No. 09-944

MAR 2 9 2010OFFICk L~ ,r~: ~LERK

~n tl)e ~upreme ~ourt o[ t~e ~niteb ~tate~

PLACER DOME, INC. AND BARRICK GOLDCORPORATION,

Petitioners,

Vo

PROVINCIAL GOVERNMENT OF MARINDUQUE,Respondent.

ON PETITION FOR A WRIT OF CERTIORARITO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

PETITIONERS’ REPLY TO BRIEF INOPPOSITION

JERROLD J. GANZFRIEDCounsel of Record

EDWARD HAN~ARTIN CUNNIFFHOWREY LLP1299 Pennsylvania Ave., N.W.Washington, D.C. 20004ganzfriedj@howrey.com(202) 783-0800

Attorneys for PetitionersPlacer Dome, Inc. and BarrickGold Corporation

March 29, 2010

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TABLE OF CONTENTS

TABLE OF AUTHORITIES .......................................ii

INTRODUCTORY STATEMENT ...............................1

I. RESPONDENT CANNOT RECAST THEFUNDAMENTAL NATURE OF THECASE ....................................................................1

II. UNDER ANY VIEW OF THE RECORD,SIGNIFICANT QUESTIONS MERITTHIS COURT’S ATTENTION ............................4

III. THE EXISTING SPLIT AMONG THECIRCUITS SHOULD BE RESOLVED ...............8

CONCLUSION ..........................................................12

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TABLE OF AUTHORITIES

CASES

Banco Nacional de Cuba v. Sabbatino,76 U.S. 398 (1964) ............................................... 9

Hertz Corp. v. Friend,No. 08-1107 (U.S. Feb. 23, 2010) ........................2

Patrickson v. Dole Food Co.,251 F.3d 795 (9th Cir. 2001) ......................... 8, 10

Pearson v. Callahan,129 S. Ct. 808 (2009) ....................................... 7, 8

Provincial Government of Marinduque v.Placer Dome, Inc.,No. 07-16306 (9th Cir. Sept. 15, 2008) ...............9

Ruhrgas AG v. Marathon Oil Co.,526 U.S. 574 (1999) ............................................. 8

Sinochem International Co. v. MalaysiaInternational Shipping Corp.,549 U.S. 422 (2007) ......................... 1, 4, 5, 6, 7, 8

W.S. Kirkpatrick & Co. v. EnvironmentalTectonics Corp.,493 U.S. 400 (1990) ...........................................10

INTRODUCTORY STATEMENT

As the petition sets forth, this case presentstwo recurring questions of great practicalsignificance on which the federal judiciary sorelyneeds this Court’s guidance. Respondent’s oppositionmerely underscores the urgency and importance ofthis Court’s review. On the one hand, respondentcontends that the critical issue of subject matterjurisdiction in this case - the federal common law offoreign relations - was not decided by either thedistrict court or the court of appeals and, moreover,that the district court "conducted none of thenecessary fact-finding to establish jurisdiction onthat basis." Br. in Opp. at 1-2. See also id. at 8, 27.On the other hand, respondent contends that thesequencing of issues permitted by Sinochem Int’l Co.v. Malaysia Int’l Shipping Corp., 549 U.S. 422 (2007)- forum non conveniens before subject matterjurisdiction - is not even implicated here becauseboth lower courts ruled on subject matterjurisdiction. Br. in Opp. at 1. That internalinconsistency in respondent’s argument permeatesthe entire brief in opposition, which, ultimately,offers no justifiable basis for denying certiorari.

RESPONDENT CANNOT RECAST THEFUNDAMENTAL NATURE OF THECASE

At the outset, the Court should be mindful ofrespondent’s rhetorical legerdemain that seeks torecast the case as something that it is not. At nopoint in its opposition brief does the ProvincialGovernment ever identify the mine operator and

alleged tortfeasor by name - i.e., Marcopper MiningCompany. To do so, of course, would highlight theundisputed fact that the mining company whoseconduct is challenged was a Philippine entity ownedin largest part either by Philippine governmentofficials or agencies. Pet. App. 122a.

Also missing from the brief in opposition is theword "Canada," even though petitioner Placer Dome,Inc. was a Canadian company headquartered inCanada and continued to be a Canadian companywhen it was amalgamated with petitioner Barrick.1Instead, respondent refers to Nevada as "theoperational center of Barrick’s worldwide operations"(Br. in Opp. at 4) - an assertion that is incorrect,unsupported by the record, and wholly irrelevant tothe issues presented in the petition. Cf. Hertz Corp.v. Friend, No. 08-1107 (U.S. Feb. 23, 2010).

Respondent’s creative wordsmithing cannottransform the essential nature of this case: a lawsuitby a provincial government of the Republic of thePhilippines that challenges actions by a Philippinecompany (Marcopper) in which, at all relevant times,the largest shareholder was either the President of

1 Respondent refers briefly to petitioners’"remarkabl[e]" argument in the lower courts for dismissalunder forum non conveniens in favor of a BritishColumbia forum. Br. in Opp. at 6-7. The suggestion of aCanadian forum could be considered remarkable only ifone ignores, as respondent does, that Placer Dome was aCanadian company that amalgamated with "old" BarrickGold Corporation to form another Canadian company -i.e., "new" Barrick Gold Corporation. Pet. App. 25a.

the Philippines2 or the Philippine Commission onGood Government. Pet. App. 94a.

In short, this case is principally an internaldispute between different levels of the Philippinegovernment. The underlying claims, therefore,directly implicate delicate issues of foreign relations.Indeed, the case has the potential to entangle thejudiciary of this country in disputes over regulatoryand policy decisions made by the federal governmentof the Philippines concerning the extraction ofnatural resources that were unpopular withprovincial governments of the Philippines. Undersettled principles, subject matter jurisdiction to

2 Marcopper was owned and managed by a number ofpresidential administrations. The complaint expresslychallenges actions of the Philippines government underthe administrations of Presidents Ferdinand Marcos(1965-1986), Corazon Aquino (1986-1992), and FidelRamos (1992-1998). The complaint alleges thatMarcopper was involved in destructive mining activitiesin the Province of Marinduque from 1964 to 1997, thusextending long after Marcos’ departure. Pet. App. l14a-l15a. Two of the three environmental disasters alleged inthe complaint - the 1993 Maguila-Guila Dam collapseand the 1996 Boac River tailings plug collapse, which thebrief in opposition (at 3) labels the "most cataclysmic" -occurred when President Ramos was in power many yearsafter President Marcos had been removed. Moreover, theoperating permits that the complaint challenges wererenewed annually by the national government andattempts to revoke those government-issued permits wererebuffed by the Aquino administration. Pet. App. 128a,129a.

decide whether the case should proceed rests in aUnited States district court rather than a state court.

Another inherent foreign relations aspect ofthe case is whether the United States, through itscourts, should prescribe rules of conduct and liabilityunder foreign law for Canadian companies thatinvest in non-U.S, entities. In this regard, the Courtmust be mindful of the fact that petitioner PlacerDome was merely a minority shareholder of theMarcopper company. Indeed, Philippine law strictlylimited the extent of non-Philippine ownership. Pet.App. 122a.

By their very nature, the ProvincialGovernment’s claims as alleged in the complaintraise foreign relations issues posing complexquestions of subject matter jurisdiction of the typethat Sinochem contemplated. In reversing thedistrict court’s decision that forum non convenienswas the appropriate basis for disposition of this case,the Ninth Circuit drastically curtailed the discretionthat Sinochem expressly provided. Certiorari iswarranted to ensure the maintenance of a properbalance between trial and appellate courts in theirexercise of sound discretion.

II. UNDER ANY VIEW OF THE RECORD,SIGNIFICANT QUESTIONS MERITTHIS COURT’S ATTENTION

The nuances and complexities in theprocedural history of this case serve only to broadenthe potential impact of a decision by this Court. Tobe sure, the timing of this Court’s decision in

Sinochem affected the timing and sequencing of thedistrict court’s decision-making process. The districtcourt’s initial, pre-Sinochem decision to deny remandto state court noted that subject matter jurisdictionexisted under the Act of State doctrine. Pet. App. 8a.

Having found a basis for federal jurisdiction,the district court did not address the additionalgrounds upon which petitioners asserted removaljurisdiction in federal court.3 Accordingly, as theProvincial Government repeatedly asserts inopposing certiorari, the district court never engagedin the complex fact-finding necessary to rule on theexistence of jurisdiction under the federal commonlaw of foreign relations. Br. in Opp. at 1, 2, 7 n.10, 8,27, and 31. Nor did the district court address thefurther complexities of ascertaining personaljurisdiction. Id. at 8.

Rather, once Sinochem was decided, thedistrict court immediately recognized the wisdom ofthis Court’s guidance, stayed all discovery onpersonal jurisdiction, and moved directly to considerforum non conveniens as a basis for dismissal.4 ER1547. In opting for that sequence of issues, thedistrict court expressly relied upon the discretionafforded by Sinochem. Id.

3 See Ninth Circuit Excerpt of Record ("ER") at 2094,2095, 2098, 2104-15, 2855, 3019.

4 Barrick did not "drop[] its personal jurisdiction motionin favor of a new motion", as the Province incorrectlyasserts. Br. in Opp. at 6-7. Rather, the district courtstayed the issue of personal jurisdiction. ER 1547.

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Under any view of the district courtproceedings, this case presents important questionsregarding the proper application of Sinochem byfederal trial and appellate courts. Consider thepossible scenarios:

¯ If, as petitioners contend, the districtcourt eventually concluded that it could reach forumnon conveniens without resolving all aspects ofsubject matter jurisdiction, then this case presents astraightforward application of Sinochem. The NinthCircuit’s reversal precipitously restricts the verydiscretion that this Court conferred upon districtcourts to use the most efficient, expeditioussequencing in each case. That determinationnecessarily raises important questions regarding thescope of appellate review over Sinochem discretion.5

5 There is no merit to respondent’s contention that anydiscussion of subject matter jurisdiction in Sinochem wasmerely dicta. Br. in Opp. at 19 n.41. This Court grantedreview in Sinochem specifically for the purpose ofdetermining "whether forum non conveniens can bedecided prior to matters of jurisdiction." 549 U.S. at 428-29. The Court held that, "where subject-matter orpersonal jurisdiction is difficult to determine, and forumnon conveniens considerations weigh heavily in favor ofdismissal, the court properly takes the less burdensomecourse." Id. at 436. This cannot be read as dicta becauseit is both the answer to the question the Court wasreviewing and the essence of the Court’s decision. In anyevent, if the references in Sinochem to subject matterjurisdiction were dicta, there would be even more reasonto grant certiorari in this case so that this Court coulddefinitively resolve the question.

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¯ If, as the Provincial Governmentcontends and the Ninth Circuit concluded, thedistrict court decided at least some aspects of subjectmatter jurisdiction, then the case presents additionalvital questions of the proper scope of review. Doesthe appellate court have free rein to decide issues ofsubject matter jurisdiction that the district court,relying on Sinochem, chose not to consider? Morespecifically, is the appellate court empowered toresolve aspects of jurisdictional questions on whichthe district court, to use respondent’s description,"conducted none of the necessary fact-finding"? Br.in Opp. at 1. And, what standard governs theappellate court’s analysis of the question whether thedistrict court should have decided all potential basesfor subject matter jurisdiction? Does the appellatecourt itself have discretion to employ a differentsequence?

On this last point, Pearson v. Callahan, 129 S.Ct 808 (2009) is informative, since it conferreddiscretion on both the district court and the court ofappeals to decide the appropriate decisionalsequence. Accordingly, the interplay of those twoseparate exercises of discretion poses compellingquestions regarding the scope of review that thisCourt should decide.

In any event, a fundamental question remainsthat this Court should resolve: Under whatcircumstances may the appellate court proceed todecide forum non conveniens first, even if the districtcourt did not proceed in that manner? Here, theNinth Circuit did not attempt to utilize the appellatediscretion this Court described in Pearson.

The operational point is simple. In a case inwhich the clearly correct path is to dismiss ongrounds of forum non conveniens in favor of theavailable adequate forum proposed by petitioners,the district court chose the most efficient,expeditious course available at the time of decision.Contrary to the holding in Sinochem and theprinciples also articulated in Ruhrgas AG v.Marathon Oil Co., 526 U.S. 574 (1999) and Pearson,the Ninth Circuit charted a more circuitous,laborious and time-consuming course. This Court’sreview is fully warranted to ensure that the lowercourts can achieve the salutary objectives thatinformed Sinochem, Ruhrgas, and Pearson.

III. THE EXISTING SPLIT AMONG THECIRCUITS SHOULD BE RESOLVED

The Provincial Government’s opposition tocertiorari on the issue of using the common law offoreign relations as a basis for subject matterjurisdiction is entirely incorrect. First, and contraryto respondent’s contention, the assertion of a split inthe circuits on this issue is not a late-breakingdevelopment conjured up only for purposes ofcertiorari. It is the strongest type of circuit conflict:one explicitly recognized by the court of appeals. TheNinth Circuit’s decision in Patrickson addresses theconflict, expressly disagreeing with the decisions ofthe Second, Fifth and Eleventh Circuits. Patricksonv. Dole Food Co., 251 F.3d 795, 800-03 (9th Cir.2001). Accordingly, the conflict that petitioners raisein this Court was well known to the Ninth Circuit.Of course, since this case was litigated in the NinthCircuit, attention in the lower courts naturally

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focused on Ninth Circuit precedent rather than onthe decisions of other appellate courts with which theNinth Circuit had already disagreed.

Second, again contrary to respondent’scontention, the federal common law of foreignrelations was consistently and repeatedly asserted asa basis for federal jurisdiction in both the districtcourt and the court of appeals. See note 3, supra.6As is evident from the decision below, however, thereis considerable disagreement and confusion in thefederal courts over two concepts: the Act of Statedoctrine and the federal common law of foreignrelations. Although both implicate some similarconcerns, there are differences.

The Act of State doctrine is typically employedas a basis for defeating federal jurisdiction. Thus,cases decided under that rubric often turn onjusticiability questions regarding the authority of aUnited States court to sit in judgment of acts takenby sovereign governments within their own territory.See e.g., Banco Nacional de Cuba v. Sabbatino, 376U.S. 398, 416 (1964) (applying act of state doctrine ina financial dispute involving the nationalization of asugar company in Cuba).

6 The basis for federal jurisdiction was also discussed atlength in petitioners’ brief to the Ninth Circuit on appeal.See Brief of Appellees at 53-60, Provincial Gov’t ofMarinduque v. Placer Dome, Inc., No. 07-16306 (9th Cir.Sept. 15, 2008).

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Confusion can easily ensue when Act of Stateterminology is employed as a basis for establishingfederal subject matter jurisdiction. Patricksonexpressly points to such affirmative use of Act ofState principles. 251 F.3d at 800 n.2. As is evidentfrom Patrickson and from the decision below in thiscase, however, it would become entirely circular forthe Act of State doctrine to have the same meaningin the jurisdiction-establishing and the jurisdiction-defeating contexts. In that event, subject matterjurisdiction would exist under the Act of Statedoctrine only in cases subject to dismissal under theAct of State doctrine. The operative rule, therefore,cannot require the party asserting jurisdiction toshow - as a predicate for subject matter jurisdiction- that adjudication of the claims requires a federalcourt to sit in judgment of the acts of a foreignsovereign within its own territory.

Nor does it help nominally to invoke anotherdoctrine - such as the federal common law of foreignrelations - and then to make that doctrine co-extensive with the Act of State doctrine. In the viewof the Ninth Circuit, subject matter jurisdictionexists only where "a court must decide - that: is,when the outcome of the case turns upon - the effectof official action by a foreign sovereign." Pet. App.12a (quoting W.S. Kirkpatrick & Co. v. Envtl.Tectonics Corp., 493 U.S. 400, 406 (1990)). Byapplying a doctrine - Act of State - normally used todefeat jurisdiction, the Ninth Circuit makes theanalysis altogether circular.

This case provides a suitable opportunity forthis Court to resolve the existing confusion by

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employing more discerning terminology and analysis.In the present circumstances, the federal commonlaw of foreign relations offers a more direct, moreaccurate, and more understandable mode of analysisthat plainly applies to this case. A case such as thisone - in which a foreign provincial governmentchallenges actions by an entity in which officials andagencies of that country’s national governmentowned the largest share - surely poses questions offoreign relations. Moreover, the actions challengedin the complaint were authorized, approved, andacquiesced in by multiple Philippine administrationsover the course of decades. See note 2, supra.Furthermore, the only defendants in the case areCanadian companies (one of which held an indirectminority interest at one time in the Philippinecompany that is alleged to be the tortfeasor). In lightof these facts, it is clear that the foreign relationsissues implicate not only United States-Philippinerelations, but United States-Canadian relations aswell.

On this record, there should be no doubt that afederal court has subject matter jurisdiction toconsider these questions. Even if a district courtultimately determines that dismissal is warrantedunder the Act of State doctrine or forum nonconveniens, there is no basis for denying that courtthe threshold jurisdiction to make those rulings.

In short, there are vitally important reasonsfor this Court to grant certiorari, to resolve theexisting conflict among the circuits, and to dissipatethe confusion that has befuddled lower courts inanalyzing jurisdiction under the federal common law

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of foreign relations. This case is an ideal vehicle forthis Court’s review.

CONCLUSION

The petition for a writ of certiorari should begranted.

Respectfully submitted.

JERROLD J. GANZFRIEDCounsel of Record

EDWARD HANMARTIN CUNNIFFHOWREY LLP1299 Pennsylvania Ave., N.W.Washington, D.C. 20004ganzfriedj@howrey.com(202) 783-0800

Attorneys for PetitionersPlacer Dome, Inc. and BarrickGold Corporation

March 29, 2010