In CC/Devas (Mauritius) Ltd. et al. v. Antrix Corp. Ltd. et al., the U.S. Supreme Court rendered a landmark decision clarifying the standard for personal jurisdiction under the Foreign Sovereign Immunities Act (“FSIA”).
I. Case Background #
In 2005, Devas Multimedia Private Ltd. entered into a satellite lease agreement with Antrix Corporation Ltd., a state-owned enterprise of the Government of India. In 2011, the Indian government directed Antrix to terminate the agreement under the contract’s force majeure clause, citing its own governmental needs. The arbitral tribunal unanimously held that Antrix had breached the contract and awarded Devas $562.5 million in damages plus interest. Subsequently, Devas petitioned the U.S. District Court for the Western District of Washington to recognize and enforce the arbitral award, ultimately obtaining a judgment of $1.29 billion.
Antrix appealed the decision. The U.S. Court of Appeals for the Ninth Circuit, relying on its prior precedent International Shoe Co. v. Washington, 326 U.S. 310 (1945), held that in addition to FSIA, personal jurisdiction also requires a showing of “minimum contacts” under general due process principles. On that basis, it found personal jurisdiction lacking and vacated the lower court’s judgment.
II. Issues in Dispute #
- Does the FSIA, beyond the requirements of 28 U.S.C. § 1330(b), require satisfaction of the “minimum contacts” standard articulated in International Shoe?
- If no such additional requirement exists, how do U.S. federal courts establish personal jurisdiction over foreign sovereigns in actions for recognition and enforcement of arbitral awards?
III. Key Legal Conclusions of the U.S. Supreme Court #
The U.S. Supreme Court rejected the Ninth Circuit’s additional requirement and clarified the applicable personal jurisdiction standard under the FSIA.
1. The Two-Prong Test Under FSIA #
The Supreme Court emphasized that under FSIA, 28 U.S.C. § 1330(b):
“Personal jurisdiction over a foreign state shall exist as to every claim for relief over which the district courts have jurisdiction under subsection (a) where service has been made under section 1608 of this title.”
Held: #
“Personal jurisdiction exists under the FSIA when an immunity exception applies and service is proper. The FSIA does not require proof of ‘minimum contacts’ over and above the contacts already required by the Act’s enumerated exceptions to foreign sovereign immunity.”
Accordingly, personal jurisdiction over a foreign state under FSIA requires only two elements:
- Existence of an Immunity Exception (Subject Matter Jurisdiction):
When any of the exceptions enumerated in 28 U.S.C. §§ 1605–1607 (such as commercial activity, arbitral award enforcement, etc.) applies, federal courts automatically acquire subject matter jurisdiction. 28 U.S.C. § 1605(a)(6) provides: “A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case… in which… the action is brought… to confirm an award made pursuant to… an agreement to arbitrate…” - Proper Service of Process:
The plaintiff must properly serve the foreign state in accordance with the procedures set forth in 28 U.S.C. § 1608.
Once these two elements are satisfied, personal jurisdiction automatically exists without any additional inquiry into minimum contacts.
2. Primacy of Statutory Text #
The Court emphasized that Congress used the mandatory term “shall exist” in § 1330(b), which leaves no room for courts to impose additional requirements:
“Subject matter jurisdiction plus service of process equals personal jurisdiction.” (GSS Group Ltd. v. National Port Auth., 680 F.3d 805, 811 (D.C. Cir. 2012)).
3. Rejection of Minimum Contacts Standard #
The Ninth Circuit erroneously imported the traditional International Shoe minimum contacts standard applicable in general civil litigation. The Supreme Court expressly rejected this approach:
“We decline to add in what Congress left out: the FSIA was supposed to ‘clarify the governing standards,’ not hide the ball.“
In other words, Congress had comprehensively designed the immunity and jurisdiction framework for foreign sovereigns under FSIA. The judiciary has no authority to unilaterally introduce additional requirements.
4. Legislative History Argument Rejected #
The Supreme Court also refuted the Ninth Circuit’s reliance on legislative history:
“The FSIA’s legislative history leads to the same result as § 1330(a)’s text: personal jurisdiction rises and falls based on whether an immunity exception applies and the plaintiff has effectuated proper service.“
The phrase “minimum jurisdictional contacts” in legislative reports merely refers to the nexus already embodied in FSIA’s substantive immunity exceptions, not a separate incorporation of International Shoe’s minimum contacts analysis.
IV. Unresolved Issues Left for Lower Courts #
In this decision, the Supreme Court deliberately refrained from addressing several remaining issues, leaving them for consideration by lower courts:
- Whether the Due Process Clause of the Fifth Amendment imposes a separate minimum contacts requirement;
- Whether the arbitral award at issue falls within the scope of the FSIA arbitration exception under § 1605(a)(6);
- Whether the doctrine of forum non conveniens would warrant dismissal of the case.
V. Implications and Recommendations for Chinese Enterprises #
As long as an arbitral award qualifies for an FSIA immunity exception (such as § 1605(a)(6) Arbitration Exception) and proper service has been effected, personal jurisdiction over the foreign state-owned enterprise may be established in U.S. federal court without the need to demonstrate any additional contacts with the United States.
For Chinese enterprises entering into agreements with foreign governments or state-owned entities, particularly under initiatives such as the Belt and Road Initiative, arbitration clauses designating enforcement in New York Convention jurisdictions should be given priority in dispute resolution provisions.
Accordingly, particular attention should be paid during contract negotiations to the inclusion of well-drafted Waiver of Immunity Clauses and carefully tailored arbitration provisions. For transactions involving state-owned capital or sovereign-backed projects, professional legal teams should conduct advance reviews of FSIA-related jurisdictional risks.
Moreover, strict compliance with the FSIA’s service of process requirements under 28 U.S.C. § 1608 is crucial in such proceedings. U.S. courts will treat proper service as a core element in determining personal jurisdiction. Chinese enterprises involved in either defense or enforcement proceedings must adhere rigorously to FSIA’s procedural framework.
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