DeJoria v. Maghreb Petroleum Exploration S.A.

John Paul DeJoria (plaintiff) and Maghreb Petroleum Exploration, S.A., Mideast Fund for Morocco Limited (MPE/MFM) (defendant) were former partners in a Moroccan oil venture. DeJoria was an investor in an oil exploration and drilling company that operated in Morocco. The King of Morocco’s first cousin had invested in the company. DeJoria had personally met with the King of Morocco to discuss investments and expanding drilling operations. In 2000, the King of Morocco announced the discovery of substantial oil reserves in Morocco. The announcement was huge national news. However, there was actually only a very small amount of oil. The announcement damaged the King’s and DeJoria’s company’s credibility. In 2002, MPE/MFM sued seven of its former partners, including DeJoria, in Morocco, alleging that the former partners mismanaged their company and fraudulently represented its value to induce MPE/MFM to invest in it. In 2009, a court in Morocco entered a judgment in favor of MPE/MFM against DeJoria and another person for approximately $122.9 million. The Moroccan judicial system, however, was heavily impacted by corruption and political influence. The United States Agency for International Development (USAID) released its “Morocco Rule of Law Report” in 2010 and detailed the prevalence of corruption in Morocco and the inefficiencies of the judiciary. The USAID report described how the King of Morocco had considerable influence over the appointment, discipline, and transfer of judges, negatively impacting judicial independence. In 2011, Morocco’s own foreign minister spoke to an audience in Washington, DC, and described that judicial independence is not a reality in Morocco and judges were often influenced by phone calls from the justice department. In 2012, nearly two-thirds of Morocco’s judges signed a petition demanding structural reforms to guarantee their independence from the king. DeJoria filed a motion for nonrecognition of foreign judgment, arguing that Texas law mandates nonrecognition of the Moroccan court judgment. MPE/MFM argued that DeJoria’s case was not important to the King or the royal family, so corruption was not a genuine concern. MPE/MFM filed an opposition to DeJoria’s motion in support of recognition and enforcement of the Moroccan court judgment.