Turkiye Halk Bankasi A.S. v. United States
598 U.S. 264
SCOTUS2023Background
- Halkbank is a majority state‑owned Turkish bank indicted in SDNY for a multi‑year scheme to evade U.S. sanctions on Iran, including alleged money‑laundering and false statements. Two individual co‑defendants have been convicted; others remain at large.
- Halkbank moved to dismiss, arguing (1) 18 U.S.C. §3231 does not reach instrumentalities of foreign states, and (2) the Foreign Sovereign Immunities Act (FSIA) immunizes it from criminal prosecution.
- The district court denied dismissal; the Second Circuit affirmed, holding the court had §3231 jurisdiction and (assuming FSIA covers criminal cases) that the charged conduct fell within the FSIA commercial‑activity exception.
- The Supreme Court granted certiorari to resolve whether §3231 covers prosecutions of foreign instrumentalities and whether the FSIA bars criminal prosecutions.
- The Supreme Court held that §3231 does grant district courts jurisdiction over the prosecution and that the FSIA governs only civil suits and therefore does not provide immunity from criminal prosecution; it vacated and remanded for further consideration of common‑law immunity issues.
Issues
| Issue | Plaintiff's Argument (United States) | Defendant's Argument (Halkbank) | Held |
|---|---|---|---|
| 1) Does 18 U.S.C. §3231 confer federal criminal jurisdiction over foreign states/instrumentalities? | §3231’s broad grant of jurisdiction over “all offenses” includes prosecutions regardless of the defendant’s status. | §3231 should be read to implicitly exclude foreign states/instrumentalities because other statutes expressly reference them. | Held: §3231 covers prosecutions of foreign instrumentalities; no atextual exclusion. |
| 2) Does the FSIA grant immunity from criminal prosecution to foreign states and their instrumentalities? | FSIA addresses immunity rules but applies to civil suits; it does not immunize against criminal prosecutions. | The FSIA’s general rule (§1604) makes foreign states immune from the jurisdiction of U.S. courts except as specified, and thus bars criminal prosecution. | Held: FSIA is a comprehensive civil‑litigation scheme and does not provide immunity in criminal proceedings. |
| 3) If FSIA applied, would the commercial‑activity exception bar immunity for the charged conduct? | (Gov’t) The commercial‑activity exception would displace immunity for commercial conduct that touches the U.S. | (Halkbank) The FSIA and its exceptions should be read to protect instrumentalities from prosecution or limit applicability. | Second Circuit found the charged conduct fell within the commercial‑activity exception; Supreme Court did not adopt that analysis because FSIA is inapplicable to criminal cases (issue left unresolved here). |
| 4) Does common‑law foreign sovereign immunity bar this criminal prosecution? | Common‑law immunity does not necessarily bar prosecution of a commercial instrumentality once the Executive commences federal criminal proceedings. | Common‑law immunity may still protect foreign sovereigns/instrumentalities in criminal cases; Executive action cannot unilaterally abrogate such immunity. | Held: Court did not decide; vacated and remanded to the Second Circuit to consider common‑law immunity arguments. |
Key Cases Cited
- Samantar v. Yousuf, 560 U.S. 305 (analyzing FSIA’s text, purpose, and limits and holding FSIA does not govern suits against individual foreign officials)
- Verlinden B. V. v. Central Bank of Nigeria, 461 U.S. 480 (describing FSIA as a comprehensive framework for civil actions against foreign states)
- Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (discussing FSIA as the sole basis for jurisdiction over foreign states in federal civil court contexts)
- Schooner Exchange v. McFaddon, 7 Cranch 116 (recognizing foreign sovereign immunity as a common‑law doctrine)
- Republic of Mexico v. Hoffman, 324 U.S. 30 (describing sovereign immunity as substantive law governing exercise of jurisdiction)
- Ex parte Peru, 318 U.S. 578 (confirming sovereign immunity principles as limits on judicial jurisdiction)
- Whitman v. American Trucking Assns., Inc., 531 U.S. 457 (canon against finding major statutory changes hidden in isolated provisions)