Never have I believed that
all monies appropriated for National Security, so far as the Book Haram
insurgency is concerned, entered into a python mouth. While I tick the likelihood
of many misappropriations, I cannot mount faint eyelids under my brows to the
singularity that some terms were caught in the web of aborted covenants, and
this, I shall bear out on the Dolarian deal.
Of certainty, the Dolarian
was seen when I penned a project on Leahy
Law and Terrorism in Nigeria, tasking my pen on the possible waivers of the
Foreign Assistance Act, 1961, Arms Export Control Act, and making coinages like
the Book Excuse, which I shall speak
of in a later piece. And from that time on the passage, I perceived the
Dolarian as one Martial deal, the Nigerian Army shelved in its parchments.
Howbeit, in this piece, we
shall be looking at the Dolarian terms, the bench’s rationales like the Eitel Factors in its analysis, and of
course, a failed deal. All these we shall see from one recommendation fora
default judgment in SocieteD'equipmentsInternationaux Nigeria, Ltd., v.
Dolarian Capital, Inc., And Ara G. Dolarian, Defendants (Case No.
1:15-cv-01553-GEB-SKO), somewhere in California in 2015. Well, I am not awareof
anadoption or a set aside.
SEI, which is in the business
of acquiring various military assets and munitions[,] primarily for the
Nigerian armed services, contracted with the Nigerian military to acquire and
deliver various military assets and munitions for the use of the Nigerian
military in combating the Boko Haram insurgency (Compl., ¶ 8; Aboubakar Decl.,
¶ 10.). SEI then contacted DCI's agent, Marion Ford, to discuss potential arms
transactions whereby DCI would procure and sell military assets and munitions
to SEI for use by the Nigerian military. (Aboubakar Decl., ¶ 7.) Ford
represented to SEI that DCI either had or would be able to acquire the military
assets and munitions the Nigerian military needed, and had contacts and
connections that would enable DCI to export these assets and munitions to
Nigeria. (Adopted).
DCI and SEI signed several
contracts, totaling in value to $246,433,542.50. One of these contracts, signed
in June 2014, involved the sale and supply of military assets and munitions for
the sum of $8,616,042.50. As a condition of the contracts, SEI was to pay a
deposit in the amount of "50% of the contract value" at the time of
"signing and sealing of the contract" and was to provide DCI "with
the necessary End User Certificate(s)" for export. Part payments were
made. However, DCI failed in delivering the items. As recorded, SEI cancelled
the June 2014 contract by letter dated May 7, 2015, based on the "constant
delay of execution of the contract" and DCI's "[f]ailure to obtain
export license[s], and then demanded return of the money already paid.
By letter dated May 15, 2015,
DCI agreed "to cancel [the June 2014 contract] in [the] amount of
$7,823,646.57" and apply the amount as a credit against another contract
entered into between SEI and DCI. DCI further demanded an additional
$2,583,890.93 "due and payable" on this second contract. (Aboubakar
Decl., Exh. F.) DCI refused and failed to return any amount of the
$8,618,646.57 it received. (Compl., ¶¶ 18, 40; Aboubakar Decl., Exhs. E, F, G.)
The five signed agreement
totaled $246,433,542.50 and were for A (sale of six Mi-24/Mi-35 helicopters); B
(sale of six DEFA Type 553 revolver cannons, arming wire for high explosive
bombs, a Marta 155 Type rocket launch pad, 1,000 high explosive bombs, 25,000
rounds of helicopter revolver ammunition, 5,000 68 mm SNEB antiaircraft rocket,
helicopter pylon cartridges); C (50 20x110 mm single-barrel autocannons); D
(50,000 rounds of autocannon ammunition); E (30 T-72 MBTs (main battle tanks);
20 Zu-23-4 23 mm 4 lightly armored anti-aircraft tracked vehicles, 400,000
Zu-23-4 ammunition rounds, 13,500 125 mm T-72 high explosive rounds, 1,500 125
mm APFSDS-T armor-piercing anti-tank ammunition rounds).Failure of DCI to
fulfill its own part of the contract led to the suit.
On October 9, 2015, the suit
was filed. On November 18, 2015, proceeding pro se, Dolarian filed an answer
"by and for himself and on behalf of [DCI]," a Counterclaim for
breach of contract against SEI, and a third-party complaint against Amanda
Giovanni, a defense contractor. On November 30, 2015, the Court struck the
answer as to DCI pursuant to Local Rule 183(a), which prohibits a corporation
or other business entity from appearing in federal court without counsel, and
entered default against DCI, and on January 12, 2016, dismissed the
counterclaim pursuant to Fed. R. Civ. P. 12(b)(1). (Docs. 15; 23.)
On November 19, 2015, SEI
filed a request for the Clerk of Court to enter default against Defendant DCI,
and on November 30, 2015, default was entered. (Docs. 10; 16.) On March 15,
2016, SEI filed a motion for default judgment against Defendant DCI pursuant to
Federal Rule Civil Procedure 54(b) seeking damages in the amount of
$8,618,646.57 and costs in the amount of $738.43. (Docs. 32; 33). Defendant DCI
did not file an opposition.
On the discussion, the court
per SHEILA K. OBERTO, Magistrate
Judge of United States District Court, E.D. California, held that the Court may
exercise personal jurisdiction over DCI in line with the court rules and that
the contracts at issue do not violate the Arms Export Control Act, (AECA). But
I shall talk about the AECA later in the piece.
Now let us look at the act of
entering a Default Judgment, where the EitelAnalysis
lies. For Eitel, seven factors stand that a district court must consider in
exercise of its discretion. Videlicet: the possibility of prejudice to the
plaintiff; the merits of the plaintiff's substantive claim; the sufficiency of
the complaint; the sum of money at stake in the action; the possibility of a
dispute concerning material facts; whether the default was due to excusable
neglect; and the strong policy underlying the US Federal Rules of Civil
Procedure favoring decisions on the merits. See Eitel v. McCool, 782 F.2d 1470,
1471-72 (9th Cir. 1986). Considering the factors all on merits, it concludes
that all factors favor the entry of default judgment against DCI in the amount
of $8,618,646.57.
And then, on Frow Standard, the court held that
exercise of the Court's Discretion to Enter Default Judgment against fewer than
all defendants is appropriate, adding that,Frow does not preclude entry of
default judgment against DCI. On circumstances the court recommended, it held:
“Here, like Shanghai Automation, "because
differing judgments would not necessarily be illogical, Frow does not apply,
and the Court retains discretion to enter default judgments against less than
all defendants under Rule 54(b). This is an appropriate case to exercise such
discretion." Id. at 1009-10.There are strong reasons favoring entry of a
default judgment against DCI even though defendant Dolarian will remain in the
case. Nearly all the factors enumerated in Eitel v. McCool , militate in SEI's
favor. See supra. Further weighing in favor of granting default judgment at
this stage is the danger that any damages awarded is likely to become
increasingly uncollectible with the passage of time. Cf. In re Uranium
Antitrust Litig., 473 F. Supp. 382, 390 (N.D. Ill. 1979) (plaintiff faced the
possibility that the "defaulting defendants, which are all foreign
corporations, may conceal or transfer their assets which are subject to
execution by United States Courts"). There is significant risk of
prejudice if entry of judgment against DCI is delayed, in that the damages
sought are significant, and defendant Dolarian has previously represented to
the Court that the United States government has seized some or all of the funds
paid to DCI by SEI under the June 2014 contract (see Answer, ¶ 18 (stating that
"Defendants admit that they have not returned funds provided by SEI, as
those funds have been improperly seized by the United States Government and [ ]
are not in Defendants' possession, custody, or control")). Regardless of
the reason the money has been seized, SEI has sufficiently demonstrated the
risk of prejudice by a delayed grant of default against DCI.”
Now back to AECA again, we
can see how DCI failed in getting the necessary licenses after many
representations which were surely missed.
I guess the district’s recommendation is fine on the gavel.
Generally, export of arms,
munitions, weapons, equipment for military use and related components, and the
technology to design, build, and test such items out of the United States is
regulated by US Federal Law, one of
which is the Arms Export Control Act. The president of the USA delegated the
authority to regulate the export of defense articles and defense services to
the Secretary of State, which ordinarily is the responsibility of the US
President. Basically the president is authorized to control the import and
export of defense articles and defense services in furtherance of world peace,
national security, and the foreign policy of the United States and to establish
and maintain a United States Munitions List (the "Munitions List",
which is known as a catalog of designated defense articles and defense services
that are subject to export restrictions; though the list is not without an
exception as in the "normal commercial use". But generally, Items
designated by the President are not to be exported without a license for such
export from the United States Department of State. 22 U.S.C. § 2278(b)(2).
The contracts between SEI and
DCI included a provision requiring DCI to obtain the necessary licenses from
the State Department in compliance with ITAR, they do not violate the AECA.
Further, SEI allegedthat DCI's failure to obtain the necessary licenses from
the State Department caused the breach, supporting an inference that the
parties formed the contract with the express intent to comply with the AECA,
and DCI does not contend that the contracts are unenforceable. SEI was said to
have met its burden of demonstrating that the contracts do not violate the AECA
and that damages may be recovered for DCI's breach as recorded.
On the recommendation,
default judgment was to be GRANTED against defaulting defendant in the amount
of $8,618,646.57.
California law provides that, "[f]or the breach
of an obligation arising from contract, the measure of damages, except where
otherwise expressly provided by this Code, is the amount which will compensate
the party aggrieved for all the detriment proximately caused thereby, or which,
in the ordinary course of things, would be likely to result therefrom."
Cal. Civ. Code § 3300. In addition, breach of contract damages must be
"clearly ascertainable in both their nature and origin." Id., § 3301.
For me, three things are
paramount on the Dolarian: One, grant of licenses for some preferred arsenals
as shielded by the US WAR GUIDE; Two, the biased Leahy Law which I have once
criticized, having subjected the fusion
to an impartiality test I modeled, other criticisms such as the Doug Stoke’s
four weaknesses, my argument of the Book
Excuse, and thirdly, the appropriations which I believe are hidden to many
but known to few.Indeed, there are more tales than the Dasukigate; there are
the Dolarian and its failed deal.
By
Ebi Robert
Email:
[email protected]