Court Opinion

ID: 4015109
Source: CourtListenerOpinion
Date Created: 2016-07-12 20:01:04.042972+00
Date Added: 2024-06-11T07:44:53.934586
License: Public Domain

FILED
                            NOT FOR PUBLICATION
                                                                             JUL 12 2016
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

MANDANA D. FARHANG and M.A.                      No. 14-15601
MOBILE LTD.,
                                                 D.C. No. 5:08-cv-02658-RMW
              Plaintiffs - Appellees,

 v.                                              MEMORANDUM*

INDIAN INSTITUTE OF
TECHNOLOGY, KHARAGPUR, an
Indian Institute of Technology
incorporated under the “Institutes of
Technology, Act 1961" and PARTHA P.
CHAKRABARTI,

              Defendants - Appellants,

  and

TECHNOLOGY INCUBATION AND
ENTREPRENEURSHIP TRAINING
SOCIETY, an Indian society; et al.,

              Defendants.

                    Appeal from the United States District Court
                      for the Northern District of California
                    Ronald M. Whyte, District Judge, Presiding

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                          Argued and Submitted July 7, 2016
                              San Francisco, California

Before:        SILVERMAN and NGUYEN, Circuit Judges and ANELLO,** District
               Judge.

      The Indian Institute of Technology, Kharagpur (“IITK”) and Partha P.

Chakrabarti appeal from the district court’s order denying their motion to dismiss

plaintiffs’ third amended complaint pursuant to the Foreign Sovereign Immunities

Act (“FSIA”) and common law foreign official immunity principles. We have

jurisdiction under the collateral order doctrine. See Terenkian v. Republic of Iraq,

694 F.3d 1122, 1130 (9th Cir. 2012). We review de novo the district court’s legal

rulings and its factual findings for clear error. See id. at 1132. We affirm in part,

vacate in part, and remand.

      1.       Contrary to plaintiffs’ contentions, defendants’ notice of appeal in this

case was timely. While the district court originally denied IITK’s motion to

dismiss on FSIA immunity grounds in 2010, that motion and order related to the

first amended complaint in this action. Subsequent to that order, a third amended

complaint was filed that added Mobile M.A. as a plaintiff and included additional

allegations. Defendants moved to dismiss that complaint and, when that motion

          **
             The Honorable Michael M. Anello, District Judge for the U.S. District
Court for the Southern District of California, sitting by designation.

                                            2                                    14-15601
was denied, defendants timely filed their notice of appeal.

      2.     The district court correctly determined the “waiver exception” to the

FSIA applied to each of M.A. Mobile Ltd.’s claims against IITK. IITK impliedly

waived its immunity under the FSIA as to these claims by agreeing to a

nondisclosure agreement which expressly provided that the laws of the United

States and the State of California would govern the agreement. See 28 U.S.C. §

1605(a)(1); see also Joseph v. Office of the Consulate Gen. of Nigeria, 830 F.2d
1018, 1022 (9th Cir. 1987) (“[A]t the very least it is clear that a sovereign party has

waived immunity where a contract specifically states that the laws of a jurisdiction

within the United States are to govern the transaction.” (emphasis in original)).

This waiver extends to all of M.A. Mobile’s claims because each claim arises out

of or relates to the nondisclosure agreement which forms the basis of IITK’s

waiver.

      However, the district court erred in extending this waiver to encompass

Mandana Farhang’s individual claims against IITK. The district court concluded

that Farhang, while not a party to the nondisclosure agreement, was nonetheless an

intended third-party beneficiary of that agreement because Farhang owned M.A.

Mobile and was entitled to any economic benefit derived from the technology

covered by the nondisclosure agreement. These facts, however, are insufficient to

                                           3                                    14-15601
establish that Farhang was an intended third-party beneficiary. See Neverkovec v.

Fredericks, 74 Cal. App. 4th 337, 349 (1999) (“[T]he fact that . . . the contract, if

carried out to its terms, would inure to the third party’s benefit, is insufficient to

entitle him or her to demand enforcement.” (internal quotation marks and citation

omitted)); see also Corporacion Mexicana de Servicios, S.A. de C.V. v. M/T

Respect, 89 F.3d 650, 655 (9th Cir. 1996) (“The waiver exception is narrowly

construed.”). We accordingly vacate the district court’s denial of IITK’s motion to

dismiss to the extent the district court found that ITTK’s implied waiver of

immunity extended to Farhang’s individual claims.

      Before the district court, plaintiffs also argued that the commercial activity

exception to FSIA immunity applied. See 28 U.S.C. § 1605(a)(2). Because it

found the waiver exception applied to all of the plaintiffs’ claims, the district court

did not consider these arguments. Because we hold that the waiver exception does

not apply to Farhang’s claims against IITK, we remand with instructions for the

district court to consider in the first instance whether the commercial activity

exception applies to her claims in light of our holding in Farhang v. Indian

Institute of Technology, Kharagpur, 529 F. App’x 812 (9th Cir. 2013).

      3.     The district court erred in denying Chakrabarti’s motion to dismiss

that was premised on common law foreign official immunity. The district court

                                            4                                      14-15601
concluded that the evidence submitted by plaintiffs suggested that Chakrabarti’s

“involvement in the joint venture was not purely official.” However, plaintiffs, in

their third amended complaint, expressly alleged that defendants – including

Chakrabarti – were acting “within the scope of said role and/or relationship” with

IITK. See Yousuf v. Samantar, 699 F.3d 763, 769 (4th Cir. 2012) (finding that

foreign officials are entitled to immunity under the common law for actions taken

during the course of their official duties). While the evidence suggests that

Chakrabarti may have obtained some incidental individual benefit from his

involvement in the joint venture this is insufficient to negate his official role in the

transaction. Cf. Chuidian v. Philippine Nat’l Bank, 912 F.2d 1095, 1102 (9th Cir.

1990), abrogated on other grounds by Samantar v. Yousuf, 560 U.S. 305 (2010)

(that a defendant “experienced a convergence between his personal interest and his

official duty and authority” does not “serve to make his action any less an action of

his sovereign”).

      Accordingly we vacate the denial of Chakrabarti’s motion to dismiss the

third amended complaint, and remand with instructions to dismiss plaintiffs’

claims against him.

      Each party shall bear their own costs.

      AFFIRMED in part, VACATED in part, and REMANDED.

                                            5                                     14-15601