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Price v. Socialist People's Libyan Arab Jamahiriya

November 23, 2004

MICHAEL H. PRICE AND ROGER K. FREY, APPELLEES
v.
SOCIALIST PEOPLE'S LIBYAN ARAB JAMAHIRIYA, APPELLANT



Appeal from the United States District Court for the District of Columbia (No. 97cv00975)

Before: Ginsburg, Chief Judge, and Edwards and Roberts, Circuit Judges.

The opinion of the court was delivered by: Ginsburg, Chief Judge

Argued September 28, 2004

Michael Price and Roger Frey sued the Socialist People's Libyan Arab Jamahiriya, better known as Libya, pursuant to the terrorism exception to the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. § 1605(a)(7), alleging various causes of action arising from their detention in that country in 1980. The district court denied Libya's motion to dismiss and Libya appeals, arguing that (1) sovereign immunity protects it from suit because the plaintiffs, in depositions in another case, contradicted key allegations in their complaint here, and in any event (2) Price and Frey have not stated a cause of action.

We conclude the facts recited in the amended complaint are, notwithstanding possible tension between them and the story told in the depositions, sufficient under the terrorism exception to the FSIA to divest Libya of its immunity from suit. We do not reach the question whether the complaint states a cause of action because doing so would require us to exercise pendent appellate jurisdiction, for which there is no basis in this case.

I. Background

In 1997 Price and Frey sued Libya, seeking $40 million in damages for hostage taking and torture, which acts they argued divested Libya of its immunity pursuant to the terrorism exception to the FSIA. Neither party disputes that in March, 1980 Price and Frey, American citizens working in Libya for a Libyan company, were arrested in Libya and charged with taking photographs for an illegal purpose. Price and Frey were eventually tried and acquitted of the charge of taking illegal photographs and later were permitted to leave Libya. Beyond these basic facts, however, it seems the plaintiffs and Libya, which has not yet had an opportunity fully to tell its side of the story, differ as to many important details of the plaintiffs' detention and trial.

Price and Frey maintained in their original complaint that they were "incarcerated in prison in Tripoli for ... 105 days," during which time they were subject to "physical, mental and verbal abuse," including being "[p]rovided inadequate food," "denied any dental care," "given a urine soaked mattress on which to sleep," and "kicked, clubbed and beaten by the prison guards." The complaint also stated Libyan officials informed the plaintiffs their incarceration "was the for the purpose of demonstrating [Libya's] support for the government of Iran which held hostages in the U.S. embassy in Teheran."

Libya moved to dismiss the plaintiffs' complaint, contending: (1) the FSIA is unconstitutional insofar as it delegates to the Executive Branch legislative authority to determine which countries are amenable to suit under § 1605(a)(7); (2) the court's exercise of personal jurisdiction over Libya would violate that nation's right to due process; and (3) the plaintiffs failed to state a claim upon which relief could be granted. The district court denied Libya's motion, see Price v. Socialist People's Libyan Arab Jamahiriya, 110 F. Supp. 2d 10 (D.D.C. 2000), and Libya pursued an interlocutory appeal, which we decided in 2002. See Price v. Socialist People's Libyan Arab Jamahiriya, 294 F.3d 82 ( Price II ).

After analyzing the "stringent definition" of "torture" in the terrorism exception to the FSIA, we observed that the plaintiffs' complaint "offer[ed] no useful details about the nature of the ... beatings [they] allegedly suffered" and said "virtually nothing about the purpose of the alleged torture." Id. at 93- 94. Accordingly, we remanded the matter to the district court "to allow plaintiffs to attempt to amend their complaint" so as to bring their claim within the terrorism exception. Id. at 94. We also held the claim for "hostage taking" should have been dismissed because "even when read most favorably to [the plaintiffs] ... [the] complaint point[ed] to no nexus between what happened to [the plaintiffs] in Libya and any concrete concession that Libya may have hoped to extract from the outside world." Id. at 94.

On remand the district court granted the plaintiffs' motion to amend the complaint. As amended, the complaint makes several new factual allegations pertinent to this appeal, including that during "months of incarceration" the plaintiffs experienced repeated "extra-judicial acts of torture," including "continuous[ ] and intentional[ ]" beatings and threats of "severe physical pain" and of "imminent death." The amended complaint further alleges the plaintiffs were "forced to watch either a beating or a killing of a fellow prisoner for the purposes of forcing [them] to confess to being spies," and that they were visited by an attorney who told them "they would likely receive the death penalty for spying if they did not confess." Once again Libya moved to dismiss, this time arguing: (1) our decision in Price II had foreclosed consideration of the claim for hostage taking; (2) the district court lacked subject matter jurisdiction because key allegations in the amended complaint were contradicted by depositions the plaintiffs filed in the case they had brought in New York against the company that had employed them in Libya; and (3) the Flatow Amendment, 28 U.S.C. § 1605 (note), a source of substantive law invoked in the amended complaint, does not create a cause of action against a foreign state.

After a hearing the district court granted Libya's motion to dismiss the claim for hostage taking. Price v. Socialist People's Libyan Arab Jamahiriya, 274 F. Supp. 2d 20, 22-23 (D.D.C. 2003) ( Price III ). With regard to subject matter jurisdiction, however, the court -- applying our instruction in Phoenix Consulting v. Republic of Angola, 216 F.3d 36 (2000), to go beyond the pleadings insofar as necessary to resolve disputed facts bearing upon a foreign sovereign's immunity -- held the amended complaint stated a cause of action for mental torture within the terrorism exception to the FSIA. Price III, 274 F. Supp. 2d at 25-26. Finally, the district court ruled that the Flatow Amendment, in conjunction with the terrorism exception, created a cause of action against a foreign state. Id. at 27-29. Again, Libya filed an interlocutory appeal.

II. Analysis

Libya makes two alternative arguments. First, Libya contends the district court lacks subject matter jurisdiction because the factual allegations of the amended complaint were discredited by inconsistent statements in the plaintiffs' New York depositions. Second, Libya argues the plaintiffs failed to state a claim upon which relief can be granted because, after the district court issued its decision, we held in Cicippio-Puleo v. Islamic Republic ...


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