BALLANTINE et al v. DOMINICAN REPUBLIC

Filing 16

MEMORANDUM OPINION in support of 15 Order denying Plaintiffs' 1 Petition to Vacate Arbitral Award Declining to Exercise Jurisdiction. Signed by Judge Timothy J. Kelly on 8/11/20. (lctjk2)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
LISA BALLANTINE et al.,
Plaintiffs,
v.

Civil Action No. 19-cv-3598 (TJK)

DOMINICAN REPUBLIC,
Defendant,
MEMORANDUM OPINION
Lisa and Michael Ballantine initiated arbitration against the Dominican Republic to
resolve an investment dispute. The arbitration panel found that it lacked jurisdiction over the
Ballantines’ claims under the Dominican Republic-Central America Free Trade Agreement and
issued an award in favor of the Dominican Republic. The Ballantines moved for this Court to
vacate the award under the Federal Arbitration Act (FAA), 9 U.S.C. § 10. But the FAA requires
that notice of a vacatur motion be served within three months of the award’s delivery, 9 U.S.C.
§ 12, and the Ballantines failed to complete service under the Foreign Sovereign Immunities Act
(FSIA), 28 U.S.C. § 1608(a), until several weeks after the FAA deadline lapsed. The Ballantines
argue that they served timely notice on the Dominican Republic and that satisfying the FSIA’s
service requirements within three months is both unnecessary and nearly impossible. For the
reasons explained below, the Court disagrees, and will deny the Ballantines’ motion as untimely.
Background
Lisa and Michael Ballantine are American-born, dual citizens of the United States and the
Dominican Republic. ECF No. 1-1 (“MTV”) at 8, 11. The couple bought property in the
Dominican Republic in 2003 and began developing a luxury residential complex. ECF No. 1-3

(“Award”) ¶¶ 57–59. After the Dominican Republic allegedly discriminated against the
Ballantines in failing to issue them building permits and “expropriated” their investment
“without compensation,” they brought an arbitration in Washington D.C. under the Dominican
Republic-Central America Free Trade Agreement (“CAFTA-DR”). MTV at 12, 14; Award at
179. On September 3, 2019, a majority of the arbitration panel found that it lacked jurisdiction
over the dispute because “Lisa Ballantine was dominantly Dominican and not dominantly
American.” MTV at 1, 15. So the panel issued an award in favor of the Dominican Republic.
See generally Award; see also ECF No. 11 (“Opp.”) at 9 (“The Award was delivered to the
parties on September 3, 2019.”).
On December 3, 2019, the Ballantines filed a Motion to Vacate the Award in this Court
under the Federal Arbitration Act (FAA), 9 U.S.C. § 10, and to “order the Dominican Republic
to submit to arbitration in accordance with CAFTA-DR.” 1 MTV at 43. According to them,
“there are 8 separate and independent reasons why the [panel] exceeded [its] authority,
manifestly disregarded the law, or acted with evident partiality in ruling” that it lacked
jurisdiction. Id. at 19 (emphasis omitted).
The Ballantines made three attempts to serve notice of the Motion to Vacate on the day of
filing. They (1) mailed and hand delivered the Motion to the Dominican Republic’s arbitration
counsel, Arnold & Porter (A&P), see ECF No. 1-17; (2) engaged a Dominican bailiff to serve the
Motion on the Ministry of Industry and Commerce, but nobody authorized to accept service was
available or notified, see ECF No. 13-8; and (3) emailed the Motion to the head of the Ministry
of Industry and Commerce, see ECF No. 13-1 (“Moore Decl.”) ¶ 12. The next day, the bailiff
successfully served a copy of the Motion on the Ministry of Industry and Commerce, see ECF

1

The Ballantines style their filing as a “Petition,” as opposed to a motion. See ECF No. 1.
2

No. 13-9, and A&P responded to the Ballantines a couple of weeks later that its representation of
the Dominican Republic ended when the arbitration concluded, see ECF No. 11-3.2
On December 10, 2019, the Ballantines requested from the Clerk of the Court
summonses addressed to the Dominican Republic, ECF No. 3, which the Clerk issued the next
day, ECF No. 4. On January 8, 2020, the Ballantines filed affidavits requesting foreign mailing
by the Clerk under the FSIA, 28 U.S.C § 1608(a)(3); the Clerk complied on January 22, 2020,
and mailed a copy of the summons, complaint, and notice of suit, together with a translation of
each, to the Dominican Republic’s Ministry of Industry and Commerce and Ministry of Foreign
Affairs. See ECF Nos. 5–8. The Dominican Republic filed an opposition arguing that the
Motion is untimely, and that—even if the Court finds otherwise—the Ballantines do not clear the
high hurdle for vacatur. See generally Opp.; but see ECF No. 13 (“Reply”).
Legal Standard
A plaintiff seeking to vacate an arbitration award under the FAA has the burden of
proving that she accomplished valid service. The Argentine Republic v. Nat’l Grid PLC, No. 09cv-248 (RBW), 2010 WL 11229950, at *1 (D.D.C. June 7, 2010), aff'd, 637 F.3d 365 (D.C. Cir.
2011); see Light v. Wolf, 816 F.2d 746, 751 (D.C. Cir. 1987). Section 12 of the FAA, 9 U.S.C
§ 12, sets a three-month deadline and other requirements for service:
Notice of a motion to vacate, modify, or correct an award must be served upon the
adverse party or his attorney within three months after the award is filed or
delivered. . . . If the adverse party shall be a nonresident [of the district within
which the award was made] then the notice of the application shall be served by
the marshal of any district within which the adverse party may be found in like
manner as other process of the court.

2

The Dominican Republic retained A&P again “following service on the Foreign Ministry on
January 24, 2020.” Opp. at 14 n.7; see ECF Nos. 9–10.
3

This three-month deadline is a non-jurisdictional statute of limitations. See Republic of
Argentina v. BG Grp. PLC, 715 F. Supp. 2d 108, 120 n.10 (D.D.C. 2010) (citing Dalal v.
Goldman Sachs & Co., 541 F. Supp. 2d 72, 76 (D.D.C. 2008)), rev’d on other grounds, 665 F.3d
1363 (D.C. Cir. 2012).
Analysis
The Ballantines failed to timely serve their Motion to Vacate the Award. Section 12 of
the FAA requires that notice of a motion to vacate “must be served upon the adverse party”
within three months of filing or delivery, 9 U.S.C. § 12. And for nonresidents of the district
where the arbitration occurred, like the Dominican Republic here, see Award at 179, notice
“shall be served by the marshal of any district within which the adverse party may be found in
like manner as other process of the court.” 9 U.S.C. § 12.
These requirements, courts have recognized, present tricky issues for serving foreign
parties. “[F]oreign parties,” such as the Dominican Republic, “will not necessarily be found in
any district” of the United States, InterCarbon Bermuda, Ltd. v. Caltex Trading & Transp.
Corp., 146 F.R.D. 64, 67 (S.D.N.Y. 1993), and service by marshals is “an artifact” of an “era that
ended in the early 1980s,” Technologists, Inc. v. MIR’s Ltd., 725 F. Supp. 2d 120, 126 (D.D.C.
2010). What is left is the requirement that service be “in like manner as other process of the
court,” 9 U.S.C. § 12—which courts have interpreted to mean that service on foreign parties
should be “in accordance with Rule 4.” Technologists, Inc., 725 F. Supp. 2d at 126. And Rule 4,
in turn, states that a “foreign state . . . must be served in accordance with [the FSIA’s] 28 U.S.C.
§ 1608.” Fed. R. Civ. P. 4(j)(1); see Transaero, Inc. v. La Fuerza Aerea Boliviana, 30 F.3d 148,
154 (D.C. Cir. 1994) (“[S]ection 1608(a) sets forth the exclusive procedures for service on a
foreign state.” (cleaned up)). Thus, the FAA required that the Ballantines serve notice of their

4

Motion to Vacate on the Dominican Republic under the FSIA within three months of the
Award’s filing or delivery: by December 3, 2019, see MTV at 15; Opp. at 9.
The FSIA “sets out in hierarchical order . . . four methods by which ‘[s]ervice ... [must]
be made.’” Republic of Sudan v. Harrison, 139 S. Ct. 1048, 1054 (2019) (quoting 28 U.S.C.
§ 1608(a)). The third method, applicable here, calls for:
sending a copy of the summons and complaint and a notice of
suit, together with a translation of each into the official language
of the foreign state, by any form of mail requiring a signed
receipt, to be addressed and dispatched by the clerk of the court to
the head of the ministry of foreign affairs of the foreign state
concerned.
28 U.S.C. § 1608(a)(3).3 The Ballantines made three attempts to serve notice on the Dominican
Republic on the last day of the FAA’s three-month window, December 3, 2019: they emailed the
Motion to the head of the Ministry of Industry and Commerce, see Moore Decl. ¶ 12; they sent
the Motion to the Dominican Republic’s arbitration counsel, A&P, see ECF No. 1-17; and they
directed a Dominican bailiff to try to provide a copy of the Motion to the Ministry of Industry
and Commerce, although he did not succeed, see ECF No. 13-8.
The Ballantines did not achieve timely service through any of these efforts. First, they
directed none of these attempts to “the head of the ministry of foreign affairs” of the Dominican
Republic, and none were “dispatched by the clerk of the court,” as required. 28 U.S.C.
§ 1608(a)(3). Second, as for sending the Motion to A&P, notice of a vacatur motion may be

3

The FSIA’s other three methods are delivery under a “special arrangement,” 28 U.S.C.
§ 1608(a)(1); delivery “in accordance with an applicable international convention on service of
judicial documents,” id. § 1608(a)(2); and, if service under the first three methods is impossible
within thirty days, delivery through “diplomatic channels,” id. § 1608(a)(4). Here, the parties
agree that service under Section 1608(a)(3) is appropriate because they do not have a special
agreement for service and the Dominican Republic and the United States are not parties to an
international convention on judicial service. See Opp. at 13; Reply at 24.

5

served upon the “adverse party[’s] attorney” only if “the adverse party is a resident of the district
within which the award was made.” 9 U.S.C. § 12. But the Dominican Republic is a
nonresident, see Award at 179, so this provision is inapplicable. 4 Third, while the FSIA requires
that “a copy of the summons” be served, 28 U.S.C. § 1608(a)(3), the Ballantines only requested
summonses a week after the December 3, 2019, service deadline. See ECF No. 3. In fact, the
Ballantines failed to request foreign mailing by the Clerk under the FSIA until January 8, 2020,
over a month after the FAA’s three-month service deadline. See ECF Nos. 5–6.
Neither of the Ballantines’ arguments solve their service problem. They argue that their
efforts above provided the Dominican Republic with actual notice of their Motion on December
3, 2019, which they maintain is all that 9 U.S.C. § 12 requires. See Reply at 21. But that reading
would eviscerate the FAA’s language in Section 12 that service be “in like manner as other
process of the court,” 9 U.S.C. § 12, which—when applied to service on a foreign sovereign like
the Dominican Republic—refers to the process outlined in Rule 4 and, in turn, the FSIA. 5 See
Technologists, Inc., 725 F. Supp. 2d at 126; Grupo Unidos Por El Canal, S.A. v. Autoridad del
Canal de Panama, No. 17-cv-23996, 2018 WL 3059649, at *4 (S.D. Fla. June 20, 2018)

4

Even if serving the Motion to Vacate on the Dominican Republic’s attorney was proper under
the FAA, it does not appear that A&P could accept service on the Dominican Republic’s behalf.
See ECF No. 11-3; Berkowitz v. Republic of Costa Rica, 288 F. Supp. 3d 166, 171–73 (D.D.C.
2018) (finding that service on arbitration counsel that no longer represented a foreign sovereign
“pursuant to the FAA did not qualify as effective service”); Grupo Unidos Por El Canal, S.A. v.
Autoridad del Canal de Panama, No. 17-cv-23996, 2018 WL 3059649, at *3 (S.D. Fla. June 20,
2018) (“[T]he Petitioners fail to establish that . . . arbitration counsel was authorized [to accept
service], which is their burden.”).
5

The Ballantines cite several cases in support of their notice argument, none of which pertain to
service on a foreign party under the FSIA. See Reply at 21 & n.18 (citing Sanders-Midwest, Inc.
v. Midwest Pipe Fabricators, Inc., 857 F.2d 1235, 1237 (8th Cir. 1988); Stifel, Nicolaus & Co. v.
Stern, No. 20-cv-0005 (SAG), 2020 WL 1529021, at *5 (D. Md. Mar. 31, 2020); Santos v. GE,
No. 10-cv-6948 (JSR) (MHD), 2011 WL 5563544, at *7 (S.D.N.Y. Sept. 28, 2011), report and
recommendation adopted, 2011 WL 5563536 (S.D.N.Y. Nov. 15, 2011)).
6

(“[A]ctual notice of a motion to vacate does not translate to proper service under the FAA and
FSIA . . . .”).
The Ballantines also appear to call for equitable tolling of the FAA service deadline
because, according to them, construing 9 U.S.C. § 12 to require FSIA service within three
months would “effectively make it impossible” for parties to file timely motions to vacate
arbitration awards for foreign entities. See Reply at 20, 23–24. And to be sure, serving a foreign
sovereign can be cumbersome, see Reply at 23–25, and it is not at all clear that Congress
contemplated the difficulties in completing FSIA service in such a short time frame, see Republic
of Argentina, 715 F. Supp. 2d at 120 n.10. Still, the D.C. Circuit rejected a similar argument in
Argentine Republic v. National Grid PLC, 637 F.3d 365 (D.C. Cir. 2011) (per curiam). In that
case, the plaintiff “argued that it would be impossible to complete service of notice within the
[FAA’s] three month period” because the defendant was headquartered abroad and the FSIA
required using government channels to serve under the Hague Convention. Id. at 367. The court
found that Federal Rule of Civil Procedure 6(b) cannot be used to extend the three-month service
window because 9 U.S.C. § 12 sets a “strict deadline,” and “it would be incongruous to allow
courts to circumvent the congressional directive” with “common law . . . exceptions.” Id. at 368
(quoting Dalal, 541 F. Supp. 2d at 76).6 So it does not appear that equitable tolling is available
to the Ballantines here.

6

See also Cigna Ins. Co. v. Huddleston, 986 F.2d 1418, 1993 WL 58742, at *11 (5th Cir. 1993)
(per curiam) (noting that “there is no ‘discovery rule’ or ‘equitable tolling’ exception to the
[three-month deadline] in section 12 of the FAA”); Taylor v. Nelson, 788 F.2d 220, 225 (4th Cir.
1986) (“The existence of any [due diligence or tolling] exceptions to § 12 is questionable, for
they are not implicit in the language of the statute, and cannot be described as common-law
exceptions because there was no common-law analogue to enforcement of an arbitration
award.”); Florasynth, Inc. v. Pickholz, 750 F.2d 171, 175 (2d Cir. 1984) (“[T]here is no common
law exception to the three month limitations period on the motion to vacate.”). But see Move,

7

Finally, even if the Court had the power to equitably toll the service deadline, on the
record here such tolling would be inappropriate, since the obstacles cited by the Ballantines were
not the reason they missed the deadline. They moved to vacate on the last day of the service
window, failed to request summonses until after the deadline, and did not even try to complete
FSIA service by requesting foreign mailing until about a month later. See ECF Nos. 1, 5–6. As
a result, they cannot show that they pursued their rights diligently or that “extraordinary
circumstances” prevented them from timely serving the Dominican Republic. BCB Holdings
Ltd. v. Gov’t of Belize, 110 F. Supp. 3d 233, 245 (D.D.C. 2015), aff’d, 650 F. App’x 17 (D.C.
Cir. 2016).7
Conclusion
For the above reasons, the Court will deny the Ballantines’ Petition to Vacate Arbitral
Award Declining to Exercise Jurisdiction, ECF No. 1. A separate order will issue.
/s/ Timothy J. Kelly
TIMOTHY J. KELLY
United States District Judge
Date: August 11, 2020

Inc. v. Citigroup Glob. Mkts., Inc., 840 F.3d 1152, 1156–57 (9th Cir. 2016) (“[N]either the text,
nor the structure, nor the purpose of the FAA is inconsistent with equitable tolling.”).
7

See also Pfannenstiel v. Merrill Lynch, 477 F.3d 1155, 1158 (10th Cir. 2007) (declining to
apply equitable tolling because the plaintiff had a month to timely serve the defendant after
learning of grounds to vacate the arbitration award); Fradella v. Petricca, 183 F.3d 17, 21 (1st
Cir. 1999); Lawson-Jackson v. Rosenhaus, No. 16-cv-4049 (TDC), 2017 WL 4063800, at *3 (D.
Md. Sept. 13, 2017) (“even if equitable exceptions could apply,” the plaintiff did not show “any
basis to excuse her failure to meet the service deadline” after moving to vacate on the last day of
the limitations period).
8