Opinion ID: 3065087
Heading Depth: 2
Heading Rank: 3

Heading: Sovereign Immunity Under the FSIA.

Text: The primary issue before us is whether Appellants are entitled to sovereign immunity under the FSIA, such that the district court lacks subject matter jurisdiction. The existence of subject matter jurisdiction under the FSIA is a question of law reviewed de novo. Adler v. Fed. Republic of Nigeria, 107 F.3d 720, 723 (9th Cir. 1997). A district court’s factual findings on jurisdictional issues are reviewed for clear error. Id. 7 In Swint, the Supreme Court left open the possibility that we might exercise pendent appellate jurisdiction when we properly have jurisdiction over one ruling and “related rulings that are not themselves independently appealable” are “inextricably intertwined,” or when review of the related ruling is “necessary to ensure meaningful review of the [issue over which the court has jurisdiction],” Swint, 514 U.S. at 50-51, and we have done so under some circumstances. See Idaho Watersheds Project v. Hahn, 307 F.3d 815, 824 (9th Cir. 2002); Hook v. Ariz. Dep’t of Corr., 107 F.3d 1397, 1401-02 (9th Cir. 1997). We decline to do so here, however. Whether Appellants are “persons” within the meaning of the Due Process Clause for purposes of personal jurisdiction is not inextricably intertwined with our determination of sovereign immunity. Likewise, whether the case involves a case or controversy against Spain does not relate to or necessarily involve our consideration of sovereign immunity. Further, because we can resolve the sovereign immunity issue without reaching the merits of Appellants’ challenge to Article III case or controversy and standing, we do not exercise pendent appellate jurisdiction under Swint. Accordingly, we dismiss this appeal as to these issues. CASSIRER v. THYSSEN-BORNEMISZA COLLECTION 12703 A. The FSIA Provides Limited Exceptions to Sovereign Immunity. [3] The district court has original jurisdiction of any nonjury civil action against a foreign state, including its agencies and instrumentalities.8 See 28 U.S.C. § 1330(a). Under the FSIA, however, foreign states are immune from the jurisdiction of United States courts, subject only to the specific exceptions in §§ 1605, 1607, and specified existing international agreements. See id. at § 1604.9 Thus, the sole basis for obtaining jurisdiction over a foreign state in federal court is the existence of an exception to the FSIA. Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 439 (1989). The FSIA exceptions include “waiver of immunity, § 1605(a)(1), commercial activities occurring in the United States or causing a direct effect in this country, § 1605(a)(2), property expropriated in violation of international law, § 1605(a)(3), inherited, gift, or immovable property located in the United States, § 1605(a)(4), non-commercial torts occurring in the United States, § 1605(a)(5), and maritime liens, § 1605(b).” Id. B. The Expropriation Exception. [4] Cassirer contends that neither the Foundation nor Spain is entitled to sovereign immunity due to the “expropriation exception” of § 1605(a)(3).10 Section 1605(a)(3) provides that 8 Section 1603(a) defines “foreign state” to include “a political subdivision of a foreign state or an agency or instrumentality of a foreign state . . .” 9 Section 1604 provides: “Subject to existing international agreements to which the United States is a party at the time of enactment of this Act a foreign state shall be immune from the jurisdiction of the courts of the United States and of the States except as provided in sections 1605 to 1607 of this chapter.” 28 U.S.C. § 1604. 10 Section 1605(a)(3) provides: “A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any 12704 CASSIRER v. THYSSEN-BORNEMISZA COLLECTION a “foreign state shall not be immune . . . in any case . . . in which rights in property taken in violation of international law are in issue . . . .” The issue regarding the applicability of this exception arises because the statute uses the passive voice and does not expressly require that the foreign state (against whom the claim is made) be the entity that took the property in violation of international law. Appellants invite us to read such a requirement into the statute. The parties agree that Germany, and not Spain, allegedly took the Painting in violation of international law. Therefore, under the construction urged by Appellants, the expropriation exception could not apply. We disagree. [5] We find § 1605(a)(3) to be unambiguous. Where “the intent of Congress is clear and unambiguously expressed by the statutory language,” that is normally the end of the statutory analysis. Zuni Pub. Sch. Dist. No. 89 v. Dep’t of Educ., 550 U.S. 81, 93 (2007). We hold that the plain language of § 1605(a)(3) does not require that the foreign state (against whom the claim is made) be the entity who expropriated the property in violation of international law. [6] Our holding is consistent with the legislative history.11 In reviewing Congress’s intent in enacting the FSIA, we concase . . . in which rights in property taken in violation of international law are in issue and that property or any property exchanged for such property is present in the United States in connection with a commercial activity carried on in the United States by the foreign state; or 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.” 28 U.S.C. § 1605(a)(3). 11 Under appropriate circumstances, we may consider legislative history even when the plain language is clear. We do this, however, only where the legislative history “clearly indicates that Congress meant something other than what it said.” Carson Harbor Vill., Ltd. v. Unocal Corp., 270 F.3d 863, 877 (9th Cir. 2001) (emphasis added). CASSIRER v. THYSSEN-BORNEMISZA COLLECTION 12705 sider § 1602, which sets forth Congress’s findings and purpose. This section expresses Congress’s understanding that foreign states are not immune from suit “insofar as their commercial activities are concerned.”12 In explaining § 1602, the House Report states that Congress is adopting the restrictive theory of sovereign immunity, that is, “[T]he sovereign immunity of foreign states should be ‘restricted’ to cases involving acts of a foreign state which are sovereign or governmental in nature, as opposed to acts which are either commercial in nature or those which private persons normally perform.” H.R. Rep. No. 94-1487, at 14 (1976), reprinted in 1976 U.S.C.C.A.N. 6604, 6613. [7] Consistent with the restrictive theory of sovereign immunity described in § 1602 and the House Report, the exceptions in § 1605(a) apply to situations in which foreign states act more like private persons or are engaged in commercial activities. The plain language of § 1605(a)(3) is entirely consistent with Congress’s intent, because § 1605(a)(3) gives a court jurisdiction over a foreign state in cases involving stolen property only if the foreign state (or its agency) is engaged in a commercial activity in the United States. 12 In its statement of “Findings and declaration of purpose,” 28 U.S.C. § 1602 provides: The Congress finds that the determination by United States courts of the claims of foreign states to immunity from the jurisdiction of such courts would serve the interests of justice and would protect the rights of both foreign states and litigants in United States courts. Under international law, states are not immune from the jurisdiction of foreign courts insofar as their commercial activities are concerned, and their commercial property may be levied upon for the satisfaction of judgments rendered against them in connection with their commercial activities. 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. 12706 CASSIRER v. THYSSEN-BORNEMISZA COLLECTION Citing In re Republic of Philippines, 309 F.3d 1143 (9th Cir. 2002), Appellants argue that § 1605(a)(3) applies only when the foreign state against whom the claim is leveled actually took property in violation of international law. Republic of Philippines required us to interpret the exception in § 1605(a)(4), which provides that a foreign state loses its immunity in any case “in which rights in property in the United States acquired by succession or gift or rights in immovable property situated in the United States are in issue.” We construed the statute as applying only to rights in property in the United States acquired by succession or gift by the foreign state. In reaching this conclusion, we relied on language in the House Report which stated: There is general agreement that a foreign state may not claim immunity when the suit against it relates to rights in property, real or personal, obtained by gift or inherited by the foreign state and situated or administered in the country where the suit is brought . . . The reason is that, in claiming rights in a decedent’s estate or obtained by gift, the foreign state claims the same right which is enjoyed by private persons. Republic of Philippines, 309 F.3d at 1151 (quoting H.R. Rep. No. 94-1487) (emphasis added). In other words, to effectuate Congress’s intent to grant courts jurisdiction over foreign states only when they act more like private persons, we read “by the foreign state” into § 1605(a)(4). Under this reading, courts gain jurisdiction over a foreign state only if the state acted like a private person and by claiming rights in a decedent’s estate or obtaining a gift. Contrary to Appellant’s argument, our interpretation of § 1605(a)(4) in Republic of Philippines is entirely consistent with a plain language reading of § 1605(a)(3). It is not necessary to read “by the foreign state” into § 1605(a)(3) to achieve consistency with the restrictive theory of sovereign immunity. The plain language of § 1605(a)(3) already grants courts jurisdiction over foreign CASSIRER v. THYSSEN-BORNEMISZA COLLECTION 12707 states only if they act like a private person by engaging in commercial activities. Republic of Philippines therefore provides no justification to depart from the plain language of § 1605(a)(3). [8] Because nothing in the plain language of the FSIA or the legislative history requires us to read additional language into the statute, we hold that the expropriation exception to sovereign immunity found in § 1605(a)(3) does not require that the foreign state against whom the claim is made be the foreign state that took property in violation of international law. C. Commercial Activity in the United States. [9] For the expropriation exception to apply, the FSIA also requires “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.” 28 U.S.C. § 1605(a)(3). The Foundation admits that it is an “agency or instrumentality” of Spain and that it owns the Painting. We agree with the district court that the Foundation has engaged in sufficient commercial activity in the United States to satisfy § 1605(a)(3). As defined in the FSIA, “commercial activity” means either a regular course of commercial conduct or a particular commercial transaction or act. The commercial character of an activity shall be determined by reference to the nature of the course of conduct or particular transaction or act, rather than by reference to its purpose. 28 U.S.C. § 1603(d). “The central question is whether the activity is of a kind in which a private party might engage.” 12708 CASSIRER v. THYSSEN-BORNEMISZA COLLECTION Siderman de Blake v. Republic of Argentina, 965 F.2d 699, 708 (9th Cir. 1992) (internal quotation marks omitted). In Siderman, we concluded that Argentina conducted commercial activity in the United States, because (1) it advertised an expropriated hotel in the United States; (2) it solicited guests through its United States agent (Argentina’s national airline); (3) numerous Americans stayed at the hotel; and (4) the hotel accepted all major American credit cards. Id. at 712-13. Likewise, in Altmann, we concluded that authoring, promoting, and distributing books and other publications in the United States to exploit expropriated paintings were “sufficient to constitute ‘commercial activity’ for the purpose of satisfying the FSIA.” Altmann, 317 F.3d at 959. In this case, after allowing limited jurisdictional discovery, the district court found that the Foundation engaged in commercial transactions in the United States, including transacting business as a purchaser and a seller of goods and services and as an advertiser in distributing marketing and other commercial promotional materials. Cassirer v. Kingdom of Spain, 461 F. Supp. 2d 1157, 1173-75 (C.D. Cal. 2006). For example, the Foundation made numerous purchases of books, posters, post cards, and related materials from United States businesses in New York, California, and Washington, D.C. The Foundation also purchased books about Nazi expropriation of great works of art13 and a book presumably about the works of Pissaro. Id. at 1173. The Foundation sold posters and books to United States residents and businesses, and 13 The district court noted, “As particularly ironic examples, the Foundation purchased through Amazon.com The Lost Museum: The Nazi Conspiracy to Steal the World’s Greatest Works of Art, . . . and from the American Association of Museums in Washington, DC purchased a volume on Museum Policy and Procedure for Nazi Era Issues.” Cassirer, 461 F. Supp. 2d at 1173 (internal citations omitted). CASSIRER v. THYSSEN-BORNEMISZA COLLECTION 12709 licensed the reproduction of images to various United States businesses. Id. The Foundation also admitted that it worked with U.S. entities to secure goods to be sold in the Museum gift shop, including paying U.S. citizens to write for its exhibit catalogs. Id. Further, it admitted that it has shipped gift shop items to purchasers in the United States. Id. Notably, the Foundation sold a poster of the Painting at issue in this case to individuals in both California and North Carolina. The California purchaser resides in the Central District of California and used her American Express credit card to consummate the transaction. Id. The Foundation also solicited, recruited, and commissioned writers and speakers from the United States to provide services at the Museum. Id. The Foundation facilitated the production of a film on the Foundation collection, featuring the Painting, which it knew would be presented in-flight on Iberia Airlines flights to and from the United States. Id. at 1174. The Foundation placed advertisements in magazines that are distributed in the United States and sent press releases, brochures, and general information to TourEspaña and the Spanish National Tourist Offices in the United States. For example, the Foundation advertised in news publications such as Newsweek, Time Magazine, and the New Yorker. Id. It also distributes its Museum bulletin, “Perspectives,” to individuals in the United States, including two in the Central District of California. Id. The Foundation also contracted with museums in the United States to loan its artwork to the U.S. institutions or to borrow artwork for display in the Foundation Museum in Spain. Id. at 1174-75. [10] The record supports the district court’s factual findings, which are not clearly erroneous. Cassirer has produced numerous examples of the Foundation’s commercial activity in the United States that are “of a kind in which a private 12710 CASSIRER v. THYSSEN-BORNEMISZA COLLECTION party might engage.” Siderman, 965 F.2d at 708 (internal quotation marks omitted). Much of that activity was connected with the Painting. Thus, Cassirer has adequately demonstrated that the Foundation has engaged in sufficient commercial activity in the United States to satisfy § 1605(a)(3).