An upcoming U.S. Supreme Court battle pits two of the strangest bedfellows, the United States and Venezuela, against a U.S. oil company in a far-reaching dispute that could open the door to more lawsuits against foreign governments.
Likely to draw worldwide attention, oral arguments are scheduled for Wednesday on whether Venezuela violated international law by seizing oil-drilling rigs that belong to an Oklahoma-based oil company, Helmerich & Payne International.
The practical matters of the case date to 2010, when the late Venezuelan President Hugo Chavez nationalized American oil companies. But the more significant issue before the high court is whether the case violates customary international law that usually grants countries immunity from legal proceedings in another nation.
The Obama administration doesn’t defend Venezuela’s actions but says allowing its prosecution undermines the concept of sovereign immunity and could prompt other nations to retaliate by stripping U.S. immunity in other parts of the world.
“This case has the potential to be a blockbuster, as it will define when suits against foreign governments get through the courthouse door,” said Trey Childress, professor of law at Pepperdine University School of Law.
Childress notes the court will hear the case just a month after the House of Representatives and the Senate in September rejected President Barack Obama’s veto of a bill that would allow families of the victims of the Sept. 11 terrorist attacks to sue Saudi Arabia for any role it had in the operations. It was the first successful override of a presidential veto since Obama took office.
This case has the potential to be a blockbuster.
Trey Childress, Pepperdine University School of Law
The White House blasted that decision by Congress, arguing it could put American diplomats, military service members and government assets abroad at risk of legal action should other countries pass similar laws.
“I would venture to say that this is the single most embarrassing thing that the United States Senate has done, possibly, since 1983,” Obama spokesman Josh Earnest told reporters in late September aboard Air Force One.
The Saudi lawsuit legislation amends U.S. law to allow suits against foreign sponsors of terrorism, but it’s relevant in this case because both cases apply to the same 1976 law, the Foreign Sovereign Immunities Act, that grants other countries broad immunity from American lawsuits.
The Venezuelan government argued that simply allowing Helmerich & Payne to subject Venezuela to litigation by pleading discrimination was likely a violation of Venezuela’s sovereignty.
“Foreign sovereign immunity is supposed to protect foreign states from the burdens of litigation,” the Venezeulan government wrote in its brief to the Supreme Court.
Foreign sovereign immunity is supposed to protect foreign states from the burdens of litigation.
Venezuelan government
In a 28-page amicus brief for the United States, former Solicitor General Donald B. Verrilli Jr. cited the sensitive issues related to the foreign relations of the United States that could result in retaliatory actions by other nations.
“That permissive approach may result in adverse foreign-relations consequences and reciprocal adverse treatment of the United States in foreign courts,” he wrote.
Email: fordonez@mcclatchydc.com; Twitter: @francoordonez.
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