you make up for it i think the court hopefully again i don't wear out my welcome during it this case implicates some of but not exactly the same issues as the pax s case that's why for example it was identified as potentially related in our submissions but not as directly related they were not coordinated below the plaintiffs and both of them although commonly represented by my self and my colleagues doctrine which brings me to the opening finally after some coming out hein this is not a case of first impression but it's a case of half impression or if we all wanted flashbacks of bush v gore of hanging chad no ormal statement on the contours of the active state doctrine embodying or excluding a commercial activity exception has ever been issued in a binding ruling by the supreme court or this court a plurality however of the supreme court in the dining hall case did in fact endorse such an exception for both logical and legal reasons i believe that this case presents an excellent opportunity for this court to make that final pronouncement it's been deferred in other instances because of the acts involved in the challenges being made but here we have once again the quintessential prive that a commercial contract which in this case the district court even affirmatively noted would have bene commercial activity under the foreign sovereign immunity set in the rulin once again we have the situation of what the doctrine is intended to protect i'm like the foreign sovereign immunity is that which is a creature some of the statute and designed to in fact the policy pronouncements of the state department regarding when and where a foreign sovereign can be sued that the state doctrines an equitable doctrine that recognizes the separation of powers between article three courts such as this recorder this court and the executive which is charged with plenary power in the conduct of foreign affairs as a result the analysis of this doctrine focuses specifically upon the impact of which a ruling by a court on an issue would have on international relations and it has to have a negative impact that's the doctrine from that comes the inevitable conclusion that as we've seen and with the cases it's not the place of the united states court to interfere with the executives foreign relations prerogatives or to pass judgment upon the acts of a foreign nation and so when we see all of the active state cases they involve matters such as expropriation of resources like the nationalization of oil fields the seizure of goods attempts to sue over the issuance or denial of a license went to centrally sovereign acts which are committed solely to a government that no private entity could do by contrast here we have a contract for the sale of salt that's ben extract it's a commodity that exists despite the efforts of a mitsubishi to cast this as a explicit natural resources extraction case it's not the salt has been mined or in this case evaporated and is injected into the stream of commerce by the company it's not good isn't i mean sell itself is is is a natural resource that is i think quintessentially part mining concessions or in this case of abberation concessions to the salt that would be a case where the exploitation of mexico's natural resources would be being challenged and would be within the after state doctrine and our view however those concessions were issued in the one nine hundred fifty s to a fully private us before the mexican government acquired its fifty one percent stake they continue today mexico has made the determination that the salt will be commercialized and sold that concession made no mention of to whom and again i mention that it's outset was a private corporation owned by an american daniel loued we so the question then becomes is the breach of a contract or the downstream conduct of mitsubishi a private corporation in the united states in furtherance of the sale of that salt within the b someone may extract or may exploit these resources and we see this a lot of the active state cases deal with opac and oil extraction the decision to poil out of the ground or to do it through a state owned enterprise would be a government did not have a majority suppose the contract with the first contract instead of forty years ago was today and the mexican government did have a majority interest would you still say there are no cases that say that mining falls within the sale or not but the distinction i would draw again is do you have the state's authorization to go construct the salt flat or did the mine and pull natural resources out the ground versus once you exclusively vested in the mexican government based on generic documents from the constitution of the united makes you can state such that when we're talking about we are back in assessing the talking about something that belongs to the government of mexico i see no reason to dispute that and i don't believe that's the timing of on this case i don't think that this case raises any issue about whether the mexican state or any state has the authority to determine not just the exploitation of the natural resources within its borders but all manner of conduct within its borders the question is once that state has made the determination that this resource will be extracted and exploited for commercial sale how far does the protection go perhaps it man it goes far enough to protect s s decision to sell them it's a big issue but when acid makes a decision to sell to other companies it does not doesn't protect those when mitsubishi engages in acts in the united states to stifle competition and prevent other entities from competing in the solar seesaw market does the act the state doctrine protect mitsubishi's conduct the answer is no under the extraterritorial doctrine which is an exception to the ad to say and also again because the tenuous link between the original extraction of resources and their ultimate injection into the commercial marketplace  other terrible metal actually probably iron because they're magnetic and i play with be that as it may the sale paperclips even in their own example doesn't implicate the act of say doctrine but that metal must have been mined at some point and ultimately mining rights always flow back to the sovereign that's why even in the united states whenever you look at the title of the land who discusses whether or not you're also obtaining title to the mineral rights it's subject to permeating and regulation by the e p a and the army of the interior so too in mexico but once the mexican government has granted rights to extract salt and then the salt exists in the commercial market space  in europe if that were a policy decision of the mexican government wouldn't that be the use of natural resources in some respects i believe your honor is correct however i think that this gets to a very somewhat esoteric distinction in mexican law between the mexican state and state owned enterprises such as a parastatal is a legal term of art and of these as the state draws a distinction between them so while under the foreign sovereign immunity these act which we have been discussing a state owned enterprises concern instrumentality of a foreign state under mexican law and the government are two separate entities although you know in some higher forms of the line and some respects but but mexico nj fifty one percent of this doesn't mean that it's in furtherance of the acts of the state whenever s acts again i believe that the answer to that even under mexican law is no your honor because it does draw a distinction it is not for example the mexican department of the interior as a governmental agency or department acting it's a governmental owned corporation which is granted a stink set of legal rights and has controlling ownership correct but even with the controlling ownership under mexican law itself the distinction is drawn and some of that while i was discussed in the record that the state doctrine is not bound by the foreign sovereign and b s i know it's not beyond buy it doesn't foreign state mean the same thing when you use it in each of those doctrines i believe that the difference comes in the use of the foreign sovereign in these act herm instrumentality of a foreign state which goes beyond the mere existence of a sovereign into things like state owned corporations sovereign wealth funds and so forth that is a falls squarely within the abundant precedent in this court and elsewhere that any crust of lawsuits challenging the manner in which a foreign government or a government controlled entity seeks to profit from its natural resources are governed by the act of state doctrine it's not merely the manner in which when whether they choose to extract resources or not the language from this court's decision in the international association of machinists includes how it chooses to profit from those natural resources the cases that were brought against opec and foreign control the oil companies remain good law they're on point and they dictate the outcome here and it's notable that the plaintiffs have no case law so forth for their contrary arguments just to summarize the facts the mexican government has chosen to exploit its natural resource of sea salt in a manner a manner similar to the way many developing countries exploit their resources if they enter arrangement with companies that are capable of providing the necessary expertise capital and manpower to extract and mine the sea salt as other countries do with respect to other natural resources me to be she in turn is compensated for making the necessary investment and dedicating the necessary resources in part to its ability to distribute the finished product plaintiffs are challenging the ability of mexico to profit from its fees salt through its chosen means each of their claim is two core components first an official act of a foreign sovereign performed in its own territory and second that the relief would declare the act invalid those conditions are all satisfied here as is majority owned and controlled by the mexican government the decision how to profit from a natural resource is a classic sovereign act and the challenge to action flowed from that decision and mitsubishi as well as the contract that s ahead within a food were performed in mexico and this lawsuit seeks to declare those actions illegal and invalid straightforward application of the law plaintiffs make a number of arguments the one that the court spent the most time considering here and i think it is the key argument is whether this is commercial activity whether the sale of some salt can be separated can be segregated from the other components of this integrated agreement and treated as an independent act that excluded from the act of state doctrine there's a good deal of law on this point while they claim th decision is whether to exploit a sovereign activity but actually exploiting its commercial case lot says otherwise indeed this court in the international association of machinists case addressed the point it said the act of state doctrine precludes courts and i'm quoting instructing a foreign sovereign to alter its chosen means of allocating and profiting from its own valuable natural resources those quotes locating and profiting from mexico's decision of the means by which it chooses to profit from that sea salt is exactly what we're talking about and exactly what plaintiffs are trying to say does not come with th how downstream into the market does that is that in your mind is the act of state doctrine covered the distribution and sales of the season i would say to the next seller by  mitsubishi so for example to take the paperclip analogy i'm not saying but that if a chef chooses to use too much sea salt that can be tracked back and will be come within the act of state government but the contours of this arrangement that mexico has agreed to is exclusive sale cording to the complaint by mitsubishi and that's as far as the claim in this case goes so the court doesn't need to resolve what would happen if somewhere further down the line to a later seller had an issue i would be surprised if such a case would come with an act of state doctrine but here looking at the arrangement that's being challenged that is exclusive distribution as part of this arrangement that comes within the core here in the court needn't go any further than that  extending the act of state doctrine now one of the things plaintiff argued was the international association of machinists the court was dealing only with price fixing but that consisted only of production limits so he said that doesn't extend to the sale of the product well that's actually not accurate if the court will will look back at that opinion not only with her production with that part of the case but also royalty payments that is amounts that charge to the companies that and once again we're talking about conditions associated with the sale of the oil in clay co the court described the activity as going to going to boil concession which is in some respects functionally similar to what we have here in perth instances the conduct involved not only the decision whether to permit exploitation but the economic terms that would govern the sale of the oil finally plaintiff distinction makes no sense in addition to  by the precedent there saying we agree courts can't tell mexico whether to exploited sea salt but the court should tell mexico how it can do so that is that it cannot use the normal arrangement that developing countries  exploit their natural resources we're dealing with an integrated decision here let me turn very quickly to a few other arguments the plaintiffs of them to size in their reply brief they argue at some length that mitsubishi was obligated to obtain input from the addressed exactly that argument and rejected the respondents argued that the act of state doctrine should be a political and i quote only when the executive branch expressly stipulates that it does not wish to court to pass on the question of the supreme court rejected the position saying the state department may wish to refrain from taking a position and anyway it's questionable whether the examination of validity by the judiciary should depend on an educated guess by the  for none of this court's cases applying the effect of state doctrine has imposed such a requirement or for that matter received such input second argument they make they argue that mexican commercial law applies and therefore this is not this is a commercial act under mexican bar the answer to that is it's irrelevant you have to state doctrine addresses which branch of the united states government should handle matters involving the sovereignty of foreign nation should it be the executive branch should it be to judicial branch the test turns on whether there's been an official act and whether the u s courts are being asked to declare it invalid or the governing authority it doesn't turn on which body of law the foreign country itself would use to resolve a breach of contract action which incidentally this case is not going to cite no act of state authority again we have found none even considering what the method law of a foreign country would apply finally with respect to the extraterritorial exemption that plaintiff has identified we believe that argument has no basis whatever is the can this court held in the case that doctrine applies when a foreign nation seeks to confiscate assets held in the united states it's understandable in that circumstance that the fact of state doctrine would not apply because you're dealing with an impact and acts in the purports to confiscate assets held in the united states and that's as far as any of the cases applying the extraterritorial extraterritoriality exception go it doesn't apply merely because the action taken wholly within the foreign country has fact in the united states if it did every single one of the opec cases would have come out the other way from the way this court and other courts have decided in some this case falls squarely within the terms of the act of state in this court's long standing compliance with united states law for its actions in the united states simply because it asserts that mexico has compelled it to do so or wants it to do so that is the core issue that issue from the united states department of state unlike many other cases such as the in re vitamin c case from the second circuit or even in this case this court's case where actually the state department changed its position on whether or not the alien tort claims act the case could proceed it started off opposed and then it said that later on there was no impediment and actually desired the case to proceed in our that the point here is that this doctrine is to permit courts to abstain from passing on the acts of a sovereign in execution of its sovereign actions within its own territory that is not what the court would be called upon to do here and finally the very last point your honour's and i beg your indulgence for this time is the baca bunco national case which counsel pointed to about how it is not a requirement that the department of state answer any call or weigh in on every single one of these cases that's correct the supreme court did say so but it also say that it has to be more than educated guess even use the term here we have nothing but speculation as to the harm to us mexico relations by virtue of the case proceeding speculation is not enough to invoke the doctrine and dismissive thank you for your indulgence your hono