Opinion ID: 778751
Heading Depth: 2
Heading Rank: 3

Heading: Federal Court Subject Matter Jurisdiction Over Actions Involving Foreign States

Text: Under the FSIA, federal district courts 15 have original jurisdiction without regard to amount in controversy of any nonjury civil action against a foreign state ... as to any claim for relief in personam with respect to which the foreign state is not entitled to immunity either under sections 1605-1607 of [28 U.S.C.] or under any applicable international agreement. 16 28 U.S.C. § 1330(a). The FSIA further provides that a foreign state shall be immune from [such] jurisdiction ... except as provided in sections 1605 to 1607 of the FSIA. Id. at § 1604. The FSIA thus provides the sole basis for obtaining [subject matter] jurisdiction over a foreign sovereign in the United States. Republic of Argentina v. Weltover, Inc., 504 U.S. 607, 611, 112 S.Ct. 2160, 119 L.Ed.2d 394 (1992) (internal quotation marks omitted); accord Saudi Arabia v. Nelson, 507 U.S. 349, 355, 113 S.Ct. 1471, 123 L.Ed.2d 47 (1993). 17 Most of the exceptions to foreign states' immunity are contained in 28 U.S.C. § 1605, which provides in pertinent part: 18 § 1605. General exceptions to the jurisdictional immunity of a foreign state 19 (a) A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case — 20 .... 21 in which the action is based [1] upon a commercial activity carried on in the United States by the foreign state; or [2] upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere; or [3] upon an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect in the United States[.] 22 28 U.S.C. § 1605(a)(2). Virtual Countries contends that the Republic is not immune from suit in a United States court because, under the third clause of § 1605(a)(2), the claims in this case are based ... upon an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act cause[d] a direct effect in the United States. Id. For a defendant foreign state to be amenable to jurisdiction under the third clause, the lawsuit for which jurisdiction is sought must be (1) based ... upon an act outside the territory of the United States; (2) that was taken in connection with a commercial activity of [the foreign state] outside this country; and (3) that caused a direct effect in the United States. Weltover, 504 U.S. at 611 (internal quotation marks and punctuation omitted). We focus on the third requirement, a direct effect in the United States, and find the absence thereof dispositive of this appeal.