Cassirer v. Thyssen-Bornemisza Collection Found.

• Decision Date: 21 April 2022
• Docket Number: 20-1566
• Citation: 142 S.Ct. 1502
• Parties: David CASSIRER, et al., Petitioners v. THYSSEN-BORNEMISZA COLLECTION FOUNDATION
• Court: U.S. Supreme Court

142 S.Ct. 1502

David CASSIRER, et al., Petitioners

v.THYSSEN-BORNEMISZA COLLECTION FOUNDATION

No. 20-1566

Supreme Court of the United States.

Argued January 18, 2022

Decided April 21, 2022

Mathew Staver, Orlando, FL, for petitioners

Sopan Joshi for United States as amicus curiae, by special leave of the Court, supporting reversal

Douglas Hallward-Driemeier, Washington, DC, for respondents.

Scott E. Gant, Boies Schiller Flexner LLP, Washington, DC, Samuel J. Dubbin, P.A. Dubbin & Kravetz LLP, Coral Gables, FL, Laura W. Brill, Nicholas Daum, Kendall Brill & Kelly LLP, Los Angeles, CA, David Boies, Counsel of Record, Boies Schiller Flexner LLP, Armonk, NY, David A. Barrett, Boies Schiller Flexner LLP, New York, NY, Stephen N. Zack, Andrew S. Brenner, Rossana Baeza, Boies Schiller Flexner LLP, Miami, FL, for petitioners.

Sarah Erickson Andre, Counsel of Record, Thaddeus J. Stauber Nixon Peabody LLP, Los Angeles, CA, for respondent.

Justice KAGAN delivered the opinion of the Court.

Under the Foreign Sovereign Immunities Act of 1976 (FSIA), 28 U.S.C. § 1602 et seq., a foreign state or instrumentality is amenable in specified circumstances to suit in an American court. In this case, the plaintiffs brought such a suit to recover expropriated property. The question presented is what choice-of-law rule the court should use to determine the applicable substantive law. The answer is: whatever choice-of-law rule the court would use if the defendant were not a foreign-state actor, but instead a private party. Here, that means applying the forum State's choice-of-law rule, not a rule deriving from federal common law.

I

Although the legal issue before us is prosaic, the case's subject matter and background are anything but. At issue is the ownership of an Impressionist painting depicting a Paris streetscape: Camille Pissarro's Rue Saint-Honoré in the Afternoon , Effect of Rain (shown in this opinion's appendix). Pissarro's agent sold the painting in 1900 to Paul Cassirer, a member of a prominent German Jewish family owning an art gallery and publishing house. Some quarter century later, Lilly Cassirer inherited the painting and displayed it in her Berlin home (as also pictured in the appendix). But in 1933, the Nazis came to power. After years of intensifying persecution of German Jews, Lilly decided in 1939 that she had to do anything necessary to escape the country. To obtain an exit visa to England, where her grandson Claude Cassirer had already relocated, she surrendered the painting to the Nazis. The underlying question in this case—which this opinion will not resolve—is whether the Cassirer family can get the painting back.

The post-war search for Rue Saint-Honoré was a long one. Lilly and Claude, who both eventually ended up in the United States, had no success tracking down the painting. After being legally declared the rightful owner, Lilly agreed in 1958 to accept compensation from the German Federal Republic—about $250,000 in today's dollars. (The painting is now thought to be worth tens of millions.) In fact, Rue Saint-Honoré was nearby: Like the Cassirers, the painting had also arrived in the United States after the war, and sat in a private collection in St. Louis from 1952 to 1976. In that year, the Baron Hans Heinrich Thyssen-Bornemisza (descended from the founder of a German steel empire) purchased the painting and brought it back to Europe. Rue Saint-Honoré hung at his residence in Switzerland until the early 1990s. At that time, the Baron sold much of his art collection, including Rue Saint-Honoré , to an entity the Kingdom of Spain created and controlled, called the Thyssen-Bornemisza Collection Foundation. In addition to financing the $300 million-plus purchase, the Spanish Government provided the Foundation with a palace in Madrid to serve as a museum for the collection. The museum, as museums do, published a catalogue of its holdings. An acquaintance of Claude's saw the catalogue and made the connection, telling him in 1999 where Rue Saint-Honoré was now located. (Lilly had by then long since died, with Claude as her sole heir.)

After informal efforts to recover the painting failed, Claude sued the Foundation in federal court in the Central District of California, near where he then lived. His complaint asserted various property-law claims, all alleging that he owned Rue Saint-Honoré and was entitled to its return. And because the Foundation is an "instrumentality" of the Kingdom of Spain, the complaint invoked the FSIA to establish the court's jurisdiction. See § 1603(b) (describing an instrumentality as a legally separate but state-controlled entity). The FSIA governs whether a foreign state or instrumentality is amenable to suit in an American court. It provides the sovereign actor with immunity unless the claim against it falls within a specified exception. See §§ 1605–1607. The complaint here asserted that the statute's expropriation exception applied. That exception removes immunity for cases involving "rights in property taken in violation of international law." § 1605(a)(3). At a prior stage of this litigation, the courts below held that the Nazi confiscation of Rue Saint-Honoré brought Claude's suit against the Foundation within the expropriation exception. See 461 F.Supp.2d 1157, 1176–1177 (CD Cal. 2006), aff ’d, 616 F.3d 1019, 1037 (CA9 2010) (en banc), cert. denied, 564 U.S. 1037, 131 S.Ct. 3057, 180 L.Ed.2d 886 (2011). That determination, which is no longer at issue, meant that the suit could go forward. (Claude, though, would not live to see anything further; he passed away in 2010, and his heirs became the plaintiffs.)¹

But go forward pursuant to what law? The courts had to decide whose property law (Spain's? California's?) should govern the suit, and thus determine the painting's rightful owner. Resolving that question required application of a choice-of-law rule—a means of selecting which jurisdiction's law governs the determination of liability. Yet there another issue lurked. For the parties contested which choice-of-law rule should apply—serving up, so to speak, a choice of choice-of-law principles. The Cassirer plaintiffs urged the use of California's choice-of-law rule; the defendant Foundation advocated a rule based in federal common law. The courts below, relying on a minimally reasoned Ninth Circuit precedent, picked the federal option. See 153 F.Supp.3d 1148, 1154 (CD Cal. 2015), aff ’d, 862 F.3d 951, 961 (CA9 2017), cert. denied, 584 U. S. ––––, 138 S.Ct. 1992, 201 L.Ed.2d 270 (2018). That federal choice-of-law rule, they further held, commanded the use of Spanish (not Californian) property law to resolve the ownership issue. See 153 F.Supp.3d at 1155, aff ’d, 862 F.3d at 963. Finally, the courts below determined after a trial that under Spanish law the Foundation was the rightful owner, because it purchased Rue Saint-Honoré without knowing the painting was stolen and had held it long enough to gain title through possession. See No. 05–cv–03459 (CD Cal., Apr. 30, 2019), ECF Doc. 621, pp. 26–30, aff ’d, 824 Fed.Appx. 452, 454–455 (CA9 2020).

The Cassirers sought our review, limited to a single issue: whether a court in an FSIA case raising non-federal claims (relating to property, torts, contracts, and so forth) should apply the forum State's choice-of-law rule, or instead use a federal one. We granted certiorari, 594 U. S. ––––, 142 S.Ct. 55, 210 L.Ed.2d 1024 (2021), because that question has generated a split in the Courts of Appeals. The Ninth Circuit stands alone in using a federal choice-of-law rule to pick the applicable substantive law. All other Courts of Appeals to have addressed the issue apply the choice-of-law rule of the forum State.² We agree with that more common approach, and now vacate the judgment below.

II

The FSIA, as indicated above, creates a uniform body of federal law to govern the amenability of foreign states and their instrumentalities to suit in the United States. See supra , at 1507. The statute first lays down a baseline principle of foreign sovereign immunity from civil actions. See § 1604. It then lists a series of exceptions from that principle (including the expropriation exception found to apply here). See §§ 1605–1607; supra , at 1507. The result is to spell out, as a matter of federal law, the suits against foreign sovereigns that American courts do, and do not, have power to decide.

Yet the FSIA was never "intended to affect the substantive law determining the liability of a foreign state or instrumentality" deemed amenable to suit. First Nat. City Bank v. Banco Para el Comercio Exterior de Cuba , 462 U.S. 611, 620, 103 S.Ct. 2591, 77 L.Ed.2d 46 (1983). To the contrary, Section 1606 of the statute provides:

"As to any claim for relief with respect to which a foreign state is not entitled to immunity under [the FSIA], the foreign state shall be liable in the same manner and to the same extent as a private individual under like circumstances."

So when a foreign state is not immune from suit, it is subject to the same rules of liability as a private party. Which is just to say that the substantive law applying to the latter also applies to the former. See First Nat. City Bank , 462 U.S. at 622, n. 11, 103 S.Ct. 2591. As one court put the point, Section 1606 directs a "pass-through" to the substantive law that would govern a similar suit between private individuals. Oveissi v. Islamic Republic of Iran , 573 F.3d 835, 841 (CADC 2009). The provision thus ensures that a foreign state, if found ineligible for immunity, must answer for its conduct just as any other actor would.

And in so doing, Section 1606 also dictates the selection of a choice-of-law rule: It, too, must mirror the rule that would apply in a similar suit between private parties. For only the same choice-of-law rule can guarantee use of the same substantive law—and thus (see above) guarantee the same liability. See Barkanic v. General Admin. of Civ. Aviation of People's Republic of China ...