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Another Middle Eastern country is at war in America — a legal war, that is. And it’s losing. On Oct. 31, Jordan lost another round in its effort to end a long-running dispute over the ownership of a jet plane. The 5th U.S. Circuit Court of Appeals held in Hashemite Kingdom of Jordan v. Layale Enterprises S.A. that a federal district court lacks jurisdiction in the case. “It’s a pretty simple case, but Jordan made it complex,” says Robert Knebel Jr., Layale’s attorney and a partner in Fernandez & Gibbs in Dallas. Stuart Newberger, who represents Jordan, says the kingdom got into the case to protect its sovereign immunity. “We’re just frustrated because the courts keep closing the doors on us,” says Newberger, a partner in Crowell & Moring in Washington, D.C. Newberger says his clients will seriously consider asking the U.S. Supreme Court to hear the case. At issue, he says, is the role of the federal courts in disputes involving foreign countries. “Needless to say, this case is quite unusual,” Judge Rhesa Hawkins Barksdale, the author, said in the 5th Circuit’s opinion in which he was joined by Senior Judge Henry Politz and U.S. District Judge Eldon Fallon of the Eastern District of Louisiana. Jordan initiated the action in December 1999 through its ambassador, Dr. Marwan Muasher, and alleged that the sequestration of the Boeing 727-200 aircraft by the Tarrant County, Texas, sheriff violated its immunity as a foreign sovereign and must be dissolved. In its complaint, Jordan alleged that Rifaat Al Assad of Syria — the father of the president of Layale, a Panamanian company — had owned the aircraft, which he had transported to Jordan in October 1992. Jordan alleged that it was given the aircraft by Al Assad after the Royal Jordanian Airlines Corp., an entity wholly owned by the kingdom, estimated costs at more than $2 million for service, repairs, accumulated rental charges and other expenses necessary to make the plane airworthy. ROYAL CONNECTION Jordan further alleged that the aircraft ultimately was conveyed to two members of its royal family — Prince Talal bin Mohammed and Princess Ghida Talal — who were issued a temporary registration by the kingdom’s civil aviation authority in 1996. Layale alleged in its response that the aircraft is registered in the Cayman Islands and that the registration never has been discontinued. Knebel says Layale presented in evidence a bill of sale dated Feb. 26, 1987. Barksdale noted in the opinion that the prince and princess entered into an operating agreement with Arab Wings Co., a wholly owned subsidiary of Royal Jordanian, in March 1996. The contract was renewed a year later but expired in April 1998, the opinion said. Before they entered into the agreement with Arab Wings, the royal family members leased the plane to HMS Aviation, a Jordanian company, the opinion said. The lease agreement provided that HMS would renovate and refurbish the plane, which was taken to Meacham Field in Fort Worth, Texas, for servicing, Barksdale wrote. Knebel says Layale found the plane in Fort Worth and filed a suit in the 67th District Court to prove the company owned it. Layale also put up a $5,000 bond and obtained a court order to have the plane sequestered, the 5th Circuit said in the opinion. The opinion said HMS had the case removed to federal court in May 1997, but Layale succeeded in remanding the case to state court two months later. Jordan intervened in August 1998, claiming its federal sovereign immunity barred any court in the United States from taking action on the aircraft, the opinion said. U.S. District Judge Terry Means of the Northern District of Texas in Fort Worth remanded the case to state court in early 1999. The 5th Circuit opinion said Means noted that Layale’s petition did not name Jordan as a party, so the action was not against a sovereign. Jordan filed a petition for mandamus and appealed, but the 5th Circuit rejected both. In its latest action, Jordan attempted to establish the federal district court’s jurisdiction over the sovereign immunity issue by having the ambassador bring the action. The 5th Circuit held that the lower court lacks jurisdiction because the action was brought by the ambassador rather than against him. Barksdale pointed out that no relief is sought against the ambassador in either the federal action or the underlying state-court proceeding. “Whatever interest of Jordan in the aircraft may be at issue, it is not an interest held by Jordan’s ambassador,” he said in the opinion. “I don’t know why Jordan is in this lawsuit,” Knebel says, adding that Jordan doesn’t claim it owns the plane and is not seeking ownership of it. While Jordan does not argue that it owns the plane, Newberger contends that the suit is against the kingdom’s interests. He contends Layale did not claim ownership of the plane until after all the money was poured into repairs on it. The 5th Circuit said in the opinion that Jordan’s interest appears to be in the operating agreement that the prince and princess have with Arab Wings. To rise to the level of “property” covered by the Foreign Sovereign Immunities Act, an asset would have to be owned by a country, the court said in a footnote to the opinion. Newberger says the current turmoil in the Middle East could heighten the U.S. Supreme Court’s interest in this case because Jordan is one of the United States’ closest allies. Forcing Jordan to go to a state court in Fort Worth over this aircraft is an insult, he says.

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