T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on and i s notpr e c e de nt * e xc e pta s pr ovi de d by 9th C i r . R . 36- 3. NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T MOHA ME D E . L AS HE E N, P l ai nt i ff

- A pp el l ee , E M B A S S Y O F T H E A R A B R E P U B L IC O F E G Y P T ; e t a l., D efen d an t s - A p p el l an t s, a nd T HE L OO MI S C OMP AN Y, D e f

e n d a n t. N o. 10- 17034 D. C . No . 2 : 0 1 - c v - 0 0 2 2 7 - L KK EFB ME MOR AN DU M *

A pp ea l fr om the U ni t ed S t at es D i stri ctC ou rt f o rth e E a s te rn D is tr ic t o f C a lif o rn ia L a w r e nc e K . K a r l t on, S e ni orD i s tr i c tJ udge , P r e s i di ng A r gue d a nd S ubm i tt e d D e c e m be r1, 2011 S a n F r a n c is c o , C a lif

o rn ia 

# FI LED JU L 02 2012 M OLLY C. DW Y ER, CLERK U . S. C O U R T OF APPE ALSTh e H o n o r ab l e J a me s G . Ca rr , Se n i o rD i s tr i c tJ u d g e f o rth e U . S. ** D i s tr i c tC ourtf

orthe N orthe rn D i s tr i c tof O hi o, s i tt i ng by de s i gna t i on. A s in th e p r e v io u s N in th C ir c u it o p in io n o n th is m a tte r , “L a s h e e n ” r e f e r s to 1 b o th M o h a m e d L a s h e e n a n d h is e s ta te . See E m bas s yof the A r ab R e

publ i c of E gy pt v . L as he e n (L as he e n I

), 60 3 F . 3d 11 66 , 11 68 n. 1 (9th C i r. 20 10 ).

2 B ef ore: T H O M A S and C L IF T O N , C i rc ui tJudg es , and C A R R , S eni or D i stri ct Judg e. ** T h e A r ab R e p u b lic o f

E g yp t, th e E m b a s s y o f

th e A r ab R e p u b lic o f

E g yp t, a nd the E m ba s s y of

E gyptC ul tur a l a nd E duc a t i ona l B ur e au ( c ol l e c t i ve l y , the

“ E gypt i an de f

e nda nt s ” ) appe a l the di s tr i c tc ourt ’ s de t e rm i na t i on tha tthe y a r e not i m m une f

r om s ui tby M oha m e d E . L a s he e n ( “ L a s he e n” ) . L a s he e n s ue d the 1 E g yp tia n d e f

e n d a n ts f o rv io la tio n s o f

th e E m p lo y e e s R e tir e m e n t I n c o m e S e c u r ity A ctof 19 74 (“ E R IS A ”) and b re ac h o f c on tra ct . T he E gypt i an defendant s a ss ert ed sovere i gn i m m un i ty. B ec ause L as heen’ s c l ai m s are base d u po n the E gypt i an de f e nda nt s ’ c om m e r c i a l a c t i vi ty , w e a f f i rm . A s the pa rt i e s a r e f a m i l i a rw i th the fa ctual and l egal hi st ory of the ca se , w e nee d n otre coun ti there . I U n d e rth e F o r e ig n S o v e r e ig n I m m u n itie s A c t ( “F S I A ” ) , “af o r e ig n s ta te s h a ll be i m m un e f

rom the j uri sdi ct i on of the court s of the U ni t ed S t at es and o f the S t at es e x c e p t a s p r o v id e d in ” th e A c t. 2 8 U .S .C . § 1 6 0 4 . T h u s , “af o r e ig n s ta te is p resu m p t i v el y i m m u n e fro m th e j u ri sd i ct i o n o f U n i t ed S t at es co u rt s[, ] u n l ess a3

spec i fi ed except i on appl i es . ” L as he e n I, 603 F . 3d a t1169- 70 ( quot i ng Saudi A r abi a v . N

e l s on , 50 7 U . S . 34 9, 35 5 (19 93 )) . “ O nce the pl ai nt i ff offe rs evi dence tha ta [ ] F S I A e xc e pt i on t o i m m uni ty appl i e s , the pa rty c l a i m i ng i m m uni ty be a r s the bur de n of

pr ovi ng by apr e ponde r a nc e of the e vi de nc e tha tthe e xc e pt i on doe s not ap p ly .” J

o s e p h v . O ffic e o f th e C o n s u la te G e n . o

f N ig e r ia , 830 F . 2d 1018, 1021 ( 9 th C ir . 1 9 8 7 ) , ce rt. deni ed , 48 5 U . S . 90 5 (19 88 ). H er e, L as heen argues thattw o st atut ory e xcept i on s app l y t o the E gypt i an d e f e n d a n ts : ( 1 ) w a iv e ra n d ( 2 ) c o m m e r c ia l a c tiv ity . See 2 8 U .S .C . § 1 6 0 5 ( a ) ( 1 ) - ( 2 ) . B e c aus e w e a f

f i rm on the ba s i s of

the c om m e r c i a l a c t i vi ty e xc e pt i on, w e ne e d not r e a c h the w a i ve re xc e pt i on. U nde rthe c om m e r c i a l a c t i vi ty e xc e pt i on, “ [ a ] f or e i gn s t a t e s ha l l notbe i m m une f

r om the j ur i s di c t i on of

c ourt s of

the U ni t e d S t a t e s orof

the S t a t e s i n a ny c a s e . . . i n w hi c h the a c t i on i s ba s e d upon ac om m e r c i a l a c t i vi ty c a rr i e d on i n the U ni t ed S t at es by the forei gn st at e . . . . ” 28 U . S . C . § 1 60 5(a) (2). T he F S IA defi nes

“ com m er ci al ac t i vi ty” as “ ei ther are gu l arcourse of com m er ci al cond uctor a pa rt i c ul a rc om m e r c i a l tr a ns a c t i on ora c t . ” 28 U . S . C . § 1603( d) . I ta l s o e xpl a i ns th a t “[ t]h e c o m m e r c ia l c h a r a c te ro f a n a c tiv ity s h a ll b e d e te rm in e d b y r e f e r e n c e to the na tur e of

the c our s e of

c onduc torpa rt i c ul a rtr a ns a c t i on ora c t , r a the rtha n by re fe re nce t o i t s purpo se . ” I d. T h e S u p rem e C o u rth as el ab o rat ed u p o n th ese4

re qu i re m ent s. A fore i gn st at e e ng ages i n com m er ci al ac t i vi ty w hen i texer ci se s

“ o n l y th o se p o w ers th atcan al so b e ex erci sed b y p ri v at e ci t i zen s, ” an d n o tth o se

“ po w er s pec ul i art o sov er ei gn s. ” N e l s on , 5 0 7 U .S . a t 3 6 0 ( q u o ta tio n s o m itte d ) ; se e al so R epub l i c of

A rgent i na v. W

el tover , Inc. , 5 0 4 U .S . 6 0 7 , 6 1 4 ( 1 9 9 2 ) . T h e k e y in q u iry “is w h e th e rth e [ g o v e rn m e n t’s ] p a rtic u la ra c tio n s . . . (w hat everthe m ot i ve behi nd them ) are the t ype o f a c tio n s b y w h ic h ap r iv a te p a rty engages i n . . . com m er ce . ” I d. (quo t at i on s om i tt ed). T hu s, thi s C ou rtconsi ders w hether “ the ca t egory of c on du cti s c om m er ci al i n n ature. ” L as he e n I, 60 3 F . 3d at 1170 ( quot i ng Sun v . T

ai w an , 20 1 F . 3d 11 05 , 11 09 (9th C i r. 20 00 ) ( i nt ernal quot a t i on m a rks om i tt e d) ) . F i na l l y , the r e m us tbe “ as uf f i c i e ntne xus be tw e e n the pl ai nt i ff’ s a ss ert ed cause of a ct i on and the fore i gn st at e’ s c om m er ci al ac t i vi ty. ” Id . T hi s r e qui r e s tha tthe f

or e i gn s t a t e ’ s a c t i vi t i e s f orm the ba s i s of

a n e l e m e ntof

the p la in tif f’s c la im . N

e l s on , 5 0 7 U .S . a t 3 5 7 ; see a l so H o lde n v . C a n a d ia n C o n s u la te , 9 2 F .3 d 9 1 8 , 9 2 0 ( 9 th C ir . 1 9 9 6 ) ; G ate s v . V i c torFi ne Foods , 54 F . 3d 1457, 1463 (9th C i r. 19 95 ). I n th is c a s e , L a s h e e n p le d tw o c au s e s o f a c tio n th a t p o te n tia lly f o rm th e b a s is of the c om m e r c i a l a c t i vi ty e xc e pt i on: E R I S A vi ol a t i ons , i nc l udi ng br e a c h of f i duc i a ry duty , a nd br e a c h of c ontr a c t . A s thi s C ourte xpl a i ne d i n L as he e n I, “ [b ]y contra ct i ng w i th a com pany t o m anage a hea l th b enef i t s pl an . . . the E gypt i an5

D ef endant s di d n otac tw i th the po w er s pec ul i art o a sovere i gn , bu ti nst ea d act ed as p r iv a te p la y e r s in th e m a rk e t.” 6 0 3 F .3 d a t 1 1 7 1 . S im ilar ly , b y p r o v id in g ah e a lth benefi t s pl an t o p art i ci pant s, the E gypt i an defendant s “ di d n otac tw i th the po w er s pecul i art o a sovere i gn , bu ti nst ea d act ed as pri vat e pl ay er s i n the m arket . ” I d. R e g a r d le s s o f

th e irp u rp o s e , th e n a tu r e o f th e ira c tiv ity w a s c o m m e r c ia l. See 28 U . S . C . § 1 60 3(d); Sun , 201 F . 3d a t1108. M or e ove r , thi s a c t i vi ty f orm s the ba s i s of

L a s he e n’ s c l a i m s . I n G at es v. V i c torFi ne Foods , agove rnm e nt a l C a na di a n pork pr oc e s s i ng c om pa ny ow ne d, throu gh subsi di ar i es , a C al i forni a pl ant . 54 F . 3d at14 59 . W hen the C anadi an com pany w i thd re w fi nanci al supp ort , the pl antcl osed, and w orkers atthe pl antsued th e C a n a d ia n c o m p a n y u n d e rv a r io u s e m p lo y m e n t- r e la te d th e o r ie s . I d. We ob se rved that“ [t ] he re cord cont ai n[ed] no evi dence t o sug gestthat[the C anadi an c o m p a n y ] w a s in v o lv e d in [ th e C a lif o rn iap la n t’s ] d e c is io n to c a n c e l its P la n a n d to cl ose i t s pl ant . ” I

d. a t1465. A ddi t i ona l l y , the r e w a s no “ e vi de nc e tha t[ the C a n a d ia n c o m p a n y ] p a rtic ip a te d in a n y d e c is io n s c o n c e rn in g [ th e C a lif o rn iap la n t] op er at i on s. ” I

d. B ec ause the com m er ci al ac t i vi t i es w er e unrel at ed t o the cl ai m s a t is s u e , w e c o n c lu d e d th a t th e c o m m e r c ia l a c tiv ity e x c e p tio n d id n o t ap p ly . I d. I n th is c a s e , b y c o n tr a s t, th e r e c o r d s u g g e s ts th a t th e E g yp tia n d e f e n d a n ts w er e c l osel y i nv ol ved i n the deci si on t o d eny L as heen coverage. L as heen6

prod uced: the A gree m entbetw ee n L oo m i s and the E gypt i an defendant s, w hi ch s pe c i f i e s tha tthe E gypt i a n de f e nda nt s w e r e the f

i na l de c i s i on- m a ke ri n c ove r a ge de c i s i ons ; al e tt e rf

r om the E gypt i a n de f

e nda nt s t o L oom i s e xpl a i ni ng the c ove r a ge de c i s i on on L a s he e n’ s tr a ns pl a nt ; a nd i nt e rna l L oom i s c orr e s ponde nc e s how i ng the c o m p a n y ’s im p le m e n ta tio n o f th e E g yp tia n d e f

e n d a n ts ’ d e c is io n . T h u s , th e r e is subst ant i al evi dence thatthe E gypt i an defendant s w er e “ i nv ol ved i n”–i nd ee d, that they m ade–the deci si on re gardi ng L as heen’ s c ov er age, up on w hi ch hi s c l ai m s are ba s e d. I I T h e E g yp tian d e f

e n d a n ts a r g u e th a t, e v e n if th e y w e r e in v o lv e d in c o m m e r c ia l a c tiv ity , th e e x c e p tio n d o e s n o t ap p ly b e c au s e L a s h e e n w a s ac iv il s e rv a n t. See H

olden , 9 2 F .3 d a t 9 2 1 . T he ci vi l -s ervanti nq ui ryst em s f rom the F S IA ’ s l egi sl at i ve hi st ory, t o w hi ch w e tu rn f o raf r a m e w o rkb y w h ic h to a n a ly z e c o m m e r c ia l a c tiv ity . H olden , 92 F . 3d a t921. T he H ous e R e porton the F S I A s t a t e s : “ A l s o publ i c orgove rnm e nt a l a nd notc om m e r c i a l i n na tur e , w oul d be the e m pl oy m e ntof di pl om a t i c , c i vi l s e rvi c e , or m i l i t ary per sonn el , bu tno tthe em pl oym entof A m er i can ci t i ze ns or thi rd coun try na t i ona l s by the F or e i gn s t a t e i n the U ni t e d S t a t e s . ” H . R . R e p. N o. 94- 1487, a t11 ( 1 9 7 6 ) , r e

pr i nte d i n 1 9 7 6 U . S . C . C . A . N . 6 6 0 4 , 6 6 1 5 . T h u s, th e rep o rtco n t i n u es,7

“[ a ]c tiv itie s s u c h a s af

o r e ig n g o v e rn m e n t’s s a le o f as e rv ic e o rap r o d u c t, . . . its e m pl oy m e ntore nga ge m e ntof l abor e r s , c l e r i c a l s t a f

f orpubl i c r e l a t i ons or m a rke t i ng a ge nt s . . . w oul d be a m ong thos e i nc l ude d w i thi n the de f i ni t i on [ of com m er ci al ac t i vi ty] . ” I d. M o r e o v e r , “c o u rts . . . h a v e ag r e a t d e a l o f la titu d e in det erm i ni ng w hati s ‘ com m er ci al ac t i vi ty’ for purpo se s of th[e A ct ] . ” I d. T ru e to the l e gi s l a t i ve hi s t ory , w e ha ve e m pl oy e d af l e xi bl e appr oa c h i n de t e rm i ni ng w h e th e rap e r s o n is ac iv il s e rv a n t. H olden , 92 F . 3d a t921. H e r e , L a s h e e n w a s ap r o f e s s o ra t ap u b lic u n iv e r s ity in E g yp t. H e c a m e to th e U n ite d S ta te s o n as tu d e n t s c h o la r s h ip to s tu d y h o rtic u ltu r e , in c o n n e c tio n w ith h is te a c h in g in E g yp t. E v e n a s s u m in g th a t E g yp t’s la w s d e f in e u n iv e r s ity pr of e s s or s a s c i vi l s e rva nt s , he w a s e f f e c t i ve l y on s abba t i c a l w hi l e s tudy i ng i n the U ni t e d S t a t e s . A s i n H

olden , he w a s notpr ovi de d the s a m e be ne f i t s orpr ot e c t i ons a s ac iv il s e rv a n t. See H olden , 92 F . 3d at92 1. T he E gypt i an defendant s argue that h e w a s e n title d to s tu d e n t b e n e f its , b u t th is is n o t p e r s u a s iv e e v id e n c e o f c iv il se rvi ce . T he t

y pe o f a c tiv ity in w h ic h L a s h e e n w a s in v o lv e d

– s tu d y a t a uni ve r s i ty–w a s atype “ of a c t i on[ ] by w hi c h apr i va t e pa rty e nga ge s i n tr a de a nd tra ff i c or c om m er ce . ” Ka to , 3 6 0 F . 3 d at1 1 4 (q u o t at i o n m ark s o m i tt ed ). T h u s, L a s h e e n w a s n o t ac iv il s e rv a n t.8 I I I B ec ause L as heen’ s c l ai m s ari se ou tof the E gypt i an defendant s’ com m er ci al a c t i vi ty , the E gypt i a n de f e nda nt s f a l l unde ras t a tut ory e xc e pt i on of the F S I A a nd are n o ten t i t l ed t o so v erei g n i m m u n i ty.

AF F I RME D.