Republic of Argentina v. Weltover, Inc.

Headnotes

1. International Law — Commercial Activity Exception Under the Foreign Sovereign Immunities Act, a foreign state is immune from the jurisdiction of United States courts unless one of the statutorily defined exceptions applies, and the Act provides the sole basis for obtaining jurisdiction over a foreign sovereign in the United States. 504 U.S. at 611 (citing Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 434-439 (1989))
2. International Law — Commercial Activity When a foreign government acts, not as a regulator of a market, but in the manner of a private player within it, its actions are "commercial" within the meaning of the FSIA; because the commercial character of an act is determined by reference to its nature rather than its purpose, the question is not whether the government acts with a profit motive or to fulfill uniquely sovereign objectives, but whether the particular actions are the type of actions by which a private party engages in trade and commerce. 504 U.S. at 614
3. International Law — Commercial Activity — Foreign Sovereign Debt A foreign state's issuance of debt instruments is a commercial activity under the FSIA where the instruments are garden-variety debt: they may be held by private parties, are negotiable and tradable on the international market, and promise a future stream of cash income; there is nothing distinctive about a state's assumption of debt, other than perhaps its purpose, that would cause it always to be classified as a sovereign act. 504 U.S. at 615-617
4. International Law — Commercial Activity — Nature Versus Purpose The FSIA squarely forecloses inquiring into the purpose of a foreign state's conduct to determine its commercial character; however difficult it may be to separate purpose from nature, the statute requires that it be done, and it is irrelevant why a foreign state participated in the bond market in the manner of a private actor — it matters only that it did so. 504 U.S. at 616-617
5. International Law — Direct Effect An effect is "direct" for purposes of § 1605(a)(2) if it follows as an immediate consequence of the defendant's activity; the statute contains no unexpressed requirement that the effect be "substantial" or "foreseeable," though the principle de minimis non curat lex ensures that jurisdiction may not be predicated on purely trivial effects in the United States. 504 U.S. at 618
6. International Law — Direct Effect — Place of Performance Where a foreign state's contractual obligations are to be performed in the United States — as where creditors designate New York accounts as the place of payment and the state has made interest payments into those accounts — the state's unilateral rescheduling of those obligations necessarily has a "direct effect in the United States," because money that was supposed to have been delivered to a New York bank was not forthcoming. 504 U.S. at 618-619
7. International Law — Standing of Foreign Plaintiffs The "direct effect" requirement of the FSIA can be satisfied even where the plaintiffs are all foreign corporations with no other connections to the United States, since the FSIA permits a foreign plaintiff to sue a foreign sovereign in the courts of the United States provided the substantive requirements of the Act are satisfied. 504 U.S. at 619 (citing Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 489 (1983))
8. Constitutional Law — Due Process Assuming that a foreign state may be a "person" for purposes of the Due Process Clause of the Fifth Amendment, a foreign state satisfies the "minimum contacts" test by issuing negotiable debt instruments denominated in United States dollars and payable in New York and by appointing a financial agent in that city, thereby purposefully availing itself of the privilege of conducting activities within the United States. 504 U.S. at 619 (citing International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945); Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985))