Republic of Congo Wins Ruling on Motion to Transfer for Lack of Venue

Cleary Gottlieb won a victory for the Republic of Congo on April 27 when District Judge John F. Keenan granted its motion to transfer to the District of Columbia claims brought in the Southern District of New York by plaintiff Commissions Import Export to recognize a judgment confirming an arbitral award it obtained against the Congo in the United Kingdom. This was the first decision to rule on the appropriate standard for venue in federal court in an action to recognize a foreign judgment. The plaintiff argued that the alleged presence of Congo property in New York that might be used to satisfy a U.S. judgment (recognizing its UK judgment) was sufficient to lay venue in the Southern District. The court rejected this argument and agreed with the Congo that the alleged presence of property in the district that might be used to satisfy an as yet unobtained U.S. court judgment cannot form the basis for venue in an action for the recognition of a foreign money judgment. The court also agreed with the Congo that a “substantial part of the events” underlying a foreign money judgment must have occurred in the district in which a recognition action is brought. The court transferred the case to the District of Columbia because in an action against a foreign sovereign, unless proper elsewhere, venue exists only in that district.