[00:00:00] Speaker 02:
Case number 25-1796, Venezuela-USSRL versus Bolivarian Republic of Venezuela appellant, Mr. Perla for the appellant, Mr. Conlon for the appellee.

[00:00:14] Speaker 00:
Whenever you're ready, Mr. Perla.

[00:00:16] Speaker 01:
Thank you, Your Honor.

[00:00:17] Speaker 01:
Good morning, Your Honors, and may it please the court, Juan Perla of Curtis-Malay for the appellant, the Republic of Venezuela.

[00:00:24] Speaker 01:
This appeal presents a question that was left unanswered by this court in Valores.

[00:00:29] Speaker 01:
And that is whether recognizing and enforcing an award that is governed by the New York Convention violates US public policy where the arbitral tribunal and the petitioners chose to deal only with the Maduro regime after it was derecognized by the United States and therefore lacked any authority to speak for or bind the Venezuelan state as a matter of US law.

[00:00:55] Speaker 01:
Although it's a novel question, the principles that decide it are centuries old.

[00:01:02] Speaker 00:
From the founding, it was understood that only the executive branch has the power to recognize the legitimate government of our- Mr. Perla, I know how important the recognition power is for Article II, but I'm wondering, I mean, here, Venezuela didn't make any objection before the tribunal about the question of representation.

[00:01:25] Speaker 00:
So the Arbitral Tribunal, unlike in Valores, made no statement about which council was legitimate or whether they were representing the properly recognized government of Venezuela.

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There was no challenge at all.

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So how can, you know, confirmation of the word here even implicate the recognition power?

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I mean, the award here doesn't say anything about the legitimate, you know, government or the council representing

[00:01:55] Speaker 00:
the government.

[00:01:57] Speaker 01:
Well, Your Honor, first of all, the interim government, the recognized government, did not have an obligation to intervene at that point.

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It was not put on notice.

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As the district court here recognized, there are other jurisdictions outside of the United States that recognize the Maduro regime.

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And there was no way to anticipate that the US would come to the US to enforce this award.

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Also, there is an analogous situation, the Pemex case,

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where it didn't matter what the foreign tribunal was purporting to do or thought they were doing.

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In that case, it was whether the Mexican court had retroactively applied the relevant statute.

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And the Second Circuit looked at that and said, in fact,

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The Mexican court said, we're not doing that.

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So it wasn't even silent.

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They were saying they disavowed that they were doing that.

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And the Second Circuit said, what we look at is the effect.

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What is the effect of recognizing that foreign tribunal's judgment?

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There's an actual legal effect.

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There's a disagreement about what the tribunal did, whether it was retroactive or not.

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So they can say it's not retroactive, but a US court can look and see whether something's retroactive.

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no consideration or adjudication at all by the arbitral tribunal because Venezuela, you know, the interim government never made any kind of challenge before the tribunal.

[00:03:26] Speaker 01:
Well, the recognition can be implicit, Your Honor.

[00:03:28] Speaker 01:
It doesn't have to be explicit.

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The tribunal doesn't have to say we are choosing one over the other or we are formally recognizing the Maduro regime.

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It is the conduct of allowing the Maduro regime to come in and speak on behalf of the state as if it were the legitimate government of the state that incurs the infringement of the recognition doctrine because it would be inconsistent with the recognition of the National Assembly and its leadership

[00:03:56] Speaker 00:
For the same reason that you just said, why would Venezuela challenge it?

[00:04:00] Speaker 00:
Because some countries recognize the Maduro regime.

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Why would the Arbitral Tribunal feel the need to question who was representing Venezuela if Venezuela made no challenge to it?

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To the representation by the Maduro Council?

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I mean, the argument kind of goes both ways.

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I don't think so, Your Honor, because

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The tribunal may be doing things that it thinks are consistent with laws that apply to it and that may apply in other jurisdictions.

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It's not necessarily looking proactively to make sure that its award will be enforceable as a matter of public policy in every single jurisdiction.

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Frankly, that would have been on the US to alert the tribunal to the fact that there was a problem that for them might have consequences if they try to enforce the award in the United States.

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And that is,

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The United States is supposed to intervene in international arbitration involving commercial transactions between a company and another foreign country.

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I mean, are you suggesting the U.S.

[00:05:05] Speaker 00:
government?

[00:05:07] Speaker 01:
No, no, your honor.

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That seems the U.S.

[00:05:10] Speaker 00:
right outlandish.

[00:05:12] Speaker 01:
No, Your Honor, VUS, the petitioner.

[00:05:14] Speaker 00:
Oh, VUS, okay.

[00:05:15] Speaker 00:
Okay, thank you.

[00:05:16] Speaker 01:
Not the U.S.

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side.

[00:05:16] Speaker 00:
Yeah.

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So it would have been incumbent on VUS to alert the petitioner that there might have been a problem.

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In fact, VUS cites an example of Conoco.

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It's at JA 94.

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Conoco was arbitrating with Venezuela at the time that the recognition was affected, and Conoco

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allowed for both governments to participate and then they brought the reward to the U.S.

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They were concerned that if they brought the award to the U.S., they might confront a public policy challenge.

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So they made sure that they prevented that problem from arising because they anticipated potentially bringing it to the U.S., which they did.

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The U.S.

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did not do that here.

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So it was not a problem that the

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US-recognized government did not attempt to intervene in the arbitration because that would have not been necessary if the award was not going to be enforced in the US.

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It also doesn't have any implications for purposes of waiver or forfeiture because the public policy exception cannot be waived under this court's decision.

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What did the arbitrators do, if anything, to acknowledge

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the receipt and consideration of filings by the council that purported to represent basically the council that replaced you.

[00:06:38] Speaker 01:
They allowed it and welcomed it without giving us any notice of the purported attempt to change.

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We didn't receive any notice.

[00:06:46] Speaker 03:
You say they allowed it, but I mean, this is a friendly question, I think, because I bet they did more than just passively remain silent.

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Did they say or write anything to suggest we are considering the filings by the new council?

[00:07:01] Speaker 01:
Yes, Your Honor.

[00:07:02] Speaker 01:
What you mean is they didn't just allow the council to be changed.

[00:07:06] Speaker 01:
They then received submissions from the Maduro regime's representatives.

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They had an entire damages proceeding to determine what the amount of the liability would be.

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So all of those acts were undertaken by the arbitral tribunal.

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And the proceeding was live.

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It was an oral argument, an oral.

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It was not just on paper.

[00:07:30] Speaker 01:
That's correct, Your Honor.

[00:07:31] Speaker 01:
There was a proceeding, I believe, that dealt with the damages at a hearing.

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And it is taking that award, all of the things that the Maduro regime did, and bringing it into the United States and asking this court to convert what is otherwise a quasi-contractual private arrangement and give it the imprimatur of the court by converting it into a U.S.

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judgment, that is

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would be inconsistent with the U.S.

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executive's recognition of only the National Assembly as being able to speak and bind the Republic.

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And that is what makes a New York convention award significantly different from the LORAS, the ICCID award, because the ICCID award comes to the U.S.

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already as a U.S.

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state court judgment entitled to full faith and credit in the first instance.

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Was Conoco an ICCID or New York?

[00:08:21] Speaker 01:
Conoco was an exit award, I believe, where the issue arose, but I think that was before velour as so I believe Conoco was probably cautiously avoiding any potential defect of litigating only with the Maduro regime that was the recognized by the United States.

[00:08:39] Speaker 01:
because they were going to come to the US and enforce the award.

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And so that would have been the appropriate thing for VUS to do in the arbitration if they intended to come here.

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And this is a significant infringement on the executive, but it's a matter of US public policy because it is meant, the recognition doctrine is meant to govern not just the government, but also

[00:09:05] Speaker 01:
the business transactions and commercial transactions that private parties enter into with the Venezuelan state during the time period in which the US recognizes a different government than who may be purporting to be acting on behalf of the state outside of the United States.

[00:09:20] Speaker 01:
And that comes straight from the Supreme Court's decision in guaranteed trust.

[00:09:25] Speaker 01:
where they say, and I quote, the very purpose of the recognition by our government is that our nationals may be conclusively advised with what governments they may safely carry on business transactions and who its representatives are.

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And then it goes on to say, quote, recognition would be but an idle ceremony yielding none of the advantages of established diplomatic relations in enabling business transactions to proceed if

[00:09:48] Speaker 01:
if they didn't deal with the recognized legitimate government.

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So this is a matter that goes beyond just a formal acknowledgement of who the Venezuelan government is.

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It is meant to impact the way that we as a nation and the people here interact with that.

[00:10:09] Speaker 03:
Do you think we would benefit from asking the Department of Justice if they have views about

[00:10:15] Speaker 03:
the public policy exception here, its applicability.

[00:10:20] Speaker 01:
Specifically the public policy.

[00:10:22] Speaker 01:
Your honor, you're obviously welcome to ask the views of the US government.

[00:10:27] Speaker 01:
I think we have everything we need from the US government to make the determination here.

[00:10:31] Speaker 01:
We have very clear recognition, derecognition of Maduro.

[00:10:35] Speaker 01:
very clear recognition of the National Assembly.

[00:10:38] Speaker 01:
We have a public policy exception that allows for refusal of this award, and we have a long history of jurisprudence, constitutional provisions that elevate the recognition doctrine to the level of U.S.

[00:10:50] Speaker 01:
public policy, including Pink Decision and others.

[00:10:56] Speaker 00:
Mr. Perla, I mean, okay, even if we assume that the recognition power is something

[00:11:04] Speaker 00:
that could implicate the public policy defense under the New York Convention.

[00:11:07] Speaker 00:
How would our confirmation of this award actually run afoul of the recognition power?

[00:11:15] Speaker 00:
So there's an award that says nothing about representation or, you know, the legitimate counsel or the legitimate recognized, U.S.

[00:11:25] Speaker 00:
recognized government.

[00:11:26] Speaker 00:
How would our decision actually implicate that public policy?

[00:11:33] Speaker 00:
I mean, the reasoning of Laura's of Laura's basically says it doesn't in facts that are you know more favorable and for Laura's than they are here.

[00:11:42] Speaker 01:
Well, I'll take that into part if I may your honor and I see one at a time.

[00:11:47] Speaker 01:
I think what Judge Walker was mentioning is significant, which is not only was there a swap of counsel that was recorded in the award, but there were submissions that were treated as if they had been submitted by the Venezuelan state.

[00:12:01] Speaker 01:
There were hearings that were held where the Maduro regime's representatives purported to speak for the Venezuelan state.

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All of that was factored into determining what the damages were into deciding what liability the Venezuelan state would have.

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And it was done without the presence of the U.S.

[00:12:15] Speaker 01:
recognized government.

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And that is significant.

[00:12:18] Speaker 01:
The 11th Circuit, for example, in Luke oil, confronted the argument by the Maduro regime appointed a board of the national oil company, Pedevesa, who said, just let us in because we have the same interests, ultimately, as the Guaido appointed board, so we can carry the water for the national oil company that is owned by Venezuela.

[00:12:39] Speaker 01:
And the 11th Circuit said no, because they may desire the same outcome, but the recognition that the US government has made requires us to not give you any authority, Maduro regime-appointed board, and we would only be able to hear and give credit to the statements of the Guaido, or National Assembly Recognized Board.

[00:13:03] Speaker 01:
So I think that Judge Walker makes some very good points about that.

[00:13:09] Speaker 01:
The difference with Valores is that in Valores, the judgment or the Ixid award is already a judgment entitled to full faith and credit.

[00:13:19] Speaker 00:
But that was not the reasoning.

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Like the Valores reasoning, there was reasoning about the Ixid judgment.

[00:13:29] Speaker 00:
But then the discussion about the recognition power does not turn on

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On the way exit works it turns on the specific facts of the case and says nothing we would do here would be running you know into the recognition power.

[00:13:47] Speaker 01:
So I don't think that's quite right, Your Honor.

[00:13:50] Speaker 01:
The way I read Valores, it was focused very specifically on exit awards.

[00:13:55] Speaker 01:
It was very much focused on the uniqueness of the exit convention, how it is insulated and self-contained, how if the exit institution sees the award as binding, full faith and credit means that the US courts must also treat it as binding.

[00:14:11] Speaker 00:
Well, that was in the discussion of Valores about full faith and credit, and then

[00:14:15] Speaker 00:
the panel separately considered, even if there should be full faith and credit, does this recognition power argument undermine our decision to give it full faith and credit?

[00:14:29] Speaker 00:
I mean, I'm interested in your thoughts on why that's not the right way to read the decision.

[00:14:39] Speaker 01:
I think it actually helps us, Your Honor, that the court in Valores analyzed first whether the award was entitled to full faith and credit as a state court judgment, and then said, yes, it is, and then said, therefore, we can't do anything more.

[00:14:53] Speaker 01:
And in fact, the court says, notes, there is no roving public policy exception to full faith and credit.

[00:15:00] Speaker 01:
So whatever implications might come of the US recognition, it's not something that we can look at.

[00:15:06] Speaker 02:
But the court also said that in enforcing the award, the court is not recognizing any regime as the current government of Venezuela.

[00:15:18] Speaker 02:
And if that's true, there's no contradiction between the recognition clause and the judicial enforcement and recognition of this award.

[00:15:28] Speaker 02:
And I don't know how you get around it.

[00:15:30] Speaker 01:
Well, Your Honor, I don't think that can be read outside the context of it being an exit award.

[00:15:37] Speaker 01:
In fact, both places where the court explained this very issue of not equivalent to recognition or not implicating the recognition power, it made very specific that it was referring to exit awards.

[00:15:49] Speaker 01:
And it makes sense to

[00:15:53] Speaker 01:
treat it that way because as the court analyzed, Congress implemented a statute that gave it full faith and credit and treated it as if it was already part of the US legal system.

[00:16:03] Speaker 01:
The president ratified the exit convention and signed the implementing statute.

[00:16:10] Speaker 01:
So there was an agreement between the executive, between Congress, that when it dealt with exit awards, which are very special, which are very unique in terms of the way that they are structured under the convention,

[00:16:20] Speaker 01:
We would not be looking behind what the tribunal did because it's a self-contained system and we would be treating it as if it were a final judgment of a state.

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court that was already part of our legal structure.

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That is not what happens with the New York Convention Award, which is in the nature of a contract, as this court and the Supreme Court have observed.

[00:16:43] Speaker 01:
And it is the act of converting it into a judgment through the confirmation and enforcement process that you give it the judiciary's stamp of approval.

[00:16:51] Speaker 01:
And that is what incurs the implicit, if not

[00:16:54] Speaker 01:
explicit contradiction between what the tribunal did in terms of allowing the Maduro regime to speak and act for the Venezuelan state and the executive's recognition in the United States that Maduro is not the head of state.

[00:17:11] Speaker 01:
His acts cannot be given the legitimacy of being the recognized government because then it would result in things like, is he entitled to immunity?

[00:17:20] Speaker 01:
is, you know, other things that might start to sound in the fact that there is a contradiction between what the tribunal did and what the executive.

[00:17:28] Speaker 00:
Mr. Purley, Venezuela is not bringing an inadequate representation defense here under the New York Convention.

[00:17:36] Speaker 00:
And I assume that's maybe because you can't demonstrate prejudice from

[00:17:42] Speaker 00:
adequate representation.

[00:17:44] Speaker 00:
So there's no, I mean, that is also another exception to the New York Convention is lack of adequate representation, but am I correct that Venezuela is not bringing such a challenge?

[00:17:57] Speaker 00:
Not trying to get within that exception?

[00:17:59] Speaker 01:
We haven't invoked that here, your honor, because the public policy exception is really the most relevant and applicable exception here.

[00:18:06] Speaker 01:
Again, under the public policy exception, if we're right that the recognition doctrine is a public policy, I think Luke oil is a very good from the 11th circuit is very instructive on the point that it doesn't matter whether the interest and the advocacy may have been aligned and may have been adequately represented by the Maduro regime.

[00:18:27] Speaker 01:
What matters is that

[00:18:28] Speaker 01:
allowing the Maduro regime to speak for the Venezuelan state and then enforce that award as if it had been the Venezuelan state that had appeared and defended would be a contradiction of the executive's recognition power.

[00:18:42] Speaker 00:
Why doesn't accepting your argument allow nations to do

[00:18:48] Speaker 00:
you know, play games with this, right?

[00:18:51] Speaker 00:
You know, you kind of allow this to go forward, a large judgment issues against Venezuela, not challenged before the arbitral tribunal.

[00:19:00] Speaker 00:
And then you come to enforcement in the US courts, claim the public policy exception.

[00:19:06] Speaker 01:
Again, Your Honor, I think it's because the New York convention has

[00:19:14] Speaker 01:
more than I believe 190 government parties to it.

[00:19:18] Speaker 01:
So not all of them recognize the National Assembly, many of them recognize the Maduro regime.

[00:19:25] Speaker 01:
So the US could very well have a strategy where it's trying to enforce its award and litigate with the Maduro regime and has

[00:19:34] Speaker 01:
at its availability, these other jurisdictions where they can go and try to enforce their award.

[00:19:39] Speaker 01:
But if they're going to come to the United States, they have to make sure that they are not incurring in some kind of violation that might implicate the public policy, as it would of any other country.

[00:19:49] Speaker 01:
If they're looking to have a global enforcement strategy for their award, they have to be

[00:19:56] Speaker 01:
They have to be careful to not do things in the arbitration that could incur problems as a matter of public policy in the different jurisdictions where they're going.

[00:20:05] Speaker 01:
That's what Conoco did.

[00:20:06] Speaker 01:
And it's their own submission that they point to.

[00:20:10] Speaker 01:
And that would have avoided any kind of problem that they had coming here to the United States.

[00:20:15] Speaker 01:
So we don't think that it is for the US-recognized government necessarily in the context of the New York Convention to run around and

[00:20:24] Speaker 01:
cure the problems that the petitioners may be incurring when they're litigating with one government or the other.

[00:20:31] Speaker 01:
So I don't think that that avoids the problem that is presented here as a matter of US public policy.

[00:20:43] Speaker 00:
See if my colleagues have any further questions.

[00:20:47] Speaker 02:
Not me.

[00:20:49] Speaker ?:
No.

[00:20:49] Speaker 00:
OK.

[00:20:50] Speaker 00:
Thank you.

[00:20:50] Speaker 00:
We'll hear from Mr. Conlon.

[00:20:54] Speaker 04:
Good morning, may it please the court.

[00:20:56] Speaker 04:
John Conlon, representing Venezuela, US SRL.

[00:21:00] Speaker 04:
I'll refer to it as VUS, the appellee in this matter.

[00:21:04] Speaker 04:
VUS seeks confirmation of an award against Venezuela based on the refusal of a Venezuelan state-owned company to pay dividends to the US.

[00:21:13] Speaker 04:
Venezuela's objection to confirmation under Article 5 2B of the New York Convention that recognition and enforcement would violate U.S.

[00:21:21] Speaker 04:
public policy requires it to establish first confirmation of an arbitration award against Venezuela is tantamount to recognition of the Maduro regime.

[00:21:31] Speaker 04:
and that such recognition infringes on the exclusive power of the executive to recognize the representative.

[00:21:38] Speaker 03:
Mr. Conlin, I think you may be correct with where you're going, that we may be able to recognize this award without our court recognizing the Maduro regime, as we did a few, I mean, that's the holding from a few years ago.

[00:21:57] Speaker 03:
I think the problem for you, though, is that

[00:22:00] Speaker 03:
We can't recognize this award without holding that it is U.S.

[00:22:06] Speaker 03:
public policy to allow arbitration against a nation's people in absentia.

[00:22:17] Speaker 03:
Isn't that what happened?

[00:22:18] Speaker 03:
First of all, isn't that correct?

[00:22:19] Speaker 03:
I mean, do you agree that the nation of Venezuela, their people, were not represented at the damages phase of this arbitration?

[00:22:27] Speaker 03:
They were absent.

[00:22:29] Speaker 04:
Well, the recognized government of Venezuela participated in the jurisdictional phase.

[00:22:36] Speaker 03:
My question is about the damages phase.

[00:22:39] Speaker 04:
At the damages phase, Venezuela was represented by the Maduro regime in that arbitration.

[00:22:46] Speaker 03:
That is to say that the people of Venezuela were represented by fraudsters and imposters who

[00:22:55] Speaker 03:
we, as our government has said, have no more connection to them than the Stuart monarchy has to the United Kingdom.

[00:23:05] Speaker 03:
They're over.

[00:23:06] Speaker 03:
Their time is over.

[00:23:06] Speaker 03:
They're not the sovereign anymore.

[00:23:09] Speaker 04:
Well, I would say with respect to the ability of Maduro regime to act on behalf of

[00:23:16] Speaker 04:
Venezuela in arbitrations, that's precisely what happened in the Valouris case.

[00:23:23] Speaker 04:
The Maduro regime represented Venezuela in the annulment portion of the exit proceeding in that case.

[00:23:29] Speaker 03:
But it didn't matter there whether recognizing that award was in US public policy or not, because exit didn't have a public policy exception.

[00:23:37] Speaker 04:
There was no public policy exception, but the court was presented specifically with the question and did analyze the issue as argued by Venezuela that, and with respect to Ixid in Volores, Venezuela argued that in exceptional cases, certain courts have held that the full faith and credit will not be accorded to state court judgments regular on their face, where to do so would defeat a vital and overriding federal interest.

[00:24:06] Speaker 04:
essentially the public policy argument that they're making here.

[00:24:10] Speaker 03:
I read it to say, full faith and credit's bar against re-litigation is unyielding, followed in the next citation with a parenthetical that says, recognizing lack of jurisdiction as a basis to deny full faith and credit, but noting that the Supreme Court's decisions support no roving public policy exception to the full faith and credit due judgment.

[00:24:28] Speaker 03:
So what Valoris said is that when it comes to full faith and credit, there is no roving public policy exception.

[00:24:36] Speaker 03:
But here, there is a roving

[00:24:39] Speaker 03:
public policy exception, it's express.

[00:24:41] Speaker 03:
It's in the treaty.

[00:24:44] Speaker 04:
But it was not considered under the context of the New York Convention, public policy exception, but the very same issues were considered by the court in Volores in addressing these issues.

[00:24:58] Speaker 03:
Mr. Conlon, let me ask you this hypothetical.

[00:25:02] Speaker 03:
Let's assume for the sake of hypothetical that Volores is not completely controlling, that it leaves us room to try to figure out whether recognition here would be

[00:25:12] Speaker 03:
consistent with U.S.

[00:25:13] Speaker 03:
public policy.

[00:25:14] Speaker 03:
Let's imagine that there was an arbitration and the damages phase of that arbitration against the United Kingdom, I mentioned this earlier, the descendants of the Stuart monarchs fired the United Kingdom's attorneys and then hired attorneys who purported to represent the United Kingdom for the entirety of the damages phase.

[00:25:34] Speaker 03:
and then the arbitrators awarded damages, and then the other side seeks to enforce that arbitration, seeks to get recognition of that arbitration award in the United States.

[00:25:46] Speaker 03:
Don't you think it will be against US public policy to recognize an arbitration award against the United Kingdom when the people of the United Kingdom were not at all represented?

[00:25:57] Speaker 03:
It's not even a matter of adequate representation.

[00:26:00] Speaker 03:
There's no representation.

[00:26:02] Speaker 03:
It's the difference between ineffective assistance of council and no council.

[00:26:06] Speaker 04:
Well, I think that we're like the situation presented in velour is where under the rules of the arbitral regime, it was proper for, in this case, the Stuart dynasty to represent the people of England

[00:26:21] Speaker 04:
in connection with that arbitration, then I don't think it would be against US public policy.

[00:26:27] Speaker 04:
Whether that representation was adequate or not under the circumstances would be a separate issue.

[00:26:31] Speaker 04:
If the Stuart dynasty did not properly or adequately under due process argument represent the people of England, then I think that's a separate question.

[00:26:44] Speaker 03:
I'll mull that over.

[00:26:50] Speaker 04:
With respect to valorous this court squarely held that judicial confirmation of an exit arbitral award against Venezuela, even where Venezuela was represented by the do you recognize Maduro regime during the arbitration process does not constitute recognition of any government.

[00:27:07] Speaker 04:
As this court explained, confirming an arbitral award is not equivalent to recognition of the Maduro regime and does not imply a denial of the justice of the president's recognition of the interim government.

[00:27:18] Speaker 04:
That reasoning applies with full force here and is dispositive of appellant's argument.

[00:27:23] Speaker 00:
In Voloris, this court observed that- Can I ask you a conceptual question about this?

[00:27:28] Speaker 00:
Because in considering the public policy defense, do we have to-

[00:27:37] Speaker 00:
determine, you know, well, the recognition power is, you know, legitimately within the public policy defense and then determine whether it applies.

[00:27:49] Speaker 00:
Can we just assume that the recognition power could sometimes be a valid defense?

[00:27:56] Speaker 00:
And I mean, can we just go to the second step of that, which is to decide whether here enforcement of the award would contravene the recognition power?

[00:28:05] Speaker 04:
Sure, I think as Dolores squarely held, it does not.

[00:28:10] Speaker 04:
Recognition is a formal acknowledgement that a particular regime is the government of a state, and it's a political rather than a judicial question.

[00:28:19] Speaker 04:
Contrary to the argument made by Venezuela, one does not implicitly recognize a foreign regime.

[00:28:25] Speaker 04:
Here, with respect, and to the extent your question is, does assuming that there is a public policy here, is it the type of public policy that would qualify under the New York Convention?

[00:28:40] Speaker 00:
Is that your- Do we have to decide that question?

[00:28:43] Speaker 04:
No, I don't think you need to get there.

[00:28:45] Speaker 04:
I think that

[00:28:49] Speaker 04:
confirmation of an arbitral award is fundamentally different from recognizing a regime as legitimate or not legitimate government of a particular sovereign state.

[00:29:01] Speaker 04:
Here, the award is against the sovereign state of Venezuela.

[00:29:06] Speaker 04:
It is not against a particular regime.

[00:29:08] Speaker 04:
The award was issued based on acts of Venezuela when it was represented by the Maduro regime as the recognized and legitimate regime of

[00:29:18] Speaker 04:
Venezuela.

[00:29:20] Speaker 04:
Liability was determined when the Maduro regime was the recognized government of Venezuela represented by council here.

[00:29:32] Speaker 04:
The only issue that was determined in the arbitration

[00:29:36] Speaker 04:
in which the Maduro regime was not the recognized government of Venezuela was damages.

[00:29:42] Speaker 04:
And damages simply consisted of the unpaid dividends, the amount of the unpaid dividends, which was $52 million plus accumulated interest plus costs.

[00:29:52] Speaker 04:
So in terms of making determinations about liability, that was all done under the supervision of the recognized government and council here.

[00:30:03] Speaker 03:
I have a question about the procedural question.

[00:30:09] Speaker 03:
If I understand correctly, when VUS changed council earlier in the proceedings, the Permanent Court of Arbitration invited VUS to provide Venezuela with a letter of representation, which showed the authorization for the new council to act on behalf of VUS.

[00:30:30] Speaker 03:
My first question is, do I have that part correct?

[00:30:33] Speaker 04:
That is my understanding, Your Honor.

[00:30:35] Speaker 03:
Then do you know, did the Permanent Court of Arbitration ask for, and did you receive, a power of attorney from the National Assembly during the arbitration proceedings when the Maduro regime purported to replace the Curtis law firm?

[00:30:56] Speaker 04:
Not to my knowledge, Your Honor.

[00:30:59] Speaker 03:
OK.

[00:30:59] Speaker 03:
Just for clarifying.

[00:31:04] Speaker 04:
is separately, although the court does not need to reach this issue, Venezuela has failed to demonstrate the existence of a qualifying public policy under the New York convention.

[00:31:14] Speaker 04:
The public policy exception is to be construed narrowly and applies only in clear-cut cases where enforcement would violate the forum state's most basic notions of morality and justice.

[00:31:25] Speaker 04:
As to Venezuela's argument that the recognition power constitutes qualifying public policy under the New York Convention, the district court observed that Venezuela cites no case finding a public policy issue on facts similar to this case or anything close.

[00:31:39] Speaker 04:
and that Venezuela does not even attempt to justify its position that enforcement.

[00:31:44] Speaker 00:
You said we don't necessarily need to decide that question.

[00:31:47] Speaker 04:
You do not.

[00:31:47] Speaker 04:
I don't think you need to reach that.

[00:31:48] Speaker 04:
I think Dolores is disposed of that.

[00:31:50] Speaker 04:
You don't need to even get to whether the recognition doctrine is a public policy applicable under the New York Convention.

[00:32:04] Speaker 00:
OK.

[00:32:06] Speaker 00:
Judge Randolph, do you have any further questions?

[00:32:08] Speaker 02:
No, that's fine.

[00:32:10] Speaker 00:
Judge Walker?

[00:32:12] Speaker 00:
No?

[00:32:13] Speaker 00:
Okay.

[00:32:14] Speaker 00:
Mr. Perla, we'll give you two minutes on rebuttal.

[00:32:18] Speaker 02:
Thank you.

[00:32:18] Speaker 02:
Mr. Perla, before we launch into that, there's a question that

[00:32:26] Speaker 02:
is not on the record, and I don't expect you to, that you may know, but the attorneys who represented Venezuela after the Maduro regime was no longer recognized by the United States, they continued through the damages stage, is that correct?

[00:32:49] Speaker 01:
Yes, correct.

[00:32:50] Speaker 01:
They were acting for, purporting to act for the Venezuelans.

[00:32:57] Speaker 02:
But who paid those attorneys for their services during the doubt?

[00:33:06] Speaker 01:
I don't know that for a fact, Your Honor, but I would assume that it was the Maduro regime.

[00:33:11] Speaker 01:
I do know that it was not the National Assembly U.S.

[00:33:14] Speaker 01:
recognized government.

[00:33:16] Speaker 02:
OK, OK.

[00:33:19] Speaker 01:
So I think you know Judge Walker makes a very good point about the difference between velour as here, which is the distinction between a roving public policy exception and that doesn't exist under the exit convention and that does exist here and the difference why that matters is that.

[00:33:36] Speaker 01:
not New York Convention Awards, are like private contracts.

[00:33:39] Speaker 01:
And we have a series of cases that we've cited where the contradiction between the enforcement of the contract and the formal recognition by the US government was implicit.

[00:33:51] Speaker 01:
It didn't matter.

[00:33:52] Speaker 01:
You don't have to sit here as a court and say, we formally acknowledge the Maduro regime.

[00:33:56] Speaker 01:
The arbitration tribunal did not have to include a statement that say, we formally acknowledge the Maduro regime as the government everywhere.

[00:34:03] Speaker 01:
What you have to look at is the effect under the New York Convention is the effect of enforcing the award and the recognition doctrine can be contradicted implicitly.

[00:34:12] Speaker 01:
It was in pink and the Supreme Court said no matter what gloss be given to what the New York Court of Appeals contrary decision is by not recognizing the and if I may just finish this, Your Honor.

[00:34:23] Speaker 01:
In not recognizing the acts of the recognized Soviet government, it amounts to official disapproval or non recognition of that government that disapproval or non recognition is in the face of the underlying policy adopted by the United States.

[00:34:39] Speaker 01:
when it recognized the Soviet government.

[00:34:41] Speaker 01:
So you don't need a formal statement in the arbitration award.

[00:34:45] Speaker 01:
You don't need a formal statement in this court's decision under the New York Convention.

[00:34:49] Speaker 01:
It is the effect of the award's enforcement that is what is what offends the U.S.

[00:34:56] Speaker 01:
public policy and therefore the district court aired and should be reversed.

[00:35:00] Speaker 03:
Mr. Perla, just a clarification on Judge Randolph's and your answer Judge Randolph's question.

[00:35:04] Speaker 03:
Tell me if this chronology is correct.

[00:35:07] Speaker 03:
The Curtis law firm represented Venezuela in the arbitration at the beginning.

[00:35:12] Speaker 03:
After that, the National Assembly was recognized by the United States.

[00:35:18] Speaker 03:
After that, the Maduro regime fired the Curtis law firm.

[00:35:25] Speaker 03:
After that, the damages proceeding happened.

[00:35:28] Speaker 03:
Is that all correct?

[00:35:30] Speaker 01:
Your Honor, I'm not sure that we were fired, but we stopped taking instructions from the Maduro regime.

[00:35:36] Speaker 01:
And I do appreciate the question, Judge Walker, because I want to make something clear.

[00:35:40] Speaker 01:
On page 33 of the US's brief, they say that Curtis continued to serve as counsel for the Maduro regime after it had been recognized.

[00:35:50] Speaker 01:
And that's just plainly false.

[00:35:51] Speaker 01:
Your timing and chronology is correct, Judge Walker.

[00:35:54] Speaker 01:
We were acting for the US-recognized government during the jurisdiction liability phase.

[00:36:00] Speaker 01:
Then the US government derecognized the Maduro regime and recognized the National Assembly.

[00:36:06] Speaker 01:
At that point, we began taking instructions from the National Assembly, US-recognized government, and we were no longer involved in the proceedings once the Maduro regime then

[00:36:19] Speaker 01:
entered with their new law firm purporting to act for Venezuela without giving us any notice.

[00:36:28] Speaker 00:
Okay, are there no further questions?

[00:36:31] Speaker 02:
Yes, not by me.

[00:36:33] Speaker 00:
Okay, thank you to both counsel.

[00:36:35] Speaker 00:
The case is submitted.