Sachs v. Republic of Austria

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Sovereign Immunity
  • Date Filed: 09-26-2012
  • Case #: 11-15458
  • Judge(s)/Court Below: Circuit Judge Tallman for the Court; Concurrence by Circuit Judge Bea; Dissent by Circuit Judge Gould
  • Full Text Opinion

To overcome the presumption that a foreign state is entitled to separate juridical status under the Foreign Sovereign Immunities Act, 28 U.S.C. § 1602, a claimant must show that the foreign state had a “day-to-day, routine involvement” over the affairs of the individual or corporation.

Carol Sachs sued OBB Personenverkehr (“OBB”), an Austrian-owned company, for injuries sustained while trying to board a moving train in Innsbruck. OBB Holding Group, created under Austrian railway law, owns OBB and forwards its profits to the Austrian government. The district court dismissed the suit for lack of subject matter jurisdiction, because the commercial activity exception of the Foreign Sovereign Immunities Act did not apply. Sachs appealed. The Foreign Sovereign Immunities Act (“FSIA”), 28 U.S.C. § 1602 et seq, allows United States courts to obtain jurisdiction over foreign states. Unless there is an exception, foreign states are immune from suit in federal and state courts. In this case the commercial activity exception applies where the “action is based upon a commercial activity carried on in the United States by the foreign state.” Sachs’s jurisdictional argument relied on the fact that she purchased her Eurail pass from Rail Pass Experts, a Massachusetts company, and argued that this sale constitutes a commercial activity attributable to OBB. The Court relied on Doe v. Holy in determining which acts may be attributed to foreign states for purposes of jurisdiction under the FSIA. The foreign state is entitled to a “presumption of separate juridical status.” Overcoming the presumption requires a showing that the foreign state had a “day-to-day routine involvement” over the affairs of the individual or corporation. Sachs did not allege any routine involvement of “OBB in Eurail Group much less Rail Pass Experts.” The Court determined that the connection between OBB and Rail Pass Experts was too attenuated to overcome this presumption so as to “impute the sale of the Eurail pass to OBB.” AFFIRMED.

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