Case 1:10-cv-01618-TFH Document 35 Filed 01/21/11 Page 1 of 7

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA
__________________________________________
)
DEVINCCI SALAH HOURANI et al. )
)
)
Plaintiffs )
) Civil Action No. 10-1618 (TFH)
v. )
)
ALEXANDER V. MIRTCHEV et al. )
)
)
Defendants )
__________________________________________ )

PLAINTIFFS’ REPLY IN SUPPORT OF THEIR

MOTION FOR LEAVE TO TAKE JURISDICTIONAL DISCOVERY AND IN
OPPOSITION TO THE MIRTCHEV DEFENDANTS’ MOTION FOR SANCTIONS

In response to Plaintiffs’ Motion for Leave to Take Jurisdictional Discovery, the two sets

of Defendants—Mirtchev and Krull (“Krull Defendants”) and GlobalOptions, Inc. and

GlobalOptions Management (“Global Defendants”)—both argue that Plaintiffs are not entitled to

jurisdictional discovery. In addition, all Defendants repeatedly cite to the Petition for Discovery

filed pursuant to 28 U.S.C. § 1782 (In Re Application of Caratube Oil Co., Misc. No. 10-285-

JDB) by a company mostly owned by Devincci Hourani—Caratube International Oil Co.—and

not by Plaintiffs on their own behalf, as if that case is somehow dispositive of the relief sought in

this case (which, of course, it is not). Finally, the Krull Defendants, not joined by the Global

Defendants, assert in the most general manner that two recent documents, coming from the

highest levels of the Kazakhstan Government and attached to Plaintiffs’ motion, are “forgeries”

and that, on that basis, sanctions should be imposed. As we explain below, each of these

arguments should be rejected, and the limited jurisdictional discovery should proceed.

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I. Limited Jurisdictional Discovery Is Necessary and Appropriate to Respond to

Defendants’ Rule 19 Defense.

Plaintiffs’ request for limited jurisdictional discovery is quite simple. It seeks to develop

a record for the Court to resolve the issue raised by Defendants under Rule 19: (1) whether the

Republic of Kazakhstan is an indispensible party; and (2) if so, whether the inclusion of

Kazakhstan as a party would thus deprive this Court of subject matter jurisdiction since

sovereign immunity would apply.1

Defendants’ oppositions to this request studiously avoid the thrust of why the production

of documents indicating the scope and nature of Defendants’ commercial relationship with

Kazakhstan likely will, on its own, establish that Kazakhstan is not a necessary party—and thus

resolve the Rule 19 Motion. If discovery indicates that Defendants’ contractual relationships

with Kazakhstan give rise to some form of contribution or indemnity relief against Kazakhstan,

then Defendants would not be prejudiced through nonjoinder of this country; they have adequate

remedies outside of these proceedings if they are subject to a judgment.

Moreover, the Global Defendants even rely on authority supporting the utility of

jurisdictional discovery. In Synygy, Inc. v. ZS Assocs., Inc., 2009 WL 1532117, at *3 n.1 (3d

Cir. June 1, 2009), the Third Circuit held that limited jurisdictional discovery is available to aid

the parties and the court in resolving Rule 19 issues. In the present case, the Rule 19 defense has

brought this issue directly to bear; indeed, it is the nature of the relationship between Kazakhstan

1
The Global Defendants assert that Plaintiffs’ motive for seeking jurisdictional discovery is to submit such
evidence to the Tribunal in the Caratube arbitration pending against the Republic of Kazakhstan. See GlobalOptions
Opp’n to Pls.’ Mot. for Leave to Take Jurisdictional Disc. at 3. Obviously, this is impossible because such
discovery has not been commenced and the final deadline for submission of evidence in those proceedings was
January 12, 2011.

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and the Defendants—and any contribution or indemnity rights bound up therein—that is the

subject of the discovery.

Finally, and despite Defendants’ position, this Circuit has explained that “if a party

demonstrates that it can supplement its jurisdictional allegations through discovery, then

jurisdictional discovery is justified.” GTE New Media Services Inc. v. BellSouth Corp., 199 F.3d

1343, 1351 (D.C. Cir. 2000) (citation omitted); see also Phoenix Consulting, Inc. v. Republic of

Angola, 216 F.3d 36, 40 (D.C. Cir. 2000) (stating that a plaintiff is entitled to “ample opportunity

to secure and present evidence relevant to the existence of jurisdiction” through jurisdictional

discovery). Because the joinder of Kazakhstan would deprive this Court of subject matter

jurisdiction, Plaintiffs are entitled to jurisdictional discovery to augment their arguments that

Kazakhstan is not a necessary party.2

II. Plaintiffs’ Exhibits Are Authentic and Not Forgeries.

Perhaps mindful that the legal and factual basis for jurisdictional discovery has been met

on this record, the Krull Defendants also assert that two of the exhibits attached to Plaintiffs’

motion are “forgeries” which must be stricken from the record and require the imposition of

sanctions. While Plaintiffs certainly take seriously any allegations of improper evidence—which

is not the case here—it is puzzling how such allegations relate to the pending motion, other than

as a distraction. In any event, Plaintiffs directly address this issue with their own competent

2
The Krull Defendants take the “Kazakhstan is the real party in interest” argument a step further by
contending that “Plaintiffs cannot pursue discovery of the alleged ‘agents’ of the foreign sovereign.” Id. at 14-17.
Aside from their failure to provide any authority for this assertion, Plaintiffs have not asserted that Mirtchev, or
Krull, are “agencies or instrumentalities” of the Republic of Kazakhstan as that term of art is defined under the
FSIA. See 28 U.S.C. § 1603(a) (explaining that sovereign immunity extends only to states, their political
subdivisions, and their agencies and instrumentalities); see also Wilmington Trust v. U.S. Dist. Court, 934 F.2d
1026, 1033 (9th Cir. 1991) (a party that is not a foreign sovereign, instrumentality thereof, or one of its political
subdivisions, does not have standing to invoke sovereign immunity.).

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evidence attached hereto, and are prepared to adjudicate more fully this claim in due course

through an orderly discovery schedule.

Specifically, the Krull Defendants attach a Declaration from their counsel, Mr. Fitch, that

states he received an unsworn letter from Steptoe & Johnson LLP, which in turn refers to a letter

it received from its client the Kazakh Ambassador to the United States, which in turn provides a

general (and unsworn) statement from His Excellency, wherein the Ambassador states that the

purported letter from him (Exhibit 5) “is an evident forgery.” Similarly a general and unsworn

letter from a Mr. M. Kasymbehov all the way from Kazakhstan states that Exhibit 4 is “a

falsified document” that “was never drafted at the Administration of the President of the

Republic of Kazakhstan.” Id. Apart from the obvious and multiple hearsay problems evident

from this daisy chain of unsworn “statements”—none of which comply with the Federal Rules or

common sense—these allegations cannot seriously carry the Krull Defendants’ burden of

alleging, let alone proving, that these two exhibits are somehow “forgeries.”

In contrast, Plaintiffs attach hereto the sworn Declaration of Dr. Rakhat Mukhtarovich

Aliyev, the source of the two “contested” documents. As Dr. Aliyev, the former son-in-law of

Kazakh President Nazarbayev, explains, he has many sources in the Kazakh Government, who,

since his exile from Kazakhstan in 2007, regularly “access sensitive documents produced and

kept by the Kazakh Government, and provide [him] with copies.” Declaration of Rakhat Aliyev

(“Aliyev Decl.”), ¶ 5.

Dr. Aliyev’s ability to come forward with such documents is not surprising, given his

prior positions in the Kazakh Government. See id. ¶ 12.3 Indeed, he explains in some detail that

3
Nor is it a secret, since it is well known that he has come forward with such documents for some time. See
Glenn R. Simpson & Susan Schmidt, Kazakhstan Corruption: Exile Alleges New Details, WALL ST. J., July 23, 2008

(continued…)

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the specific source for these recent documents is the KNB Special Information Service, which he

personally established in Kazakhstan during his tenure as First Deputy Chairman of the KNB

(Kazakhstan’s security service). Id.

On this record, therefore, the Krull Defendants have failed to: (1) come forward with any

competent evidence to support their assertion of “forgeries;” and (2) proffer how such allegations

are even relevant to the pending motion for jurisdictional discovery. If they are serious about

these allegations, they certainly will have the opportunity to address them more fully during the

course of an orderly and discovery process. But at this point, these allegations simply do not

carry water.4

(continued…)
(noting that “Mr. Aliyev backed up some of [his assertions about President Nazarbayev] with bank statements from
Lebanon and copies of checks drawn on banks in Indonesia and Liechtenstein,” that “[d]ocuments made available by
others with knowledge of the ruling family’s finances support some of Mr. Aliyev’s claims about the existence of a
banking network and about monitoring critics,” and that “documents in Mr. Aliyev’s possession appear to show”
that consultants working for Nazarbayev tracked the President’s “critics when they were in the U.S.”).
4
Since the Krull Defendants have not demonstrated that the two documents are forgeries, there is no basis
for the imposition of sanctions.

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Conclusion

For each of the foregoing reasons, as well as for the reasons set forth in Plaintiffs’

previous Memorandum, the Court should grant Plaintiffs’ motion for jurisdictional discovery,

and deny the Krull Defendants’ motions to strike and for sanctions.

Respectfully submitted,

/s/ Michael L. Martinez

Stuart H. Newberger, D.C. Bar #294793
Michael L. Martinez, D.C. Bar #347310
CROWELL & MORING LLP
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004
Phone: 202-624-2500
Fax: 202-628-5116
Counsel for Plaintiffs

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CERTIFICATE OF SERVICE

I certify that on January 21, 2011, I caused copies of the foregoing document to be filed

electronically with the Clerk of the Court by using the CM/ECF system, which will send notice

of electronic filing to all parties of record at the e-mail addresses on file with the Clerk of the

Court.

Warren Anthony Fitch, Esq. (CM/ECF)

Counsel for Defendants Alexander V. Mirtchev and Krull Corporation.

Morton S. Taubman, Esq. (CM/ECF)

Counsel for Defendants GlobalOptions, Inc., and GlobalOptions Management, Inc.

Mark David Hunter, Esq. (CM/ECF)

Counsel for Defendants GlobalOptions, Inc., and GlobalOptions Management, Inc.

/s/
Stuart H. Newberger, D.C. Bar #294793
Michael L. Martinez, D.C. Bar #347310
CROWELL & MORING LLP
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004
Phone: 202-624-2500
Fax: 202-628-5116