Preble-Rish Haiti, S.A. v. Republic of Haiti

Background

Preble-Rish Haiti, S.A. sought maritime attachment under Rule B in support of an arbitration-related judgment against the Republic of Haiti and the Bureau de Monétisation des Programmes d’Aide au Développement (BMPAD), a Haitian governmental agency. The attachments involved two accounts held in the name of Banque Nationale de Crédit (BNC): an account at the Bank of New York Mellon holding approximately $29 million and an account at Raymond James & Associates, Inc. holding approximately $29 million.

BNC was not originally a party. It described itself as a legally distinct and autonomous commercial bank created by Haiti’s Legislative Chamber and wholly owned by the Republic of Haiti. BNC argued that the funds belonged exclusively to it and that neither Haiti nor BMPAD had an interest in the accounts. Preble-Rish did not oppose BNC’s request to intervene but disputed whether the accounts were protected from attachment and whether the defendants had an ownership interest in the funds. Preble-Rish also requested additional discovery about the source of the funds.

Intervention

The court granted BNC intervention as of right under Federal Rule of Civil Procedure 24(a)(2). The court found that BNC’s motion was timely, that denying intervention could significantly prejudice BNC, and that BNC had an interest in the attached property. The court also found that the existing parties might not adequately protect BNC’s interests because Haiti, BMPAD, and BNC are legally and functionally distinct entities.

Foreign Sovereign Immunities Act

The Foreign Sovereign Immunities Act (FSIA) generally protects property in the United States belonging to a foreign state from attachment, subject to statutory exceptions. The court concluded that BNC qualified as an agency or instrumentality of a foreign state because it was a separate legal entity wholly owned by Haiti and was not a United States citizen or an entity created under the law of a third country.

The court therefore treated the BNC accounts and their funds as property in the United States of a foreign state. It applied the strong presumption that a foreign state’s legally separate instrumentality remains separate from its owner. The court found no allegation or record support showing that Haiti or BMPAD exercised the degree of control needed to create a principal-agent relationship, or that recognizing BNC’s separate legal status would cause fraud or injustice.

The court rejected Preble-Rish’s reliance on FSIA sections 1610(a)(6) and 1610(d). The judgment underlying the attachment was based on an arbitral award against Haiti and BMPAD, not BNC. The court also found that Preble-Rish had not provided sufficient evidence that the attached accounts contained funds belonging to Haiti or BMPAD. Evidence cited by Preble-Rish did not identify either attached account as belonging to a defendant. By contrast, declarations from BNC, the Bank of New York Mellon, and Raymond James supported the conclusion that the accounts were in BNC’s name and that the funds belonged to BNC.

Rule B Attachment

The court separately held that the attachments were improper under Rule B. Rule B maritime attachment depends on showing that the attached property belonged to the defendant when it was attached. The court found insufficient evidence that either account or its funds belonged to Haiti or BMPAD rather than BNC. This independently required vacating the attachments.

Discovery

The court denied Preble-Rish’s request for discovery concerning the BNC accounts. It explained that sovereign immunity protects against the costs and burdens of litigation and that discovery concerning immunity is appropriate only to verify specific facts important to the immunity determination. Given the substantial evidence that the accounts belonged exclusively to BNC, the court found it unclear what additional information could rebut that evidence.

The court noted that a separate motion concerning the deposition of Michel Patrick Boisvert, and a pending motion concerning Haiti’s request for relief from the judgment in an earlier round of the case, remained unresolved. It stated that the order did not affect either pending matter.

Disposition

BNC’s motion to intervene was GRANTED. BNC’s motions to vacate the attachments of the BNC Mellon Account and the BNC RJAI Account were GRANTED. Preble-Rish’s request for discovery concerning those accounts was DENIED. The court also directed Preble-Rish to file two referenced exhibits on the docket within seven days and directed the Clerk to terminate the motions identified as Document 64.