Opinion ID: 696239
Heading Depth: 3
Heading Rank: 3

Heading: The District Court's Interpretation of the FSIA

Text: 25 We must determine whether the district court erred in ruling that the exceptions to the waiver of sovereign immunity for noncommercial torts listed in section 1605(a)(5)(B) of the FSIA restrict the scope of the waiver of sovereign immunity for commercial activities established by section 1605(a)(2). Before addressing the merits of this issue, however, we must decide whether we are bound by a prior Ninth Circuit opinion upon which the district court relied in granting INMECAFE's Rule 60(b)(4) motion. 26 In a footnote in Gregorian, 871 F.2d at 1515, this court stated that it is ... likely that Congress meant the clauses retaining immunity in section 1605(a)(5)(B) to deny jurisdiction over any claims alleging the torts listed. Gregorian, 871 F.2d at 1522 n. 4. INMECAFE relies upon this sentence, which suggests that all tort claims included in section 1605(a)(5)(B) are granted immunity whether committed by the foreign entity acting in an commercial or noncommercial capacity, as a holding of this court to which this panel is bound. Cf. Branch v. Tunnell, 14 F.3d 449, 456 (9th Cir.), cert. denied, --- U.S. ----, 114 S.Ct. 2704, 129 L.Ed.2d 832 (1994); United States v. Gay, 967 F.2d 322, 327 (9th Cir.), cert. denied, --- U.S. ----, 113 S.Ct. 359, 121 L.Ed.2d 272 (1992). 27 INMECAFE argues that the discussion in the Gregorian footnote constitutes an alternative ground for the court's decision. [W]here a decision rest on two or more grounds, none can be relegated to the category of obiter dictum. Woods v. Interstate Realty Co., 337 U.S. 535, 537, 69 S.Ct. 1235, 1236-37, 93 L.Ed. 1524 (1949) (quoted in English v. United States, 42 F.3d 473, 485 (9th Cir.1994)); Russell v. Commissioner of Internal Revenue, 678 F.2d 782, 785 n. 2 (9th Cir.1982). Although the district court in Carnival Cruise Lines, Inc. v. Oy Wartsila AB, 159 B.R. 984, 1001 (S.D.Fla.1993) found that the footnote in Gregorian was an alternate and supporting ground for the holding ... and cannot be fairly cast as dicta, 3 we conclude that the footnote is dictum. 4 See Black's Law Dictionary, 454 (6th ed. 1990) (defining dictum as an observation or remark ... not necessarily involved in the case or essential to its determination). 28 Gregorian held that there was no applicable exception to sovereign immunity under the FSIA for Gregorian's libel claim because Izvestia's activities were not commercial activities as defined by section 1605(a)(2). See Gregorian, 871 F.2d at 1521 (The nature of the Izvestia article ... is clearly governmental.); id. at 1522 (In conclusion, then, we hold that the activity ... was governmental rather than commercial in nature for purposes of section 1605(a)(2) of the FSIA). The footnote suggests that Gregorian's trade libel claim would fare no better because, given the court's holding that Izvestia's actions were not commercial activities as defined in section 1605(a)(2), the alleged tort of trade libel would be encompassed within the libel exception of section 1605(a)(5)(B). Id. at 1522 n. 4 (stating that the plaintiffs did not seek an exception to immunity under section 1605(a)(5). Nor could plaintiffs have established subject matter jurisdiction for their [trade] libel claim under section 1605(a)(5)). The statement in the footnote, that it is far more likely that Congress intended section 1605(a)(5)(B) to apply to all claims of libel, is therefore dictum, as it is offered only to explain why section 1605(a)(5)(B) would encompass the trade libel claim if plaintiffs had attempted to rely upon that section to establish jurisdiction. See Black's Law Dictionary, 454 (6th ed. 1990) (defining dicta as [e]xpressions in the court's opinion which go beyond the facts before the court). Although there are statements in the footnote that suggest the interpretation of section 1605 that INMECAFE urges, 5 these statements were not necessary to the decision and thus have no binding or precedential impact in the present case. See Wainright v. Witt, 469 U.S. 412, 422, 105 S.Ct. 844, 851, 83 L.Ed.2d 841 (1985); Operating Engineers Pension Trust, 766 F.2d at 1307 (Fletcher, J. dissenting); see also United States v. Crawley, 837 F.2d 291, 292-93 (7th Cir.1988) (explaining the reasons for rejecting a prior court's dictum). 29 This reading of Gregorian is buttressed by the fact that no case in this circuit has cited the contested footnote as binding precedent, and, in fact, subsequent cases have contradicted its interpretation of section 1605. See, e.g., Siderman de Blake v. Republic of Argentina, 965 F.2d 699, 710 (9th Cir.1992) (holding that the plaintiffs' claims for fraud and interference with business relationships are not subject to immunity because they fall squarely within clause two of the commercial activity exception), cert. denied, --- U.S. ----, 113 S.Ct. 1812, 123 L.Ed.2d 444 (1993); Richmark Corp. v. Timber Falling Consultants, Inc., 937 F.2d 1444, 1446 & n. 1 (9th Cir.1991) (finding subject matter jurisdiction under the commercial activity exception over fraud claim), cert. denied, --- U.S. ----, 113 S.Ct. 295, 121 L.Ed.2d 219 (1992). If Gregorian 's footnote were binding precedent, subsequent panels of this court would not have been able to find subject matter jurisdiction under the commercial activity exception over tort claims exempted in section 1650(a)(5)(B). See FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 231, 110 S.Ct. 596, 607-08, 107 L.Ed.2d 603 (1990) (stating that federal courts are under an independent obligation to examine their own jurisdiction); Harris v. Provident Life & Accident Ins. Co., 26 F.3d 930, 932 (9th Cir.1994); see also Operating Engineers Pension Trust, 766 F.2d at 1307 (Fletcher, J. dissenting) (arguing that the fact that subsequent case law does not cite or follow contested statements supports finding that those statements are dicta). Thus, we are not bound by the dictum contained in Gregorian 's footnote. See Webb v. Lewis, 44 F.3d 1387, 1392 (9th Cir.1994) (refusing to be bound by previous panel's dictum), cert. denied, --- U.S. ----, 115 S.Ct. 2002, 131 L.Ed.2d 1003 (1995); In re U.S. Financial Securities Litigation, 609 F.2d 411, 425 n. 43 (9th Cir.1979), cert. denied, 446 U.S. 929, 100 S.Ct. 1866, 64 L.Ed.2d 281 (1980).