Foreign Sovereign Immunities Act - Exhaustion of Local Remedies - Ninth Circuit Requires Case-by-Case Prudential Analysis of Exhaustion of Local Remedies in Foreign Sovereign Immunities Act Suits
FOREIGN SOVEREIGN IMMUNITIES ACT--EXHAUSTION OF LOCAL REMEDIES--NINTH CIRCUIT REQUIRES CASE-BY-CASE PRUDENTIAL ANALYSIS OF EXHAUSTION OF LOCAL REMEDIES IN FOREIGN SOVEREIGN IMMUNITIES ACT SUITS.--Cassirer v. Kingdom of Spain, 580 F.3d 1048 (9th Cir. 2009).
Foreign sovereign immunity occupies an important place in the American legal terrain, implicating domestic law, international law, and international relations concerns. In the United States, the Foreign Sovereign Immunities Act of 1976 (1) (FSIA) governs whether a foreign state is entitled to claim sovereign immunity. (2) The FSIA starts from a presumption of sovereign immunity, denying it only when a sovereign undertakes certain acts delineated by the statute. (3) The FSIA is silent, though, on whether a plaintiff bringing suit against a foreign sovereign must exhaust the remedies available in the defendant sovereign's judicial system before filing a claim in the United States. Recently, in Cassirer v. Kingdom of Spain, (4) the Ninth Circuit held that lower courts should "consider exhaustion on a prudential, case-by-case basis" where international law or comity so requires. (5) In dissent, Judge Ikuta provided strong arguments from the text and the legislative history for why the judiciary should not impose a prudential exhaustion analysis under the FSIA. (6) The unwieldy test adopted by the Ninth Circuit is problematic for another reason: practical difficulties in applying the exhaustion analysis consistently will likely undermine Congress's intent to provide a predictable legal scheme for assessing invocations of foreign sovereign immunity. The test's equitable considerations include comity and other discretionary factors that are too nebulous to employ in a predictable manner. While all of the equitable factors stem from an Alien Tort Statute (7) (ATS) case, two factors in particular may be difficult, or simply inapposite, to apply to FSIA suits. In addition to the reasons set forth in Judge Ikuta's dissent, these practical problems in applying the test suggest that if an exhaustion analysis is attached to the FSIA, it should be Congress--and not the courts--that attaches it.
In 1939, as the persecution of Jews in Nazi Germany was increasing, Lilly Cassirer attempted to leave the country. (8) A government-appointed appraiser refused to let Cassirer leave Germany with a Camille Pissarro painting, Rue Saint-Honore, apres-midi, effet de pluie, that the Cassirer family had owned for over forty years. He instead forced her to sell it to him for $360. (9) Through various sales, the painting ultimately fell into the possession of the Thyssen-Bornemisza Collection Foundation, an organization with close ties to the Spanish government. (10) In 2000, Claude Cassirer, the grandson and heir of Lilly Cassirer, learned of the painting's location and unsuccessfully petitioned a Spanish cultural minister to return it. (11) Cassirer then sued both the Foundation and Spain in the Central District of California in 2005, without attempting to litigate first in Spain. (12)
Spain and the Foundation moved to dismiss for lack of subject matter jurisdiction on the ground of sovereign immunity and for lack of personal jurisdiction. (13) Cassirer argued that the FSIA allows subject matter jurisdiction over suits alleging that property was "taken in violation of international law" when that property is owned or operated by a state or a state instrumentality that is "engaged in a commercial activity in the United States." (14) Judge Feess first found that the dispute presented a justiciable case or controversy and that the Foundation was an agency or instrumentality of Spain. (15) The court noted that the FSIA uniquely confers personal jurisdiction over a foreign state if the requirements of subject matter jurisdiction are met and the defendant is properly served. (16) The court concluded that there was sufficient evidence of the Foundation's commercial activity in the United States to support subject matter jurisdiction under the FSIA. …