Opinion ID: 780667
Heading Depth: 2
Heading Rank: 1

Heading: The Applicability of the FSIA

Text: 17 We must first determine whether the district court properly held that the FSIA may be applied to the alleged wrongful appropriation by the Republic. The FSIA provides the sole basis for obtaining jurisdiction over a foreign state in the courts of this country. Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 443, 109 S.Ct. 683, 102 L.Ed.2d 818 (1989). The defendants maintain that jurisdiction is lacking because the FSIA may not be retrospectively applied to conduct pre-dating the Department of State's 1952 issuance of the Tate Letter, while the last taking in this case purportedly occurred in 1948. See Letter of Jack B. Tate, Acting Legal Advisor, Department of State, to Acting Attorney General Philip B. Perlman, May 19, 1952 (1952 Tate Letter), reprinted in 26 Dep't State Bull. 984 (1952) and in Alfred Dunhill of London, Inc. v. Republic of Cuba, 425 U.S. 682, 711-15 app. 2, 96 S.Ct. 1854, 48 L.Ed.2d 301 (1976). To the extent courts have considered the retroactivity of the FSIA, the consensus appears to be that it would encompass events dating back at least as far as the date of this letter. See Carl Marks & Co. v. Union of Soviet Socialist Republics, 841 F.2d 26 (2d Cir.1988); Jackson v. People's Republic of China, 794 F.2d 1490 (11th Cir.1986); Slade v. United States of Mexico, 617 F.Supp. 351 (D.D.C.1985). 18 We need not reach the broad conclusion of the district court that the FSIA may be generally applied to events predating the 1952 Tate Letter. Instead, we find persuasive the reasoning set forth by Judge Wald, who resigned in 1999 from the Court of Appeals for the District of Columbia Circuit to serve two years as a judge on the International Criminal Tribunal for the Former Yugoslavia. In her dissenting opinion in Princz v. Federal Republic of Germany, Judge Wald agreed with the majority that application of the FSIA to pre-1952 conduct is not impermissibly retroactive, but set forth a narrower rationale for that conclusion. See 26 F.3d 1166, 1178-79 (D.C.Cir.1994) (Wald, J., dissenting on other grounds), cert. denied, 513 U.S. 1121, 115 S.Ct. 923, 130 L.Ed.2d 803 (1995). 19 The presumption against retroactive legislation is deeply rooted in our jurisprudence, and embodies a legal doctrine centuries older than our Republic. INS v. St. Cyr, 533 U.S. 289, 316, 121 S.Ct. 2271, 150 L.Ed.2d 347 (2001) (quoting Kaiser Aluminum & Chem. Corp. v. Bonjorno, 494 U.S. 827, 855, 110 S.Ct. 1570, 108 L.Ed.2d 842 (1990) (Scalia, J., concurring)). Although Congress is empowered to enact statutes with retrospective effect, a statute may not be applied retroactively absent a clear indication from Congress that it intended such a result. Id. (noting that cases where the Supreme Court has found truly retroactive effect involved statutory language so clear that it could sustain only one interpretation). 20 A statute does not operate retrospectively, and thus impermissibly, simply because it applies to conduct antedating the statute's enactment. Landgraf v. USI Film Prods., 511 U.S. 244, 269, 114 S.Ct. 1483, 128 L.Ed.2d 229 (1994). We must ask whether the new provision attaches new legal consequences to events completed before its enactment. Id. at 269-70, 114 S.Ct. 1483. [T]he judgment whether a particular statute acts retroactively should be informed and guided by familiar considerations of fair notice, reasonable reliance, and settled expectations. St. Cyr, 533 U.S. at 321, 121 S.Ct. 2271 (internal quotation marks omitted). We must consider the nature and extent of the change in the law and the degree of connection between the operation of the new rule and a relevant past event. Landgraf, 511 U.S. at 270, 114 S.Ct. 1483. [E]very statute, which takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability, in respect to transactions or considerations already past, must be deemed retrospective. Id. at 269, 114 S.Ct. 1483 (quoting Soc'y for Propagation of the Gospel v. Wheeler, 22 F. Cas. 756, 767 (C.C.D.N.H. 1814) (No. 13,156)). On the other hand, statutes that confer or oust jurisdiction, or change procedural rules, may be applied in suits arising before their enactment without raising concerns about retroactivity. Id. at 274-75, 114 S.Ct. 1483. Because these rules take[ ] away no substantive right but simply change[ ] the tribunal that is to hear the case, present law governs in such situations. Id. at 274, 114 S.Ct. 1483 (quoting Hallowell v. Commons, 239 U.S. 506, 508, 36 S.Ct. 202, 60 L.Ed. 409 (1916)). 21 The Princz majority found that Congress's intention for the FSIA to be retroactively applied was manifest in the statute's statement of purpose that claims of foreign states to immunity should henceforth be decided by courts of the United States and of the States in conformity with the principles set forth in this chapter. Princz, 26 F.3d at 1170 (quoting 28 U.S.C. § 1602). The majority interpreted Congress's use of the word henceforth to mean that the FSIA is to be applied to all cases decided after its enactment, i.e., regardless of when the plaintiff's cause of action accrued. Id. The court also pointed out that Congress's deletion of the language in 28 U.S.C. § 1332 providing for diversity jurisdiction over suits by a United States citizen against a foreign government would prevent prospective plaintiffs from suing over pre-enactment acts unless the FSIA's replacement section, 28 U.S.C. § 1330, were available. Id. at 1170. Further, the Princz majority suggested, as the district court found here, that application of the FSIA to the facts at issue effected merely a change of jurisdiction; thus, because the FSIA did not alter liability under the applicable substantive law, its application would not be impermissibly retroactive. Id. at 1170-71; see also Altmann, 142 F.Supp.2d at 1200. 22 Other courts have determined not to apply the FSIA to events predating its enactment. See Carl Marks, 841 F.2d 26; Jackson, 794 F.2d 1490; Slade, 617 F.Supp. 351. Nevertheless, in reaching this conclusion, these courts did not rely solely on the lack of a clear expression of congressional intent; otherwise, they would have concluded that the FSIA could not be applied to events predating its 1976 enactment. Instead, they recognized that the FSIA would properly apply to events occurring after the issuance of the 1952 Tate Letter. See Carl Marks, 841 F.2d at 27 (We believe, as did the district court, that only after 1952 was it reasonable for a foreign sovereign to anticipate being sued in the United States courts on commercial transactions. (alterations and quotation marks omitted)); Jackson, 794 F.2d at 1497-98 (We agree that to give the Act retrospective application to pre-1952 events would interfere with antecedent rights of other sovereigns (and also with antecedent principles of law that the United States followed until 1952).); Slade, 617 F.Supp. at 356 ([T]he Court finds that the FSIA cannot be applied retroactively to this case where all the operative events occurred before 1952.). Although the issuance of the 1952 Tate Letter has been recognized as the moment when the American position changed and the `restrictive theory of sovereign immunity' was adopted, for purposes of determining whether Austria could have settled expectations of immunity in a United States court, we note the observation of Judge Re, Chief Judge Emeritus of the Court of International Trade, that it was announced in 1948 that the State Department was reconsidering the policy. Edward D. Re, Human Rights, Domestic Courts, and Effective Remedies, 67 St. John's L.Rev. 581, 583-84 (1993). 23 Assuming, without deciding, that these cases are correct that congressional intent to allow application of the FSIA to pre-enactment facts is not manifest in the statutory language, we turn to the second prong of the Landgraf test and examine whether applying the FSIA would `impair rights a party possessed when he acted,' Princz, 26 F.3d at 1178 (Wald, J., dissenting on other grounds) (quoting Landgraf, 511 U.S. at 280, 114 S.Ct. 1483), i.e., whether Austria would have been entitled to immunity for its alleged complicity in the pillaging and retention of treasured paintings from the home of a Jewish alien who was forced to flee for his life. 24 In determining what rights Austria possessed when it acted, and what were its legitimate expectations, we look to the practice of American courts at that time, which was one of judicial deference to the case-by-case foreign policy determinations of the executive branch. Id. at 1178-79 (citing Verlinden, 461 U.S. at 486, 103 S.Ct. 1962). We note that in Verlinden, the Supreme Court explained that [u]ntil 1952, the State Department ordinarily requested immunity in all actions against friendly foreign sovereigns. 461 U.S. at 486, 103 S.Ct. 1962 (emphasis added). In 1943, the Supreme Court pronounced that it is of public importance that the action of the political arm of the Government taken within its appropriate sphere be promptly recognized, and that the delay and inconvenience of a prolonged litigation be avoided by prompt termination of the proceedings in the district court. Ex Parte Peru, 318 U.S. 578, 587, 63 S.Ct. 793, 87 L.Ed. 1014 (1943). Two years later, the Court exercised in rem jurisdiction over a Mexican vessel, noting the absence of a certification of immunity by the State Department or other evidence supporting immunity in conformance with the principles accepted by the State Department. See Republic of Mexico v. Hoffman, 324 U.S. 30, 34-35, 65 S.Ct. 530, 89 L.Ed. 729 (1945). 25 Determining whether the FSIA may properly be applied thus turns on the question whether Austria could legitimately expect to receive immunity from the executive branch of the United States for its complicity in and perpetuation of the discriminatory expropriation of the Klimt paintings. Mindful that such seizures explicitly violated both Austria's and Germany's obligations under the Hague Convention (IV) on the Laws and Customs of War on Land, Oct. 18, 1907, 1 Bevans 631, 1907 U.S.T. LEXIS 29 (entered into force Jan. 26, 1910), 3 and that Austria's Second Republic officially repudiated all Nazi transactions in 1946, we hold that Austria could not expect such immunity. 26 That Austria and the United States were no longer on opposite sides of World War II at the time the Federal Monument Agency attempted to extort valid title to the Klimt paintings does not mean that Austria could reasonably expect the granting of immunity for an act so closely associated with the atrocities of the War. Although the deprivation of private property, while discriminatory and indeed dehumanizing, pales in comparison with the horrors inflicted upon those who, unlike Ferdinand, were unable to escape the slavery, torture, and mass murder of the Nazi concentration camps, we are certain that the Austrians could not have had any expectation, much less a settled expectation, that the State Department would have recommended immunity as a matter of grace and comity for the wrongful appropriation of Jewish property. 27 Indeed, the State Department's position on that question is evident in an April 13, 1949 letter from Mr. Tate announcing the State Department's adoption of a policy to remove obstacles to recovery specifically for victims of Nazi expropriations. On April 27, 1949, the United States State Department issued a press release stating, in pertinent part: 28 As a matter of general interest, the Department publishes herewith a copy of a letter of April 13, 1949 from Jack B. Tate, Acting Legal Advisor, Department of State, to the Attorneys for the plaintiff in Civil Action No. 31-555 in the United States District Court for the Southern District of New York. 29 The letter repeats this Government's opposition to forcible acts of dispossession of a discriminatory and confiscatory nature practiced by the Germans on the countries or peoples subject to their controls; states that it is this Government's policy to undo the forced transfers and restitute identifiable property to the victims of Nazi persecution wrongfully deprived of such property; and sets forth that the policy of the Executive, with respect to claims asserted in the United States for restitution of such property, is to relieve American courts from any restraint upon the exercise of their jurisdiction to pass upon the validity of the acts of Nazi officials. 30 Press Release No. 296, Jurisdiction of United States Courts Re Suits for Identifiable Property Involved in Nazi Forced Transfers, reprinted in Bernstein v. N.V. Nederlandsche-Amerikaansche, 210 F.2d 375, 375-76 (2d Cir.1954) (per curiam) (emphasis added). The press release was accompanied by a copy of the actual letter, which states in pertinent part: 31 1. This Government has consistently opposed the forcible acts of dispossession of a discriminatory and confiscatory nature practiced by the Germans on the countries or peoples subject to their controls. 32