKSON
United States District Judge
51
APPENDIX A
April 18, 2013
CONFIDENTIAL
To the Governer of the Central Bank of Congo
Boulevard Colonnel Tshatshi, Commune de la Gombe,
Ville de Kinshasa
Democratic Republic of Congo
Dear Governer,
We are pleased that the Central Bank is retaining CapitalKeys (“CK” or the “Firm”) to
provide services on its behalf. The purpose of this letter is to set forth our mutual
understanding as to the terms and conditions of CK’s engagement.
CapitalKeys is one of Washington, D.C.'s top public affairs firm with local, state, federal
and international government affairs capabilities. These skills are often coupled with
sales / marketing, financial, and regulatory capabilities.
We impact political and policy making processes through our powerful relationships with
resources overseas and in and around Washington, D.C. – the White House, the
Congress, Regulatory Agencies, the Diplomatic Community, the Leadership of the
Fortune 500, Investment Firms, and the Media.
THE CAPITALKEYS APPROACH
CK was formed to provide a wide range of public affairs activities. Its members and
affiliates are known as some of the most influential and successful lobbyists in
Washington, D.C. CK was founded on the belief that a successful strategy requires more
than effective lobbying and strong relationships. It requires the full range of public affairs
tools, as well as a creative and effective communications strategy. CK provides clients
with powerful blunt advice and representation with both public and private entities.
Our approach – one of using the entire range of tools necessary for affecting the public
policy and economic process – has proven highly effective in shaping perceptions,
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-1
developing allies, turning adverse circumstances into positive outcomes, and most
importantly, producing exceptional results for our clients. We create an “echo chamber”
in and around Washington, DC for our clients. CapitalKeys is results driven and we take
pride in helping our clients achieve success.
One of the keys to being successful in Washington is the ability to put the right
information into the right hands at the right time. As a trusted and respected source of
information, CapitalKeys has proven these critical abilities time after time.
CapitalKeys is unique among its peers, combining real world McKinsey Consulting
training with political experience and a pool of global resources. We look at issues from a
business perspective and employ strategies to maximize our client’s success.
The Team
Our executive team has been carefully chosen to achieve the perfect balance of skills sets,
contacts, and bipartisanship, and successful experiences here and overseas.
Extended biography information can be viewed at www.capitalkeys.com
1.
Description of Services. CK will provide government relations and strategic
communications services to help the Client achieve the following objectives:
Strengthen the Central Bank’s relations, creditability, and integrity
with financial institutions, global asset managers, private equity, NGO’s,
and decision makers in the United States, the European Union, the Middle
East, and Asia.
Assist Central Bank in strategies to reduce inflation and stabilize the
currency.
Advise Central Bank on the creation of a new stock market for a
stronger economy.
Create a more positive image of the Central Bank before the White
House, the Department of State, The Federal Reserve and other relevant
institutions in the United States.
Introduce the Governor of the Central Bank to governmental and
institutional leaders worldwide as one of the leading forces to restore
creditability in the economy and the country of the DRC.
2
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-2
Introduce the Governor of the Central Bank to leading corporations
that might benefit from his many years and expertise of successfully
guiding monetary policy in a developing nation under the most difficult of
conditions.
Assist the Central Bank to modernize its internal infrastructure.
Work with the media to redefine the image of the Central Bank and
present this redefined good image around the globe.
Create an “echo chamber” with specific emphasis on agencies such as
the World Bank and IMF to raise issues critical to the Central Bank.
Work with relevant financial, corporate and NGO entities [i.e. The Bill
and Melinda Gates Foundation and the Jolie Pitt Foundation], through the
Central Bank leadership, with a goal towards direct foreign investment
particularly in the areas of clean water, reliant power, mining, education,
and healthcare for the people of the DRC.
2.
Additional Services and Benefits
A. General. In addition to the effort and work outlined above, we will also supply the
following services at no additional cost:
● Ambassadorial / International Relations.
As necessary, we can contact and introduce you, our Client, to high level
persons in certain foreign governments and these persons may have
relationships with their own financial services and other institutions of
help to you.
● Credibility.
Client may find that having the reference of our Firm and our Washington
D.C. office presence, in representing Client, will strengthen Client’s
credibility in dealings and relationships here and abroad. Additionally it
may enhance Client’s ability to expand its customer base and gain access
to additional funding.
3
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-3
● Strategy.
Unquestionably, during our discussions, you should have concluded we
were quick to find areas of opportunity but more importantly we have
coupled our comments and initial review with a strategy addressing
concerns.
We intend to continue the process of commenting, and review but also
lending to corporate political plans by supplying strategy resulting from
many years of domestic and international advising.
● General Relationship Building.
Apart from political and related efforts, there is a significant book of
relationships, growing, which we bring to the table.
With CK’s assistance, you potentially may find dealing with the CEO,
Executive Vice President, etc., of some major companies here and
overseas, may result in major deals, solutions, or contracts.
3. Schedule. Client agrees that this agreement will commence on November 18, 2013
and end on November 17, 2018. Prior to the expiration date of November 17, 2018,
Client may elect to extend this agreement by informing the President of CK.
4. Fee Amount, Expenses and Payment Schedule. Client agrees to pay CK $276,700 per
month for professional services (the “Retainer Fees”) for a total of $3,320,400 per year
which is $16,602,000 for 5 years payable in one payment of $16,602,000 due upon
signing.
Failure by Client to pay subsequent professional service and expense fees, if required by
this agreement and according to the schedule outlined above, will result in suspension of
work by CK for Client.
Payment will be sent by bank wire to:
Account: CapitalKeys, LLC
Bank:
Wells Fargo Bank
Account #:
1106
Routing #: 121000248
Swift Code (if necessary):
4
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-4
4. Travel. As we intend to work through our Washington, DC resources and countrybased resources on these matters from our Washington, DC offices, we do not expect
domestic and/or international travel to arise. However, when additional travel is deemed
necessary, only with agreement of the Client, other expenses, including but not limited to
items such as first or business class travel, first class hotel accommodations and board,
local transportation, printing, translation services, bulk mailing postage and legal fees
related to representing Client (e.g., lobbying registration if necessary), and coverage for
the time and effort, will be prepaid. All other expenses in excess of USD$50 (fifty U.S.
dollars) will require prior approval by Client.
If additional professional services that are not outlined in the scope of work of this
Agreement are requested by Client, both parties agree to negotiate in good faith
additional fees and expense coverage accordingly.
7. Confidentiality. Except as necessary for the performance of the services contemplated
herein, to enforce this Agreement, or as may be required or appropriate in order to
comply with all applicable laws, rules and regulations or compulsory legal process, or
with the Client’s specific consent, CK shall keep confidential all nonpublic information
received from Client, its affiliates or representatives. The same shall apply as to
information supplied by CK such as strategies and communications relating to high level
introductions.
8. Indemnification and Related Matters. Client shall indemnify, defend and hold
harmless CK, its owners, principals, and affiliates, from and against all actual or
threatened claims, proceedings, suits or investigations of any type, including attorneys’
and other professionals’ fees and disbursements, arising out of or related to the Client.
Client shall advance to each such person such attorneys’ and other professionals’ fees and
disbursements as may be so incurred upon application. Client’s obligations under this
Section shall survive termination or expiration of this agreement.
No public release or communication, naming our Firm, by Client may be
undertaken without our prior review and approval.
Regarding communication technology, Client acknowledges that communication by
wireless telephone, facsimile transmission, and e-mail poses risks to confidentiality and
Client assumes the risks. We cannot guarantee the outcome of our work efforts. We are
not responsible for engagement or compensation or terms relating to persons or firm you
contract with even those introduced by CK.
None of the terms or provisions of this letter agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by CK and
Client or the waiving party. All payments to the Firm are non-refundable and fees are
5
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-5
deemed earned upon payment. The Firm will not account for the time or costs or
otherwise, of its efforts or payments.
The terms of this agreement are proprietary and confidential and are not to be used for
any other purposes.
There are no third party beneficiaries of this Agreement. This Agreement will be
governed by the laws of the District of Columbia without regard to principles of conflicts
of law and a court in said place shall be the exclusive location for any suit or proceeding
relating to this Agreement. This Agreement may be executed in any number of
counterparts, including by facsimile, each of which shall be deemed to be an original and
all of which together shall be deemed to be one and the same instrument.
Please countersign and return to CK a copy of this letter, accept this by email, and or
make the initial payment, evidencing Client’s agreement to these terms as of the date first
written above, being the effective date of our Agreement.
Sincerely,
Adam Falkoff
President, CapitalKeys, LLC
afalkoff@capitalkeys.com
cell: 703-927-2722
ACCEPTED AND AGREED TO:
Client or authorized representative
April 18, 2013
Date
6
1615 L Street, NW • 13th Floor • Washington, DC 20036 • (202) 466-1601
A-6
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?