Daobin et al v. CISCO Systems, Inc. et al

Filing 17

MOTION to Stay by CISCO Systems, Inc. Responses due by 8/8/2011 (Attachments: # 1 Exhibit A)(Bisbee, Lincoln)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
Du Daobin, et al.

Plaintiff,
v.
CISCO Systems, Inc., et al.

Defendant.

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Civil Action No. 8:11-cv-01538 PJM

DEFENDANTS’ MOTION FOR STAY
Defendants CISCO Systems, Inc., at al., by and through their undersigned counsel,
hereby move this Court for a stay of this action. Specifically, in the interests of judicial economy
and for the reasons stated below, Defendants request a stay pending the later of: (a) a decision
on Defendants’ forthcoming motion to dismiss in Doe v. Cisco, No. 5:11-cv-02449 (N.D. Cal.),
which involves the same factual and legal issues as this action, and (b) a decision by the Fourth
Circuit Court of Appeals in Aziz v. Alcolac, No. 10-1908, which will resolve many of the central
legal issues presented here.1
I.

PROCEDURAL BACKGROUND
Plaintiffs’ Complaint, filed June 6, 2011, alleges that Plaintiffs are Chinese citizens and

residents; that the government of China persecuted the Plaintiffs as a penalty for their political
views; and that the Defendants are secondarily liable for this alleged wrongdoing by virtue of
having designed, customized, and sold internet routers and related equipment and services to
Chinese government entities in support of China’s so-called “Golden Shield” internet
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Counsel for Defendants have conferred with counsel for Plaintiffs, who oppose this motion.

infrastructure project. The Complaint asserts novel and complex international law claims under
the Alien Tort Statute (“ATS”), Torture Victim Protection Act (“TVPA”), and other statutory
and common law provisions. Defendants intend to seek dismissal of the Complaint on the
grounds that it is factually baseless, legally unsound, and inappropriate for resolution by this or
any other United States-based court.
II.

ARGUMENT
It is well established that "[a] district court has inherent power to stay proceedings to

control the disposition of the causes on its docket with economy of time and effort for itself, for
counsel, and for litigants.” Popoola v. MD-Individual Practice Assoc., 2001 WL 579774, 2 (D.
Md. 2001) (quoting Landis v. North American Co., 299 U.S. 248, 254 (1936)). See also Clinton
v. Jones, 520 U.S. 681, 706-07 (1997) (citing Landis for the same proposition); Climax
Molybdenum Co. v. M/V Seatrain Antwerp, 51 B.R. 192, 195 (D. Md. 1984) (power to stay
proceedings is within the inherent powers of a trial court) (citation omitted). In reliance on the
foregoing authority, the Popoola Court granted a stay pending resolution of an appeal that
involved the same legal issues and was awaiting decision in the Fourth Circuit Court of Appeals.
Here, Defendants’ response to the Complaint, and of all other proceedings in this action,
should be stayed pending a ruling in a parallel Northern District of California case, and a
pending Fourth Circuit appeal. Such a stay is appropriate in the interests of justice and judicial
economy.
A.

This Action Should Be Stayed Pending a Decision in the Doe Action.

This action is duplicative of an action previously filed and pending in the Northern
District of California. Doe v. Cisco, No. 5:11-cv-02449 (the “Doe” action). The Doe Complaint
is asserted on behalf of Chinese citizens and residents who allege that the government of China

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persecuted them as a penalty for their religious views; and that the Defendants are secondarily
liable for this alleged wrongdoing by virtue of having designed, customized, and sold internet
routers and related equipment and services to Chinese government entities in support of China’s
so-called “Golden Shield” internet infrastructure project. The factual allegations concerning
police misconduct and Cisco business practices in the Doe action are nearly identical to those at
issue here, putting aside certain minor differences. The defendants in the Doe action are all
defendants here. And the legal claims in the Doe action — including claims under the ATS and
TVPA — are also at issue here.
Defendants intend to seek dismissal of the Doe Complaint just as they intend to seek
dismissal here. Indeed, Defendants’ motion to dismiss the Doe complaint will be filed and
served by August 4, 2011, by stipulation of the parties in Doe. Due to the duplicative nature of
the actions, a decision on Defendants’ motion to dismiss the Doe complaint will necessarily
implicate, and potentially resolve, the legal issues relevant to this action — at a minimum
providing substantial assistance in assessing the propriety of the instant Complaint. There is
little sense in briefing the same issues simultaneously in the Doe action and in this action. The
more efficient and sensible approach, and the approach best suited to the orderly disposition of
this case, is to stay Defendants’ response to the instant Complaint pending the Doe court’s ruling
on Defendants’ forthcoming motion to dismiss that action.
B.

This Action Should Be Stayed Pending the Fourth Circuit’s Decision in Aziz..

Several of the most fundamental legal issues posed by the Plaintiffs’ Complaint are
currently pending before the Fourth Circuit. Aziz v. Alcolac, No. 10-1908. The Fourth Circuit
heard argument in Aziz on May 12, 2011. The questions presented in that appeal include whether
and when a corporation can be sued under the ATS and TVPA, and what level of intent is

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required to be alleged in order to state a claim for secondary liability under those statutes.2
Those questions are directly at issue in the instant action, which asserts multiple ATS and TVPA
claims against corporate Defendant Cisco on the basis of purported secondary liability.3
It is at this point entirely unclear how the Fourth Circuit will resolve these questions,
which have never been ruled upon by the Fourth Circuit Court of Appeals and which in recent
weeks and months have become the subject of significant national circuit splits.4 Efficiency and
judicial economy suggest that the parties and the Court ought not address these unsettled issues if
the Fourth Circuit will soon resolve them in Aziz. Indeed, generic statistics regarding time to
decision in the Fourth Circuit suggest that a decision in Aziz may issue within the next month or
so. A briefing schedule on Defendants’ contemplated motion to dismiss the Complaint, should
await that decision.

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See Aziz v. Iraq, 1:09-cv-00869-MJG (D. Md.) (slip op. June 9, 2010) (dismissing the
Complaint as against the sole corporate defendant); Aziz v. Alcolac, No. 10-1908 (4th Cir.)
(Brief of Appellee, responding to issues on appeal) (attached as Exhibit A).

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See Docket No. 1 (Complaint), causes of action at 22, 24, 25, 27, 33.

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First, as to corporate liability under the ATS, see Flomo v. Firestone Nat. Rubber Co., LLC __
F.3d ___, 2011 WL 2675924 (7th Cir. July 11, 2011) (corporate liability “limited to cases in
which the violations are directed, encouraged, or condoned at the corporate defendant’s
decisionmaking level”); Doe v. Exxon Mobil Corp., __ F.3d ___, 2011 WL 2652384 (D.C. Cir.
July 8, 2011) (corporate liability available); Kiobel v. Royal Dutch Petroleum Co., 621 F.3d
111 (2d Cir. 2010) (corporate liability unavailable); Romero v. Drummond Co., 552 F.3d 1303,
1315 (11th Cir. 2008) (ATS “grants jurisdiction from complaints of torture against corporate
defendants”).
Second, as to corporate liability under the TVPA, see Mohamad v. Rajoub, 634 F.3d 604
(D.C. Cir. 2011) (no corporate liability); Bowoto v. Chevron Corp., 621 F.3d 1116 (9th Cir.
2010) (no corporate liability); Romero v. Drummond Co., 552 F.3d 1303, 1315 (11th Cir.
2008) (allowing TVPA claim to go forward against a corporation); Khulumani v. Barclay Nat.
Bank Ltd., 504 F.3d 254 (2d Cir. 2007) (no corporate liability).
Third, as to the secondary liability standard, see Doe v. Exxon Mobil Corp., __ F.3d ___,
2011 WL 2652384 (D.C. Cir. July 8, 2011) (adopting a “knowledge” requirement);
Presbyterian Church of Sudan v. Talisman Energy, Inc., 582 F.3d 244, 258 (2d Cir. 2009)
(adopting a “purpose” requirement).

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III.

CONCLUSION
For the foregoing reasons, Defendants respectfully request entry of an order staying

Defendants’ response to this Complaint, as well as any further progress in this litigation, until the
later of: (a) the Doe court’s decision on Defendants’ forthcoming August 4, 2011 motion to
dismiss, and (b) the Fourth Circuit’s decision in Aziz. This is the approach best tailored to
furthering the ends of justice, judicial economy, and the orderly resolution of both actions.

Dated: July 21, 2011

Respectfully submitted,

/s/ Lincoln O. Bisbee
Lincoln O. Bisbee (Bar No. 28953)
[e-mail]
MORGAN, LEWIS & BOCKIUS
1111 Pennsylvania Ave, NW
Washington, D.C. 20004
202.739.3000
202.739.3001 (fax)
Counsel for Defendant

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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that true and correct copies of the foregoing was served
electronically via ECF to the following:

Daniel S. Ward
WARD & WARD, P.L.L.C.
2020 N. St., NW
Washington, DC 20036
Counsel for Plaintiff

/s/ Lincoln O. Bisbee
Lincoln O. Bisbee
Counsel for Defendant

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