OBB Personenverkehr AG v. Sachs
136 S. Ct. 390
| SCOTUS | 2015Background
- Carol Sachs (California) bought a Eurail pass online from a Massachusetts travel agent to travel in Europe.
- While boarding an OBB Personenverkehr AG (Austrian state-owned railway) train in Innsbruck, Austria, Sachs fell onto the tracks and suffered catastrophic injuries.
- Sachs sued OBB in U.S. federal court asserting negligence, strict liability (design and failure-to-warn), and implied-warranty claims.
- OBB invoked the Foreign Sovereign Immunities Act (FSIA); Sachs relied on FSIA’s commercial-activity exception, 28 U.S.C. §1605(a)(2), arguing her suit was “based upon” OBB’s sale (via agent) of the Eurail pass in the U.S.
- The Ninth Circuit (en banc) concluded the Massachusetts sale could be attributed to OBB and that the sale provided an element of each claim, so §1605(a)(2) applied; the Supreme Court granted certiorari.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sachs’s suit is “based upon” the U.S. sale of the Eurail pass under §1605(a)(2) | Sachs: The ticket sale in Massachusetts is the commercial activity on which the action is based | OBB: The gravamen of the suit is OBB’s conduct in Austria, not the U.S. sale | Held: Suit is not “based upon” the sale; gravamen is the conduct in Austria, so §1605(a)(2) does not apply |
| Whether the Ninth Circuit’s “one-element” test (if a U.S. act supplies any element of a claim, §1605(a)(2) applies) is correct | Sachs/Ninth Cir.: A U.S. sale supplies an essential element of each claim, satisfying “based upon” | OBB: The one-element test improperly focuses on isolated elements rather than the gravamen | Held: Rejected the one-element test; courts must identify the particular conduct (gravamen) on which the action is based, per Saudi Arabia v. Nelson |
| Whether agency attribution of the travel agent’s sale to OBB makes the sale OBB’s commercial activity in the U.S. | Sachs: The travel agent acted as OBB’s agent, so the sale is attributable to OBB | OBB: Attribution via common-law agency should not salvage jurisdiction; but Court did not decide on attribution | Held: Court did not reach the attribution issue because it resolved the case on the “based upon” ground |
| Whether Sachs’s new theory that the suit is based on OBB’s overall U.S.-facing commercial enterprise can be considered | Sachs (new argument on cert.): OBB’s worldwide marketing/sales to Americans makes its enterprise the U.S. commercial activity | OBB: Argument was not raised below; courts should not consider it | Held: Forfeited—argument not presented to lower courts, so Court refused to consider it |
Key Cases Cited
- Saudi Arabia v. Nelson, 507 U.S. 349 (1993) (FSIA “based upon” analysis requires identifying the particular conduct—the gravamen—on which the action rests)
- Taylor v. Freeland & Kronz, 503 U.S. 638 (1992) (arguments not raised below are forfeited on appeal)
- Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989) (FSIA is the sole basis for jurisdiction over foreign states in U.S. courts)
- Callejo v. Bancomer, S.A., 764 F.2d 1101 (5th Cir. 1985) (use of “gravamen of the complaint” in determining what an action is based upon)