INTERNATIONAL ARBITRATION-JURISDICTION OVER FOREIGN SOVEREIGNS

CC/Devas (Mauritius) Ltd. v. Antrix Corp., 221 L. Ed. 2d 867

CC/Devas prevailed in an arbitration against Antrix, an entity owned by the Republic of India, and moved to confirm the award in the Western District of Washington. Antrix asserted that the court did not have jurisdiction because it was owned by foreign sovereign and hence immune from suits in the courts of the United States as set forth in the Foreign Sovereign Immunities Act (FSIA). CC/Devas argued that the court had jurisdiction pursuant to the arbitration exception in the FSIA. The District Court held that it had jurisdiction and confirmed the award. Antrix appealed and the Ninth Circuit reversed, holding that FSIA’s arbitration exception also required a traditional minimum contacts analysis, It found that these minimum contacts were lacking and it dismissed the suit.

CC/Devas appealed to the Supreme Court, which granted certiorari. It argued that Section 1330(b) of the FSIA provided that the exception would apply in any case where “the district courts have [subject-matter] jurisdiction…[and]….where service has been made under section 1608 of this title.” There were no other requirements. The Supreme Court agreed and reversed.

The Supreme Court held that Section 1330b) imposed two substantive requirements—one related to subject-matter jurisdiction, the other related to service of process. First, district courts have [subject-matter] jurisdiction” when any of the FSIA’s immunity exceptions applies. Second, “service has been made under section 1608” when a plaintiff complies with the FSIA’s specialized service-of-process rules. When both criteria are satisfied, the statute declares that personal jurisdiction “shall exist,” and, as in other contexts, the use of the word ‘shall’ creates an obligation impervious to judicial discretion. Thus, the most natural reading of §1330(b) is that personal jurisdiction over a foreign sovereign is automatic whenever (1) an exception to immunity applies and (2) service of process has been accomplished. Or phrased in even simpler terms, subject matter jurisdiction plus service of process equals personal jurisdiction. Notably absent from §1330(b) is any reference to “minimum contacts.” The Court declined to add in what Congress left out.