UC Hastings Pilipino American Law Society (PALS)


‘No immediate way’ Supreme Court tells Marcos ‘victims’ by Paul Rivera
July 23, 2008, 4:48 pm
Filed under: News

[via Philippine News]

Published: June 18, 2008 | Author: Emmanuel Tipon

There is “no immediate way to recover on its judgment against Marcos,” the U.S. Supreme Court told the alleged 9,539 “victims” of human rights abuses during the Marcos regime in a decision rendered on June 12, 2008. Republic of the Philippines v. Pimentel, No. 06-1204.In 1972, President Ferdinand Marcos incorporated Arelma under Panamanian law. Arelma deposited $2 million with Merrill Lynch, Pierce, Fenner and Smith, a stockbroker. As of 2000, the account had grown to about $35 million. After Marcos left the Philippines in 1986, many alleged victims of human rights abuses during his regime filed a class action (Pimentel class) against him in the U.S. District Court in Hawaii.

When we visited Marcos, we asked if he was going to fight the case. “Baybayamon (Never mind),” he replied. He did not sound like the Marcos we knew. He thought that their case was weak and it would take years for them to testify. He said that he did not even know these people, so why would he violate their rights. He indicated that there might be some people who could make a plausible case against him but were not among the complainants. We later learned that the lawyers who had approached him were asking for a large amount of money which he apparently did not have at his disposal.

The claimants obtained a judgment of nearly $2 billion. See Hilao v. Estate of Marcos, 103 F.3d 767 (CA9 1996).The Estate of Roger Roxas and Golden Buddha Corp. also filed an action against Marcos’ widow, Imelda, and obtained a judgment against her. See Roxas v. Marcos, 89 Haw. 91, 969 P.2d 1209.

These claimants sought to enforce their judgments by attaching the Arelma assets held by Merrill Lynch. In order to determine the rightful owner of the assets, Merrill Lynch filed an interpleader action in the U.S. District Court in Hawaii. Named defendants were, among others, the alleged “victims,” Arelma, the Republic of the Philippines, the Philippine Presidential Commission on Good Governance (PCGG), and the PNB which held some of the assets in escrow.The Republic and the PCGG claimed a right to the assets based on a 1955 Philippine law, R.A. 1379, “An Act Declaring Forfeiture in Favor of the State Any Property Found to Have Been Unlawfully Acquired by Any Public Officer or Employee and Providing for the Proceedings Therefor.”

The Republic and the PCGG moved to dismiss the action or transfer it to a proper venue, and asked that the Judge recuse himself. The Judge denied their motions. They filed another motion to dismiss raising sovereign immunity. The Judge granted the motion but allowed the action against the “victims” to proceed, over the objection of the Republic and the PCGG. They appealed to the Court of Appeals. It affirmed the District Court, holding that the action could proceed without the Republic and the PCGG, and furthermore they would not prevail on their claims anyway.

Reversing the Court of Appeals, the U.S. Supreme Court held that it erred by giving insufficient weight to the foreign sovereign status of the Republic and the PCGG, and in discounting the merits of their claim. The Supreme Court told the appellate court to order the District Court to dismiss the interpleader action. Thus, the assets remain in the possession of Merrill Lynch, with its rightful ownership undetermined.

DISTRICT JUDGE’S IMPARTIALITY QUESTIONED

Two Justices of the Supreme Court said that the Court of Appeals should order the case reassigned to a different District Judge to conduct further proceedings. They noted that the Republic and PCGG had advanced a factual basis for suspecting that the District Judge’s impartiality could be questioned. The Judge, with a Spanish surname, is permanently assigned in Los Angeles. Observers have wondered why a Judge from Los Angeles has to come to Hawaii to conduct the Marcos trial when there are 4 U.S. District Judges in Hawaii.

The two Justices found that the Judge summoned an attorney representing Merrill Lynch to a meeting in chambers in Los Angeles on September 11, 2000, after learning that the Republic and the PCGG sought to obtain the Arelma funds from Merrill Lynch. The Judge directed Merrill Lynch to file an interpleader action before him in Hawaii and to deposit the Arelma funds with the court, despite the attorney’s argument that New York would likely be the more appropriate forum. Merrill Lynch filed the interpleader on September 14, 2000. The Judge sealed the file, making it difficult for other parties to determine the status of the proceedings.

The Justices noted that the Judge had said that the Republic and the Commission were not “real parties in interest,” and when the Court of Appeals ordered him to stay the proceedings, he did so, but vacated the stay within months, thus increasing “concern about the possibility that the District Judge would not fairly consider the Republic’s position on the merits.”

The Justices concluded: “These actions bespeak a level of personal involvement and desire to control the Marcos proceedings that create at least a colorable basis for the Republic and the Commission’s concern about the District Judge’s impartiality.”

WHAT IS THE SANDIGANBAYAN DOING?

The Supreme Court noted that in 1991, the PCGG asked the Sandiganbayan, a Philippine court with special jurisdiction over corruption cases, to declare forfeited to the Republic any property Marcos had obtained through misuse of his office. That litigation is still pending.

The Supreme Court indicated that the Sandiganbayan’s decision – whether or not the Republic and the Commission have a right to the Marcos assets – would determine what course of action would be available to the alleged human rights “victims”.

WHO ARE THE 9,539 “VICTIMS”?

Will all these “victims” come out in the open and publish their names? If they can prove that Marcos victimized them, there is someone who can help them.

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