UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

MADY MARIELUISE SCHUBARTH, 

Plaintiff, 

v. 

FEDERAL REPUBLIC OF GERMANY 

& BVVG, 

Defendants. 

 

Case No. 1:14-cv-02140 (CRC) 

MEMORANDUM OPINION 

Plaintiff Mady Marieluise Schubarth, a U.S. citizen who allegedly inherited a large estate 

that was expropriated by the East German government following World War II, seeks to recover 

the value of the taken property from Germany and a German state-owned entity. The Foreign 

Sovereign Immunities Act (“FSIA”), 28 U.S.C. § 1602, et seq., however, generally grants 

sovereign entities immunity from suit, absent a relevant exception. Because Schubarth has not 

alleged facts supporting the application of any relevant FSIA exception, the Court lacks 

jurisdiction over her claims. The Court will therefore dismiss the case. 

I. Background 

Schubarth alleges that an estate she inherited—comprising over 500 acres of partially 

developed agricultural land in the state of Thuringia, Germany—was expropriated by the East 

German government in 1945. Compl. ¶ 11. In 1991, following Germany’s reunification, 

Schubarth applied to a Thuringia state agency for restitution of the expropriated property. Id. 

¶ 14. Dissatisfied with the agency’s award, which she says amounted to a small fraction of the 

total estate, Schubarth reapplied in 1995 for additional compensation pursuant to a German law 

that had been recently enacted. Id. ¶ 18. She claimed that under the 1956 Treaty of Friendship, 
2 

Commerce and Navigation between the United States and Germany (“FCN Treaty”), 7 U.S.T. 

1839, she was entitled to the full, fair market value of the property as of the date of 

expropriation. Id. Schubarth’s application remained pending for nineteen years, until February 

2014, when the Thuringia state agency recognized her as the owner of the estate and proposed to 

award her € 35,279 in compensation. Id. ¶¶ 18–19. Despite Schubarth’s complaint that this 

amount was too low, and out of step with Germany’s obligations under the FCN Treaty, the 

agency finalized the award in November 2014, without referencing the Treaty. Id. ¶ 21. 

The following month, Schubarth brought suit in this Court, naming as Defendants the 

Federal Republic of Germany (“Germany”) and BVVG Bodenverwertungs- und- verwaltungs 

GmbH (“BVVG”)—a German state-owned entity “responsible . . . for the management, 

marketing and sale of expropriated properties located in” former East Germany. Id. ¶¶ 3–4. To 

execute its mission, BVVG “provides information about the expropriated properties it controls to 

potential buyers, including lease and purchase prices, and other commercial terms,” and 

allegedly, from 1992 to 2008, “BVVG and its predecessor, the Trust Agency, collected at least 

€ 3.5 billion from successful land marketing sales.” Id. ¶ 4. Schubarth alleges that “Germany 

was and is liable[] under the FCN Treaty . . . for the failure to provide [her with] full 

compensation for the expropriation of [her] estate,” and that she is entitled to the estate’s fair 

market value, expectation damages, prejudgment interest, and applicable attorneys’ fees. Id. 

¶¶ 26, 28. 

After a protracted period during which service was effectuated on Germany and BVVG, 

Defendants now move to dismiss Schubarth’s action on numerous grounds. They primarily 

contend that they are immune from suit under the FSIA because Schubarth has not pled facts 

establishing the requirements of the expropriation exception to FSIA immunity, 28 U.S.C. 
3 

§ 1605(a)(3). Defs.’ Mem. Supp. Mot. Dismiss (“Defs.’ MTD”) 3–9. In particular, Defendants 

maintain that among other pleading deficiencies, Schubarth has not alleged sufficient facts 

showing that BVVG “is engaged in a commercial activity in the United States,” 28 U.S.C. 

§ 1605(a)(3), which is a prerequisite for establishing the applicability of that exception. Defs.’ 

MTD 3–9. Defendants also argue that the Court lacks personal jurisdiction over them, and that 

Schubarth has failed to state a claim for relief. Id. at 11–12. 

II. Legal Standards 

Defendants have asserted immunity under the FSIA by challenging the legal sufficiency 

of Schubarth’s allegations, not the underlying facts themselves. Where that is so, a court must 

“take the plaintiff’s factual allegations as true and determine whether they bring the case within 

. . . the [FSIA] exception[ ] to immunity invoked by the plaintiff.” Simon v. Republic of 

Hungary, 812 F.3d 127, 147 (D.C. Cir. 2016) (quoting Phoenix Consulting Inc. v. Republic of 

Angola, 216 F.3d 36, 40 (D.C. Cir. 2000)) (alteration in original). Ultimately, Defendants carry 

the burden of persuading the court “that the plaintiff’s allegations do not bring its case within 

[the relevant] exception to immunity.” Phoenix Consulting, 216 F.3d at 40 (citing 

Transamerican S.S. Corp. v. Somali Democratic Republic, 767 F.2d 998, 1002 (D.C. Cir. 1985)). 

“[D]ismissal is warranted if no plausible inferences can be drawn from the facts alleged that, if 

proven, would provide grounds for relief.” Price v. Socialist People’s Libyan Arab Jamahiriya, 

294 F.3d 82, 93 (D.C. Cir. 2002). 

III. Analysis 

As mentioned above, Schubarth seeks to ground this Court’s jurisdiction in the FSIA’s 

expropriation exception, 28 U.S.C. § 1605(a)(3). That provision applies to a case 

in which rights in property taken in violation of international law are in issue and 

[either] [1] that property or any property exchanged for such property is present in 
4 

the United States in connection with a commercial activity carried on in the United 

States by the foreign state; or [2] that property or any property exchanged for such 

property is owned or operated by an agency or instrumentality of the foreign state 

and that agency or instrumentality is engaged in a commercial activity in the United 

States. 

Id. Schubarth has not alleged that the expropriated property (or property exchanged for it) is 

“present in the United States,” and she therefore concedes that clause [1] is inapplicable here. 

See Pl.’s Mem. Opp’n Defs.’ Mot. Dismiss (“Pl.’s Opp’n”) 10–11. She hangs her hat instead on 

clause [2], arguing that provision may confer jurisdiction over both Defendants. Id.1 However, 

because Schubarth has not alleged sufficient facts showing that the relevant “agency or 

instrumentality,” BVVN, “is engaged in a commercial activity in the United States,” clause [2]’s 

conditions are not met. Accordingly, the FSIA’s expropriation exception to immunity is 

unavailable. 

 The FSIA defines “commercial activity” as “either a regular course of commercial 

conduct or a particular commercial transaction or act.” 28 U.S.C. § 1603(d).2

 “The FSIA’s 

legislative history provides as examples of a ‘regular course of commercial conduct’ commercial 

enterprises such as a mineral extraction company, an airline, or a state trading corporation.” 

																																																								 1

 This argument implicates an apparent intracircuit conflict regarding whether satisfaction 

of the conditions in clause [2]—the “agency or instrumentality” prong of this provision—may 

confer jurisdiction only over an agency or instrumentality, or also over a parent foreign state. 

See Helmerich & Payne Int’l Drilling Co. v. Bolivarian Republic of Venezuela, No. 11-CV01735 (CRC), 2016 WL 2771117, at *3–*5 (D.D.C. May 13, 2016) (discussing the D.C. 

Circuit’s seemingly incompatible treatment of the expropriation exception’s two commercial 

activity clauses in Agudas Chasidei Chabad of U.S. v. Russian Fed’n, 528 F.3d 934 (D.C. Cir. 

2008) and Simon, 812 F.3d 127). Because the Court finds that clause [2]’s conditions are not 

satisfied, it is unnecessary to resolve that conflict here. 

2

 The FSIA applies a more stringent definition to clause [1]’s phrase “commercial activity 

carried on in the United States by a foreign state”: Such activity must “hav[e] substantial contact 

with the United States.” 28 U.S.C. § 1603(e). This “substantial contact” requirement is 

inapplicable to the Court’s analysis, which is confined to clause [2]. See Chabad, 528 F.3d at 

947. 
5 

Abelesz v. Magyar Nemzeti Bank, 692 F.3d 661, 692 (7th Cir. 2012) (citing H.R. Rep. 94–1487, 

at 16). A “particular commercial transaction or act” may include “a single contract” with a U.S. 

entity. Id. Given these standards and the language set forth in § 1605(a)(3), Schubarth’s task is 

to allege facts making it plausible that BVVN has either “engaged” in “a regular course of 

commercial conduct” or in “a particular commercial transaction or act” in the United States. 

She has not done so. Schubarth alleges that BVVN’s predecessor, the “Trust Agency,” 

maintained a New York office “in the early 1990s” to market and sell properties, and that those 

marketing efforts resulted in a large volume of sales. Compl. ¶ 13. Courts assessing the FSIA’s 

commercial activity requirement, however, have looked for evidence of recent or ongoing 

transactions. See Chabad, 528 F.3d at 948 (U.S.-based contracts whose performance was 

ongoing or which had been recently entered into “[a]t the time of the filing of the suit” relevant 

to assessing U.S. commercial activity under FSIA); Abelesz, 692 F.3d at 693 (bonds issued in 

U.S. dollars through U.S. bank sufficient to show U.S. commercial activity under FSIA where 

bonds were outstanding, i.e., where they would mature at a future date); Altmann v. Republic of 

Austria, 317 F.3d 954, 961, 969 & n.5 (9th Cir. 2002) (book published in the United States in 

months prior to complaint filing showed relevant U.S. commercial activity). By contrast, the 

activities of a predecessor entity occurring roughly two decades prior to the filing of the instant 

complaint do not reveal whether BVVG “is engaged” presently—or has been engaged recently—

in commercial activity in the United States. 28 U.S.C. § 1605(a)(3). 

Schubarth also alleges that BVVG’s predecessor entity “pursued marketing efforts over 

the Internet,” and that BVVG later “adopted and continued those marketing efforts . . . to the 

present day.” Compl. ¶ 13. Those efforts include “posting links to . . . information [about 

expropriated properties available for lease or sale] on its website.” Id. ¶ 4. In subsequent 
6 

briefing and attached exhibits, Schubarth elaborates that the website includes “forms for the 

submission of bids” on available properties, a page permitting “users from throughout the world 

to sign up for newsletters alerting them to newly available properties that meet desired criteria,” 

and sections “presented in English [that] are clearly targeted to foreigners.” Pl.’s Opp’n 7.3

These allegations are marked by one critical deficiency: None of them links BVVG’s 

commercial activity to the United States. At most, BVVG’s website—some of which is in 

English, the international language of commerce—shows an effort to solicit business from 

foreigners generally. But none of those webpages bespeak an attempt to target the United States 

market specifically. In fact, the website screenshots attached to Schubarth’s Opposition 

affirmatively suggest an alternative reason for the use of English: “Since the year 2000, BVVG 

[has] provide[d] consultancy services to Eastern European and Central Asian countries on the 

privatization of farm and forest land, land market development, institution building and land 

administration. In this context, BVVG has contributed to various projects of international 

cooperation.” Pl.’s Opp’n, Ex. E (emphasis added). BVVG’s consulting service is also the 

subject of the English-language brochure Schubarth highlights. See Pl.’s Opp’n 7 & Ex. I. In 

this context, English is clearly being utilized as an international—not an American—language. 

The cases Schubarth cites for support do little to aid her cause. Every one of them 

involved at least one alleged commercial transaction or solicitation that was indisputably tied to 

the United States. See Simon, 812 F.3d at 147 (defendant railway maintained “an agency for 

selling tickets, booking reservations, and conducting similar business in the United States” 

																																																								 3

 As noted above, Defendants have not contested the factual allegations underlying 

Plaintiff’s assertion of jurisdiction under the FSIA. The Court therefore need not consider 

factual allegations or evidence presented outside of the Complaint in resolving Defendants’ 

motion to dismiss. The Court does so here only for the sake of efficiency, in order potentially to 

avoid the time and expense of litigating a renewed complaint containing the relevant allegations. 
7 

(quoting complaint)); Chabad, 528 F.3d at 948 (defendant library and archive “entered [into] 

transactions for joint publishing and sales in the United States”); Abelesz, 692 F.3d at 693 

(defendant bank “issued [$200 million in] bonds denominated and payable in U.S. dollars . . . 

through a U.S. investment bank”); Cassirer v. Kingdom of Spain, 616 F.3d 1019, 1032 (9th Cir. 

2010) (defendant foundation engaged in long list of “commercial activities in the United States,” 

including “shipping gift shop items to purchasers in the United States” and “placing 

advertisements in magazines distributed in the United States”); Altmann, 317 F.3d at 969 

(defendant art gallery “author[ed], edit[ed], and publish[ed] in the United States” a book of 

paintings and “an English-language guidebook”); Siderman de Blake v. Republic of Argentina, 

965 F.2d 699, 712 (9th Cir. 1992) (sovereign defendant, through corporation, “solicit[ed] and 

entertain[ed] . . . American guests” and “accept[ed] . . . American credit cards and traveler’s 

checks”); Malewicz v. City of Amsterdam, 517 F. Supp. 2d 322, 332 (D.D.C. 2007) (defendant 

city “contracted with [U.S.] [m]useums,” “received nearly € 25,000 as consideration for the 

contract,” and “agreed to send several employees . . . to the United States”). 

 In short, Schubarth has not alleged facts plausibly showing that BVVN “is engaged in a 

commercial activity in the United States.” 28 U.S.C. § 1605(a)(3). The FSIA’s expropriation 

exception is therefore inapplicable, and this Court is without subject matter jurisdiction over 

Schubarth’s claims.4

 Accordingly, none of the Defendants’ other grounds for dismissal need be 

addressed. 

																																																								 4

 Neither has Germany “waived sovereign immunity on behalf of the BVVG” by 

operation of the FCN Treaty and the FSIA’s waiver exception to immunity, 28 U.S.C. 

§ 1605(a)(1). Pl.’s Opp’n 27. The relevant FCN Treaty waiver applies to BVVG only “if it 

engages in commercial, industrial, shipping or other business activities within the territories of” 

the United States. Treaty of Friendship, Commerce and Navigation, U.S.-Germany, art. XVIII, 

July 14, 1956, 7 U.S.T. 1839. Schubarth does not posit any material distinction between this 

commercial-activity condition and the one set forth in FSIA’s § 1605(a)(3). Accordingly, the 
8 

IV. Conclusion 

For the reasons outlined above, the Court will grant Defendants’ dismissal motion.5

 An 

Order accompanies this Memorandum Opinion. 

 

CHRISTOPHER R. COOPER 

United States District Judge 

Date: December 7, 2016 

																																																								

FCN’s waiver provision is inapplicable on account of the same deficiency precluding application 

of the expropriation exception. 

5

 Plaintiff also filed a Motion to Strike Portions of Defendants’ Reply Memorandum. 

Because the Court in reaching its holding has not relied on arguments advanced uniquely in 

Defendants’ Reply, the Court will deny as moot Plaintiff’s Motion to Strike.