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AMERADA HESS SHIPPING CORP. v. ARGENTINE REPUBLIC

May 5, 1986

AMERADA HESS SHIPPING CORPORATION; Plaintiff,
v.
ARGENTINE REPUBLIC, Defendant; UNITED CARRIERS, INC., Plaintiff, v. ARGENTINE REPUBLIC, Defendant


Carter, District Judge.


The opinion of the court was delivered by: CARTER

CARTER, District Judge

The Argentine Republic, defendant in these two related actions, has moved to dismiss both of the complaints for lack of subject-matter jurisdiction by virtue of the Foreign Sovereign Immunities Act ("FSIA"), Pub.L. No. 94-583, 90 Stat. 2891, codified at 28 U.S.C. §§ 1330, 1332(a)(2)-(4), 1391(f), 1441(d) and 1602-1611.

 Plaintiff United Carriers, Inc. ("United Carriers"), a Liberian corporation, owned the Hercules, a crude oil tanker. Plaintiff Amerada Hess Shipping Corporation ("Amerada Hess"), also a Liberian corporation, time-chartered the vessel to transport Alaskan North Slope crude oil from Valdez, Alaska to a Hess oil refinery in the Virgin Islands. Because her width precluded passage through the locks of the Panama Canal, the Hercules sailed between these two points by travelling around the southern tip of South America at Cape Horn.

 On April 2, 1982, the Argentine Republic invaded the islands known as the Falklands to the English-speaking world, and as the Malvinas to the Spanish-speaking. Great Britain defended its crown colony off of the eastern coast of Argentina, and war between the two nations ensued. Throughout that war, Liberia remained a neutral nation. The Hercules, however, could not remain wholly disengaged from the post-colonial struggle raging in the South Atlantic. On May 5, while voyaging from Valdez to St. Croix, she diverted her course upon the request of the Argentine Navy in order to search for survivors of the General Belgado, an Argentine Navy cruiser sunk by a British submarine. She was later released from this task and completed her voyage to St. Croix.

 On May 25, 1982, the Hercules began its return voyage in ballast, or without cargo, to Valdez. Without provocation or warning, Argentine military aircraft began to bomb the neutral merchant vessel three separate times on June 8: once at 1350 Greenwich Mean Time ("G.M.T."), when she was located at 46 degrees 10 minutes South latitude, 49 degrees 30 minutes West longitude; at 1430 G.M.T. when she was at 45 degrees 16 minutes South latitude, 48 degrees 25 minutes West longitude; and at 1625 G.M.T. when she was at 46 degrees 8 minutes South latitude, 48 degrees 55 minutes West longitude. Unaccountably, a belated directive to change course or suffer attack was received by the Hercules after the third attack, between 1720 and 1800 G.M.T. The complaints allege that the air attacks took place outside of the war zones designated by both the Argentine Republic and Great Britain. The bombing and rocket attacks damaged the decks and hull of the Hercules and left her with an undetonated bomb lodged in her starboard side. Thus disabled, she reversed course and sailed towards Rio de Janeiro, Brazil, the nearest safe port of refuge. United Carriers decided that it would be too dangerous to attempt to remove the undetonated bomb and repair the Hercules. The tanker was scuttled 250 nautical miles off of the Brazilian coast.

 Amerada Hess alleges that it has been unable to engage Argentine lawyers to pursue a claim for its losses in the Argentine Republic's courts. It attributes this failure to "the politically charged nature of the claim and knowledge that the claim is opposed by the Argentine Government." Verified Complaint of Amerada Hess, para. 44. Affidavits submitted in opposition to the motion to dismiss show that the attorneys for Amerada Hess have corresponded with two Argentinian lawyers who refused to press its claims in the Argentine courts. Amerada Hess and United Carriers seek to obtain relief from this court, alleging jurisdiction pursuant to the Alien Tort Act, 28 U.S.C. § 1350. Amerada Hess also alleges jurisdiction "according to the principle of universal jurisdiction, recognized in customary international law." Verified Complaint of Amerada Hess, para. 5.

 DISCUSSION

 Foreign sovereign immunity has a venerable history in this country's courts, dating back at least to Justice Marshall's decision in The Schooner Exchange, 11 U.S. 116, 3 L. Ed. 287, 7 Cranch 116 (1812). The doctrine developed over the next century and a half in a world of broadened state activity and burgeoning international trade. By the middle of this century, two aspects of foreign sovereign immunity that deserve mention had evolved. The first was substantive: the doctrine of "restrictive" immunity, which accords a foreign sovereign immunity for its public acts (jure imperii) but not for its commercial, or quasi-private, activities. The second was procedural: usually, but not always, foreign nations would seek immunity from the State Department, which would submit "suggestions of immunity" to the courts where it determined that immunity was appropriate. See Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 487-88, 76 L. Ed. 2d 81, 103 S. Ct. 1962 (1983). Political pressures exerted by foreign nations not infrequently affected the State Department's determination, id., leading to lack of uniformity and clarity in the doctrine. In 1976, Congress sought to codify the restrictive doctrine of foreign sovereign immunity and to place responsibility for making determinations of immunity squarely within the judiciary. H.Rep. No. 94-1487, 94th Cong., 2d Sess. 6-7 (1976), reprinted at 1976 U.S. Code Cong. & Ad. News 6604, 6605. Congress was emphatic that the FSIA be the sole means of assessing claims of immunity. That interest is apparent from the structure of the FSIA, which unequivocally states that:

 
Subject to existing international agreements to which the United States is a party at the time of the enactment of this Act a foreign state shall be immune from the jurisdiction of the courts of the United States and of the States except as provided in sections 1605 to 1607 of this chapter.

 28 U.S.C. § 1604. A foreign state is subject to jurisdiction in the courts of this nation if, and only if, an FSIA exception empowers the court to hear the case. The legislative history strengthens this reading. The House report states that the FSIA "sets forth the sole and exclusive standards to be used in resolving questions of sovereign immunity raised by foreign states before Federal and State courts in the United States. It is intended to preempt any other State or Federal law (excluding applicable international agreements) for according immunity to foreign sovereigns, their political subdivisions, their agencies, and their instrumentalities." H.Rep. No. 94-1487 at 12; 1976 U.S. Code Cong. & Ad. News at 6610. Almost without exception, courts interpreting the FSIA have assumed that the FSIA is the exclusive source of jurisdiction over foreign sovereigns, Frolova v. U.S.S.R., 761 F.2d 370 (7th Cir. 1985) (per curiam), even in the context of other jurisdictional grants. O'Connell Machinery Co. v. M.V. Americana, 734 F.2d 115 (2d Cir.), cert. denied, 469 U.S. 1086, 105 S. Ct. 591, 83 L. Ed. 2d 701 (1984) (admiralty); Ruggiero v. Compania Peruana de Vapores "Inca Capac Yupanqui ", 639 F.2d 872 (2d Cir. 1981) (diversity); In Re Korean Air Lines Disaster of September 1, 1983, Misc. No. 83-0345 (D.D.C. September 1, 1985) (Alien Tort Act); Siderman v. Republic of Argentina, No. CV 82-1772-RMT(MCx) (C.D.Cal. March 7, 1985) (Alien Tort Act). But see Von Dardel v. U.S.S.R., 623 F. Supp. 246 (D.D.C. 1985) (FSIA does not effect pro tanto repeal of Alien Tort Act jurisdiction).

 Plaintiffs' claims undeniably fall outside of the exceptions to blanket foreign sovereign immunity provided by the FSIA. The only provision for tort claims, where the foreign sovereign has not waived immunity, requires that the "damage to or loss of property" occur "in the United States." *fn1" Interpretation of similar language in terms of the commercial activity exception in § 1605(a)(2) has been breathtakingly broad. See Crimson Semiconductor, Inc. v. Electronum, 629 F. Supp. 903 (S.D.N.Y. 1986) (Carter, J.). Yet even that breadth is of no avail to these Liberian plaintiffs, who can claim no loss whatsoever occurring in the United States. In addition, one Court of Appeals has interpreted the legislative history of § 1605(a)(5) to require that the tortious act or omission itself occur in the United States. Frolova v. U.S.S.R., supra, 761 F.2d at 379. While we need not adopt that reasoning, we note that it is further evidence that the facts underlying this case are well beyond the purview of the § 1605(a)(5) exception.

 Plaintiffs argue that the Alien Tort Act provides the basis for jurisdiction that the FSIA denies. That statute gives the district courts "original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States." 28 U.S.C. § 1350. In their view, when the First Congress adopted the Judiciary Act of 1789 -- of which the Alien Tort Act is a part -- it intended to confer jurisdiction over suits such as the instant case to federal district courts. Neither the FSIA itself nor its legislative history mentions the Alien Tort Act. Since repeal by implication is disfavored, the cause of action created by the Alien Tort Act survives the passage of the FSIA.

 Both the premises and the conclusion of this inventive argument must be rejected. First, we do not credit plaintiffs' contention that the Argentine Republic would not have enjoyed foreign sovereign immunity in an action such as this in 1789. Second, even if we accept plaintiffs' version of legal history, the language of the Alien Tort Act is silent as to foreign sovereign immunity. Therefore, the FSIA does not repeal the Alien Tort Act any more than it repeals any other jurisdictional act that by its terms may include actions brought against foreign sovereigns.

 No case law supports the assertion that a foreign sovereign state would not have enjoyed immunity in 1789. As evidence of their contention that a foreign sovereign would not be immune in the minds of the drafters of the Alien Tort Act, plaintiffs cite the fact that a sovereign would not enjoy sovereign immunity in its own prize courts. Nanda Affidavit at 5, Plaintiffs' Joint Exhibit 12. By analogy, they suggest, a foreign sovereign would not enjoy immunity in another nation's municipal courts. Contemporary legal theory recognizes that foreign sovereign immunity, based on comity, is a very different matter from the sovereign immunity accorded the state in its own courts, based on separation of powers. The analogy would fail today; there is no reason to assume that it would have succeeded in 1789. Moreover, if we are to adopt the iconoclastic view that the Alien Tort Act preserves the vulnerability to suit of foreign sovereigns extant at its passage, we need evidence more forceful than a hypothetical argument by analogy. Plaintiffs also base their historical argument on two scholarly pieces, G. Badr, State Immunity: An Analytical and Prognostic View (1984) and S. Sucharitkul, State Immunities and Trading Activities in International Law (1959), that discover the origin of nation-state -- as ...


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