For Your Data Karaha Bodas Co 5 Perusahaan/Ministry Of Indonesia Illustration Brief Summary
March 03, 2019
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Karaha Bodas Co v Perusahaan/Ministry of Republic of Indonesia (2nd Cir 2002)
o Background:
§ P (US) together with D (Indonesia) executed a contract
· D waived “any correct of immunity”
· The contract didn’t address whether P had a correct to attach detail assets inward example of default or breach yesteryear D
§ Indonesia experienced a financial crisisàcontract was suspended
§ Indonesia Arbitration
· awarded P damages for lost investments together with profits
· P got the laurels enforced together with registered inward the US
§ Dist Ct New York
· D was to pay P out of D’s Production Sharing Percentage (i.e. D’s percentage of the cyberspace income), which D was transferred quest to the Rep of Indonesia
· Ct concluded that the Rep of Republic of Indonesia did indeed ain all the funds EXCEPT a 5% “Retention” portion, which belonged to D together with which P could thus attach
· D challenged, maxim that the Rep of Republic of Indonesia owned ALL the funds, including the Retention
o Issue: Who owns the disputed Retention funds, together with tin give the axe those funds live on attached nether New York Law? (a Choice of Law analysis)
§ Holding: Indonesia constabulary controls, together with nether that constabulary about of the funds belong to Indonesia; the remaining funds (the 5% “Retention”) belong to D together with tin give the axe live on attached
o Reasoning:
§ FSIA + Sovereign Immunityà
· A unusual sovereign shall live on immune from having his U.S.-located holding live on attached, EXCEPT every bit provided inward sections 1610 together with 1611
o §§1610 + 1611: when a unusual sovereign’s holding is used for a commercial activity inside the US, it does non taste the immunity
· Here:
o The contracts b/w P together with D used the holding for a commercial activity
o so D waived whatsoever correct of sovereign immunity, together with its percentage of the holding is thus attachable
§ Determining D’s share: Choice of Law (NY v Indonesia?)
· We should exercise Indonesian constabulary here, b/c
o 1) at that spot is no actual conflict of constabulary together with Republic of Indonesia provides the entirely specific rules together with
o 2) Republic of Indonesia has stronger Interests
· Under Indonesian law, D possesses the Retention funds
§ Attaching the Retention
· “Under NY law, a D has an involvement inward funds if whatsoever piece of job of the coin is inside the acquaint or hereafter command of D.”
· That is the example here, together with so the Retention is validly bailiwick to attachment