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Matched Legal Cases: ['art. 18', 'art. 1', 'art. 44', 'art. 42', 'art. 25', 'art. 36', 'art. 54']

693 F2d 1094 Maritime International Nominees Establishment v. Republic of Guinea | OpenJurist
693 F. 2d 1094 - Maritime International Nominees Establishment v. Republic of Guinea HomeFederal Reporter, Second Series 693 F.2d.
693 F2d 1094 Maritime International Nominees Establishment v. Republic of Guinea 693 F.2d 1094
224 U.S.App.D.C. 119
In the Matter of the Arbitration Between MARITIMEINTERNATIONAL NOMINEES ESTABLISHMENTv.The REPUBLIC OF GUINEA, Appellant,United States of America, Intervenor.
No. 81-1073.
Argued Jan. 25, 1982.Decided Nov. 12, 1982.As Amended on Denial of Rehearing Jan. 27, 1983.
The Republic of Guinea ("Guinea") appeals from, and raises numerous challenges to, the District Court's order confirming an arbitration award rendered by the American Arbitration Association in favor of Marine International Nominees Establishment ("MINE"). The District Court lacked subject matter jurisdiction, Guinea claims, because Guinea was immune under the Foreign Sovereign Immunities Act of 1976 ("FSIA"), Pub.L. No. 94-583, 90 Stat. 2891; because the arbitration clause contained in the parties' contract precluded the exercise of jurisdiction under the FSIA; and because the FSIA does not, and cannot constitutionally be read to, confer subject matter jurisdiction over suits between foreign plaintiffs and foreign states. Guinea also contends that MINE's service of process upon it did not meet the requirements of the FSIA and that the arbitration award itself was defective and unenforceable.
On January 20, 1978--some three years after the first consent form was signed--MINE filed, in federal district court, a petition to compel arbitration under section 4 of the Federal Arbitration Act ("FAA"), 9 U.S.C. Sec. 4 (1976), asserting subject matter jurisdiction under the FSIA and the FAA. J.A. 6. In essence, section 4 of the FAA empowers a federal district court to order arbitration to proceed in accordance with the terms of an arbitration agreement when adequate findings are made that an agreement did exist and that a default under the agreement did occur. Another relevant section of the FAA, section 5, 9 U.S.C. Sec. 5 (1976), sets forth the circumstances when a court is additionally authorized to order arbitration before an arbitrator or arbitrators not named in the agreement. One such instance occurs when a party "fail[s] to avail himself" of the agreed-upon method for naming arbitrators. Id.
MINE then returned to the District Court, filing on August 22, 1980, a motion to confirm and enter judgment on the arbitration award under section 9 of the FAA, 9 U.S.C. Sec. 9 (1976). J.A. 51. Accompanying the motion was a memorandum of points and authorities, with exhibits attached. Once again, MINE served process upon Guinea by the method followed earlier.
The court heard oral argument from the parties on January 8, 1981, focusing attention on the issue of subject matter jurisdiction under the FSIA.3 On January 12, 1981, the court entered an order denying Guinea's motion to dismiss, granting MINE's motion to confirm, and entering judgment on the award. R. 25.4 The court also issued a four-page memorandum opinion primarily discussing its conclusion that it had subject matter jurisdiction under the FSIA. In re Arbitration between Maritime International Nominees Establishment v. Republic of Guinea, 505 F.Supp. 141 (D.D.C.1981) (mem. op.) ["MINE v. Guinea"].
Subject matter jurisdiction is addressed by section 1330(a), 28 U.S.C. Sec. 1330(a) (1976), which creates in federal district courts
Whether subject matter and personal jurisdiction existed under the Act, then, turns in the first instance on whether Guinea was entitled to immunity under sections 1605 and 1607. These sections set forth the exceptions to the general principle, stated in section 1604, id. Sec. 1604, that foreign states are immune from the jurisdiction of federal and state courts, subject to existing international agreements to which the United States was a party at the time of the Act's passage. Of these exceptions, only subsections (a)(1) and (a)(2) of section 1605 have possible relevance to this case; the District Court found that each supported a finding of non-immunity and, hence, of subject matter jurisdiction.
Section 1605(a)(1) states that a foreign state shall not be immune in any case
Applying section 1605(a)(1) to the parties' agreement, the District Court began by noting that ICSID's Rules of Procedure call for ICSID tribunals to meet at the seat of ICSID--Washington, D.C.--unless another site is agreed upon by the parties and approved by ICSID. MINE v. Guinea, 505 F.Supp. at 143. Therefore, the court reasoned, the parties must have contemplated that arbitration would take place in the United States. Because the legislative history indicates that implicit waiver may be found "in cases where a foreign state has agreed to arbitration in another country," H.R.Rep. No. 94-1487, supra, at 18, the court concluded that the SOTRAMAR arbitration clause constituted such a waiver. MINE v. Guinea, 505 F.Supp. at 143.
We are bound not to disturb a factual finding of the District Court unless it is clearly erroneous. See Fed. R. Civ. P. 52(a). In this case, the District Court's waiver holding was unquestionably based on the factual conclusion that the parties had contemplated an ICSID arbitration. First, as stated above, a central ingredient of that holding was the ICSID procedural rule stating that ICSID arbitrations shall normally take place at ICSID's seat in Washington, D.C. From this rule the court inferred that the parties must have anticipated that arbitration would occur in the United States. Mine v. Guinea, 505 F.Supp. at 143. Obviously, the court would not have attached significance to the ICSID rules had it not understood the SOTRAMAR contract as contemplating an arbitration that would be subject to those rules--an ICSID arbitration. Second, the District Court described MINE's effort to have Guinea sign a revised submission to the jurisdiction of ICSID as an attempt to have the dispute heard "in arbitration as contemplated by the contract." Id. at 142 (emphasis added); see also id. at 142 n.2 (parties dispute whether MINE "could have proceeded to arbitration in the manner contemplated by the contract despite Guinea's refusal to participate [by refusing to sign the revised joint submission]") (emphasis added). Because exhibits filed by MINE itself in connection with its motion to confirm demand this very conclusion,11 we cannot say that the District Court's factual finding was clearly erroneous.12
Thus, it is the District Court's waiver holding that we now evaluate--that the parties' agreement to submit future disputes to an ICSID arbitration can be deemed an implicit waiver of immunity within the meaning of section 1605(a)(1).
As noted earlier, ICSID was established by the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, an international agreement to which more than seventy-five foreign states are parties. Under the Convention, which has been implemented by legislation in the United States, 22 U.S.C. Secs. 1650-1650a (1976), ICSID has "full international legal personality," Convention art. 18. ICSID's purpose is to make available to "Contracting States and nationals of other Contracting States" facilities for the conciliation and arbitration of investment disputes. Id. art. 1(2). ICSID arbitrations are undertaken by tribunals constituted under the Convention and subject to the rules of ICSID. Id. art. 44. In settling disputes, those tribunals apply "such rules of law as may be agreed by the parties"; when no such agreement exists, the law of the "Contracting State party" and rules of international law apply. Id. art. 42(1).
Relying on these facts, the State Department has urged this court to find that agreements to arbitrate with ICSID do not contemplate the involvement of domestic courts, at least not before a final ICSID decision is to be enforced.14 Brief for the United States as Intervenor and Suggestion of Interest 54. We need not reach this precise question here, however. MINE has insisted, and is estopped from denying, that United States courts were powerless to compel an ICSID arbitration under this particular arbitration agreement. Appellee's Br. 57 & n. 49; Appellee's Reply Br. to Br. for United States 23, 25; J.A. 253 (memorandum before District Court) ("as both ICSID and its President enjoy sovereign immunity, this court could not compel the President of the World Bank to appoint arbitrators in this matter"). MINE contended that an ICSID arbitration was unavailable in order to induce the District Court to go beyond the express terms of the arbitration clause and compel arbitration before the American Arbitration Association. Given that this point is now established for purposes of this litigation, we have no trouble holding that this particular ICSID agreement was not an agreement "to arbitration in another country" that waives sovereign immunity under the FSIA.15 A key reason why pre-FSIA cases found that an agreement to arbitrate in the United States waived immunity from suit was that such agreements could only be effective if deemed to contemplate a role for United States courts in compelling arbitration that stalled along the way. See, e.g., Victory Transport Inc. v. Comisaria General de Abastecimientos y Transportes, 336 F.2d 354, 363-64 (2d Cir.1964) (discussing consent to in personam jurisdiction), cert. denied, 381 U.S. 934, 85 S.Ct. 1763, 14 L.Ed.2d 698 (1965); see also Note, Maritime International Nominees Establishment v. Republic of Guinea: Effect on U.S. Jurisdiction of an Agreement by a Foreign Sovereign to Arbitrate Before the International Centre for the Settlement of Investment Disputes, 16 Geo.Wash.J. Int'l L. & Econ. 451, 463-66 (1982). As this particular ICSID agreement concededly did not foresee such a role for United States courts, we hold that it did not waive Guinea's sovereign immunity even though the agreed-to arbitration would probably take place on United States soil.
The second immunity provision relevant to this case is section 1605(a)(2). This section sets forth, in the words of the House Report, "probably the most important instance in which foreign states are denied immunity, that in which the foreign state engages in a commercial activity." H.R.Rep. No. 94-1487, supra, at 18, U.S.Code Cong. & Admin.News 1976, p. 6617. The section states that a foreign state shall not be immune in any case
The District Court seems to have held that both the first and third clauses of the section were satisfied. MINE v. Guinea, 505 F.Supp. at 143. After stating this conclusion, the court went on to list the activities of Guinea that supported it:
Id. 505 F.Supp. at 143. The sum of these activities, the court continued, was "more than sufficient to constitute commercial activity within the meaning of section 1605(a)(2)." Id. To examine this holding, we turn separately to the first and third clauses of section 1605(a)(2).16
28 U.S.C. Sec. 1603(d) (1976). The first clause receives further definition:
We turn first to the District Court's conclusion that "Guinea directed an American shipping group to perform substantial activities to aid SOTRAMAR." MINE v. Guinea, 505 F.Supp. at 143. An analysis of this finding must immediately confront the Act's requirement that the commercial activity be "carried on by" the foreign state. We have no doubt that in appropriate circumstances the activities of another may be attributed to the foreign state for purposes of the section 1605(a)(2) exception. Especially given the realities of modern commercial undertakings, a contrary conclusion would undermine "Congress's concern with providing 'access to the courts' to those aggrieved by the commercial acts of a foreign sovereign," Texas Trading & Milling Corp. v. Federal Republic of Nigeria, 647 F.2d 300, 312 (2d Cir.1981) (quoting H.R.Rep. No. 94-1487, supra, at 6), cert. denied, --- U.S. ----, 102 S.Ct. 1012, 71 L.Ed.2d 301 (1982). On the other hand, this same principle and the words of the statute impose some limits on when a foreign state can be deemed to have "carried on" activities actually performed by another.
The legislative history gives some guidance in discovering those limits. Although Congress did not elaborate on the "carried on by" requirement, it stated that some activities falling within the first clause of section 1605(a)(2) might also satisfy the second: an "act performed in the United States in connection with a commercial activity of the foreign state elsewhere." One example of the latter, Congress went on, might be "a representation in the United States by an agent of a foreign state that leads to an action for restitution based on unjust enrichment." H.R.Rep. No. 94-1487, supra, at 19, U.S.Code Cong. & Admin.News 1976, p. 6617. This reference to "an agent of a foreign state" suggests that a foreign state, in Congress's view, can surrender immunity by virtue of activities committed by an agent, and that, consequently, the "carried on by" requirement can be interpreted in light of broad agency principles. While we do not suggest that those principles should be applied rigidly and in all their detail to the immunity determination, it seems evident that to throw the net of responsibility much wider would be to ignore the words Congress employed in both the statute and the legislative history.
H.R.Rep. No. 94-1487, supra, at 13, U.S.Code Cong. & Admin.News 1976, p. 6612. Although we do not understand this statement to mean that the statutory standard for determining non-immunity is coextensive with the due process standard governing personal jurisdiction,18 see World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980); International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), we think it relevant that viewing the "carried on by" requirement in light of agency principles would be compatible with well-established due process analysis.
Our views find support in several decisions of other courts. In Yessenin-Volpin v. Novosti Press Agency, 443 F.Supp. 849 (S.D.N.Y.1978), plaintiff filed a libel suit against three defendants, two of which were Soviet Union information agencies that claimed immunity under the FSIA. Both were alleged to have written defamatory articles and to have caused the publication of those articles in periodicals that were circulated to the public in the United States. Applying the section 1605(a)(2) exception, the court rejected the relevance of the first clause, because "the allegedly offending articles were published outside the country and sent into the United States by means wholly outside the control of either [defendant]." Id. at 855. The court, in other words, properly rejected the proposition that a foreign state "carries on" activities performed by another entity simply because the state and that entity, although unconnected with each other, can both be seen as participating in the same larger commercial endeavor.
In Bankers Trust Co. v. Worldwide Transportation Services, Inc., 537 F.Supp. 1101 (E.D.Ark.1982), a restitution action involving as one defendant an official agricultural organ of the Federal Republic of Mexico, the court held that the "commercial activity" of that defendant included activities performed by a bank and a company acting as the defendant's agents in the United States.
We have said that Global's activities in the United States cannot waive Guinea's immunity if Guinea did not authorize them. But this is not to say that every action Guinea "authorizes" which eventually touches American soil will waive Guinea's immunity. We find aid in discerning the far reaches of the "carried on" requirement by considering once more principles of personal jurisdiction.20 The Supreme Court helped clarify some of those principles in Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239-1240, 2 L.Ed.2d 1283 (1958):
Continuing our search for activity that might satisfy the first clause of section 1605(a)(2), we turn to the District Court's finding that "[n]umerous meetings were held, including meetings in Connecticut and in the District of Columbia, relating to the contract." MINE v. Guinea, 505 F.Supp. at 143. There is evidence that meetings took place, but, with one exception, no reference to such a meeting indicates that Guinea was present. Because these references do not contain any information that adds to the evidence of authorization that we have already considered, these meetings cannot be seen as activity "carried on by" Guinea.
Although the third finding states that "[t]he Guinean ambassador to the United States engaged in several business-oriented contacts with officials of [MINE] related to the project," MINE v. Guinea, 505 F.Supp. at 143, the record contains a suggestion of only one such contact. A portion of a MINE official's arbitration testimony relates the following:
An evaluation of these two contacts under the first clause must begin with the recognition that, in Judge Weinfeld's words, Congress "underscore[d] the fact that the 'commercial activity carried on in the United States' must be substantial to support jurisdiction." Verlinden B.V. v. Central Bank of Nigeria, 488 F.Supp. 1284, 1296 (S.D.N.Y.1980), aff'd on other grounds, 647 F.2d 320 (2d Cir.1981), cert. granted, --- U.S. ----, 102 S.Ct. 997, 71 L.Ed.2d 291 (1982). In choosing those words, Congress made clear that the immunity determination under the first clause diverges from the "minimum contacts" due process inquiry, as well as from jurisdictional determinations under state long-arm statutes.23 We cannot conclude that these two isolated meetings amounted to more than "transitory" and "insubstantial" contact for purposes of the Act, see Verlinden, 488 F.Supp. at 1297, especially given their uncertain scope and importance.24
Having concluded that the District Court's three findings do not satisfy the first clause of the section 1605(a)(2) exception, we look next25 to the third clause of that section:
H.R.Rep. No. 94-1487, supra, at 19, U.S.Code Cong. & Admin.News 1976, p. 6618. Section 18, which is entitled "Jurisdiction to Prescribe with Respect to Effect within Territory," Restatement (Second) of Foreign Relations Law of the United States Sec. 18 (1965), concerns the extent to which a state may enact rules of law proscribing conduct outside its territory to prevent the effects of that conduct within its territory. Although section 18 is therefore concerned with legislative rather than judicial action, Congress's clear reference has led some courts to find guidance in section 18's requirement that the effect be "substantial" and "occur[ ] as a direct and foreseeable result of the conduct outside the territory."26 See Ohntrup v. Firearms Center Inc., 516 F.Supp. 1281, 1286 (E.D.Pa.1981) (mem. op.); Chicago Bridge & Iron Co. v. Islamic Republic of Iran, 506 F.Supp. 981, 989 (N.D.Ill.1980) (mem. op.); Verlinden, 488 F.Supp. at 1298; Harris v. VAO Intourist, 481 F.Supp. 1056 (E.D.N.Y.1979) (mem. op.); see also Note, Direct Effect Jurisdiction Under the Foreign Sovereign Immunities Act of 1976, 13 N.Y.U.J.Int'l L. & P. 571, 609-10 (1981). But see Texas Trading, 647 F.2d at 311 & n. 32; Note, Effects Jurisdiction Under the Foreign Sovereign Immunities Act and the Due Process Clause, 55 N.Y.U.L.Rev. 474, 502-05 (1980).
Another factor favoring recourse to section 18 lies in the scope of the FSIA's direct effect clause. The clause differs from the "direct effect" clauses found in many state long-arm statutes, because the former is explicitly intended to encompass effects resulting from commercial as well as tortious activities. See Texas Trading, 647 F.2d at 311; VAO Intourist, 481 F.Supp. at 1063-64; H.R.Rep. No. 94-1487, supra, at 19. The "substantial" and "direct and foreseeable" standards are likewise intended to apply in commercial contexts. See Restatement (Second) of Foreign Relations Law of the United States, supra, Sec. 18 comment f. In view of Congress's statement, and of the not dissimilar functions of section 18 and the third clause,27 we consider this source of guidance a proper one.
On September 18, 1981, this court entered an order granting the United States leave to intervene pursuant to 28 U.S.C. Sec. 2403 (1976), and allowing the United States to file a suggestion of interest. In addition to the regular cycle of briefing in this case, therefore, we have received a Brief for the United States as Intervenor and Suggestion of Interest, and briefs from MINE and Guinea in reply to the United States's brief
Although Guinea directs some of its arguments both to the order to compel and the order to confirm, see, e.g., Appellant's Br. 25, it is clear that the only order on review before us is the order to confirm. An order to compel arbitration issued in an independent proceeding under the FAA is a final and appealable judgment. See Chatham Shipping Co. v. Fertex Steamship Corp., 352 F.2d 291 (2d Cir.1965); 9 Moore's Federal Practice p 110.20[4.-1] (2d ed.1982). Cf. Goodall-Sanford, Inc. v. United Textile Workers, 353 U.S. 550, 77 S.Ct. 920, 1 L.Ed.2d 1031 (1957) (order directing arbitration under section 301(a) of the Taft-Hartley Act, 29 U.S.C. Sec. 185(a) (1976), is appealable as a final judgment). Guinea cannot now, by way of appealing the confirmation order, obtain review of the earlier order to compel
MINE has not argued that the District Court's finding that it had jurisdiction under the FSIA in the earlier section 4 proceeding to compel bars Guinea from questioning the District Court's exercise of jurisdiction in the section 9 proceeding to confirm now under review. Because the section 9 proceeding adjudicated a different claim from that in the earlier proceeding, any preclusive effect would derive from the doctrine of collateral estoppel, not res judicata. See Commissioner v. Sunnen, 333 U.S. 591, 597-98, 68 S.Ct. 715, 719-720, 92 L.Ed. 898 (1948); Nasem v. Brown, 595 F.2d 801, 805 n. 8 (D.C.Cir.1979). That doctrine requires that even issues less basic than jurisdiction be fully litigated before they are preclusively established. See McCord v. Bailey, 636 F.2d 606, 609 (D.C.Cir.1980), cert. denied, 451 U.S. 983, 101 S.Ct. 2314, 68 L.Ed.2d 839 (1981); 1B Moore's Federal Practice p 0.443 (2d ed. 1982). Guinea did not appear in the first proceeding, so the issue was not fully litigated and may be raised at this time
Moreover, we would almost certainly reach the same result were we to apply the doctrine of res judicata by somehow viewing Guinea's raising of the jurisdictional issue in the confirmation proceeding as a collateral attack on the holding of the proceeding to compel. As the Supreme Court recently reaffirmed, "A defendant is always free to ignore the judicial proceedings, risk a default judgment and then challenge that judgment on jurisdictional grounds in a collateral proceeding." Insurance Corp. v. Compagnie des Bauxites de Guinee, --- U.S. ---, 102 S.Ct. 2099, 2106, 72 L.Ed.2d 492 (1982). Even if this rule preserves only personal-jurisdiction attacks, it would preserve Guinea's immunity defense, which addresses both personal and subject matter jurisdiction.
MINE also argues that the SOTRAMAR contract constituted an explicit waiver of immunity within the meaning of section 1605(a)(1). Appellee's Br. 19-20. MINE can point to no particular provision in the contract arguably concerning immunity; rather, MINE rests its argument on the fact that the SOTRAMAR venture was a "mixed-economy" company under the laws of Guinea. Participation in such a company amounted to an explicit waiver, in MINE's view, because Guinean law provides that the state in a mixed economy company is a shareholder and that the state's rights and obligations are derived from its standing as a shareholder rather than as a state. Id
It is important to note why they found this later joint consent to be necessary. Under the ICSID Convention, ICSID jurisdiction can only be extended to controversies "which the parties to the dispute consent in writing to submit to [ICSID]." Convention art. 25(1). The written request must "contain information concerning the issues in dispute, the identity of the parties and their consent to arbitration in accordance with the rules of procedure for the institution of conciliation and arbitration proceedings." Id. art. 36(2). MINE contended before the District Court that the later joint consent was necessary because "[t]he Contract did not contain language of consent and submission in ac[c]ordance with ICSID's suggested clauses, or otherwise." J.A. 252 n.9. That is, the contract did not "evidence[]" the consent of both parties to submit the dispute to ICSID's jurisdiction in a way that ICSID could recognize. Id. at 252 (emphasis added); see id. at 251 (contract "did not of itself constitute a mutual consent and submission to ICSID's jurisdiction") (emphasis added).
Of course, an agreement to apply Guinean law is literally an agreement to apply the law of a "particular" country. Courts have generally assumed, however, that Congress did not endorse the literal wording of the House Report, for when paraphrasing the report they say waiver is to be found when a foreign state agrees to apply the law of "another" country. See Ohntrup v. Firearms Center Inc., 516 F.Supp. 1281, 1284 (E.D.Pa.1981) (mem. op.); Castro v. Saudi Arabia, 510 F.Supp. 309, 312 (W.D.Tex.1980). Because MINE has not questioned this reading of congressional intent, we see no reason to do so at this time
At the enforcement stage, the ICSID treaty, see Convention art. 54, and a supporting United States statute, 22 U.S.C. Sec. 1650a (1976), provide that ICSID arbitrations are to be enforced as judgments of sister states. We need not decide whether Guinea's signing of the ICSID treaty would thus waive its immunity from proceedings enforcing ICSID awards, for this is a proceeding to confirm an AAA arbitration. We also do not express opinions (1) whether any waiver of immunity for ICSID enforcement proceedings would also waive immunity for suits to compel ICSID arbitrations, or (2) whether Congress's declaration that the Federal Arbitration Act "shall not apply to enforcement of awards rendered" by ICSID, id., prohibits proceedings to compel ICSID arbitrations. Resolution of neither point is implicit in our holding today, for we decide that this ICSID agreement did not contemplate the involvement of domestic courts before the enforcement stage only because MINE cannot contend otherwise in this litigation
Because the ICSID arbitration was to take place in the United States unless otherwise specified, see pp. 1100 supra, we need not speculate about whether the courts of some other country might find themselves empowered to compel an ICSID arbitration. Thus, although other courts have found it necessary to hold that only an agreement to arbitrate in this country will waive a sovereign's immunity in United States courts, see Ohntrup v. Firearms Center Inc., 516 F.Supp. 1281, 1285 (E.D.Pa.1981) (mem. op.); Verlinden B.V. v. Central Bank of Nigeria, 488 F.Supp. 1284, 1301-02 (S.D.N.Y.1980), aff'd on other grounds, 647 F.2d 320 (2d Cir.1981), cert. granted, --- U.S. ----, 102 S.Ct. 997, 71 L.Ed.2d 291 (1982), we do not settle that question here
MINE adds to these findings the argument that Guinea's alleged breach resulted in "contact with the United States" for purposes of the first clause: "Each ton of bauxite which should have been carried by SOTRAMAR to destinations in the United States was instead carried to those same destinations by Afro-Bulk." Appellee's Br. 26. The District Court made no such finding, and MINE supports its contention in part with evidence outside the record. Id.; see Fed.R.App.P. 10. As will be clear from our discussion of the contacts listed by the District Court, the record properly before us cannot sustain the assertion, implicit in MINE's argument, that under the SOTRAMAR contract arrangements had been made to transport bauxite to destinations in the United States
Of course, a finding of FSIA personal jurisdiction, which would rest in part on a finding of non-immunity, must comport with the demands of due process, and Congress intended that the Act satisfy those demands, H.R.Rep. No. 94-1487, supra, at 13. But the immunity determination involves considerations distinct from the issue of personal jurisdiction, and the FSIA's interlocking provisions are most profitably analyzed when these distinctions are kept in mind. See generally Texas Trading, 647 F.2d 300; Kane, Suing Foreign Sovereigns: A Procedural Compass, 34 Stan.L.Rev. 385, 402-04 (1982)
The legislative history does not contradict the clear import of the words Congress chose. Commenting on section 1330(b), which concerns personal jurisdiction under the Act, the House Report stated that the immunity provisions "prescribe the necessary contacts [the "minimum contacts" requirement of International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945) ] which must exist before our courts can exercise personal jurisdiction." H.R.Rep. No. 94-1487, supra, at 13, U.S.Code Cong. & Admin.News 1976, p. 6612. To read "substantial contact" as demanding more than "minimum contacts" is fully compatible with this statement
Congress also noted that section 1330(b) is "in effect, a Federal long-arm statute over foreign states .... It is patterned after the long-arm statute Congress enacted for the District of Columbia." H.R.Rep. No. 94-1487, supra, at 13, U.S.Code Cong. & Admin.News 1976, p. 6612. The phrase "patterned after" is not a clear mandate to interpret the immunity exceptions in light of the District of Columbia long-arm statute, and "[t]here are significant differences in language and effect between the District's statute and the Act, which Congress, the author of both, could not have overlooked," Verlinden, 488 F.Supp. at 1295. Accord Texas Trading, 647 F.2d at, 311 Harris v. VAO Intourist, 481 F.Supp. 1056, 1063-65 (E.D.N.Y.1979) (mem. op.). While these differences might not always undermine the usefulness of referring to the District of Columbia statute, see VAO Intourist, 481 F.Supp. at 1064-65, the "substantial contact" requirement has not even a remote relative in that statute. See D.C.Code Sec. 13-423(a)(1) (1981) (allows personal jurisdiction as to a claim arising from the person's "transacting any business in the District of Columbia").
Although case law construing the phrase "substantial contact" is not extensive, our conclusion finds support by way of contrast with cases that find jurisdiction. See Gemini Shipping, Inc. v. Foreign Trade Org. for Chems. & Foodstuffs, 647 F.2d 317, 319 (2d Cir.1981) (defendant solicited bids in U.S. and paid under a contract through a letter of credit confirmed by a New York bank); Ohntrup v. Firearms Center Inc., 516 F.Supp. 1281, 1285-86 (E.D.Pa.1981) (mem. op.) (sales agreement was between defendant and U.S. corporation; defendant agreed that U.S. corporation would be its representative in U.S.; and agreement called for substantial sales in U.S. within first year of contract); Behring Int'l, Inc. v. Imperial Iranian Air Force, 475 F.Supp. 383, 390 (D.N.J.1979) (contract was negotiated and executed in New York, where defendant maintained office and picked up contracted-for cargo)