Brief Fact Summary. First National City Bank (now Citibank) (D) claimed that the payment on a letter of credit issued before the Cuban government nationalized all assets would be settled with the value of its assets seized in Cuba against a claim by Banco Para El Comercio Exterior de Cuba (Bancec) (P).
Synopsis of Rule of Law. Attributing liability among instrumentalities of a foreign state is not affected by the Foreign Sovereign Immunities Act of 1976 (FSIA).
Issue. Does the attribution of liabilities among instrumentalities of a foreign state affected by the Foreign Sovereign Immunities Act of 1976?
Held. (O’Connor, J) No. Attributing liability among instrumentalities of a foreign state is not affected by the Foreign Sovereign Immunities Act of 1976. The FSIA was not enacted to alter the substantive law of liability. When a claim is asserted by a foreign sovereign in the U.S court, the state is barred from asserting a defense of sovereign immunity to defeat a setoff or counterclaim due to the consideration of a fair dealing. Hence, the amount sought by Bancec (P) can be setoff with the value of its assets seized by the Cuban government.
First, where a corporate entity is so extensively controlled by its owner that a relationship of principal and agent is created, we have held that one may be held liable for the actions of the other.
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