507 U.S. 349 (1993), 91-522, Saudi Arabia v. Nelson

Docket Nº:No. 91-522
Citation:507 U.S. 349, 113 S.Ct. 1471, 123 L.Ed.2d 47, 61 U.S.L.W. 4253
Party Name:Saudi Arabia v. Nelson
Case Date:March 23, 1993
Court:United States Supreme Court

Page 349

507 U.S. 349 (1993)

113 S.Ct. 1471, 123 L.Ed.2d 47, 61 U.S.L.W. 4253

Saudi Arabia

v.

Nelson

No. 91-522

United States Supreme Court

March 23, 1993

Argued Nov. 30, 1992

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

Syllabus

The respondents Nelson, a married couple, filed this action for damages against petitioners, the Kingdom of Saudi Arabia, a Saudi hospital, and the hospital's purchasing agent in the United States. They alleged, among other things, that respondent husband suffered personal injuries as a result of the Saudi Government's unlawful detention and torture of him and petitioners' negligent failure to warn him of the possibility of severe retaliatory action if he attempted to report on-the-job hazards. The Nelsons asserted jurisdiction under the Foreign Sovereign Immunities Act of 1976, 28 U.S.C. § 1605(a)(2), which confers jurisdiction where an action is "based upon a commercial activity carried on in the United States by the foreign state." The District Court dismissed for lack of subject matter jurisdiction. The Court of Appeals reversed, concluding that respondent husband's recruitment and hiring were "commercial activities" upon which the Nelsons' action was "based" for purposes of § 1605(a)(2).

Held: The Nelsons' action is not "based upon a commercial activity" within the meaning of the first clause of § 1605(a)(2), and the Act therefore confers no jurisdiction over their suit. Pp. 355-363.

(a) This action is not "based upon" a commercial activity. Although the Act does not define "based upon," the phrase is most naturally read to mean those elements of a claim that, if proven, would entitle a plaintiff to relief under his theory of the case, and the statutory context confirms that the phrase requires something more than a mere connection with, or relation to, commercial activity. Even taking the Nelsons' allegations about respondent husband's recruitment and employment as true, those facts alone entitle the Nelsons to nothing under their theory of the case. While these arguably commercial activities may have led to the commission of the torts that allegedly injured the Nelsons, it is only those torts upon which their action is "based" for purposes of the Act. Pp. 355-358.

(b) Petitioners' tortious conduct fails to qualify as "commercial activity" within the meaning of the Act. This Court has ruled that the Act largely codifies the so-called "restrictive" theory of foreign sovereign immunity, Republic of Argentina v. Weltover Inc., 504 U.S. 607, 612, and that a state engages in commercial activity under that theory where

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it exercises only those powers that can also be exercised by private citizens, rather than those powers peculiar to sovereigns, id. at 614. The intentional conduct alleged here (the Saudi Government's wrongful arrest, imprisonment, and torture of Nelson) boils down to abuse of the power of the police. However monstrous such abuse undoubtedly may be, a foreign state's exercise of that power has long been understood for purposes of the restrictive theory as peculiarly sovereign in nature. The Nelsons' argument that respondent husband's [113 S.Ct. 1474] mistreatment constituted retaliation for his reporting of safety violations, and was therefore commercial in character, does not alter the fact that the powers allegedly abused were those of police and penal officers. In any event, that argument goes to the purpose of petitioners' conduct, which the Act explicitly renders irrelevant to the determination of an activity's commercial character. Pp. 358-363.

(c) The Nelsons' attempt to claim failure to warn is merely a semantic ploy. A plaintiff could recast virtually any claim of intentional tort committed by sovereign act as a claim of failure to warn. To give jurisdictional significance to this feint of language would effectively thwart the Act's manifest purpose to codify the restrictive theory of foreign sovereign immunity. Cf. United States v. Shearer, 473 U.S. 52, 54-55 (opinion of Burger, C.J.). P. 363.

923 F.2d 1528 (CA 11 1985), reversed.

SOUTER, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and O'CONNOR, SCALIA, and THOMAS, JJ., joined, and in which KENNEDY, J., joined except for the last paragraph of Part II. WHITE, J., filed an opinion concurring in the judgment, in which BLACKMUN, J., joined. BLACKMUN, J., filed an opinion concurring in part and dissenting in part, post, p. 364. KENNEDY, J., filed an opinion concurring in part and dissenting in part, in which BLACKMUN and STEVENS, JJ., joined as to Parts I-B and II, post, p. 370. STEVENS, J., filed a dissenting opinion, post, p. 377.

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SOUTER, J., lead opinion

JUSTICE SOUTER delivered the opinion of the Court.

The Foreign Sovereign Immunities Act of 1976 entitles foreign states to immunity from the jurisdiction of courts in the United States, 28 U.S.C. § 1604, subject to certain enumerated exceptions. § 1605. One is that a foreign state shall not be immune in any case "in which the action is based upon a commercial activity carried on in the United States by the foreign state." § 1605(a)(2). We hold that respondents' action alleging personal injury resulting from unlawful detention and torture by the Saudi Government is not "based upon a commercial activity" within the meaning of the Act, which consequently confers no jurisdiction over respondents' suit.

I

Because this case comes to us on a motion to dismiss the complaint, we assume that we have truthful factual allegations before us, see United States v. Gaubert, 499 U.S. (1991), though many of those allegations are subject to dispute. See Brief for Petitioners 3, n. 3; see also n. 1, infra. Petitioner Kingdom of Saudi Arabia owns and operates petitioner King Faisal Specialist Hospital in Riyadh, as well as petitioner Royspec Purchasing Services, the Hospital's corporate purchasing agent in the United States. App. 91. The Hospital Corporation of America, Ltd. (HCA), an independent corporation existing under the laws of the Cayman Islands, recruits Americans for employment at the Hospital

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under an agreement signed with Saudi Arabia in 1973. Id. at 73.

In its recruitment effort, HCA placed an advertisement in a trade periodical seeking applications for a position as a monitoring systems engineer at the Hospital. The advertisement drew the attention of respondent Scott Nelson in September, 1983, while Nelson was in the United States. After interviewing for the position in Saudi Arabia, Nelson returned to the United States, where [113 S.Ct. 1475] he signed an employment contract with the Hospital, id. at 4, satisfied personnel processing requirements, and attended an orientation session that HCA conducted for Hospital employees. In the course of that program, HCA identified Royspec as the point of contact in the United States for family members who might wish to reach Nelson in an emergency. Id. at 33.

In December, 1983, Nelson went to Saudi Arabia and began work at the Hospital, monitoring all "facilities, equipment, utilities and maintenance systems to insure the safety of patients, hospital staff, and others." Id. at 4. He did his job without significant incident until March, 1984, when he discovered safety defects in the Hospital's oxygen and nitrous oxide lines that posed fire hazards and otherwise endangered patients' lives. Id. at 57-58. Over a period of several months, Nelson repeatedly advised Hospital officials of the safety defects and reported the defects to a Saudi Government commission as well. Id. at 4-5. Hospital officials instructed Nelson to ignore the problems. Id. at 58.

The Hospital's response to Nelson's reports changed, however, on September 27, 1984, when certain Hospital employees summoned him to the Hospital's security office where agents of the Saudi Government arrested him.[1] The agents

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transported Nelson to a jail cell, in which they "shackled, tortured and bea[t]" him, id. at 5, and kept him four days without food. Id. at 59. Although Nelson did not understand Arabic, Government agents forced him to sign a statement written in that language, the content of which he did not know; a Hospital employee who was supposed to act as Nelson's interpreter advised him to sign "anything" the agents gave him to avoid further beatings. Ibid. Two days later, Government agents transferred Nelson to the Al Sijan Prison "to await trial on unknown charges." Ibid.

At the Prison, Nelson was confined in an overcrowded cell area infested with rats, where he had to fight other prisoners for food and from which he was taken only once a week for fresh air and exercise. Ibid. Although police interrogators repeatedly questioned him in Arabic, id. at 5, Nelson did not learn the nature of the charges, if any, against him. Ibid. For several days, the Saudi Government failed to advise Nelson's family of his whereabouts, though a Saudi official eventually told Nelson's wife, respondent Vivian Nelson, that he could arrange for her husband's release if she provided sexual favors. Ibid.

Although officials from the United States Embassy visited Nelson twice during his detention, they concluded that his allegations of Saudi mistreatment were "not credible," and made no protest to Saudi authorities. Id. at 64. It was only at the personal request of a United States Senator that the Saudi Government released Nelson, 39 days after his arrest, on November 5, 1984. Id. at 60. Seven days later, after failing to convince him to return to work at the Hospital, the Saudi Government allowed Nelson to leave the country. Id. at 60-61.

In 1988, Nelson and his wife filed this action against petitioners in the United States District Court for the Southern District of Florida seeking damages for personal injury. The Nelsons' complaint sets out 16 causes of action, which fall into three categories. Counts II through VII and counts...

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