961 F.3d 193
2d Cir.2020Background
- A Corinthian‑type bronze horse figurine (Geometric Period) was consigned to Sotheby’s for a May 14, 2018 New York auction by the 2012 Saretta Barnet Revocable Trust.
- On May 11, 2018 Greece’s Ministry of Culture emailed Sotheby’s an "URGENT" letter asserting the figurine was Greek state property under Greece’s 1932 Antiquities Act and 2002 Cultural Heritage Act, citing archives and criminal/export rules, and demanding withdrawal and cooperation for repatriation.
- Sotheby’s withdrew the lot; Sotheby’s and the trustees sued Greece in SDNY seeking only a declaratory judgment of ownership (no damages or injunction).
- The district court denied Greece’s motion to dismiss, concluding the letter was an act outside the U.S. “in connection with a commercial activity” under the FSIA §1605(a)(2) (direct‑effect clause), so Greece lacked immunity.
- On interlocutory appeal, the Second Circuit identified the predicate act as Greece’s letter but held that the connected activity was Greece’s enactment and enforcement of patrimony laws (nationalization and export regulation), which are sovereign rather than commercial acts.
- The court reversed and remanded with instructions to dismiss for lack of subject‑matter jurisdiction because the commercial‑activity exception did not apply.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Greece’s sending of the letter is an “act outside the U.S. in connection with a commercial activity” under FSIA §1605(a)(2) clause 3 | The letter was the core act and is commercial because private parties commonly send ownership/demand letters about artifacts for sale | The letter was connected to Greece’s patrimony laws and enforcement—sovereign acts (nationalization, export regulation), not commercial | Held: Sending the letter was the predicate act, but the connected activity was sovereign (patrimony laws), so §1605(a)(2) clause 3 does not apply; immunity stands |
| Whether identifying the letter itself as both the predicate act and the “commercial activity” is appropriate | Plaintiffs: the conduct (letter) is commercial independent of the legal framework | Greece: an act cannot be both the predicate act and the connected commercial activity; must identify the underlying activity (nationalization/enforcement) | Held: Court rejects treating the same act as both; must identify the underlying activity, here sovereign lawmaking/enforcement |
| Whether adjudicating ownership would force courts to evaluate Greece’s patrimony laws and thereby implicate sovereign acts | Barnet: patrimony laws may not apply to this object or be enforceable here, so adjudication is appropriate | Greece: resolving ownership requires evaluating and applying Greece’s national patrimony scheme—core sovereign interests | Held: Determining ownership would inextricably involve sovereign acts; that weighs against applying the commercial‑activity exception |
Key Cases Cited
- Republic of Argentina v. Weltover, 504 U.S. 607 (1992) (sets three‑part test for §1605(a)(2) direct‑effect clause)
- Saudi Arabia v. Nelson, 507 U.S. 349 (1993) (distinguishes sovereign acts from commercial acts)
- OBB Personenverkehr AG v. Sachs, 136 S. Ct. 390 (2015) (identify the "core" act forming the basis of the claim)
- Petersen Energia Inversora S.A.U. v. Argentine Republic, 895 F.3d 194 (2d Cir. 2018) (FSIA is sole basis for jurisdiction over foreign states)
- Garb v. Republic of Poland, 440 F.3d 579 (2d Cir. 2006) (expropriation/nationalization are sovereign acts outside the commercial exception)
- Anglo‑Iberia Underwriting Mgmt. v. P.T. Jamsostek, 600 F.3d 171 (2d Cir. 2010) (state activity performed within statutory/legal framework can be sovereign despite commercial resemblance)
- Hilao v. Estate of Marcos, 94 F.3d 539 (9th Cir. 1996) (government recovery/enforcement of allegedly stolen assets is an exercise of police/sovereign power)