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BEHRING INTL., INC. v. IMPERIAL IRANIAN AIR FORCE

August 13, 1979

BEHRING INTERNATIONAL, INC., Plaintiff,
v.
IMPERIAL IRANIAN AIR FORCE, etc., et al., Defendants.



The opinion of the court was delivered by: FISHER

OPINION AUTHORIZING WRIT OF ATTACHMENT

I. INTRODUCTION

 This opinion authorizes the issuance of a writ of attachment directing the United States Marshal to seize certain property of the defendant Islamic Republic Iranian Air Force (hereinafter "I.R.I.A.F."), the successor of the Imperial Iranian Air Force ("I.I.A.F."), pending the resolution of plaintiff's suit against the defendants. The attachment is issued pursuant to the provisions of Fed.R.Civ.P. 64 and the New Jersey Attachment Statute, N.J.S.A. 2A:26-1 Et seq.

 After defendant's motions were denied on May 11, 1979, defendant applied to this Court for an order setting an amount to be deposited in a Trust Account established pursuant to an earlier court order *fn1" , in lieu of posting a bond, and an order requiring the release of the property upon the deposit of that amount. See New Jersey Civil Practice Rule 4:60-13. A hearing was held and in an oral opinion delivered from the bench on May 22, 1979, transcript filed June 1, 1979, I granted defendant's motion, setting approximately $ 2,500,000 as the total amount to be either paid to Behring or deposited in the trust account. *fn2" Defendant reserved all rights with respect to the monies to be deposited to secure the release of its property. *fn3"

 This occurred while the Order to Show Cause, with the accompanying Temporary Restraining Order, filed February 28, 1979, was still outstanding. The hearing on the Order to Show Cause was finally held on June 1, 1979 and I reserved decision on the numerous issues raised by the parties at that hearing. This opinion resolves these issues.

 II. THE PENDING APPLICATION

 The Order to Show Cause and Temporary Restraining Order directed the defendants to appear and show "why an Order should not be entered authorizing the issuance of a Writ of Attachment directing the U.S. Marshal to seize certain (of defendant's property)". Although it has never been absolutely clear whether plaintiff intended to proceed under Rule 65 or Rule 64 of the Fed.R.Civ.P., I deem the pending application to be one under Fed.R.Civ.P. 64. Rule 64 authorizes the use of the New Jersey Attachment Statute, N.J.S.A. 2A:26-1 Et seq. *fn4"

 A. The Probability that Final Judgment will be Rendered in Favor of Plaintiff.

 At the outset, the parties dispute the actual content of this requirement. Defendant contends that New Jersey Civil Practice Rule 4:60-5(a)(1) requires a showing that there is a reasonable probability that plaintiff will succeed on the merits, similar to the showing required for the issuance of a preliminary injunction under Fed.R.Civ.P. 65(a). See, e.g., Doe v. Colautti, 592 F.2d 704, 710-12 (3d Cir. 1979). Plaintiff, on the other hand, contends that the state cases require no more than a showing that plaintiff has a prima facie cause of action against the defendant. See, e.g., Tanner Associates, Inc. v. Ciraldo, 33 N.J. 51, 161 A.2d 725 (1960). I need not resolve this dispute because I believe that plaintiff has satisfied even the stricter showing which defendant would have me require.

 The affidavits filed to date in this action show overwhelmingly that plaintiff is likely to succeed in this action. The Verified Complaint, and the Affidavit of Attachment of George Murphy, an employee and officer of Behring, filed together on February 28, 1979, aver the existence of the Behring-I.I.A.F. agreement and Behring's performance under it at all relevant times prior to January 1979. Verified Complaint, Supra, Exhibit B. Mr. Murphy further swears that defendant breached the contract both by failing to approve invoices for goods shipped to Iran and by failing to send planes to pick up cargo ready for shipment. Although reference to the contract shows that there is in fact a question as to whether the failure to send planes constitutes a breach, the failure to approve invoices properly submitted would constitute a breach of that agreement. I.R.I.A.F. has proffered no evidence which contradicts the averments in Mr. Murphy's affidavit.

 The I.R.I.A.F., however, raises two affirmative defenses which are alleged to excuse its non-performance under the contract: force majeure and the Act of State Doctrine. See Answer and Counterclaim, filed May 18, 1979, First, Second, Third, and Fourth Affirmative Defenses. Before turning to the merits of these affirmative defenses, I note that I find it difficult to believe that defendant seriously presses them. I.R.I.A.F."s Memorandum of Law In Response To Order To Show Cause Why A Writ of Attachment Should Not Issue (hereinafter "I.R.I.A.F."s Responsive Memorandum") presents its conclusory allegations with regard to these defenses in two paragraphs without citing a single authority. Furthermore, I.R.I.A.F. does not support these allegations with any evidence. Even if I were to conclude that these doctrines were generally applicable, I would therefore have no factual basis for finding that I.R.I.A.F."s non-performance was excused. Defendant's failure to supply evidence does not hurt it, however, because I do not believe that the defenses are applicable here.

 1. Act of State.

 The traditional formulation of the Act of State doctrine is set out in Underhill v. Hernandez, 168 U.S. 250, 252, 18 S. Ct. 83, 84, 42 L. Ed. 456 (1897), where the Supreme Court stated:

 
Every sovereign state is bound to respect the independence of every other sovereign state, and the courts of one country will not sit in judgment on the acts of the government of another, done within its own territory. Redress of grievances by reason of such acts must be obtained through the means open to be availed of by sovereign powers between themselves.

  See Alfred Dunhill of London, Inc. v. Cuba, 425 U.S. 682, 691 n. 7, 96 S. Ct. 1854, 48 L. Ed. 2d 301 (1976). The doctrine, however, distinguishes between the public and governmental acts of sovereign states and their private and commercial acts. The doctrine does not preclude me from considering the "repudiation of a purely commercial obligation owed by a foreign sovereign or by one of its commercial instrumentalities". Alfred Dunhill of London, Inc., supra, 425 U.S. at 695, 96 S. Ct. at 1861. Even when applicable the doctrine only serves to preclude certain issues from consideration by the court; it does not render an entire case or controversy non-justiciable. See National American Corp. v. Federal Republic of Nigeria, 448 F. Supp. 622, 640 (S.D.N.Y.1978).

 As is indicated by my Opinion Maintaining Restraints, all parties to this action have proceeded upon the assumption that I.R.I.A.F."s activities in this country were commercial in nature. This Court so held in determining that subject matter jurisdiction over this controversy existed by virtue of 28 U.S.C. ยง 1330(a). See Opinion Maintaining Restraints, supra at 402 - 403 (D.C.). Finally, it can be argued that the breaches of contract committed by I.R.I.A.F. occurred In this country, when the I.R.I.A.F. representative in New York City refused to approve invoices for payment. *fn5"

 I therefore conclude that the Act of State doctrine in no way diminishes the probability that Behring will succeed in this litigation.

 2. Force Majeure.

 The traditional formulation of the doctrine of force majeure (Vis Major) may be found in Blacks Law Dictionary (Rev'd 4th ed. 1968):

 
A greater or superior force; an irresistible force. A loss that results immediately from a natural cause without the intervention of man, and could not have been prevented by the exercise of prudence, diligence, and care. A natural and inevitable necessity, and one arising wholly above the control of human agencies, and which occurs independently of human action or neglect. In the civil ...

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