Document: 536 U.S. 88 JPMORGAN CHASE BANKv.TRAFFIC STREAM (BVI) INFRASTRUCTURE LTD. No. 01-651. Supreme Court of the United States. Argued April 17, 2002. Decided June 10, CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR SECOND CIRCUIT Respondent Traffic Stream Infrastructure Ltd. is a corporation organized under laws British Virgin Islands (BVI), an Overseas Territory Kingdom. In 1998, petitioner, then known as Chase Manhattan Bank, agreed to finance some ventures, with contract be governed by New York law and agreeing submit jurisdiction federal courts in Manhattan. subsequently sued for defaulting on its obligations. The District Southern found subject-matter alienage diversity statute, 28 U. S. C. § 1332(a)(2) — which gives district over civil actions where controversy, inter alia, "between citizens State or subjects foreign state" granted summary judgment. reversing, Second Circuit that, because was citizen not independent state, lacking. Held: A BVI "citize[n] subjec[t] purposes jurisdiction. Pp. 91-100. (a) state deemed that state's subject purposes. Steamship Co. v. Tugman, 106 118, 121. Although unrecognized States Executive Branch this has never held requisite status must directly from formally recognized distinct state`s legal dependency; any such distinction would entirely beside point statute. 91-92. (b) Constitution established Crown Kingdom exercises pervasive authority BVI, e. g., Queen may annul statute make BVI. Crown`s representatives have imposed international obligations practical sense, then, statutes permitting incorporation are enacted exercise Kingdom`s political authority, it seems fair regard company ultimate authority. 92-94. (c) Whether, posits, relationship between territories too attenuated viewed governing depends upon statute`s objective. courts' penchant before after Revolution disrupt relations discourage investment led provided Article III Constitution. First Congress jurisdiction, amended 1875 track III`s language. similarity thus bespeaks shared purpose. BVI's powers corporations sources those Parliament places well within range concern address. It BVI`s statutory responsibility external relations. 94-97. (d) Two flaws defeat Stream`s alternative argument does recognize residents subjects, legally nothing more than collection shareholders residing corporation`s First, outdated notion corporate citizenship derives natural persons long since been replaced conception entities. Second, fails jurisdictional analysis law. disqualify being domestic at issue. Section no room suggestion members polity, sovereign`s do qualify "subjects" merely they enjoy fewer rights other do. Because concedes "nationals" Kingdom, immaterial provide different abode individuals territories. 97-99. 251 F. 3d 334, reversed. SOUTER, J., delivered opinion unanimous Court. Sarah L. Reid argued cause petitioner. With her briefs were Joseph N. Froehlich Edward H. Tillinghast III. Jeffrey P. Minear amicus curiae urging reversal. him brief Solicitor General Olson, Assistant Attorney McCallum, Deputy Kneedler, Michael Jay Singer, Wendy M. Keats, William Howard Taft IV, James G. Hergen, John Schnitker. Craig J. Albert respondent. Lauren K. Kluger.* JUSTICE SOUTER 1 question here whether 1332(a)(2). We hold is. 2 * Kingdom.1 petitioner now JPMorgan ventures had construct operate toll roads China, parties' "be construed accordance York," App. 85a. "submi[t] jurisdiction" Manhattan, "waiv[e] immunity [their] jurisdiction." Ibid. charged York, 1332(a)(2), judgment Chase. When appealed, Appeals sua sponte raised court relied precedent Matimak Trading Khalily, 118 76 (1997), answering 337 (2001). reversed, case ordered remanded instructions dismiss complaint. denied rehearing en banc. 3 Circuit`s decision conflicts Circuits, see Cross Agencies, Inc. Wah Kwong Shipping Group Ltd., 181 410, 413 (CA3 1999); Koehler Dodwell, 152 304, 308 (CA4 1998); Wilson Humphreys (Cayman) 916 2d 1239, 1242-1243 (CA7 1990), implicates serious issues relations, we certiorari, 534 1074 reverse. II 4 Title provides "original all matter controversy exceeds sum value $75,000 ... state." "corporation is, States, deemed, constructively, State." 121 (1882). Cf. Restatement (Third) Foreign Relations Law 213 (1986) ("For law, nationality organized"). spite general rule citizenship, presents two about application Stream: incorporated "foreign given Territory, "citizens subjects" meaning 5 renders inapplicable begins assuming Stream, alone. Since supposed follow 6 Even assumption, however, diplomatically our own Government (an issue need decide here), dependency. On contrary, consideration relationships convinces us providing 7 current when power West Indies Act, 1962, c. 19, 5(1), issued (Constitution) Order 1976, SI 1976/2145. Under order, territory. provides, example, shall include Governor appointed "hold office during Her Majesty`s pleasure," id., pt. II, 3(1), Council mainly basis popular election Legislative Council, §§ 14-15, Legislature comprising popularly elected representatives, 25-26. 8 Bills take effect only approved royally acting through Secretary State, 42. instructed withhold assent bill conflict "likely prejudice Royal prerogative." 42(2)(b). Queen, 43(1), "[t]here reserved Majesty full peace, order good government Islands," 71. "[I]f pass Bill motion may, time he thinks fit, declare if passed...." 44. 9 slept their powers, recently exercised impose territory, Caribbean Territories (Abolition Death Penalty Murder) 1991, Merchant (Salvage Convention) (Overseas Territories) 1997, latter brought into compliance International Convention Salvage, 1989. very permit Companies Act (CAP. 285); Business 291), This view especially reasonable engaged transaction, acts behalf arena. See Halsbury, Laws England ¶ 983, p. 471 (4th ed. 1991) ("Her internationally responsible affairs dependent territories"); also Nations 1946, 45 (empowering bring "His dominions" directives Security Council). 10 nonetheless takes position "too attenuated" assumed Co., 3d, 86. This, course, 11 Both Revolution, notoriously frosty creditors trying collect debts American citizens, legislatures went so far hobble debt despite specific provision 1783 Treaty Paris either country "meet lawful impediment" collection. Definitive Peace, States-Great Britain, Art. Stat. 82. Holt, "To Establish Justice": Politics, Judiciary 1789, Invention Federal Courts, 1989 Duke 1421, 1438-1449. Ultimately, States' refusal honor treaty became enough prompt protests particularly irked demands side. 31 Journals Continental Congress, 1774-1789, pp. 781-784 (J. Fitzpatrick 1934). 12 Const., III, (federal "extend[s] Controversies Citizens thereof, Subjects"). "[T]he proponents made quite clear elimination amelioration difficulties credit principal reason having jurisdictions, one most important reasons judiciary." supra, 1473. how put debates Pennsylvania ratification convention: 13 "Let suppose case, wicked states, enabling debtor pay his creditor fourth, fifth, sixth part real debt, creditor, foreigner, complains prince injustice done him.... Bound inclination, duty, redress wrong sustains [h]e therefore apply States; accountable. `My received flagrant injury: me justice, I will myself justice.' If answerable injury, ought possess means compelling faulty repair it? They ought; what here. For now, complaint consequence injustice, can answer, `Why did your ...?'" Debates 493 Elliot 1876) (hereinafter Elliot`s Debates). 14 emphasized "extend manufactures commerce" there "proper security regular discharge contracts. cannot obtained, unless give deciding contracts government." Id., 492. His concerns echoed Madison: "We know, sir, foreigners get justice them these courts, prevented many wealthy gentlemen trading among us." 583. Madison remarked necessary "avoid controversies powers" single State`s "drag whole community war." 534; Federalist 80, Cooke 1961) (A. Hamilton) ("[A]n unjust sentence against foreigner [may] aggression sovereign" rendering "essential public tranquility"). 15 Thus, authorized Constitution, even while federal-question withheld. ch. 20, 11, 78 (providing "an alien party" $500 controversy). language replacing word "aliens" "citizens, subjects," Mar. 3, 1875, 18 470, phrase remains today. drafting up constitutional hilt, cf. Tennessee Union & Planters' 454 (1894) (despite similar language, 1331 extend III), doubt 16 addressed including charter, These just kind Framers believed bind sovereigns "by wrong[s]" nationals, Elliot's Wilson). Jones, Nationality Practice 288 (1947) ("It practice protect, Powers, [c]orporations owing existence force colonies"). Any doubters consult filings others comparable, express apprehension expulsion like cloud opportunity raise sort threat "the tranquility" hoped avoid. See, Brief Great Britain Northern Ireland Amicus Curiae; Diplomatic Note 13/2000 Embassy Washington, D. C., Dept., Feb. 2, 2000, Lodging 29, (available Clerk Court`s file); 90/2001 Oct. 5, 2002, Motion File Curiae 1a. B 17 old fiction association shareholders, presumed reside place incorporation, see, S., 120-121, result purposes, suit should understood proceeds read 1981, declaration but mere "nationals," without privileges right travel freely I. Macdonald Blake, Macdonald`s Immigration 130-131 1995) (describing categories citizenship).2 insists noncitizen individuals, itself treated deserving access opens subjects. less flaw reliance collections linked contract, Horwitz, Transformation 1870-1960, 69-93 (1992), entities, 93-107.3 derived irrelevant enquiry 19 But argument`s significant weakness failure ultimately whatever be. While perfectly true "every nation [has inherent right] determine classes entitled citizenship," Wong Kim Ark, 169 649, 668 (1898), "citizen" "subject" terms used fact, reading wrong, says is,4 claims think disqualifying. 20 imply (and 1789 implied) enjoyment certain basic privileges, Black`s Dictionary 237 (7th 1999) (defining "entitled protections" community), "[o]ne who owes allegiance sovereign laws," 1438. contrary view, text sovereign, fail ill, societies afford greater favored ones ceased subjects." And although persons, resident aliens, live particular 660 ("`children born occupied conquest, still aliens'"), least 25. Given object explained earlier, meant amenable leaving 21 accords positions taken Governments deference due various interested governments. retention both juridic, 1332(a). reverse Appeals. 22 ordered. Notes: Mark Bravin Peter Buscemi filed announced "`Dependent Territories'" would, on, "`Overseas Territories.'" Apparently change name implied more. Lodging, Amended asAmicus 99-10385 (CA5), 7, n. file). Ironically, passing 61, 36, identified goal "reducing statelessness." Indeed, rejected earlier 1958 procorporation a" vided business." 1332(c)(1). There 1332(c) applies foreign, domestic, corporations, Circuits reached agreement extends corporations. SeeDanjaq, A. Pathe Communications Corp., 979 772, 773-774 (CA9 1992); Vareka Investment, V. Investment Properties, Inc., 724 907, 909 (CA11 1984); Jerguson Blue Dot 659 31, 35 (CA5 1981). weigh point. 12-13.

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