The question
Whether alleging that a foreign sovereign commingled proceeds from expropriated property with its general funds, alone, satisfies the commercial nexus requirement of the FSIA's expropriation exception.
Hungary v. Simon
What the Court decided
Reversed. Alleging that a foreign sovereign commingled the proceeds of expropriated property with its general funds, without more, cannot satisfy the commercial nexus requirement of the Foreign Sovereign Immunities Act's expropriation exception. The exception requires plaintiffs to plead facts that allow reasonable tracing of the specific expropriated property, or property exchanged for it, to the United States, and a bare commingling theory does not do so.
How the justices split
UnanimousThe Court's opinion
Sotomayor, joined by Roberts, Thomas, Alito, Kagan, Gorsuch, Kavanaugh, Barrett, Jackson
The expropriation exception requires plaintiffs to plead facts allowing reasonable tracing of either the specific expropriated property or any property exchanged for it to the United States, and the plain text treats tangible and fungible property alike. When property is liquidated and the cash is commingled with general funds, plaintiffs must still plausibly allege that the specific proceeds have the required commercial connection. An allegation that a foreign sovereign liquidated property decades ago, commingled the proceeds, and later spent some portion on commercial activities in the United States cannot establish a plausible nexus, and this reading aligns with the FSIA's codification of the restrictive theory of sovereign immunity.
How we know · 5 sourced claims
The Court held that alleging commingling of funds alone cannot satisfy the commercial nexus requirement of the FSIA's expropriation exception.
Source: syllabus, Held
The expropriation exception requires plaintiffs to trace either the specific expropriated property or any property exchanged for it to the United States.
Source: syllabus, Held
The provision's plain text treats tangible and fungible property alike, requiring plaintiffs to plead facts enabling reasonable tracing to the United States.
Source: syllabus, Held
The D.C. Circuit had affirmed the District Court's ruling that the commingling theory satisfied the commercial nexus requirement.
Source: syllabus, Held
Justice Sotomayor delivered the opinion for a unanimous Court.
Source: syllabus, lineup