Court revives 'terrorism' lawsuit against OPEC

There is a reasonable option for serving OPEC, the worldwide Organization of Petroleum Exporting Countries group that mandates oil production levels to support prices, with notice of a "terrorism" lawsuit so that the claim can move forward in America's judicial system, an appeals court has found.

The ruling came recently from the U.S. Court of Appeals for the District of Columbia Circuit in the dispute raised by attorney Larry Klayman of Freedom Watch, and the opinion addressed the intricacies of rules of federal court procedure.

"Freedom Watch relied solely on Rule 4(f)(3) – not Rule 4(h)(1) – in seeking authorization to serve OPEC through its United States counsel," the opinion noted regarding the district court's decision to throw out Freedom Watch's request based on Rule 4(h)(1).

"The district court's stated reasons for rejecting service through counsel would not preclude authorization of such service under Rule 4(f)(3)," the opinion said. "A number of courts thus have sanctioned service on United States counsel as an alternative means of service … without requiring any specific authorization by the defendant for the recipient to accept service on its behalf."

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"As a prospective matter, the district court presumably could have elected to grant Freedom Watch's … request by ordering service on [the legal firm] White & Case within a specified time period and requiring proof of that subsequent service," the opinion, written by Judge Sri Srinivasan, said.

The court ordered the case returned to the district court where it said the judge has discretion whether to grant permission for that alternative service.

The revival of the case is significant.

It alleges OPEC participated in conspiracy, price-fixing, hampering distribution and limiting production.

It was filed two years ago, and charges that the members of OPEC, such as Saudi Arabia, Iran, and others, "specifically and intentionally limit barrels of oil that each country produces," causing the price to rise.

Klayman said that is "illegal price fixing" and violates antitrust laws. It was derailed temporarily when attorneys for OPEC argued the notification of the lawsuit wasn't carried out correctly. The appeals court opinion sets up an outline for circumstances that would make it proper.

Klayman, a former Justice Department lawyer, alleges "economic terrorism" on the part of OPEC.

He pointed out that the organization knew of the action so that it could respond in court, and he personally delivered to Frederick Luger, intake officer for OPEC in Vienna, a copy of the summons and complaint.

"Defendants concede that a summons and complaint were received by hand at OPEC's headquarters, but mistakenly believe it was by Larry Klayman, counsel for plaintiff. … Defendants were served by someone who is not a party to this action," Klayman explained to the court.

The complaint argues that without OPEC's anti-competitive agreement, more oil would be in production, and the result would be lower prices.

"Even when OPEC members produce to the full extent of their capacity, they produce far less oil than they would were they operating in a competitive market, because they artificially restrict their production capacity as part of their price-fixing scheme," the complaint alleges.

"The … nature of OPEC's price-fixing conduct is further confirmed by its course of dealing with non-members. OPEC has met with these non-members and has secured their agreement to limit production and has thereby increased the price of gasoline and other petroleum products over competitive levels," the complaint says.

Klayman previously brought legal action against Venezuelan President Hugo Chavez and Iranian President Mahmoud Ahmadinejad on behalf of torture victims, advancing the case against Iran to the point of obtaining a default judgment.

Klayman also won a nearly $2 million unpaid judgment against Cuban interests in 1996 over the shooting down of an airplane.

He also recently obtained a court ruling that the National Security Agency's spy on Americans programs likely violate the Constitution.

The claim against OPEC alleges that "as a form of economic terrorism," OPEC's actions "are designed to severely harm the economics or strategic interests of the United States and Western Europe in particular."

"The illegal conduct of the defendant, and its constituent members and co-conspirators, is thus intended at this time to also influence the American presidential and congressional elections of 2012 by destabilizing the economy to further their pro Islamic and communist agendas," the complaint says.