Whatsapp Inc. v. Nso Group Technologies Ltd.
17 F.4th 930
9th Cir.2021Background
- NSO Group is a private Israeli company that develops and licenses the Pegasus spyware to government customers; WhatsApp alleges Pegasus was deployed via WhatsApp servers to infect ~1,400 devices.
- WhatsApp sued NSO in federal court asserting the CFAA, California Penal Code §502, breach of contract, and trespass to chattels; it sought injunctions and damages.
- NSO moved to dismiss, claiming foreign sovereign immunity because it allegedly acted as an agent of foreign governments and sought conduct-based (official) immunity.
- The district court denied NSO’s immunity defense under common-law conduct-based immunity (Restatement §66); NSO appealed interlocutorily.
- The Ninth Circuit held the appeal was properly before it and ruled that the Foreign Sovereign Immunity Act (FSIA) occupies the field for entity immunity: entities can claim sovereign immunity only under the FSIA.
- Because NSO is a private corporation that does not meet the FSIA definition of “foreign state” or agency/instrumentality, it is not entitled to foreign sovereign immunity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Appealable jurisdiction over interlocutory denial of immunity | Order denying immunity is not effectively unreviewable post-judgment | Denial of immunity is an immunity-from-suit and immediately appealable | FSIA governs entity immunity, so denial of entity sovereign immunity is immediately appealable under collateral-order doctrine |
| Whether foreign sovereign immunity protects private entities outside FSIA | No; entities can claim immunity only under FSIA | Yes; a private entity acting at the state’s direction can claim conduct-based immunity | Entities not covered by FSIA cannot invoke foreign sovereign immunity; FSIA occupies the field for entities |
| Whether common-law foreign-official immunity extends to entities | Common-law official immunity applies only to natural persons, not entities | Common-law conduct-based immunity can apply to entities acting as agents of a state | Rejected: common-law official immunity does not supply immunity for entities; Congress displaced common-law entity immunity via FSIA |
| Whether NSO qualifies as a “foreign state” or agency/instrumentality under FSIA | NSO is a private contractor not owned or organized as an organ of a state | NSO contends it functions as an agent for sovereigns and markets only to governments | NSO does not meet FSIA §1603 definitions (not an organ, majority-owned, or statutory instrumentality) and therefore has no sovereign immunity |
Key Cases Cited
- Schooner Exchange v. McFadden, 7 Cranch 116 (U.S. 1812) (origin of foreign sovereign immunity as doctrine of comity)
- Samantar v. Yousuf, 560 U.S. 305 (2010) (FSIA does not cover individual foreign officials; FSIA governs entities)
- Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480 (1983) (FSIA provides comprehensive framework for claims against foreign states and their instrumentalities)
- Republic of Austria v. Altmann, 541 U.S. 677 (2004) (FSIA governs immunity claims against foreign states/entities)
- Permanent Mission of India to the U.N. v. City of New York, 551 U.S. 193 (2007) (adoption of restrictive theory of sovereign immunity)
- Opati v. Republic of Sudan, 140 S. Ct. 1601 (2020) (discussing historical basis of sovereign immunity)
- Republic of Argentina v. NML Capital, Ltd., 573 U.S. 134 (2014) (FSIA text controls any immunity defense by a foreign sovereign)
- Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949) (collateral-order doctrine for immediate appeals)
- P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139 (1993) (defining requirements for collateral-order appeals)