Brief Fact Summary. The suit Nelson (P) filed against Saudi Arabia (D) for wrongful arrest, imprisonment and torture was contended by the defendant who claimed foreign sovereign immunity from the subject matter jurisdiction of the federal courts.
Synopsis of Rule of Law. Unless the action is based upon a commercial activity in the manner of a private player within the market, foreign states are entitled to immunity from the jurisdiction of courts in the United States.
When a foreign government acts, not as a regulator of a market, but in the manner of a private player within it, the foreign sovereign's actions are commercial within the meaning of the FSIA.View Full Point of Law
Issue. Unless the action is based upon a commercial activity in the manner of a private player within the market, are foreign states entitled to immunity from the jurisdiction of courts in the United States?
Holding and decision: (Souter, J) Yes. Unless the action is based upon a commercial activity in the manner of a private player within the market, foreign states are entitled to immunity from the jurisdiction of courts in the United States. Hence, the torture allegation which was levied against Saudi Arabia (D) does not fall under the purview of the definition of â€œcommercial activityâ€ as contained in the Foreign Sovereign Immunities Act of 1976.
On the part of Nelson (P), his claim about not being warned of the peril attached to his job does not have any merit because sovereign nations have no duty to warn of their propensity for tortuous conducts. Since the action of the plaintiff is not in consonance with commercial activity as defined in the Act, it is therefore outside the subject-matter jurisdiction of the federal courts. The prayer of Saudi Arabia (D) dismissal was thereby granted. Reversed.
Dissent. (Stevens, J.) Jurisdiction would be upheld on the premise that the same activities had been performed by a private business.
Concurrence. (White, J.) the hospital’s employment practices and its disciplinary procedures have no clear connection to the country. The Act does not grant the Nelsons (P) access to the U.S. courts because of the absent nexus to the United States.
Discussion. When comparing â€œrestrictiveâ€ to â€œabsoluteâ€ theory of foreign sovereign immunity, a state is immune from the jurisdiction of foreign courts as to its sovereign or public acts but not as to those that are private or commercial in character. Where a state exercises only those powers that can also be exercised by private citizens, as distinct from those powers peculiar to sovereigns, such state is said to be engaging in commercial activity under the restrictive theory. The Act unmistakable commands to observe the distinction between the purpose of a conduct and its nature is recognized by the Court.