U.S. solicitor general’s office at Main Justice. Credit: Mike Scarcella/ ALM

The U.S. Supreme Court on Monday declined to review a foreign-owned corporation’s challenge to a federal grand jury subpoena believed to have been issued in connection with Special Counsel Robert Mueller’s investigation into Russian interference in the 2016 election.

The unnamed corporation from “Country A,” represented by a team from Alston & Bird, had argued that it was entitled to sovereign immunity and that complying with the subpoena would be in violation of its country’s own laws.

“If left to stand, the ruling would wreak havoc on American foreign policy—possibly alienating U.S. allies, undermining diplomatic efforts, and inviting reciprocal treatment abroad for American agencies and instrumentalities,” the company’s counsel, Brian Boone, a partner in Alston & Bird, argued. The D.C. Circuit decision was the “first appellate court in American history to exercise criminal jurisdiction over a foreign state,” the defense lawyers said in their petition.

U.S. District Judge Beryl Howell in Washington last year held the foreign entity in contempt when it refused to comply with the subpoena and imposed a daily fine of $50,000 until it complied.

The U.S. Court of Appeals for the D.C. Circuit affirmed the district court ruling in December. The appellate court, in rejecting the sovereign immunity argument, said:  “There is a reasonable probability the information sought through the subpoena here concerns a commercial activity that caused a direct effect in the United States.”

In the high court, U.S. Solicitor General Noel Francisco, urging the justices not to review the case, told the court that the dispute was a “poor vehicle” for addressing the immunity issues.

“This court has repeatedly described the [Foreign Sovereign Immunities Act as addressed to civil actions and has never suggested that it applies in the criminal context,” Francisco wrote. “The FSIA’s background, purpose, and legislative history confirm that its immunity provisions were designed to address civil cases.”

The Supreme Court’s order comes a day after a four-page summary of Mueller’s report was released to the public. The summary, prepared by U.S. Attorney General William Barr, largely exonerated the president.

Mueller’s prosecutors did not find evidence supporting a conspiracy between members of the Trump campaign and Russians. Mueller did not make a recommendation on obstruction. But Barr, consulting with Rod Rosenstein, his deputy, said the evidence was insufficient to bring an obstruction case against the president.

Several Mueller-related prosecutions and investigations are still ongoing in New York and Washington federal courts. But it was not immediately clear Monday whether the mystery company would be pressed to comply with the grand jury subpoena.

The special counsel’s office has not yet tried—publicly at least—to enforce the monetary penalty imposed against the foreign-owned company. The civil penalty, as of late February, has reached more than $2 million.

 

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