parent nodes: Foreign Sovereign Immunities Act
Saudi Arabia v Nelson
Facts
Saudi government runs hospital, uses HCA, a Cayman Is. corporation, to recruit employees from the US
Nelson recruited in US, interviews in Saudi Arabia, signs employment contract in US to work at Saudi hospital
While at hospital, Nelson notices and tries to report safety risks
Nelson arrested in hospital by Saudi gov't, tortured
After release, Nelson sues Saudi gov't for various intentional torts
(Nelson doesn't sue on his contract because it's governed by Saudi law)
Issue: Is the action "based upon a commercial activity carried on in the US" under FSIA?
Souter, J, for the Court, holds no. To qualify under this prong of 28 USC § 1605(a)(2), a foreign state's activities must both (1) be "commercial" and (2) have "substantial contact with the US." Only (1) is relevant here.
A claim is "based upon activity . . ." in the US if the activity in the US provides the elements of a cause of action. Souter points out that § 1605(a)(2) allows for claims both "based upon . . .commercial activity in the US" and claims "based upon" acts "in connection with . . .commercial activity," implying that a foreign state must do more than "a mere connection with, or relation to, commercial activity." In a footnote, however, Souter denies that every element of a claim must be commercial rather than sovereign activity to satisfy FSIA.
While Nelson was recruited in the US, his suit is based upon his torture in Saudi Arabia rather than his recruitment. Further, Nelson's torture is not itself a "commercial" act. The use or abuse of police is an obviously sovereign act, even if the Saudi government has used torture here to solve its commercial problems.
Finally, Souter rejects Nelson's argument that the Saudi government is liable in negligence for failing to warn him of its propensity to tortious conduct, given that such argument could allow any noncommercial tort to be brought under FSIA as a failure-to-warn claim. Souter thus holds that the Saudi government has not carried out "commercial activity" in the US, and is thus immune under FSIA.
White, J, concurs in the judgment, arguing that Saudi Arabia has carried out a "commercial act," but that such act is not "in the US" as FSIA requires. Operating a hospital and retaliating against employees are both commercial acts, argues White. "The purpose of the commercial exception (is) to prevent foreign states from taking refuge behind their sovereignty when they act as market participants," as has happened here. It does not matter whether the state had used police or privately-hired thugs to carry out its torture.
White concurs, however, on the ground that Nelson's suit is not based on his US recruitment, but rather his torture in Saudi Arabia.
Kennedy, J, concurring and dissenting in part, argues that Nelson's claim in negligence may be viable, since the Saudi recruiters had failed to warn Nelson of possible torture at the time of his recruitment in the US, and since recruiting employees is not a sovereign act. Kennedy argues that the Court has dismissed Nelson's negligence claim so briefly because it disagrees with the claim's substantive merits, even though § 1606 requires sovereigns to be held liable to the same extent as a private party.