In a unanimous opinion, the Supreme Court of the United States ruled in favor of Baker Botts’ client Devas Multimedia Private Ltd., resolving an important issue arising under the Foreign Sovereign Immunities Act (“FSIA”). The case was led on appeal by Partner Aaron Streett, Chair of Baker Botts’ Supreme Court and Constitutional Law Practice.

The Court held that personal jurisdiction exists under the FSIA when—as the statute clearly articulates—an exception to the foreign state’s sovereign immunity applies and the foreign state has been properly served. The justices rejected the Ninth Circuit’s outlier rule that personal jurisdiction under the FSIA requires satisfaction of a third requirement, the minimum-contacts test. As the Court explained, “[n]otably absent from [the FSIA] is any reference to ‘minimum contacts,’” and it “decline[d] to add in what Congress left out.” Instead, “the most natural reading of [FSIA] is that personal jurisdiction over a foreign sovereign is automatic whenever (1) an exception to immunity applies and (2) service of process has been accomplished.”

This case stems from a contractual dispute between an Indian satellite communications company and the Indian government. Devas, a telecommunications provider in India formed by U.S. businessmen, obtained a $1.3 billion arbitral award for breach of contract against Antrix Corporation Ltd., a corporation wholly owned by the Republic of India and incorporated by the government to market goods and services created by its space program. Devas petitioned to confirm the arbitral award in the Western District of Washington, and after concluding that the two requirements of the statute were satisfied, the district court held that personal jurisdiction over Antrix existed and confirmed the arbitral award. On appeal, the Ninth Circuit ruled that the district court was bound to apply a minimum-contacts analysis by longstanding circuit precedent, and because minimum contacts were lacking, it held that the district court erred in exercising personal jurisdiction over Antrix.

The Ninth Circuit was the only federal court to hold that the FSIA requires plaintiffs to prove minimum contacts before a court may assert personal jurisdiction over a foreign state. Today’s decision eliminates a significant circuit split and restores uniformity to the FSIA on this critical issue. All courts will apply the FSIA as written, and none will impose additional hurdles to exercising personal jurisdiction over a foreign state. Businesses transacting with foreign states will have the certainty of knowing that if they are the victim of sovereign wrongdoing, the U.S. courts will be open to hear their claims.

In addition to Mr. Streett, the Baker Botts team included Vern Cassin (Washington, D.C.), Christopher Tutunjian (Houston), and Benjamin Hunt (Austin).

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