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ZULIMA
V. FARBER
ATTORNEY GENERAL OF NEW JERSEY
Attorney for Plaintiff Governor Jon Corzine
R.J. Hughes Justice Complex
25 Market Street
P.O. Box 112
Trenton, New Jersey 08625-0112
By:
James H. Martin
xxxxAssistant Attorney General
xxxx609-984-1933
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
------------------------------------------------------------------------------------------------------------------------------------------------------------------
HON. JON CORZINE, Governor of the State of New Jersey,
xxxxxxxxxxxxxxxxxxxxxxPlaintiff,
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxcccccccccxxxxxxxxxxxxCivil
Action No.
xxc x xv.
HON. JOHN SNOW, Secretary of the Treasury; ccccccccccccccccccccccccccccccccccccccVERIFIED
COMPLAINT
HON. CONDOLEEZZA RICE, Secretary of State;
HON. DONALD RUMSFELD, Secretary of Defense;
HON. CARLOS GUTIERREZ, Secretary of Commerce;
HON. ALBERTO GONZALES, Attorney General of the United
States;
HON. MICHAEL CHERTOFF, Secretary of Homeland Security;
HON. JOSHUA B. BOLTEN, Director of the Office of Management
and Budget;
HON. ROB PORTMAN, United States Trade Representative;
HON.
STEPHEN J. HADLEY, Assistant to the President for National
Security Affairs;
HON. ALLAN HUBBARD; Assistant to the President for Economic
Policy;
HON. JOHN MARBURGER, Director of the Office of Science
and Technology Policy;
COMMITTEE ON FOREIGN INVESTMENTS IN THE UNITED STATES,
xxxxxxxxxxxxxxxxxxxxxxDefendants.
------------------------------------------------------------------------------------------------------------------------------------------------------------------
Plaintiff, Hon. Jon Corzine, Governor of the State of
New Jersey, hereby alleges as follows:
PARTIES
-
Plaintiff Hon. Jon Corzine is the Governor of the State
of New Jersey and is responsible for the protection
of the health and safety of the people of New Jersey
and those who work in and travel through the State.
He brings this suit in furtherance of his duty to address
a potential threat to the safety and well-being of millions
of New Jersey residents and visitors who live, work
and travel in the areas closely adjacent to New Jersey’s
port facilities, as well as the security of those port
facilities.
-
Defendant Hon. John Snow is the United States Secretary
of the Treasury, and a member and chairman of the Committee
on Foreign Investments in the United States (“CFIUS”).
He is sued in his official capacity.
-
Defendant Hon. Condoleezza Rice is the United States
Secretary of State and a member of CFIUS. She is sued
in her official capacity.
-
Defendant Hon. Donald Rumsfeld is the United States
Secretary of Defense and a member of CFIUS. He is sued
in his official capacity.
-
Defendant Hon. Carlos Gutierrez is the United States
Secretary of Commerce and a member of CFIUS. He is sued
in his official capacity.
-
Defendant Hon. Alberto Gonzales is the Attorney General
of the United States and a member of CFIUS. He is sued
in his official capacity.
-
Defendant Hon. Michael Chertoff is the United States
Secretary of Homeland Security (“DHS”) and
a member of CFIUS. He is sued in his official capacity.
-
Defendant Hon. Joshua B. Bolten is the Director of the
Office of Management and Budget for the Executive Office
of the President of the United States and a member of
CFIUS. He is sued in his official capacity.
-
Defendant Hon. Rob Portman is the United States Trade
Representative and a member of CFIUS. He is sued in
his official capacity.
-
Defendant Hon. Stephen J. Hadley is the Assistant to
the President of the United States for National Security
Affairs and a member of CFIUS. He is sued in his official
capacity.
-
Defendant Hon. Allan Hubbard is the Assistant to the
President of the United States for Economic Policy and
a member of CFIUS. He is sued in his official capacity.
-
Defendant Hon. John Marburger is the Director of the
Office of Science and Technology Policy for the Executive
Office of the President of the United States and a member
of CFIUS. He is sued in his official capacity.
-
Defendant Committee on Foreign Investments in the United
States (“CFIUS”), an inter-agency committee
chaired by the Secretary of the Treasury, was established
by Executive Order 11858 to monitor and evaluate the
impact of foreign investment in the United States. In
1988, the President, pursuant to Executive Order 12661,
delegated to CFIUS his responsibilities under 50 U.S.C.
App. §2170.
JURISDICTION AND VENUE
-
This Court has jurisdiction over this action because
the claims arise under the Constitution and laws of
the United States. 28 U.S.C. §1331.
-
Venue
is properly laid in this District because a substantial
portion of the events giving rise to the claims asserted
in this Complaint arose in New Jersey. 28 U.S.C. §1391(b).
FACTS - PORT NEWARK
-
New Jersey is the most densely populated State in the
nation. Port Newark is located in or adjacent to the
three most densely populated counties in New Jersey,
Essex, Union and Hudson Counties.
-
Port Newark is one of the largest ports in the nation.
More than 3 million units of containerized cargo move
through the Port annually.
-
The area where Port Newark is located is the focal point
of much of the transportation infrastructure in the
region. CSX, Conrail, Norfolk Southern, Canadian Pacific
and several short lines provide freight rail service
in and around Port Newark. Amtrak and New Jersey Transit,
the third largest public transportation provider in
the country, provide rail passenger service on tracks
and at stations adjacent to Port Newark.
-
The New Jersey Turnpike, Interstate 78, State Highways
1&9, 21, and 22, are adjacent to Port Newark, as
is Newark Liberty International Airport which provides
air transportation for millions of passengers each year
from around the world, as well as for freight.
-
Port Newark is located close to the Goethals Bridge,
the Bayonne Bridge, the Newark Bay Bridge, the Verrazzano
Narrows Bridge, and the Holland and Lincoln Tunnels.
These facilities are critical components of the region’s
transportation network.
-
The Port Newark area is the site of major petrochemical
refining, storage and transportation facilities, natural
gas transportation facilities, power generation facilities
and telecommunications services facilities.
-
From Port Newark, containers are loaded onto commercial
vehicles and railways for destinations throughout the
United States.
-
A breach of security at Port Newark poses a threat to
the people of New Jersey, and all those who live, work,
and travel in the State, as well as the critical facilities
located near Port Newark.
-
A breach of security at Port Newark could result in
allowing a weapon of mass destruction to be transported
from Port Newark onto the roads and railways of New
Jersey, to destination points throughout the United
States.
THE PROPOSED ACQUISITION
-
Upon information and belief, on or about November 2005,
Dubai Ports World (“Dubai”), through Thunder
FZE (“Thunder”), made an offer to acquire
Peninsular and Oriental Steam Navigation (“P&O”),
a corporation formed under the laws of the United Kingdom
which is engaged in shipping and logistics operations
at Port Newark, New Jersey. A subsidiary of P&O
is a partner in a limited liability company that leases
a container port at Port Newark.
-
Upon information and belief, in or about February 2006,
the shareholders of P&O approved the acquisition.
-
Upon information and belief, the acquisition will be
completed on or about March 2, 2006, after being confirmed
by the High Court of Justice of England and Wales.
-
Upon information and belief, Dubai and Thunder are wholly-owned
subsidiaries of Ports Containers and Free Zone Corporation,
which is controlled by the government of the Arab Emirate
of Dubai.
-
Upon information and belief, Dubai and Thunder are entities
over which control is exercised or exercisable by the
government of the United Arab Emirate of Dubai, a member
of the United Arab Emirates federation.
THE UNITED ARAB EMIRATES
-
According to the National Commission on Terrorist Attacks
upon the United States, Monograph on Terrorist Financing,
Staff Report to the Commission (the “Monograph
on Terrorist Financing”), the vast majority of
money funding the September 11, 2001 attacks flowed
through the United Arab Emirates.
-
According to the Monograph on Terrorist Financing, the
United Arab Emirates was “ambivalent and selectively
cooperative” in assisting the United States in
its efforts to stop the flow of money to Al Qaeda entities.
-
Upon information and belief, the United Arab Emirates
is one of only three nations that recognized the Taliban
as Afghanistan’s legitimate government.
-
Upon information and belief, the United Arab Emirates
was the home to Marwan al-Shehhi, a September 11th hijacker.
-
Upon information and belief, the United Arab Emirates’
banking system has been used by groups affiliated with
Al Qaeda.
-
Upon information and belief, a covert group, headed
by the father of Pakistan’s nuclear program, Adbul
Qadeer Khan, with the help of a Dubai company, supplied
Pakistan nuclear technology to Iran, Libya and North
Korea, countries identified by the United States as
state sponsors of terrorism.
THE EXON-FLORIO AMENDMENTS
-
50 U.S.C. App. §2170 authorizes the President of
the United States to review proposed transactions involving
the merger, acquisition, or takeover by an entity owned
or controlled by a foreign government of an entity engaged
in interstate commerce in the United States. That statute
authorizes the President to suspend or prohibit any
such transaction when, in the President’s view,
the foreign government intending to exercise control
over an entity engaged in interstate commerce in the
United States might take action that threatens to impair
the national security.
-
In 1988, pursuant to Executive Order 12661, the President
of the United States delegated his authority under 50
U.S.C. App. §2170 to CFIUS.
-
Pursuant to 31 C.F.R. §800.401, any party to a
transaction subject to 50 U.S.C. App. §2170 may
send a voluntary notice to the CFIUS of the intended
transaction.
-
Pursuant to 31 C.F.R. §800.402, any voluntary notice
submitted to CFIUS must contain information regarding
the “essentials of the transaction,” including
the extent of control a foreign government exercises
over the company submitting the notice.
CFIUS CONSIDERATION OF DUBAI’S PURCHASE
OF P&O
-
Upon
information and belief, in late 2005 or early 2006,
Dubai sent a voluntary notice to CFIUS that the company
planned to purchase P&O, which would give Dubai
control of shipping operations at a portion of Port
Newark.
-
Upon information and belief, Dubai’s offer to
purchase P&O is conditioned on completion of the
CFIUS review process.
-
Upon information and belief, CFIUS reviewed the documents
and information Dubai submitted in conjunction with
the company’s voluntary notice.
-
Upon information and belief, DHS identified security
concerns arising from the proposal to allow Dubai to
gain control of shipping operations at Port Newark and
other locations.
-
Upon information and belief, officials from the DHS
obtained safeguards and assurances from Dubai addressing
the Department’s security concerns.
-
Upon
information and belief, based upon its review of the
documents and information submitted by Dubai in conjunction
with the voluntary notice and the supplemental safeguards
and assurances Dubai provided to one or more members
of CFIUS, CFIUS determined not to undertake an investigation
of Dubai’s proposed purchase of P&O and resulting
gain of control of a portion of Port Newark.
-
Upon information and belief, pursuant to 31 C.F.R. §800.502(b),
CFIUS notified P&O and Dubai that an investigation
of the transaction was not required. Pursuant to 31
C.F.R. §800.5023(a) a decision by CFIUS not to
investigate a proposed transaction concludes action
under 50 U.S.C. App. §2170.
COUNT ONE
SEEKING A WRIT OF MANDAMUS REQUIRING CFIUS TO FULFILL
ITS STATUTORY OBLIGATION UNDER 50 U.S.C. APPENDIX §2170
-
The
Plaintiff repeats and re-alleges the foregoing allegations
as if fully set forth at length herein.
-
50 U.S.C. App. §2170(b) mandates that CFIUS undertake
an investigation where “any entity controlled
by or acting on behalf of a foreign government”
seeks to engage in any acquisition that “could
affect the national security of the United States.”
-
CFIUS and its members failed to fulfill their statutory
obligation to conduct an investigation of the proposed
acquisition of P&O by Dubai, given the clear potential
that the sale of P&O to Dubai, and the subsequent
transfer of control of portions of Port Newark, New
Jersey to the government of the United Arab Emirate
of Dubai, could affect the national security of the
United States.
COUNT TWO
SEEKING DOCUMENTS AND INFORMATION WHICH WILL PERMIT
PLAINTIFF TO FULFILL HIS CORE STATE FUNCTION TO ENSURE
THE HEALTH AND SAFETY OF THE PEOPLE OF NEW JERSEY, AND
THOSE WHO WORK IN, AND TRAVEL THROUGH THE STATE
- The
State of New Jersey and plaintiff Governor Corzine are
responsible for protecting the health and safety of the
people of New Jersey, and those individuals who work in
and travel through the State, all of who could be impacted
by a breach of security at the Port Newark.
-
The protection of public health and safety is an integral
and traditional governmental function of the State of
New Jersey executed by plaintiff Governor Corzine and
his designees, including officials at the Office of Counter-Terrorism.
-
Under the Maritime Transportation Security Act of 2002,
Congress recognized that United States ports may serve
as a vector or target for terrorist attacks aimed at the
United States. 46 U.S.C. §70101 note.
-
Under the National Response Plan adopted pursuant to Homeland
Security Presidential Directive 5 (“NRP”)
(December 2004 at p6), primary responsibility for responding
to the consequences of a terrorist attack or other incident
of national significance falls to the State, county and
local resources of the State. (“The NRP is based
on the planning assumptions and considerations presented
in this section. Incidents are typically managed at the
lowest possible geographic, organizational, and jurisdictional
level.”).
-
While the Coast Guard inspects security at the Seaport,
the Maritime Transportation Security Act only requires
the Coast Guard to inspect facilities once per year.
-
Pursuant to the Maritime Transportation Security Act of
2002, the owner and/or operator of a facility is the cornerstone
of security. The owner/operator is required to develop
a Facility Security Plan (“FSP”) and designate
an employee to serve as Facility Security Officer (“FSO”).
The FSO is responsible for implementing the FSP, which
includes responsibilities related to record keeping, surveillance,
ensuring appropriate training and hiring practices, and
conducting security inspections. The FSO is in a position
to gain information regarding the port facility’s
entire operation as well as information regarding the
security practices of other entities involved in port
security.
-
To the extent the State lacks confidence in the FSO and
his or her employer, the State’s ability to fulfill
its obligation to ensure adequate security at the Port
Newark is impaired.
- In
order to plan for the response to and recovery from terrorist
activity, and in order to detect and prevent acts of terrorism
in areas where the State has principal responsibility,
plaintiff Governor Corzine, and his designees, must have
access to information needed to enable the Governor to
protect and preserve the lives, health, and property of
the people of New Jersey and those who work in and travel
through the State.
-
In order to effectuate this responsibility, plaintiff
Governor Corzine instructed the New Jersey Office of Counter-Terrorism
to request from DHS and CFIUS the documents and information
submitted to CFIUS by Dubai and any evidence of the safeguards
and assurances regarding security concerns provided by
Dubai to DHS or any member of CFIUS, or any mitigation
agreement memorializing the safeguards and assurances.
-
Officials at New Jersey’s Office of Counter-Terrorism
have security clearance from the United States government
to review confidential materials concerning national security.
-
Neither DHS nor CFIUS has provided all of the requested
information.
-
Defendants’ failure to provide New Jersey’s
Office of Counter-Terrorism with all of the documents
and information relevant to the acquisition by Dubai,
impairs plaintiff Governor Corzine’s ability to
execute New Jersey’s traditional function of protecting
the health and safety of its people, and those individuals
who work in or travel through the State.
-
Defendants’ failure to provide New Jersey’s
Office of Counter-Terrorism with all of the documents
and information relevant to the acquisition by Dubai,
interferes with the residual and inviolable sovereign
functions reserved to the State of New Jersey by the Tenth
Amendment to the United States Constitution.
WHEREFORE, Plaintiff Governor Corzine seeks an Order
directing:
(a)
CFIUS to perform the investigation of the proposed acquisition
of P&O by Dubai Ports World that is required by
50 U.S.C. App. §2170(b);
(b)
CFIUS to rescind its notification to Dubai and/or P&O
that no investigation was required under 50 U.S.C. App.
§2170(b) of the proposed acquisition of P&O
by Dubai;
(c)
CFIUS, upon completion of its investigation of the proposed
acquisition of P&O by Dubai Ports World, to present
to the President a report that includes the information
mandated by 50 U.S.C. App. §2170(e)-(f) and 31
C.F.R. §800.504(b);
(d)
defendants to provide to New Jersey’s Office of
Counter-Terrorism the documents and information provided
to CFIUS by Dubai Ports World;
(e)
defendants to provide to New Jersey’s Office of
Counter-Terrorism any other documents, letters, memoranda,
electronic documents in the possession of CFIUS or any
of its members relating to Dubai Ports World and/or
its acquisition of P&O; and
(f)
such other relief as this Court deems necessary and
proper
Respectfully
submitted,cccccgccddddcccccc
ZULIMA V. FARBERcgcffddddffffffffffccccc
ATTORNEY GENERAL OF NEW JERSEYfffff
By:
______________________________ccccc
James H. Martincccccccccbbbbcccccccccccc
Assistant Attorney Generalcbbbbcccccccccc
Dated:
ccTrenton, New Jersey
xxxxxxxxxcFebruary
23, 2006
|
VERIFICATION
State
of New Jersey
xxxxxxxxxxxxxxxxxxxvxx
County of Mercer cx
On this 23rd day of February, 2006, James McElwain, New
Jersey’s Homeland Security Advisor, appeared before
me. After I administered the oath to him, upon his other
he said that he read the Verified Complaint and that the
facts stated in it are within his personal knowledge and
are true and correct.
___________________________
James McElwainxxxxxxxxxxxxxxxxxxxx
Sworn
and subscribed before
me this 23rd day of February, 2006
_____________________________
Attorney-At-Law
State of New Jersey
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