Carol Sachs v. Republic of Austria
2013 U.S. App. LEXIS 24290
| 9th Cir. | 2013Background
- Sachs sues OBB Personenverkehr AG in the Northern District of California for injuries suffered boarding an OBB train in Innsbruck, Austria.
- OBB is a foreign-state owned railway; Eurail Group markets passes, with RPE (U.S.-based) selling passes online to Sachs.
- Eurail pass includes disclaimers stating intermediaries act for carriers and that travel requires passport/documentation.
- District court dismissed for lack of subject-matter jurisdiction based on sovereign immunity; Sachs appealed.
- En banc Ninth Circuit held that the FSIA’s first clause of the commercial-activity exception applies when a foreign-state common carrier sells tickets in the United States through an agent, imputing the agent’s activity to the foreign state.
- Court analyzed whether RPE’s U.S. sale of the Eurail pass constitutes “commercial activity carried on in the United States by the foreign state” and whether Sachs’s claims are “based upon” that activity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the FSIA commercial-activity exception applies. | Sachs argues RPE’s U.S. sale of Eurail passes constitutes commercial activity by OBB. | OBB contends no imputation from RPE to OBB under 1603(b) and no substantial contact. | Yes; first clause applies. |
| Whether RPE’s sale can be imputed to OBB. | RPE was an authorized agent/subagent of OBB via Eurail Group. | RPE’s sale is not an agency under §1603(b) and cannot be imputed. | RPE’s sale imputed to OBB. |
| Whether the sale created substantial contact with the United States. | Sale in U.S. shows substantial contact. | Contact must be tied to the foreign state’s conduct, not merely a sale. | Yes, substantial contact established. |
| Whether Sachs’s claims are “based upon” the commercial activity. | Elements of negligence and warranties rely on the European transport arrangement initiated by U.S. sale. | Not all claims are based upon that activity; some may be independent. | Claims are based upon the commercial activity to extend jurisdiction. |
Key Cases Cited
- Kirkham v. Société Air France, 429 F.3d 288 (D.C. Cir. 2005) (agency imputation for travel-ticket sales triggers FSIA jurisdiction)
- Barkanic v. General Administration of Civil Aviation of the People's Republic of China, 822 F.2d 11 (2d Cir. 1987) (agency/imputation through travel-agent sales)
- Doe v. Holy See, 557 F.3d 1066 (9th Cir. 2009) (approach to imputing acts via alter ego/agency framework (Bancec))
- Sun v. Taiwan, 201 F.3d 1105 (9th Cir. 2000) (commercial activity not always foundation of a claim; need nexus to claim elements)
- Saudi Arabia v. Nelson, 507 U.S. 349 (1993) (‘based upon’ requires nexus between commercial activity and claim elements)
- Samantar v. Yousuf, 560 U.S. 305 (2010) (consistency of meaning of ‘foreign state’ across FSIA provisions)
- First National City Bank v. Banco Para El Comercio Exterior de Cuba, 462 U.S. 611 (1983) (alter-ego framework for piercing corporate veil (Bancec))
- Terenkian v. Republic of Iraq, 694 F.3d 1122 (9th Cir. 2012) (defines ‘substantial contact’ and framework for FSIA jurisdiction)
- Mar. Int’l Nominees Establishment v. Republic of Guinea, 693 F.2d 1094 (D.C. Cir. 1983) (agency concept in commercial activity context)
- Gates v. Victor Fine Foods, 64 F.3d 1457 (9th Cir. 1995) (preservation/general principles when interpreting FSIA)