OBB Personenverkehr AG v. Sachs
Issues
When is an entity an “agent” of a “foreign state” for purposes of the Foreign Sovereign Immunities Act; and, what degree of commercial activity within the United States is sufficient to trigger an exception to immunity for personal injury liability under that Act?
The Foreign Sovereign Immunities Act (“FSIA”) limits the ability of U.S. citizens to bring causes of action against foreign states and their agents in U.S. courts. See Brief for Petitioner, OBB Personenverkehr AG at 25. But the FSIA contains a commercial activity exception, which allows a U.S. court to hear suits involving a foreign state when the action is “based upon” the state’s commercial activity in the United States. See id. In this case, the Supreme Court will consider how to define when an entity is an agent of a foreign state, and the scope of the commercial activity exception’s “based upon” requirement. See id. at i. OBB Personenverkehr AG (“OBB”), a state-run Austrian passenger railway, argues that foreign states are “presumptively immune” from U.S. jurisdiction under the FSIA unless an exception applies. See id. at 25 (internal quotation omitted). OBB contends that injured Americans like Carol Sachs cannot satisfy “the based upon” requirement for claims arising from harm incurred on foreign soil. See id. at 28. Sachs argues that a sale of a ticket in the United States constitutes commercial activity and thus satisfies that requirement. See Brief for Respondent, Carol P. Sachs at 23–24. In the alternative, OBB argues that the FSIA clearly defines who can be an “agent” of the state, and that the Ninth Circuit erred in relying on common-law agency principles to find that a third-party’s ticket seller was an agent of OBB. See Brief for Petitioner at 43–46. Sachs counters that common-law agency principles should apply notwithstanding the language of the FSIA. See Brief for Respondent at 20–21. This case may affect the balance of international litigation and may result in a shift from the restrictive theory of sovereign immunity. See Brief of Amici Curiae Governments of the Kingdom of the Netherlands and the Swiss Confederation, in Support of Petitioner at 26, 34. This case may also result in changes to how agents of a foreign state engage in business with the United States over the Internet. See Brief of NML Capital, LTD, in Support of Respondent at 16; Brief of Amici Curiae International Rail Transport Committee, in Support of Petitioner at 14.
Questions as Framed for the Court by the Parties
- For purposes of determining when an entity is an “agent” of a “foreign state” under the first clause of the commercial activity exception of the Foreign Sovereign Immunities Act, 28 U.S.C. § 1605(a)(2), does the express definition of “agency” in the FSIA, the factors set forth in First National City Bank v. Banco Para el Comercio Exterior de Cuba, or common law principles of agency, control?
- Under the first clause of the commercial activity exception of the FSIA, 28 U.S.C. § 1605(a)(2), is a tort claim for personal injuries suffered in connection with travel outside of the United States “based upon” the allegedly tortious conduct occurring outside of the United States or the preceding sale of the ticket in the United States for the travel entirely outside the United States?
In March 2007, Carol Sachs purchased a four-day Eurail pass for travel in Austria and the Czech Republic from Rail Pass Experts (“RPE”), a Massachusetts company. See Sachs v. Republic of Austria, 737 F.3d 584, 587 (9th Cir.
Written by
Edited by
Additional Resources
- Ingrid Wuerth, Supreme Court to Decide Another Foreign Sovereign Immunities Act Case, Lawfare (Jan. 25, 2015).