# Petition for Writ of Certiorari — Republic of Argentina v. Siderman de Blake > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386011_1172%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1993 - **Citation:** 507 U.S. 1017 ## Text IN THE Supreme Court of the Gnited States OCTOBER TERM, 1992 REPUBLIC OF ARGENTINA and PROVINCE OF TUCUMAN, ARGENTINA, Petitioners, . vs SUSANA SIDERMAN DE BLAKE, et al., Respondents. Petition For Writ Of Certiorari To The United States Court of Appeals For The Ninth Circuit PETITION FOR WRIT OF CERTIORARI BRUNO A. RISTAU Counsel of Record 4801 Massachusetts Ave., N.W. Washington, D.C. 20016 (202) 895-1560 Counsel for the Petitioners PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203 QUESTIONS PRESENTED 1. Whether the ‘commercial activity” exception of the Foreign Sovereign Immunities Act confers juris- diction over a suit against Argentina and one of its constituent Provinces (Tucumdn) for the seizure and “intervention” of respondents’ real estate by military authorities that governed the Province following the 1976 coup d’état in Argentina. 2. Whether the State of Argentina and the Tucu- man Province waived their immunity from suit under the “‘tort exception’”’ of the Foreign Sovereign Im- munities Act for a tort in violation of international law (torture) committed in 1976 against an Argentine national in Tucuman Province, where five years after the tort victim took up residence in the United States, a Tucuman court requested a California State court to serve on the victim a document relating to a crim- inal proceeding instituted against him in Tucuman. ill TABLE OF CONTENTS Page OPINIONS BELOw ..... AANA SuRASNAARKancebheniuansaseencneciaaians ] ian eh caps lnessestxstrdunciianasiecacssacecees:, 2 ee 2 I a accshcsasdiansndnawravesansaveacecea sce? ccc. 6 1. Nature of the Case .............ccccccccccccoccscscees... 6 2. The Proceedings in the District Court ....... 7 3. The Proceedings in the Ninth Circuit ..... si ) 4. The Ninth Circuit’s Decision ........................ 12 a. The Sidermans’ expropriation claims ...... 12 b. José Siderman’s torture claim ................. 16 REASONS FOR GRANTING THE WRIT oeeeccecceececcceeeess.. 19 I. The Ninth Circuit has erroneously construed and applied an important Act of Congress governing the immunity of foreign states from suits for the taking of property, and its construction of the Act’s commercial ac- tivity exception to sovereign immunity con- flicts with other Circuits; this Court has already granted certiorari in another case to review the conflict ...............ccccccccssssccseseesees, 19 II. The Ninth Circuit’s holding that a foreign State may be sued for torture where the tor- tious act and the injury occurred abroad is in direct conflict with an applicable decision MN RING icc nsnantencxsessesacsnaricinscovécacssecces, 24 IN goa. of schisduincavasbseansseseniascucaresacessaee, ccs. 2 TABLE OF AUTHORITIES Cases: Pages Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989) ................. 12,16,17,24,25 Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 CITE sungcncacanecsnueactusasnaaneisseaaenapcuaecicmeibeaes 25 Nelson v. Saudi Arabia, 923 F.2d 1528 (11th Cir. 1991), cert. granted, No. 91-522, June 8, RONNIE spcindk cxcaceaeatusismanoeiinckcacsaeaveaaeecuaiceaaarencs) 23 National City Bank v. Republic of China, 348 U.S. BC AMIE cchnccnsinidnt cosceseduchactconvaeabiuacsecsscauibcicios’ 18 Stena Rederi AB v. Comision de Contratos, 923 F.2d Be Se SAN. RIED siecgusneseneissteenrsancsatinchieiasenss 22 Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. BE, CIID sichbesnsistucsesscalebecunicimesbixeisacunaimencens 24 W. S. Kirkpatrick v. Environmental Tectonics Corp., S55 U.S. 2, 110 GAA. TOS CUB GO) vvcivsicsevsnss 25 Zschernig v. Miller, 389 U.S. 429 (1968) ............... 25 Statutes: Foreign Sovereign Immunities Act, 28 U.S.C. §§1330, 1602-1611: MII biihuinasievakssoueelacibicibennntaniuhesenntonaioa passim REED \cravnandieesdcannanecsouicdomnidenatsaeaelisaiiacnlekainas 2,6 NOM tach easanesacoamailallicuaenscandecs diobacasianmiunciaoies 3 NII inks niaisvdisindiciecn adntanadasbuasculessapplaceencdaeiainiaas 16 NIN dacctescuinnkasetskcedsamavecetseetapuatiaupaeimantiaciasd 20 ID ihe toma saute tana boots Oe ee ee 20 SETI ndisinvcat cin nniissecs pa viaseconeabednapasadsnemeiaeunetadenaees 4,16 POINTED Sscias csleslan:covudednconicancduooacss peckonmmniouanae 4,17 IED cicisncideecintaeeiscerniecoinunsees 4,13,14,19,21,22,23 | | rE Fe kh EE set snicannncesincrtasneckahanmoiabaatumnnaieintis 5,16 §1607 Table of Authorities Continued Page Te ii Ae es ctntasascasstsreiaeurennctaseieem enous 2 Be eect IE a dessus concesececsauaniacnenseaeeeaeneaeeen 6 Fe ic MEI pvpndevacesnaepncaiceananemeceenaneanhennaelcsiania 6 Se Re as ee seiscnachsaxcda tia aiiaasueniaces tacabcerkeneneuaanien 6 Miscellaneous: H.R. Rep. No. 94-1487, 94th Cong., 2d Sess. ERA OTE scsincencincteunrsassucunsehennimancedccapiotaiaiecinnaeed me 20 UU OUNG TGTE TEUEG TE ecsricerrrsescntivnisienase ] Supreme Court of Argentina, No. S525.XX, Order OF TOCNEE FB, TOGO eniinercdinsctreicemasnaicn 1] CORT ROUEN SON sisiccs cxesesitcivsisencevecanccaciconenhers 17 Universal Declaration of Human Rights ................ 17 IN THE Supreme Court of the Gnited States OCTOBER TERM, 1992 No. REPUBLIC OF ARGENTINA and PROVINCE OF TUCUMAN, ARGENTINA, Petitioners, vs SUSANA SIDERMAN DE BLAKE, et al.. Respondents PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT The Republic of Argentina and the Province of Tucuman! petition the Court that a writ of certiorari issue to review the judgment rendered in this case by the United States Court of Appeals for the Ninth Circuit. OPINIONS BELOW The opinion of the court of appeals, Appendix A (App.la-43a), is reported at 965 F.2d 699 (1992). ‘In compliance with Rule 29.1 of the Rules of this Court. Petitioners represent that the Republic of Argentina is a foreign State, and that the Province of Tucumén is a constituent prov- ince and a political subdivision of the Republic of Argentina. The orders of the United States District Court for the Central District of California are not reported; they are reproduced below in Appendix B (App. 44a- 45a), Order re Subject Matter Jurisdiction and Per- sonal Jurisdiction of March 14, 1984; Appendix C (App. 46a-53a), Judgment by Default of September 28, 1984; and Appendix D (App. 54a-57a), Order Va- cating Default Judgment and Dismissing Action of March 7, 1985. JURISDICTION The judgment of the court of appeals was entered on May 22, 1992. This Court’s jurisdiction is invoked under 28 U.S.C. § 1254(1). STATUTE INVOLVED The Foreign Sovereign Immunities Act of 1976 (FSIA), 28 U.S.C. §§ 1830, 1602-1611, reads in rele- vant part as follows: § 1330. Actions against foreign states (a) The district courts shall have original ju- risdiction without regard to amount in con- troversy of any nonjury civil action against a foreign state as defined in section 1603(a) of this title as to any claim for relief in per- sonam with respect to which the foreign state is not entitled to immunity either under sec- tions 1605-1607 of this title or under any applicable international agreement. (b) Personal jurisdiction over a foreign state shall exist as to every claim for relief over which the district courts have jurisdiction un- der subsection (a) where service has been made under section 1608 of this title. § 1603. Definitions For purposes of this chapter— (a) A “foreign state’’, except as used in sec- tion 1608 of thistitle, includes a political sub- division of a foreign state or agency or instrumentality of a foreign state as defined in subsection (b). (b) An “agency or instrumentality of a for- eign state’’ means any entity— (1) which is a separate legal person, cor- porate or otherwise, and (2) which is an organ of a foreign state or political subdivision thereof, or a majority of whose shares or other ownership inter- est is owned by a foreign state or political subdivision thereof, and (3) which is neither a citizen of a State of the United States as defined in section 1332(c) and (d) of this title, nor created under the laws of any third country. (c) (d) A “commercial activity’’ means either a regular course of commercial conduct or a particular commercial conduct or a particular commercial transaction or act. The commer- cial character of an activity shall be deter- mined by reference to the nature of the course of conduct or particular transaction or act, rather than by reference to its pur- pose. (e) A “commercial activity” carried on in the United States by a ‘‘foreign state’ means commercial activity carried on by such state and having substantial contact with the United States. § 1604. Immunity of a foreign state from jurisdiction Subject to existing international agree- ments to which the United States is a party at the time of enactment of this Act a foreign state shall be immune from the jurisdiction of the courts of the United States and of the States except as provided in sections 1605- 1607 of this chapter. § 1605. General exceptions to the jurisdic- tional immunity of a foreign state (a) A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case— (1) in which the foreign state has waived its immunity either explicitly or by im- plication, notwithstanding any with- drawal of the waiver which the foreign state may purport to effect except in ac- cordance with the terms of the waiver; (2) in which the action is based upon a commercial activity carried on in the United States by the foreign state; or upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere; or upon an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect in the United States; (3) in which rights in property taken in violation of international law are in issue and that property or any property ex- changed for such property is present in the United States in connection with a commercial activity carried on in the United States by the foreign state; or that property or any property exchanged for such property is owned or operated by an agency or instrumentality of the foreign state and that agency or instru- mentality is engaged in a commercial ac- tivity in the United States; (4) (5) not otherwise encompassed in para- graph (2) above, in which money dam- ages are sought against a foreign state for personal injury or death, or damage to or loss of property, occurring in the United States and caused by the tortious act or omission of that foreign state or of any official or employee of that for- eign state while acting within the scope of his office or employment; except this paragraph shall not apply to— (A) any claim based upon the exer- cise or performance or the failure to exercise or perform a discretionary function regardless of whether the discretion be abused, or (B) any claim arising out of mali- cious prosecution, abuse of process, libel, slander, misrepresentation, de- ie ceit, or interference with contract rights; STATE MENT 1. Nature of the Case The amended complaint in this suit was filed in November 1982 by respondents José Siderman (‘“‘hus- band’’), his wife Lea and their son Carlos (Argentine nationals residing in California at the time of suit), and by their daughter Susana Siderman de Blake, a naturalized United States citizen residing in Florida (collectively ‘‘the Sidermans’’). The amended complaint named as defendants the Republic of Argentina (‘‘Argentina’’); the Province of Tucuman (‘“Tucuman’’), a constituent province and a political subdivision of Argentina; eight Argentine na- tionals claimed to have been members of the military Government of the Province of Tucumén; and an Ar- gentine construction and real estate management company, “INOSA,”’ owned by the Sidermans. The company owned the ‘Hotel Gran Corona”’ in the city of San Miguel de Tucuman. The Sidermans invoked the district court’s jurisdic- tion under the Foreign Sovereign Immunities Act of 1976 (“FSIA’’), 28 U.S.C. §13830; the Alien Tort Stat- ute, 28 U.S.C. §1350; diversity jurisdiction, 28 U.S.C. §1332; federal question jurisdiction, 28 U.S.C. §1331; and pendent jumsdiction. Service on Argentina and on Tucuman was made by mail on the Argentine Min- istry of Foreign Affairs and on the Governor of Tu- cuman, respectively; the individual defendants and the INOSA company were not served. The complaint asserted eighteen claims for relief: claims by the Sidermans for an uncompensated taking of real estate and a wrongful ‘“‘judicial intervention”’ of the INOSA company instigated by military authorities who governed Tucumdén following the coup d’état in Argentina in 1976; a claim by the husband for a week-long wrongful detention in Tucumén fol- lowing the coup, during which period he claims to have been mistreated and tortured by masked, ma- chine-gun carrying soldiers; a claim by the husband for false arrest in Italy as a result of a vexatious, and ultimately unsuccessful, extradition request made by Argentina in 1981; a claim by the wife for loss of consortium and emotional distress; derivative claims by the wife, son and daughter for the husband’s tor- ture; derivative claims by the Sidermans on behalf of INOSA for conversion, constructive fraud, intentional interference with business relationships and breach of fiduciary duty based on the wrongful intervention: and a claim for the enforcement of an Argentine judg- ment. The Sidermans sought compensatory and declara- tory relief and punitive damages of $100 million each on 15 of the claims asserted. The last claim sought enforcement of a decree issued by a Provincial court in Tucuman that had vacated the intervention against INOSA and ordered the return of the company’s prop- erties to the Sidermans. 2. The Proceedings in the District Court In February 1983, following receipt of the com- and Tucumdén, the Argentine Embassy in Washington presented a diplomatic note to the Department of State asserting sovereign immunity with respect all claims asserted by the Sidermans. The Department of State advised the Embassy that under the FSIA, immunity defenses should be raised in court and transmitted copies of the note and of the Depart- ment’s response to the Clerk of the district court. In March 1984, following a hearing on the Sider- mans’ motion to enter a default, the district court dismissed sua sponte on act of state grounds the Sid- ermans’ taking claims (App. 44a-45a). The court, how- ever, found that it was competent under the Alien Tort Statute to hear the husband’s claim for a tort in violation of international law and the wife’s claim for loss of consortium. Without stating any reasons, the court further ruled that it had personal jurisdic- tion over Argentina and over Tucumén, but that it lacked personal jurisdiction over the _ individual defendants and the INOSA company and dismissed the suit as to these defendants. The court did not examine its competence under the FSIA to hear the claims asserted against Argentina and Tucumdan. In September 1984, the district court entered a default judgment against Argentina and Tucuman for some $2.6 million on the husband’s claim as compen- sation for pain and suffering, physical injuries, loss of earnings, medical expenses and moral damages, and for $100,000 in favor of the wife for loss of consortium. The court denied recovery to the son and the daughter. (App. 46a-53a). One month later, the court entered an order sua sponte for reconsideration of the issue of sovereign immunity, and ordered the issue briefed. In early-January 1985, Argentina and Tucuman sought relief from the default judgment on the ground that the FSIA provided the sole jurisdictional basis for suits against them in United States courts. They submitted that the claims asserted against them by the Sidermans were not cognizable under the Act and that, in consequence, the default judgment was void. Without taking any position on the legal issues raised in Petitioners’ moving papers, the United States filed a suggestion of interest and urged the court to con- sider Argentina’s motion. On March 7, 1984, the district court granted the relief sought by the Petitioners, vacated the default judgment, and dismissed the action on the ground that Argentina and Tucuman were immune from the suit under the FSIA, and that the claims asserted by the Sidermans did not fall within any of the excep- tions to sovereign immunity under the Act (App. 54a- 57a). The Sidermans appealed the district court’s dis- missal of their taking claim against Argentina and Tucuman and the husband’s compensation claim for torture.’ 3. The Proceedings in the Ninth Circuit Following the filing of their notice of appeal in April 1985, the Sidermans obtained nine consecutive six-month stays of the appeal. (App. 6a-7a n.5). The Sidermans secured these stays by representing to the Ninth Circuit that the appeal may become moot. In their successive applications for the stays, they in- formed the court that they had filed an action in the Supreme Court of Argentina under compensatory leg- islation enacted by the civilian Government of Pres- 2 The Sidermans did not appeal the dismissal of the suit against the individual defendants and the INOSA company, or the ruling that the wife, son and daughter lacked standing to claim deriv- atively damages for the husband’s torture. (App. 6a nn. 2, 3). 10 ident Raul Alfonsin that had replaced the military regime in late-1984. They further advised the court that their Argentine action ‘‘seeks the same relief against the Republic of Argentina as sought by this action,’ and that if they obtained redress in Argen- tina their appeal would become moot.’ The following year they informed the court that the Argentine Supreme Court had sent a letter rogatory to the U.S. District Court in Los Angeles asking that two wit- nesses be heard.‘ In 1988, they advised the court that the Argentine Supreme Court ‘‘agreed to hear plaintiffs’ claims for torture and property depriva- tion;’’ that ‘“‘[t]hese are the same claims that are the subject of the instant United States action,’ and that from May 1986 to February 1988 evidence was taken both in Argentina and in the United States to de- termine the Respondents’ financial condition and their ability to post a substantial bond that was recuired under Argentine law.® Early in 1989, they submitted to the court that the Argentine Supreme Cour: had issued a decision waiving the bond and that a Prov- incial court in Tucumdn had issued a preliminary de- cision for the return of some of the Sidermans’ properties. ‘“‘When these properties are returred a major issue will be resolved in plaintiffs’ favor in $ Letter from Respondents’ counsel to the Clerk of the Court of February 10, 1986; Motion to Stay Briefing Pending Reso- lution of Action in Argentina, filed March 3, 1986. ‘Status Report and Motion for Further Stay, filed April 27, 1987. ‘Status Report and Motion for Further Stay, filed June 9, 1988. 1] Argentina.’’* Later that year, they submitted that the action in Argentina was “‘still pending’’ and that the Sidermans “will also attempt to settle the case through the Argentine Executive Branch.’ In their last application for a stay of the appeal, the Sider- mans advised the court that they had pending a re- quest before the ‘‘Advisory Committee of the Argentine Presidency,’’ and that the daughter had requested the Department of State to espouse a dip- lomatic claim on her behalf.® The Sidermans failed to inform the court of appeals that the compensation claims that they had filed in the Supreme Court of Argentina had been challenged for untimeliness, and that in September 1989, the Supreme Court issued an order dismissing their suit as time-barred.° Argentina and Tucumdan opposed any further stays of the appeal and moved for summary affirmance on the authority of this Court’s then recent decision in 6 Status Report and Motion for Further Stay, filed January 3, 1989. 7 Status Report and Motion for Further Stay, filed July 18, 1989. § Status Report and Motion for Further Stay, filed August 23, 1990. ® The dispositive part of the Order read: [T]he suit is dismissed, with costs, on the ground that it is time-barred (Arts. 68 and 69 of the Code of Pro- cedure). Notification to be given to the parties. Supreme Court of Argentina, No. S525.XX—Original Juris- diction. Siderman, José and others vs. The Argentine Nation and The Province of Tucumén; [complaint] for compensation and damages; Order of September 19, 1989. a 12 Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989). On October 15, 1990, the court of appeals denied summary affirmance, vacated the last stay, and ordered that the appeal be briefed and argued. 4. The Ninth Circuit’s Decision The court of appeals vacated the district court’s judgment dismissing the expropriation claims on the basis of the act of state doctrine and remanded the case for an evidentiary hearing to determine whether the Sidermans’ expropriation claims were cognizable under the FSIA’s ‘“‘commercial activity” and “‘inter- national takings’ exceptions to sovereign immunity. (App. 23a). The court noted that ‘‘i]f the district court determines that it does have jurisdiction over the expropriation claims, Argentina can raise, and the district court can reconsider, the act of state doctrine as a defense to those claims.” (App. 23a-24a). The court further ruled that the district court’s dismissal of the husband’s claim for torture for lack of subject matter jurisdiction under the FSIA con- stituted reversible error (App. 43a); it remanded the claim to the district court for a determination whether Argentina had impliedly waived its immunity from Suit because of ‘‘Argentina’s invocation of United States judicial authority [as] part and parcel of its efforts to torture and persecute José Siderman.”’ (Ibid.). a) The Sidermans’ expropriation claims The court criticized the district court for dismissing the Sidermans’ expropriation claims under the act of state doctrine without considering at the outset its subject matter jurisdiction under the FSIA. (App. 9a- 13 12a). It then proceeded to examine whether the ex- propriation claims were cognizable under any of the three ‘‘commercial activity’’ exceptions in §1605(a\2).!° The court began its analysis by acknowledging that to come within the first clause of the FSIA’s com- mercial activity exception, a claim against a foreign state must be ‘“‘based upon a commercial activity car- ried on in the United States by the foreign state.’’ (App. 14a). In the court’s view, Argentina’s contin- uing management of INOSA, its operation of the Gran Corona Hotel in Tucumén and its receipts of profits from the INOSA company were activities “‘of a kind in which a private party might engage’’ (zbid.), and were clearly commercial in nature. The court further noted that the seizure of INOSA through a “‘judicial intervention” may also constitute a commercial activ- ity. (App. 15a n. 10). Turning to the statutory re- quirement that the foreign states’s commercial activities be ‘‘carried on in the United States,” the court concluded that the requirement was satisfied by the complaint’s allegations that the Argentine na- tional airline, Aerolineas Argentinas, advertised the Gran Corona Hotel in the United States and that ‘numerous Americans have stayed at the Hotel, which accepts all major American credit cards.’’ (App. 16a). In the court’s view, these allegations were sufficient to demonstrate that the commercial activities Argen- tina was conducting through INOSA have “‘substantial contact with the United States”’ (ibid.), and that the expropriation claim therefore fell squarely within clause one of the commercial activity exception. © For ease of reference, this petition will refer only to the section numbers of the Act, as codified in 28 U.S.C. 14 As to the second clause of §1605(a\2)—which denies immunity if a claim is based ‘‘upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere’’—the court held that since Americans spend money at the Gran Corona Hotel ‘‘which the Sidermans claim rightfully belongs to them’”’ (App. 17a), the “‘Sidermans’ causes of action for conversion, constructive fraud, inten- tional interference with business relationships and breach of fiduciary duty [in Argentina] directly relate, therefore, to Argentina’s acts in this country.” (Jbid.). Thus, the Sidermans’ pleadings also satisfied clause two of the commercial activity exception. Noting that the Sidermans did not rely on the third clause of §1605(a\2)—which denies immunity to a for- eign state if the claim is based on a commercial act outside the United States and causes a “direct effect’’ in this country—the court speculated that if the Sid- ermans could show that dividends from INOSA should have been, but were not, paid to them in the United States, the “direct effect’’ requirement of the third clause would also be satisfied. (App. 19a). The court instructed the district court that ‘‘on remand the Sid- ermans also may pursue jurisdiction under clause three and seek to cure any jurisdictional defects by amending their complaint and submitting additional evidence.”’ (Jbid.). The court then turned to Petitioners’ arguments that subject matter jurisdiction over the Sidermans’ expropriation claims could only be predicated on the specific international takings exception to sovereign immunity codified in § 1605(aX3). Petitioners urged that those Respondents who were Argentine citizens could not assert a taking claim in violation of inter- 15 national law against their own sovereign, and that in any event the Sidermans’ complaint failed to show on its face that their claims were cognizable under § 1605(aX3) because none of the property allegedly seized in Argentina (or property exchanged for such property), was claimed to be physically present in the United States. The court accepted the first proposition and re- jected the latter. (App. 19a-20a). It ruled that the daughter, an American citizen, was not barred from asserting a claim under §1605(a\3) for a taking in violation of international law. (App. 20a). The fact that none of the expropriated properties were “‘pres- ent in the United States in connection with a com- mercial activity carried on in the United States” by Argentina or Tucuman (first clause of §1605(a\3)), was not dispositive of the jurisdictional issue tend- ered. The court pointed to the second clause of the international takings exception—which permits a court to hear a suit where the expropriated property “‘is owned or operated by an agency or instrumentality of the foreign state and that agency or instrumen- tality is engaged in a commercial activity in the United States’’—and held that the daughter could as- sert subject matter jurisdiction under that clause. The court reasoned (1) that the daughter’s claim “that Argentina violated the international law of expropri- ation is substantial and non-frivolous, because the complaint alleges that Argentine officials seized IN- OSA for their personal profit and not for any public purpose ... and because the Siderman family is Jew- ish’”’ (App. 21a); (2) when INOSA was subjected to judicial intervention in Tucuman, it became an “agency or instrumentality’ of Argentina or Tucu- EEE 16 man, as defined in §1603(b) (App. 22a); and (8) the daughter also satisfied the second clause’s final re- quirement—that the agency or instrumentality be en- gaged in a commercial activity in the United States. In the court’s view, ‘‘[t]he Sidermans’ allegations con- cerning Argentina’s solicitation and entertainment of American guests and Hotel Gran Corona and the ho- tel’s acceptance of American credit cards and trav- eler’s checks are sufficient at this stage of the proceedings to show that Argentina is engaged in a commercial activity in the United States.”’ (App. 22a- 23a). In consequence, the complaint “brings [the daughter’s] expropriation claims within clause two of the international takings exception.’ (App. 23a). b) José Siderman’s torture claim The court began its analysis of this claim by ob- serving that, in its view, the decision in Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989), merely limited the non-commercial tort exception of the FSIA, §1605(a\5), ‘‘to cases in which the damage to or loss of property occurred within the territorial jurisdiction of the United States.”’ (App. 26a). Had tne Sidermans relied solely on that excep- tion, “their claims clearly would be barred under Amerada Hess.” (Ibid.). The court emphasized, how- ever, that the Sidermans’ jurisdictional argument was not based on the tort claims exception (App. 38a n. 17), but rather on the ‘‘international law principle of yus cogens, and the FSIA’s existing treaty (section 1604) and implied waiver (section 1605(aX1)) excep- tions” (App. 26a), which the Amerada Hess Court did not address. Following a lengthy exegesis on the doctrine of jus cogens (App. 26a-34a), the court concluded that state- ——————— sponsored torture is now universally outlawed and constitutes a violation of jus cogens. (App. 33a). Re- cognizing that it did not ‘‘write on a clean slate’ (App. 34a), the court lamented that in this case it was bound by an affirmative Act of Congress, and that its task was to interpret the Act “through the prism of Amerada Hess.” (App. 35a). The court ac- knowledged that the Amerada Hess Court was ‘“‘so emphatic in its pronouncement that ‘immunity is granted in those cases involving alleged violations of international law that do not come within one of the FSIA’s exceptions’,’”’ that it was forced to conclude “that if violations of jus cogens committed outside the United States are to be exceptions to immunity, Con- gress must make them so.” (App. 35a). Based on Amerada Hess, the court also rejected the Sidermans’ contention that Argentina should be denied sovereign immunity for torture claims under the 1948 Universal Declaration of Human Rights and the United Nations Charter (App. 35a-38a), since nei- ther of these documents contained any provision “‘re- garding remedies or compensation for violations of its substantive rules of conduct.” (App. 37a). It therefore concluded that ‘‘[t]he existing treaty exception of sec- tion 1604 does not apply to torture claims.’’ (App. 38a). The court, however, found in the waiver provision of §1605(aX1) a potential basis for the assertion of jurisdiction over the torture claim. The record estab- lished that in 1980—some four years after Mr. Sid- erman had left Argentina for the United States—the Presiding Judge of the Supreme Court of the Prov- ince of Tucuman addressed a letter rogatory to the Superior Court in Los Angeles and requested that a document relating to a criminal proceeding against José Siderman in Tucuman be delivered to Mr. Sid- erman. A judge of the Superior Court mailed the notice to Mr. Siderman."' In the court’s view, this judicial assistance request presented ‘‘a situation where Argentina apparently not only envisioned United States court participation in its persecution of the Sidermans, but by its actions deliberately implicated our courts in the persecution.”’ (App. 41a). The court found that the presentation of the letter rogatory, sufficed “‘to bring the [Sidermans’] claims for torture within ... [the waiver provision] of the FSIA.” (App. 39a). Without citing any authority, the court reasoned that ‘“‘i]f Argentina has engaged our courts in the very course of activity for which the Sidermans seek redress, it has waived its immunity as to that redress.’’!* (App. 42). The court instructed the district court to determine on remand whether the requisite direct connection exists between Mr. Sid- erman’s torture in 1976 and the 1980 Argentine letter rogatory. “If it does, Argentina will be subject to the court’s jurisdiction for the torture claims.’’ (App. 48a). ‘The Superior Court’s letter to Mr. Siderman is reproduced in Appendix E. ‘2 The Sidermans argued below that Argentina and Tucumdn should be deemed to have waived their sovereign immunity pur- suant to §1607 of the FSIA. That section codifies the principle established in National City Bank v. Republic of China, 348 U.S. 359 (1955), that when a foreign state brings an action or in- tervenes in an action in a federal or state court, it becomes subject to counterclaims and setoffs. 19 REASONS FOR GRANTING THE WRIT I. THE NINTH CIRCUIT HAS ERRONEOUSLY CON- STRUED AND APPLIED AN IMPORTANT ACT OF CONGRESS GOVERNING THE IMMUNITY OF FOR- EIGN STATES FROM SUITS FOR THE TAKING OF PROPERTY, AND ITS CONSTRUCTION OF THE ACT’S COMMERCIAL ACTIVITY EXCEPTION TO SOVEREIGN IMMUNITY CONFLICTS WITH OTHER CIRCUITS; THIS COURT HAS ALREADY GRANTED CERTIORARI IN ANOTHER CASE TO REVIEW THE CONFLICT. The court of appeals’ decision in this case marks the first time that any United States court has as- serted jurisdiction over a foreign state under the FSIA for compensation for a taking of property under the “commercial activity’’ exception of the FSIA. The court’s decision is demonstrably wrong. The compe- tence of courts to hear taking suits is to be found in the ‘‘international takings exception”’ to sovereign im- munity, codified in subparagraph (3) of §1605(a), not in the ‘“‘commercial activity’’ exceptions in subpara- graph (2) of that section. The international takings exception is a specific, self-contained exception to the general immunity of foreign states, and empowers courts to hear claims for the taking of property in violation of international law. To begin with, §1605(a\X3) differentiates between taking claims asserted against a foreign state itself (first clause), and taking claims asserted against agen- cies and instrumentalities of foreign states (second clause). For a taking claim to succeed under the first clause, the claimant must show that the property was taken in violation of international law, that the prop- erty (or property exchanged for such property) is present in the United States, and that the property’s presence here is in connection with a commercial ac- tivity carried on in the United States by the foreign state, a political subdivision or an agency or instru- mentality of the foreign state. H.R. Rep. No. 94-1487, 94th Cong. 2d Sess. at 19 (1976). The Sidermans’ complaint asserted that the prop- erty taken from them by the military authorities in Tucumén consisted of real estate and of a hotel owned by INOSA, an Argentine company owned by the Sid- ermans. Since they did not claim that any of the taken property, or any property exchanged for such prop- erty, was brought by Argentina or Tucumdan to the United States, their taking claim plainly does not fall within the jurisdictional provision of the first clause of §1605(a\3). The court of appeals’ conclusion that the district court was competent to hear the taking claim under the second clause of §1605(aX3) does not bear anal- ysis. Under the second clause, the expropriated prop- erty (or any property exchanged for such property) (1) must be owned or operated by an “agency or instrumentality”’ of a foreign state, and (2) that agency or instrumentality must be engaged in a ‘‘com- mercial activity in the United States.’’° The legisla- tive history explains that the jurisdictional regime of the first clause differs from that of the second clause in that under the latter ‘‘the property need not be present in connection with a commercial activity of the agency or instrumentality.’’ Jbid. The court of appeals misconstrued the distinction between these '’ The terms ‘‘commercial activity’ and ‘‘commercial activity carried on in the United States by a foreign state”’ are defined in §1603(d) and (e) of the FSIA. two clauses and, in effect, ruled that under the second clause the property need not be present in the United States at all. The only plausible interpretation of the legislative history just quoted is that where an agency or instrumentality of a foreign state owns or holds the property, the property need not be present in the United States in connection with a commercial activity of that agency. The premises of the court’s syllogism, viz., that INOSA qualified as an ‘‘agency and instrumentality”’ of Argentina or of Tucumdan because of the judicial intervention (App. 22a); that INOSA engaged in com- mercial activities in the United States because of Ar- gentina’s alleged “‘solicitation and entertainment of American guests at the Hotel Gran Corona and the hotel’s acceptance of American credit cards and trav- eler’s checks’’ (ibid.); and that ‘‘[t]he Sidermans’ al- legations bring Susana Siderman de_ Blake's expropriation claims within clause two of the inter- national takings exception’’ (App. 23a) are invalid. The daughter’s taking claim is not cognizable under §1605(aX3). The court of appeals’ principal jurisdictional ruling regarding the taking claim, 7.e., that the district court had subject matter jurisdiction over Respondents’ ex- propriation claims under the three clauses of the “commercial activity’ exception of §1605(a\2), is un- precedented and clearly erroneous. The core of the Sidermans’ taking claim was that their real estate was unlawfully seized by the military authorities in Tucumdan, not that Argentina breached a contract or other commercial undertaking, or committed a com- mercial tort. Leaving aside the court’s assumption that the taking of property by a state within its ter- ritory can be considered a ‘‘commercial activity,”’ the Respondents’ claims are not “‘based upon”’ the activ- ities carried on by Argentina and Tucumdan in the United States—or more accurately, the claims are not ‘“‘based upon”’ the activities of INOSA or the Hotel Gran Corona—as mandated by the first clause of §1605(a\2) of the FSIA. The mere fact that a foreign state or one of its agencies engages in commercial activities in the United States does not satisfy the first clause of the FSIA’s commercial activity excep- tions. The plain and unambiguous language of the first clause mandates that the suit against the foreign state be ‘‘based upon” that activity. Here, the court of appeals identified Argentina’s or Tucumdan’s rele- vant commercial activity as the Hotel Gran Corona’s solicitation of American guests and its acceptance of American credit cards. Plainly, these are not the com- mercial activities on which the Sidermans’ taking claims are based. The fact that a foreign state or one of its agencies engages in commercial operations in the United States is itself inadequate to support a finding of subject matter jurisdiction under the FSIA. There must be a close connection between the cause of action asserted and the jurisdictional facts upon which it is based. Other contacts between a defendant foreign state and the forum state, unrelated to a par- ticular cause of action, but that might justify assertion of jurisdiction under the theories of ‘‘doing business,’ or even of “‘transacting business,’’ do not satisfy the requirements of the commercial activity exception of the FSIA. The Circuits, however, have differed widely on the proper interpretation of the “‘based upon’”’ language in §1605(a). Cf, e.g., Stena Rederr AB v. Comision de 23 Contratos, 923 F.2d 380 (5th Cir. 1991) (to satisfy commercial activity exception of FSIA, commercial activity that provides jurisdictional nexus must also be activity on which lawsuit is based) with Nelson v. Saudi Arabia, 923 F.2d 1528 (11th Cir. 1991) (com- mercial activity exception of FSIA permits assertion of claim for torture allegedly committed by officials in Saudi Arabia because Saudi government entered into employment contract with claimant in this coun- try). To resolve the conflict among the Circuits, this Court granted certiorari last Term in the Nelson case (Saudi Arabia v. Nelson, No. 91-522), and the matter is presently being briefed. The Court should therefore also grant certiorari in the instant case, since it pre- sents yet another variant of the Circuit Courts’ con- fusing and _ inconsistent interpretations and applications of §1605(a\2)’s “‘based upon’’ standard. The Sidermans also cannot bring their expropria- tion claims within the second or third clauses of the commercial activity exception codified in §1605(a\2) because the claims are not based “upon an act per- formed in the United States in connection with a commercial activity of ... [Argentina] elsewhere” (second clause), nor are they based “‘upon an act out- side the territory of the United States in connection with a commercial activity of ... [Argentina] else- where, and that act causes a direct effect in the United States” (third clause). By their own pleadings, the Respondents’ expropriation claims are not ‘“‘based upon’”’ a commercial activity of Argentina or Tucu- man, but upon a quintessentially sovereign or gov- ernmental act—whether denominated seizure, taking, expropriation, confiscation, nationalization or judicial intervention. The court of appeals, therefore, miscon- 24 strued the import and meaning of the commercial activity exception of the FSIA—the core of the FSIA’s exception to foreign sovereign immunity—and incor- rectly decided this important federal question. Il. THE NINTH CIRCUIT’S HOLDING THAT A FOR- EIGN STATE MAY BE SUED FOR TORTURE WHERE THE TORTIOUS ACT AND THE INJURY OCCURRED ABROAD IS IN DIRECT CONFLICT WITH AN APPLICABLE DECISION OF THIS COURT. The court of appeals’ decision in this case also marks the first time that any United States court has asserted jurisdiction over a foreign state and one of its constituent provinces for an intentional tort (wrongful detention and torture) alleged to have been committed by persons acting under color of law on Argentine soil. Not only has the court disregarded the FSIA’s express provision for immunity from dam- age actions in the United States for extraterritorial torts committed by foreign states, but it also ignored the explicit teaching of this Court only three years ago in Argentine Republic v. Amerada Hess Shipping Corp., supra. Less than a decade ago, in Verlinden B.V. v. Cen- tral Bank of Nigeria, 461 U.S. 480, 491 (1983), the Court cautioned that in enacting the FSIA Congress did not intend to appoint United States courts tc sit as little international courts of claims, open to all who seek to litigate a grievance against a foreign state anywhere in the world. In the instant case, the court of appeals has turned a deaf ear to this Court’s di- rective. A suit as the present simply has no place in the courts of the United States. Lo) qr The court of appeals’ rationale that the Amerada Hess Court’s holding was inapposite to José Sider- man’s torture claim because here Argentina impliedly waived its immunity from suit is bizarre: according to the court the waiver occurred in 1980—some two years before the instant suit was filed—when a prov- incial court in Tucumdn requested that a document relating to a criminal action against Mr. Siderman be served on him in Los Angeles. According to the court of appeals, the State of Argentina thereby deliber- ately involved United States courts “‘in its efforts tc torture and persecute’”’ Mr. Siderman. (Mr. Siderman had left Argentina and became a resident of the United States in 1976.) The sanction which the court felt appropriate for such brazenness was to deny to the State of Argentina the immunity from suit which Congress and this Court have said Argentina enjoys. The FSIA is a carefully crafted federal statute, reg- ulating the jurisdiction of all courts in the United States in a sensitive area and it is designed to keep the courts out of the conduct of the foreign relations of the United States. Through a strict interpretation of this jurisdictional statute, Argentine Republic v. Amerada Hess, supra, 488 U.S. at 439-41, application of the act of state doctrine, Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 428-32 (1964), W. S. Kirk- patrick v. Environmental Tectonics Corp., 493 U.S. __., 110 S.Ct. 701, 707 (1990) and treaty interpre- tation, Zschernig v. Miller, 389 U.S. 429, 437-41 (1968), this Court has time and again instructed fed- eral and state courts to desist from sitting in judg- ment on acts performed by foreign states in their own territories, from examining the ‘‘democracy quo- 26 tient’”’ of foreign governments, and from exporting United States law into the territories of foreign states. The present case is a regrettable example of a fed- eral appellate court’s unwillingness to heed the teach- ings of this Court and to assume the role of a surrogate for the President and the Secretary of State in the conduct of the United States’ foreign relations. It should be jurisdictionally irrelevant that the suit here seeks to subject to the jurisdiction of American courts acts of a former military regime in Argentina that was criticized and condemned by the community of nations for its misdeeds. The Government of Ar- gentina respectfully submits that it is not a proper role for American courts to review these acts and to attempt to grant redress to victims of the regime’s excesses. The court of appeals’ jurisdictional rulings in the instant case do not appear to have been mo- tivated by purely legal considerations, but rather—as the opinion repeatedly manifests—by the court’s re- vulsion at what it termed ‘a horrifying portrait of anti-Semitic, government-sponsored tyranny” painted in the Sidermans’ pleaungs. The court of appeals was informed by the Respondents that the democratically elected govern- ment of Argentina that succeeded the military regime in 1983 had, immediately after it assumed the reins of government, provided domestic redress for human rights violations and property losses suffered by its citizens at the hands of its predecessor regime. The court was also advised by the Respondents that they had availed themselves of the redress that had been made available to them under the laws of Argentina and in the Supreme Court of Argentina. Disregarding the comity due to the Supreme Court of Argentina, Se SS Se ee ee. bo ~ the court merely adjourned this appeal for almost five years to await the outcome of Respondents’ claims in Argentina. When informed that the Respondents’ principal suit in Argentina was dismissed by the Supreme Court for untimeliness, and that the Respondents’ claims for the return of property had been successful only in part, the court proceeded to hear the Sidermans’ appeal. The court’s erroneous jurisdictional rulings, and its instructions to the dis- trict court on remand would, in essence, require com- prehensive discovery under the guise of jurisdictional discovery. The court’s actions are plainly at odds with Congress’ intent in enacting the FSIA and with es- tablished doctrine that sovereign immunity is an im- munity from suit rather than a defense on the merits, and that sovereign immunity is effectively lost if ov- erbroad discovery is ordered or if a case is erro- neously permitted to go to trial. The Court should grant the instant petition for certiorari and review both the substance of the court of appeals’ immunity ruling with respect to the ex- traterritorial tort asserted by the Respondents and the process employed by the court. CONCLUSION For the foregoing reasons, this Court should grant the petition for certiorari. Respectfully submitted, BRUNO A. RISTAU Counsel for the Petitioners August 20, 1992. APPENDIX APPENDIX A UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT ‘ SUSANA SIDERMAN DE BLAKE, JOSE SIDERMAN, CARLOS SIDERMAN, AND LEA SIDERMAN, Individuals, Plaintiffs-Appellants, Vv. THE REPUBLIC OF ARGENTINA, a foreign country; THE PROVINCE OF TUCUMAN OF THE REPUBLIC OF No. 85-5773 ARGENTINA, a province of a foreign D.C. No. country; Oscak HoNnorRATo, CV-82-1772-RMT ABELARDO GARCIA, CARLOS ROSALES, JUAN ROMAN DIOSQUE, Victor EpuARDO Mo .inA, GENERAL Bussi, CAPTAIN ABAS, GENERAL FORZANO, GENERAL MERLO, individuals; AND INMOBILIARIA DEL Nor-Oeste, S.A., an Argentine Corporation, Defendants-Appellees. OPINION Appeal from the United States District Court for the Central District of California Robert M. Takasugi, District Judge, Presiding Argued and Submitted June 3, 1991—Pasadena, California : Filed May 22, 1992 Before: Betty B. Fletcher, William C. Canby, Jr. and Robert Boochever, Circuit Judges. COUNSEL Michael J. Bazyler, Whittier College School of Law, Los Angeles, California, for the plaintiffs-appellants. Bruno A. Ristau, Kaplan, Russin & Vecchi, Washington, D.C., for the defendants-appellees. Betsy R. Rosenthal, Los Angeles, California, for amicus Anti- Defamation League of B’Nai B’Rith. OPINION FLETCHER, Circuit Judge: Susana Siderman de Blake and Jose, Lea, and Carlos Sider- man (collectively, “the Sidermans’”) appeal the dismissal of their action against the Republic of Argentina and the Argen- tine Province of Tucuman (collectively, “Argentina’). The Sidermans’ complaint alleged eighteen causes of action aris- ing out of the torture of Jose Siderman and the expropnation of the Sidermans’ property by Argentine military officials. The district courtdismissed the expropnation claims on the basis of the act of state doctrine, but granted a default judg- ment to Jose and Lea Siderman on the torture claims. Argen- tina then entered its first appearance in the case and moved for relief from judgment on the ground that the Foreign Sov- ereign Immunities Act (“FSIA”), 28 U.S.C. §§ 1330, 1602-11, rendered it immune from the Sidermans’ action. The district court granted the motion and vacated the default judgment. The Sidermans now appeal. We reverse and remand for fur- ther proceedings. FACTS The factual record, which consists only of the Sidermans’ 3a complaint and numerous declarations they submitted in sup- port of their claims, tells a hornfying tale of the violent and brutal excesses of an anti-Semitic military junta that ruled Argentina. On March 24, 1976, the Argentine military over- threw the government of President Maria Estela Peron and seized the reins of power for itself, installing military leaders of the central government and the provincial governments of Argentina.’ That night, ten masked men carrying machine guns forcibly entered the home of Jose and Lea Siderman, husband and wife, in Tucuman Province, Argentina. The men, who were acting under the direction of the military governor of Tucuman, ransacked the home and locked Lea in the bath- room. They then blindfolded and shackled 65-year old Jose, dragged him out of his home, tossed him into a waiting Car, and drove off to an unknown building. For seven days the men beat and tortured Jose. Among their tools of torture was an electric cattle prod, which they used to shock Jose until he fainted. As they tortured him, the men repeatedly shouted anti-Semitic epithets, calling him a “Jew Bastard” and a “Shitty Jew.” They inflicted all of these crueluies upon Jose Siderman because of his Jewish faith. At the end of this nightmarish week, his body badly bruised and his nbs broken, Jose was taken out of the building and driven to an isolated area, where the masked men tossed him out of the car. The men told Jose that if he and his family did not leave Tucuman and Argentina immediately, they would be killed. On the day of Jose’s release, he and Lea fled to Buenos Aires in fear for their lives. Their son Carlos followed shortly thereafter, and the night Carlos left Tucuman, military authorities ransacked his home. In June 1976, Jose, Lea, and Carlos left Argentina for the United States, where they joined Susana Siderman de Blake. She is the daughter of Jose and Lea and is a United States citizen. ‘A general description of the military coup and its aftermath can be found in Forti v. Suarez-Mason, 672 F. Supp. 1531, 1536 (N.D. Cal. 1987). Before the hasty flight from Tucuman to Buenos Aires, Jose was forced to raise cash by selling at a steep discount part of his interest in 127,000 acres of land. Pnor to their departure for the United States, the Sidermans also made arrangements for someone to oversee their family business, Inmobiliaria del Nor-Oeste, S.A. (“INOSA”), an Argentine corporation. Susana Siderman de Blake, Carlos Siderman and Lea Siderman each owned 33% of INOSA and Jose owned the remaining one percent. Its assets comprised numerous real estate holdings including a large hotel in Tucuman, the Hotel Gran Corona. The Sidermans granted management powers over INOSA to a certified public accountant in Argentina. After the Sidermans left Argentina for the United States, Argentine military officers renewed their persecution of Jose. They altered real property records in Tucuman to show that he had owned not 127,000, but 127, acres of land in the prov- ince. They then initiated a cnminal action against him in Argentina, claiming that since he owned only 127 acres he had sold land that did not belong to him. Argentina sought the assistance of our courts in obtaining jurisdiction over his per- son, requesting via a letter rogatory that the Los Angeles Superior Court serve him with documents relating to the action. The court, unaware of Argentina’s motives, complied with the request. Soon thereafter, while he was travelling in Italy, Jose was arrested pursuant to an extradition request from Argentina to the Italian government. Argentina charged that Jose had fraudulently obtained the travel documents enabling him to leave Argentina in 1976. Jose was not permitted to leave Cremora, Italy, for seven months, and actually was impris- oned for 27 days, before an Italian Appeals Court finally held that Argentina’s extradition request would not be honored, as it was politically motivated and founded on_ pretextual charges. The Argentine military also pursued INOSA with vigor. In Apnl 1977, INOSA was seized through a sham “judicial intervention,” a proceeding in which property is put into receivership. The purported reasons for the intervention were that INOSA lacked a representative in Argentina and that INOSA had obtained excessive funds from a Tucuman pro- vincial bank. Though these reasons were pretexts for perse- cuting the Sidermans because of their religion and profiting from their economic success, the Sidermans were unable to oppose the intervention because Argentine officials had imprisoned and killed the accountant to whom they had granted management powers over INOSA. In 1978, the Sider- mans retained an attorney in Argentina and brought a deriva- tive action in a Tucuman court in an effort to end the intervention. The court ordered that the intervention cease, and the order was upheld by the Supreme Court of Tucuman, but the order remains unenforced and the intervention has continued. Argentine military officials and INOSA’s appointed receivers have extracted funds from INOSA, pur- chased various assets owned by INOSA at sharply discounted prices, and diverted INOSA’s profits and revenues to them- selves. In 1982, Jose, Lea, and Carlos, who by then had become permanent residents of the United States, and Susana, a United States citizen since 1967, turned to federal court for relief. They filed a complaint asserting eighteen causes of action based on the torture and harassment of Jose by Argen- tine officials and the expropriation of their property in Argen- tina. Named defendants included the Republic of Argentina, the Province of Tucuman, INOSA, and numerous individual defendants who participated in the wrongdoing. In December 1982, the Sidermans properly served Argentina and Tucuman with the Summons and Complaint. The Argentine Embassy subsequently sought assistance from the U.S. State Depart- ment, which informed Argentina that it would have to appear and present any defenses it wished to assert to the district court, including the defense of sovereign immunity, or risk a default judgment. The State Department also provided a directory of lawyer referral services. Despite receiving this information, Argentina did not enter an appearance, and the Sidermans filed a motion for default judgment. On March 12, 1984, the distnct court dismissed the Sider- mans’ expropriation claims sua sponte on the basis of the act of state doctrine and ordered a hearing for the Sidermans to prove up their damages on the torture claims.’ The Sidermans moved for reconsideration of the court's dismissal of the expropnation claims. On September 28, 1984, the court denied the motion for reconsideration and entered a default judgment on the torture claims, awarding Jose damages and expenses totalling $2.6 million for his torture claims and awarding Lea $100,000 for her loss of consortium claim. The damages award finally elicited a response from Argen- tina, which filed a motion for relief from judgment on the ground that it was immune from suit under the FSIA and that the district court therefore lacked both subject matter and per- sonal jurisdiction. The United States filed a suggestion of interest, asking the court to consider the issue of foreign sov- ereign immunity but indicating no view of the ments. On March 7, 1985, the district court vacated the default judgment and dismissed the Sidermans’ action on the ground of Argen- tina’s immunity under the FSIA.* The Sidermans filed a timely notice of appeal on April 5, 1985.° We have jurisdic- tion over the appeal pursuant to 28 U.S.C. § 1291. *The district court also dismissed the claims against the individual defendants for lack of personal jurisdiction because they were never served. The Sidermans are not challenging this ruling on appeal. *Lea, Carlos, and Susana were found to lack standing to claim damages for Jose’s torture, and they do not appeal this ruling of the district court. “The court did not reach the question of personal jurisdiction, nor do the parties argue the issue on appeal. The FSIA provides that personal juns- diction exists if subject matter jurisdiction exists and proper service has been made under the FSIA. See 28 U.S.C. § 1330(b). Nevertheless, the exercise Of personal junsdiction also must comport with the constitutional requirement of due process. See Olsen by Sheldon v. Government of Mex- ico, 729 F.2d 641, 648-51 (9th Cir.), cert. denied, 469 U.S. 917 (1984). ‘Since filing the notice, the Sidermans have sought and obtained nine six-month stays of the appeal while they pursued an ultimately unsuccess- DISCUSSION Until 1952, foreign states and their agencies and instrumen- talities enjoyed virtually absolute immunity from suit in the courts of the United States. See Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 486 (1983). Chief Justice John Marshall authored the seminal opinion that considered and recognized the immunity of a foreign state from suit in a United States court. In The Schooner Exchange v. M'Faddon, 11 U.S. (7 Cranch) 116 (1812), the Court upheld a French plea of immunity against an American citizen’s assertion of title to an armed national vessel of France that had entered the territorial waters of the United States. In his opinion for the Court, Chief Justice Marshall first emphasized the “exclusive and absolute” nature of a nation’s terntorial jurisdiction, any exception to which could arise only from the consent or waiver of that nation. 11 U.S. (7 Cranch) at 136. He then explained: The world being composed of distinct sovereignties, possessing equal nghts and equal independence, ... all sovereigns have consented to a relaxation in prac- tice, in Cases under certain peculiar circumstances, of that absolute and complete jurisdiction within their respective territories which sovereignty confers. Id. Thus, Chief Justice Marshall announced that the common practice of nations forms the foundation for the doctrine of foreign sovereign immunity, while a given state’s agreement to grant immunity in a particular case is a matter of grace, comity, and respect for the equality and independence of other sovereigns. See Verlinden, 461 U.S. at 486. Although The Schooner Exchange did not announce a rule of absolute sov- ful suit in Argentina that could have mooted the present case. On October 15, 1990, in light of Argentina’s opposition to the ninth stay, the stay was vacated and the briefing schedule set. ereign immunity, in the following 140 years absolute immu- nity became the norm, principally because the courts practiced consistent deference to the Executive Branch, which ‘ordinarily requested immunity in all actions against friendly foreign sovereigns.” /d. In 1952, however, the Acting Legal Adviser of the State Department, Jack Tate, sent a letter to the Acting Attorney General announcing that the State Department was adopting the “restrictive” principle of foreign sovereign immunity. /d. at 487 & n.9. Under the restrictive principle, as defined in the Tate Letter, “the immunity of the sovereign is recognized with regard to sovereign or public acts (jure imperii) of a state, but not with respect to private acts (jure gestionis).” 26 Dep't of State Bull. 984 (1952), reprinted in Alfred Dunhill of London, Inc. v. Republic of Cuba, 425 U.S. 682, 711 (1976) (Appendix 2). With the issuance of the Tate Letter, the United States joined the emerging international consensus that private acts of a sovereign — commercial activities being the primary example — were not entitled to immunity. While the Tate Letter altered the Executive Branch’s view of foreign sover- eign immunity, it did not provide the courts with concrete leg- islative standards for determining whether to assert jurisdiction over actions against foreign states. Thus, the courts continued to defer to the Executive Branch. When the State Department issued a suggestion of immunity in a partic- ular case, the court followed it; when the State Department remained silent, the court relied on prior suggestions for pre- cedential assistance in determining immunity. Verlinden, 461 U.S. at 487. With the enactment of the FSIA in 1976, Congress replaced the regime of deference to Executive suggestion with a comprehensive legislative framework “governing claims of immunity in every civil action against a foreign state or its political subdivisions, agencies, or instrumentalities.” /d. at 488; H.R. Rep. No. 1487, 94th Cong., 2d Sess. 7, reprinted in 1976 U.S. Code Cong. & Admin. News 6604, 6606 (“A 9a principal purpose of this bill is to transfer the determination of sovereign immunity from the executive branch to the judi- cial branch ....”). In essence, the FSIA codified the restric- tive theory of sovereign immunity, which had become widely accepted in international law. See Verlinden, 461 U.S. at 487- 88; H.R. Rep. No. 1487, 94th Cong., 2d Sess. 14, 1976 U.S. Code Cong. & Admin. News at 6613 (referring to interna- tional law and Tate Letter). Structurally, the FSIA sets forth the general rule that foreign states are immune from the juris- diction of both federal and state courts in the United States, subject to certain exceptions. 28 U.S.C. §§ 1330(a) & 1604. A federal court lacks subject matter jurisdiction over a claim against a foreign state unless the claim falls within an excep- tion to immunity under the FSIA. See 28 U.S.C. § 1330(a); Verlinden, 461 U.S. at 489; see also Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 439 (1989) (FSIA is “sole basis for obtaining jurisdiction over a foreign State in federal court”). As a threshold matter, therefore, a court adjudicating a claim against a foreign state must determine whether the FSIA provides subject matter jurisdiction over the claim. Liu v. Republic of China, 892 F.2d 1419, 1424 (9th Cir. 1989), cert. dismissed, 111 S. Ct. 27 (1990). The existence of subject matter jurisdiction under the FSIA is a question of law subject to de novo review. /d. Where, as in the present case, a clam has been dismissed for lack of jurisdiction, we accept the alle- gations of the complaint as true. Gerritsen v. de la Madrid Hurtado, 819 F.2d 1511, 1513 (9th Cir. 1987). The parties and the district court have agreed that the Sider- mans’ claims fall into two categories: those relating to the expropriation of INOSA and those relating to the torture of Jose Siderman. The district court initially dismissed the expropriation claims on the basis of the act of state doctrine, while awarding a default judgment to the Sidermans on the torture claims. Only later did the court dismiss the torture claims and the Sidermans’ entire action. Because the two cat- 10a egones of claims were dismissed at different stages of the suit, and for different reasons, we separately address each cat- egory. I. EXPROPRIATION CLAIMS In its order of March 12, 1984, the district court dismissed the expropriation claims on the basis of the act of state doc- trine; it did not consider whether it had subject matter juns- diction over the claims pursuant to the FSIA.°® The district court erred in deciding the act of state issue without first con- sidering the threshold issue of its subject matter jurisdiction. Because the federal courts lack junsdiction over a claim against a foreign state that is immune under the FSIA, “[alJt the threshold of every action in a district court against a for- eign state, ... the court must satisfy itself that one of the [FSIA] exceptions applies.” Verlinden, 461 U.S. at 493-94. The district court must address this issue “even if the foreign State does not enter an appearance to assert an immunity defense.” Jd. at 494 n.20. The court simply cannot proceed without subject matter jurisdiction. In contrast to the junsdictional nature of foreign sovereign immunity under the FSIA, “[t]he act of state doctrine is not a junsdictional limit on courts.” Liu, 892 F.2d at 1431. The doctnne reflects the prudential concern that the courts, if they question the validity of sovereign acts taken by foreign states, *Argentina contends that the district court held that it lacked jurisdiction over the expropnation claums when it later granted Argentina’s motion for relief from judgment and dismissed the Sidermans’ entire action. We find no evidence in the record to support this contention. At the time that Argentina filed its motion, the distnct court already had dismissed the expropriation claims. Those claims were no longer at issue. Moreover, the parties neither raised nor bnefed the applicability of the FSIA to the expropriation claims before the district court, and nothing in the court's order granting Argentina's motion indicates that it considered the issue. The sole basis for the district court's dismissal of the expropriation claims was the act of state doctrine. lla may be interfering with the conduct of American foreign pol- icy by the Executive and Congress.’ W.S. Kirkpatrick & Co. v. Environmental Tectonics Corp., 493 U.S. 400, 404 (1990): Liu, 892 F.2d at 1431. The act of state doctrine is a principle or rule of decision that the courts apply in deciding cases within their jurisdiction. Environmental Tectonics, 493 U.S. at 406, 409; see also West v. Multibanco Comermex, S.A., 807 F.2d 820, 827 (9th Cir.) (describing act of state doctrine as “combination justiciability and abstention rule”), cert. denied, 482 U.S. 906 (1987). In terms of the Federal Rules of Civil Procedure, the act of state doctrine does not bar an action for lack of subject matter jurisdiction, Fed. R. Civ. P. 12(b)(1), but rather for failure to state a claim upon which relief can be granted, Fed. R. Civ. P. 12(b)(6). See Timberlane Lumber Co. v. Bank of America, N.T. & S.A., 549 F.2d 597, 602 (9th Cir. 1976). If a court lacks jurisdiction over a case involving a for- eign state, the act of state doctrine never comes into play.’ ’The doctrine derives from Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (1964), in which the Court declined to adjudicate the validity of expropniations by the Cuban government. The precise holding of Sabbatino was that: the Judicial Branch will not examine the validity of a taking of property within its own terntory by a foreign sovereign govern- ment, extant and recognized by this country at the time of suit, in the absence of a treaty or other unambiguous agreement regarding controlling legal principles, even if the complaint alleges that the taking violates customary international law. Id. at 428; see also Restatement (Third) of the Foreign Relations Law of the United States § 443(1) & Comment b (1987). As the numerous qualifi- cations in Sabbatino’s holding indicate, the act of state doctrine is “supple, flexible, ad hoc.” Republic of the Philippines v. Marcos, 862 F.2d 1355, 1361 (9th Cir. 1988) (en banc), cert. denied, 490 U.S. 1035 (1989). *We note that in /niernational Association of Machinists and Aerospace Workers (IAM) v. Organization of Petroleum Exporting Countries (OPEC), 649 F.2d 1354 (9th Cir. 1981), cert. denied, 454 U.S. 1163 (1982), a panel of our court applied the act of state doctrine without first resolving the threshold issue of immunity and jurisdiction under the FSIA. However, the OPEC decision was rendered prior to the Supreme Court's 12a “Because sovereign immunity is jurisdictional and the act of State doctrine is not, we must consider sovereign immunity before reaching the act of state doctrine.” De Sanchez v. Banco Central De Nicaragua, 770 F.2d 1385, 1389 (Sth Cir. 1985); see Liu, 892 F.2d at 1424 (first determining whether subject matter jurisdiction existed under FSIA before address- ing district court's act of state ruling). Since the district court did not consider jurisdiction under the FSIA with regard to the expropriation claims, it made no findings of fact concerning jurisdiction. The record consists of the complaint and numerous declarations submitted by the Sidermans in support of their contention that certain of the FSIA exceptions apply, but includes no pleadings or evidence from Argentina, which had not yet entered an appearance in the case when the expropriation claims were dismissed. Argentina contends that the Sidermans’ complaint and decla- rations fail to demonstrate that the expropnation claims fall within an FSIA exception, and asks us to affirm the district court’s dismissal on that ground. We therefore review the record to determine whether the Sidermans have sustained their initial burden of alleging jurisdiction under the FSIA. If the allegations in the Sidermans’ complaint, which we must accept as true, and the uncontroverted evidence presented by the Sidermans bring the claims within an FSIA exception, the burden then shifts to Argentina to prove that any relevant exceptions do not apply. “Once the plaintiff offers evidence that an FSIA exception to immunity applies, the party claim- ing immunity bears the burden of proving by a preponderance of the evidence that the exception does not apply.” Schoenberg v. Exportadora de Sal, S.A. de C.V., 930 F.2d opinions in both Verlinden, which clearly establishes that the question of whether there is junsdiction under the FSIA must be answered “[a]t the threshold of every action in distnct court against a foreign state,” 461 U.S. at 493-94, and Environmental Tectonics, which clarified the nature of the act of state doctrine. We therefore address the jurisdictional issue first. 13a 777, 779 (9th Cir. 1991) (quoting Joseph v. Office of the Con- sulate Gen'l of Nigeria, 830 F.2d 1018, 1021 (9th Cir. 1987), cert. denied, 485 U.S. 905 (1988)). If the Sidermans success- fully have alleged that an exception to immunity under the FSIA applies to their claims, we must remand the claims in order to afford Argentina the opportunity to rebut the Sider- man’s evidence and sustain its burden of proof before the dis- trict court. The Sidermans argue that two of the FSIA exceptions apply to their expropriation claims, the commercial activity exception, 28 U.S.C. § 1605(a)(2), and the international tak- ings exception, 28 U.S.C. § 1605(a)(3). We consider each in turn. A. Commercial Activity Exception The commercial activity exception provides that a foreign State is not immune from jurisdiction where "Although the Sidermans have submitted declarations and evidence beyond the pleadings, allegations in a complaint can themselves be suffi- cient to require a response from the foreign state defendant before the complaint can be dismissed. In Meadows v. Dominican Republic, 817 F.2d 517, 522-23 (9th Cir.), cert. denied, 484 U.S. 976 (1987), we held that, at least with regard to the commercial activity exception to the FSIA, the dis- tnict court should observe the foilowing procedure: Where, as here, the plaintiff alleges in his complaint that his claum is based on a foreign state's strictly commercial acts, the defendant must establish a prima facie case that it is a sovereign State and thattheplainuff's clairn arises out of a public act. This proof establishes a presumption that the foreign state is protected by immunity. The plaintiff then has the burden of going forward with the evidence by offering proof that one of the FSIA exemp- tions applies. Once the plaintiff has presented this evidence, the defendant must prove its entitlement to immunity by a preponder- ance of the evidence. Thus, even if the Sidermans had presented nothing more than the allega- tions in their complaint, Meadows indicates that it would have been incumbent upon Argentina to respond to those allegations. l4a the action is based [1] upon a commercial activity carried on in the United States by the foreign state, or [2] upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere; or [3] upon an act outside the tern- tory of the United States in connection with a com- mercial activity of the foreign state elsewhere and that act causes a direct effect in the United States 28 U.S.C. § 1605(a)(2). As the bracketed numbering indi- cates, section 1605(a)(2) contains three clauses. See Schoen- berg, 930 F.2d at 779-80. We find that the Sidermans have presented sufficient allegations and evidence to demonstrate — at least at this stage of the proceedings — that their expro- priation claims fall within the first and second clauses and may also fall within the third. In order to come within the first clause of the exception, a claim against a foreign state must be “based upon a com- mercial activity carried on in the United States by the foreign state.” Commercial activity “means either a regular course of commercial conduct or a particular commercial transaction or act.” 28 U.S.C. § 1603(d). In determining whether an act or activity is commercial, we must look to its nature, not its pur- pose. 28 U.S.C. § 1603(d); Schoenberg, 930 F.2d at 780. Though activities that customarily are carned on for profit are certainly commercial, Schoenberg, 930 F.2d at 780, an activ- ity need not be motivated by profit to be commercial, Joseph, 830 F.2d at 1024. The central question is “whether the activity is of a kind in which a private party might engage.” /d. In light of the allegations and evidence submitted by the Sider- mans, we have no doubt that the Sidermans’ claims are based on commercial activity being conducted by Argentina. The activities that form the basis for the claims — Argentina's continuing management of INOSA, its operation of the Hotel Gran Corona, and its receipt of profits from the company’s 15a Operations — are clearly activities “of a kind in which a pri- vate party might engage.” The more difficult question is whether this commercial activity is being “carried on in the United States.” 28 U.S.C. § 1605(a)(2). As defined by the FSIA, “ ‘commercial activity carried on in the United States by a foreign state’ means com- mercial activity carried on by such state and having substan- tial contact with the United States.” 28 U.S.C. § 1603(e). Under this definition, the forum state need not engage in com- mercial activity in the United States on a regular basis. Shapiro v. Republic of Bolivia, 930 F.2d 1013, 1018 (2d Cir. 1991). Instead, the critical inquiry is whether there is “‘a nexus between the defendant’s commercial activity in the United States and the plaintiff's grievance.” America West Airlines, Inc. v. GPA Group, Ltd., 877 F.2d 793, 796 (9th Cir. 1989). The Sidermans have alleged and put forward evidence that Argentina advertises the Hotel Gran Corona in the United States and solicits American guests through its U.S. agent, *°Argentina’s initial seizure of INOSA through a “judicial intervention,” which the Sidermans allege to have been nothing more than a sham for expropriation, sumilarly may constitute commercial activity. In L’Europeenne de Banque v. La Republica de Venezuela, 700 F. Supp. 114 (S.D.N.Y. 1988), a consortium of banks had entered into a deposit lending agreement with a Venezuelan bank, pursuant to which the consortium deposited $30 million. Venezuela subsequently declared an “intervention” in the bank's affairs on the ground that the bank was either in danger of failing or had violated banking laws. Venezuela granted all management powers to a vice president of Venezuela’s Deposit Guaranty and Bank Protection Fund, and eventually the bank was ordered liquidated. In the consorium’s subsequent action against Venezuela, the court found that Venezuela's intervention and operation of the bank constituted commer- cial activity. 700 F. Supp. at 119-20. On the present record, we cannot determine whether a judicial intervention in Argentina is an action that a Private party can perform. The Sidermans are free to pursue this argument on remand. We note that the commercial activity exception does not require that every act alleged be commercial in nature. See Foremost- McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d 438, 450 (D.C. Cir. 1990). l6a Aerolinas Argentinas, the national airline of Argentina. They have alleged further that numerous Americans have stayed at the Hotel, which accents all the major American credit cards, including Mastercard, Visa, and American Express. On the present record, we believe that these allegations are sufficient to demonstrate that the commercial activities Argentina is conducting through INOSA have “substantial contact with the United States.” The Sidermans’ allegations also satisfy the nexus requirement established in America West. Several of the Sidermans’ expropriation claims are directed toward the stream of revenue and benefits that Argentina is receiving through its operation of the Hotel. Argentina’s continuing receipt of the profits and benefits that nghtfully belong to the Sidermans — including those derived from U.S. sources — are some of the “specific acts that form the basis of the suit.” Id. at 797 (quoting Joseph, 830 F.2d at 1023) (emphasis omit- ted). We conclude that the Sidermans’ allegations and evi- dence bring their claims within clause one of the commercial activity exception. Clause two of the exception applies to actions based “upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere.” 28 U.S.C. § 1605(a)(2). As the few cases to address this clause have noted, it requires a “maternal connection ... between the plainuff’s cause of action and the act performed in the United States.” Stena Rederi AB. v. Comision de Contratos del Com- ite Ejecutivo General, 923 F.2d 380, 388 (Sth Cir. 1991) (emphasis in onginal). A plaintiff must either demonstrate a causal connection between a sovereign’s actions in the United States and those abroad giving rise to the plaintiff's claims, or the sovereign’s acts in the United States must themselves rep- resent an element in the plaintiff's cause of action. Gilson v. Republic of Ireland, 682 F.2d 1022, 1027 n.22 (D.C. Cir. 1982); see also H.R. Rep. No. 1487, 94th Cong., 2d Sess. 19, reprinted in 1976 U.S.C.C.A.N. 6613, 6618. The allegations and evidence set forth by the Sidermans that Argentina solicits guests for the Hotel Gran Corona in the United States and presumably accepts payments for those res- ervations in this country, and that as a result numerous Ameri- cans stay at the Hotel, suffice to meet this test. Because of Argentina's acts in the United States — the solicitation and acceptance of reservations — Americans spend money at the Hotel Gran Corona, money which the Sidermans claim right- fully belongs to them. The Sidermans’ causes of action for conversion, constructive fraud, intentional interference with business relationships and breach of fiduciary duty directly relate, therefore, to Argentina’s acts in this country. Argentina undertakes those acts, furthermore, in connection with com- mercial activity elsewhere, mainly its operation of the Hotel. The Sidermans’ claims thus fali squarely within clause two of the commercial activity exception. For the Sidermans’ expropriation claims to satisfy clause three of the exception, the claims must be based “upon an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act [must] cause[ ] a direct effect in the United States.” 28 U.S.C. § 1605(a)(2). The Sidermans base their claims on Argentina's seizure and continuing operation of INOSA, both of which constitute acts that Argentina has performed outside United States terntory. It is equally clear that they have been per- formed in connection with the commercial activities of oper- ating the Hotel Gran Corona and managing INOSA’s real estate investments in Argentina. These activities are, as noted above, “of a kind in which a private party might engage.” Joseph, 830 F.2d at 1024. The dispositive element in clause three for purposes of this case, therefore, is the requirement that the acts cause a direct effect in the United States. Under the direct effect requirement, the “foreign sover- eign’s activities must cause an effect in the United States that is substantial and foreseeable in order to abrogate sovereign immunity.” America West, 877 F.2d at 799. For example, in America West, an American airline sued an Irish national air- line for damage sustained by an aircraft engine on which the l&8a Irish airline had performed faulty maintenance work. Finding that it was not foreseeable that the maintenance work per- formed in Ireland on an engine then owned by a Netherlahds Antilles company would have an effect in the United States, we held that the direct effect requirement was unsatisfied. /d. at 800. The “purely fortuitous” fact that the plaintiff whose plane subsequently was fitted out with the engine was an American corporation was insufficient to create a direct effect. Id., see also Security Pacific Nat'l Bank v. Derderian, 872 F.2d 281, 286 (9th Cir. 1989); Martin v. Republic of S. Africa, 836 F.2d 91, 94-95 (2d Cir. 1987) (finding no direct effect in United States where African-American was denied medical treatment in South Africa). As a general matter, therefore, “[mJere financial loss” suf- fered by a person, whether individual or corporate, in the United States is not, in itself, sufficient to constitute a “direct effect.” America West, 877 F.2d at 799-800. However, in cases where a plaintiff's claim is for breach of a contract pro- viding that payment or performance must be made in the United States, the “direct effect” requirement has been deemed satisfied." For example, in Meadows v. Dominican Republic, 817 F.2d 517 (9th Cir. 1987), we considered an action brought by two U.S. residents to recover a loan com- mission they earned by obtaining a loan on behalf of a foreign "These cases reflect the general rule that “a direct effect occurs at the locus of the injury directly resulung from the sovereign defendant's wrongful acts.” Restatement (Third) of the Foreign Relations Law of the United States § 453 Reporter's Note 5 (1987). Thus, two Ninth Circuit cases cited by Argentina have held that the estate or family of a decedent who died abroad could not establish the required direct effect, because their injuries were only indirectly related to the direct injury suffered by the decedent. See Australian Gov't Aircraft Factories v. Lynne, 743 F.2d 672, 674-75 (9th Cir. 1984), cert. denied, 469 U.S. 1214 (1985) (American pilot died when plane crashed in Indonesia); Berkovitz v. Islamic Republic of Iran, 735 F.2d 329, 332 (9th Cir.), cert. denied, 469 U.S. 1035 (1984) (American killed by revolutionary forces in Iran). These cases are distin- guishable from the Sidermans’ action, which asserts direct injunes to the Sidermans as the owners and shareholders of INOSA. 19a government. Under the loan agreement, the commission was to be paid in the United States — through the plaintiffs’ bank — and we found this to be a sufficiently direct effect to per- mit jurisdiction under clause three. 817 F.2d at 523. See also Gregorian v. Izvestia, 871 F.2d 1515, 1527 (9th Cir. 1989) (discussing similar cases); L’Europeenne de Banque v. La Republica de Venezuela, 700 F. Supp. 114, 121 (S.D.N.Y. 1988) (extending rule to encompass foreign plaintiff). As an owner and shareholder of INOSA, each of the Sidermans is entitled to a share of the profits earned by the corporation. If INOSA’s articles of incorporation or by-laws (or the equivalent corporate documents under Argentine law) require INOSA to pay those dividends at the shareholder's place of residence, the United States, we believe in light of Meadows that the direct effect requirement would be satisfied. While the record before us does not reveal whether this is the case, it would be premature to hold that the Sidermans have failed to establish a direct effect. Since the Sidermans have alleged jurisdiction under clauses one and two, and we are remanding the expropriation claims on those grounds, on remand the Sidermans also may pursue jurisdiction under clause three and seek to cure any jurisdictional defects by amending their complaint or submitting additional evidence. See Trentacosta v. Frontier Pac. Aircraft Indus., 813 F.2d 1553, 1561-62 (9th Cir. 1987); In re Complaint of McLinn, 744 F.2d 677, 685 (9th Cir. 1984). B. International Takings Exception The Sidermans argue that their claims also fall within the international takings exception to the FSIA’s rule of immu- nity. That exception provides that a foreign state is not immune in an action in which rights in property taken in violation of international law are in issue and [1] that property or any property exchanged for such property is present | ’ a) 7 1! 20a in the United States in connection with a commercial activity carried on in the United States by the foreign state; or [2] that property or any property exchanged for such property is owned or operated by an agency Or instrumentality of the foreign state and that agency or instrumentality is engaged in a commer- cial activity in the United States .... 28 U.S.C. § 1605(a)(3). Though few courts have had the Opportunity to cosisider the international takings exception, it is clear that Jose, Lea, and Carlos Siderman cannot assert a claim that comes within this exception. In Chuidian v. Philip- pine Nat'l Bank, 912 F.2d 1095, 1105 (9th Cir. 1990), we held that the exception does not apply where the plaintiff is a citi- zen of the defendant country at the time of the expropriation, because “[e]xpropriation by a sovereign state of the property of its own nationals does not implicate settled principles of international law.” See also De Sanchez v. Banco Central de Nicaragua, 770 F.2d 1385, 1395 (Sth Cir. 1985). However, Susana Siderman de Blake is eligible to invoke the interna- tional takings exception, and the Sidermans’ allegations and evidence bring her claims within clause two of that exception. Under that clause, the property at issue must have been taken in violation of international law. At the junsdictional Stage, we need not decide whether the taking actually violated international law; as long as a “claim is substantial and non- frivolous, it provides a sufficient basis for the exercise of our jurisdiction.” West v. Multibanco Comermex, S.A., 807 F.2d 820, 826 (9th Cir.), cert. denied, 482 U.S. 906 (1987). In West, we described three requisites under international law for a valid taking. First, “[vJalid expropriations must always serve a public purpose.” 807 F.2d at 831. Second, “aliens [must] not be discriminated against or singled out for regulation by the state.” Jd. at 832. Finally, “[a]n otherwise valid taking is ille- gal without the payment of just compensation.” /d. These well-established principles track the Restatement of Foreign Relations Law, which provides: Z2la A state is responsible under international law for injury resulting from: (1) a taking by the state of the property of a national of another state that (a) is not for a public purpose, or (b) is discriminatory, or (C) is not accompanied by provision for just com- pensation .... Restatement (Third) of the Foreign Relations Law of the United States § 712 (1987) [hereinafter ‘“Restatement’]. The legislative history of the FSIA reveals a similar understanding of what constitutes a taking in violation of international law. See H.R. Rep. No. 1487, 94th Cong., 2d Sess. 19-20, reprinted in 1976 U.S. Code Cong. & Admin. News 6604, 6618 (taking violates international law if it is done “without payment of the prompt adequate and effective compensation required by international law” or is “arbitrary or discrimina- tory in nature”). If a taking violates any one of the aforemen- tioned proscriptions, it violates international law. Susana Siderman de Blake's claim that Argentina vio- lated the international law of expropriation is substantial and non-frivolous. The complaint alleges that Argentina officials seized INOSA for their personal profit and not for any public purpose. The complaint also alleges that Argentina seized INOSA because the Siderman family is Jewish — a discrimi- natory motivation based on ethnicity. See Restatement § 712 Comment f (noting that “taking that singles out aliens gener- ally, or aliens of a particular nationality, or particular aliens, would violate international law”). Finally, none of the Sider- mans has received any compensation for the seizure, let alone just compensation. As in West, we have no difficulty conclud- ing that the Sidermans’ complaint contains “substantial and 22a non-frivolous” aliegations that INOSA was taken in violation of international law. Beyond establishing that property has been taken in vio- lation of international law, Susan Siderman de Blake must demonstrate that the expropriated property, or property exchanged for it, is owned or operated by an agency or instru- mentality of Argentina and that the agency or instrumentality is engaged in commercial activity in the United States. The Sidermans’ allegations establish that INOSA itself has become an agency or instrumentality of Argentina. As defined by the FSIA, an “agency or instrumentality” means any entity— (1) which is a separate legal person, corporate or otherwise, and (2) which is an organ of a foreign state or political subdivision thereof, ... and (3) which is neither a citizen of a State of the United States . . . nor created under the laws of any third country. 28 U.S.C. § 1603(b). As an Argentine corporation, INOSA satisfies the first and third elements of the above definition, and the Sidermans’ basic allegation that Argentina has expro- priated INOSA suffices as an allegation that INOSA is now an “organ” of Argentina or Tucuman. The Sidermans’ allega- tions thus satisfy the “agency or instrumentality” definition. The final requirement under clause two — that the agency or instrumentality must be engaged in a commercial activity in the United States — is also met. The Sidermans’ allegations concerning Argentina’s solicitation and entertainment of American guests at the Hotel Gran Corona and the hotel's acceptance of American credit cards and traveler’s checks are sufficient at this stage of the proceedings to show that Argen- 23a tina is engaged in a commercial activity in the United States. The Sidermans’ allegations bring Susana Siderman de Blake’s expropriation claims within clause two of the international takings exception. We hold that the Sidermans’ complaint and declarations allege sufficient facts to bring their expropriation claims within both the commercial activity and international takings exceptions to the FSIA’s grant of foreign sovereign immunity. We emphasize the preliminary nature of our holding; follow- ing further development of the factual record on remand, the district court ultimately must determine whether the FSIA exceptions do or do not apply to the expropriation claims. While the Sidermans have sustained their initial burden of alleging applicable exceptions to the FSIA., Argentina will have the opportunity on remand to challenge the evidence presented by the Sidermans and to present its own. Under the procedures our circuit has developed for considering jurisdic- tion under the FSIA, Argentina now bears the burden of prov- ing by a preponderance of the evidence that none of the FSIA exceptions applies to the Sidermans’ claims. Schoenberg, 930 F.2d at 779. To the extent that the jurisdictional facts are dis- puted on remand, the parties should be allowed to conduct discovery for the limited purpose of establishing jurisdictional facts before the claims can be dismissed. See America West. 877 F.2d at 801 (““[W]here pertinent facts bearing on the ques- tion of jurisdiction are in dispute, discovery should be allowed.”); see also Santos v. Compagnie Nationale Air France, 934 F.2d 890, 892 n.2 (7th Cir. 1991): Filus v. LOT Polish Airlines, 907 F.2d 1328, 1332 (2d Cir. 1990). Because we are remanding to the district court for a more complete investigation of the jurisdictional basis for the Sider- mans’ expropriation claims, we vacate the district court’s judgment dismissing those claims on the basis of the act of State doctrine. If the district court determines that it does have jurisdiction over the expropriation claims, Argentina can raise, and the district court can reconsider, the act of state | ] 24a doctrine as a defense to those claims. The district court erred in applying that doctrine before Argentina had even entered an appearance in the case. “The burden of proving acts of State rests on the party asserting the applicability of the doctrine.” Liu, 892 F.2d at 1432; see also Republic of the Philippines v. Marcos, 862 F.2d 1355, 1361 (9th Cir. 1988) (en banc), cert. denied, 490 U.S. 1035 (1989). “At a mini- mum, this burden requires that a party offer some evidence that the government acted in its sovereign capacity and some indication of the depth and nature of the government's interest.” Liu, 892 F.2d at 1432. Because the district court acted sua sponte in dismissing the expropriation claims, Argentina has offered no such evidence of an act of state.” Il. TORTURE CLAIMS The question of Argentina’s immunity from the Sidermans’ torture claims is squarely presented, without the procedural complications surrounding the district court’s treatment of the expropriation claims. The district court dismissed the torture claims on the ground that they fell within no exception to immunity under the FSIA."” In defending the district court’s "*We also note that since the time of the district court’s ruling, both the Supreme Court and our circuit have provided more extensive guidance on the factors the district court should consider in deciding whether it 1s appropriate to apply the act of state doctrine in a given case. See, e.g., W.S. Kirkpatrick & Co. v. Environmental Tectonics Corp., 493 U.S. 400 (1990); Liu, 892 F.2d at 1431-34; Marcos, 862 F.2d at 1360-61. When the district court granted the initial default judgment in favor of Jose and Lea Siderman on the torture claims, it relied on the Alien Tort Statute, which provides the federal courts with jurisdiction over “any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” 28 U.S.C. § 1350. When the dis- trict court later granted Argentina’s motion for relief from the default judgment, it held that the Alien Tort Statute did not provide an exception to foreign sovereign immunity and that no exception in the FSIA encom- passed the Sidermans’ torture claims. The Supreme Court since has held that the Alien Tort Statute does not provide jurisdiction over suits against bo on is) decision on appeal, Argentina argues that the Sidermans’ claims are foreclosed by the Supreme Court’s opinion in Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989). Since Amerada Hess represents the Court’s most extensive treatment of the FSIA and its exceptions to immunity, we begin with a discussion of the case before turn- ing to the Sidermans’ arguments about why the case does not preclude their torture claims. Amerada Hess involved a Liberian oil tanker that was attacked by Argentine military aircraft during the Falklands/ Malvinas War between Great Britain and Argentina. The tanker’s owner and its charterer each brought suit against Argentina, but the district court dismissed their actions for lack of subject matter jurisdiction under the FSIA. The court of appeals reversed, finding that subject matter jurisdiction existed under the Alien Tort Statute. The Supreme Court, reversing the court of appeals, held that the FSIA provides “the sole basis for obtaining jurisdiction over a foreign state in our courts,” 488 U.S. at 434, and fourid that none of the exceptions to the general FSIA rule of immunity encompassed the plaintiffs’ claims. Jd. at 439. In Amerada Hess, the plaintiffs relied primarily on the non- commercial tort exception to the FSIA’s grant of immunity. That exception eliminates immunity in cases in which money damages are sought against a for- eign state for personal injury or death, or damage to or loss of property, occurring in the United States and caused by the tortious act or omission of that foreign states; the FSIA is the sole basis for jurisdiction over such actions. Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 434- 38 (1989). In light of Amerada Hess, and because the FSIA links immu- nity to subject matter jurisdiction, the district court’s determination that no FSIA exception applied to the torture claims necessarily constituted a determination that the court lacked subject matter jurisdiction. foreign state or of any official or employee of that foreign state while acting within the scope of his office or employment .... 28 U.S.C. § 1605(a)(5). The Court, limiting this exception to cases in which the damage to or loss of property occurred within the territorial jurisdiction of the United States, held that it did not encompass the plaintiffs’ claims. 488 U.S. at 439- 41. Argentina has devoted the bulk of its argument in the present case to a discussion of the noncommercial tort excep- tion and Amerada Hess’s holding that the exception does not encompass tortious activity perpetrated outside the territorial jurisdiction of the United States. If the Sidermans were rely- ing on section 1605(a)(5), their claims clearly would be barred under Amerada Hess. However, none of the three argu- ments they raise rests on that exception. Instead, the Sider- mans contend that Argentina is precluded from asserting the defense of sovereign immunity by the intemational law prin- ciple of jus cogens, and by the FSIA’s existing treaty (section 1604) and implied waiver (section 1605 (a)(1)) exceptions. We consider each of these arguments in turn. A. Jus Cogens The Sidermans contend that Argentina does not enjoy sovereign immunity with respect to its violation of the jus cogens norm of international law condemning official torture.“ While we agree with the Sidermans that official acts of torture of the sort they allege Argentina to have committed constitute a jus cogens violation, we conclude that Amerada Hess forecloses their attempt to posit a basis for jurisdiction not expressly countenanced by the FSIA. As defined in the Vienna Convention on the Law of Trea- ties, a jus cogens norm, also known as a “peremptory norm” “The term “official torture” is intended to encompass acts of torture performed by or under the direction of government officials. 27a of international law, “is a norm accepted and recognized by the international community of states as a whole as a norm from which no derogation is permitted and which can be mod- ified only by a subsequent norm of general international law having the same character.” Vienna Convention on the Law of Treaties, art. 53, May 23, 1969, 1155 U.N.T.S. 332. 8 I.L.M. 679 [hereinafter “Vienna Convention”]; see also Restatement § 102 Reporter’s Note 6. Jus cogens is related to customary international law (the direct descendant of the law of nations), which the Restatement defines as the “general and consistent practice of states followed by them from a sense of legal obligation.” Restatement § 102(2). Courts ascertain cus- tomary international law “by consulting the works of jurists, wniting professedly on public law; or by the general usage and practice of nations; or by judicial decisions recognizing and enforcing that law.” United States v. Smith, 18 U.S. (5 Wheat.) 153, 160-61 (1820) (Story, J.); see also The Paquete Habana, 175 U.S. 677, 700 (1900) (in ascertaining and administering customary international law, courts should resort “to the customs and usages of civilized nations, and, as evidence of these, to the works of jurists and commentators”); Filartiga v. Pena-Irala, 630 F.2d 876, 880-81 (2d Cir. 1980). Courts seeking to determine whether a norm of customary international law has attained the status of jus cogens look to the same sources, but must also determine whether the inter- national community recognizes the norm as one “from which no derogation is permitted.” Committee of U.S. Citizens Liv- ing in Nicaragua v. Reagan, 859 F.2d 929, 940 (D.C. Cir. 1988) [hereinafter “CUSCLIN”] (quoting Vienna Convention, art. 53). In CUSCLIN, the only reported federal decision to give extended treatment to jus cogens, the court described jus cogens as an elite subset of the norms recognized as custom- ary international law. /d. While jus cogens and customary international law are related, they differ in one important respect. Customary inter- national law, like international law defined by treaties and other international agreements, rests on the consent of states. 28a A state that persistently objects to a norm of customary inter- national law that other states accept is not bound by that norm, see Restatement § 102 Comment d, just as a State that is not party to an international agreement is not bound by the terms of that agreement. International agreements and cus- tomary international law create norms known as jus disposi- tivum, the category of international law that “consists of norms derived from the consent of states” and that is founded ‘on the self-interest of the participating states.” Klein, A The- ory for the Application of the Customary International Law of Human Rights by Domestic Courts, 13 Yale J. Int'l L. 332, 351 (1988) [hereinafter “Human Rights in Domestic Courts’). Jus dispositivum binds only “those states consenting to be govemed by it.” /d. In contrast, jus cogens “embraces customary laws consid- ered binding on all nations,” id. at 350-51, and “is derived from values taken to be fundamental by the international com- munity, rather than from the fortuitous or self-interested choices of nations,” id. at 351. Whereas customary interna- tional law derives solely from the consent of states, the funda- mental and universal norms constituting jus cogens transcend such consent, as exemplified by the theones underlying the judgments of the Nuremberg tribunals following World War Il. See Note, The Nuremberg Legacy: An Unfulfilled Promise, 63 S. Cal. L. Rev. 833, 868 (1990) [herinafter “Nuremberg Legacy”’}], Belsky, Merva & Roht-Amiaza, /mplied Waiver Under the FSIA: A Proposed Exception to Immunity for Vio- lations of Peremptory Norms of International Law, 77 Calif. L. Rev. 365, 385-86 (1989) [hereinafter “/rmplied Waiver’). The legitimacy of the Nuremberg prosecutions rested not on the consent of the Axis Powers and individual defendants, but on the nature of the acts they committed: acts that the laws of all civilized nations define as criminal. See Nuremberg Leg- acy, supra, at 862-67. The universal and fundamental nghts of human beings identified by Nuremberg — mghts againsi genocide, enslavement, and other inhumane acts, see id. at 847 (discussing Nuremberg Charter) — are the direct ances- 29a tors of the universal and fundamental norms recognized as jus cogens. In the words of the International Court of Justice. these norms, which include “principles and rules concerning the basic rights of the human person,” are the concem of all States, “they are obligations erga omnes.” The Barcelona Traction, Light & Power Co. (Belgium v. Spain), 1970 1.C.J. ce Because jus cogens norms do not depend solely on the con- sent of states for their binding force, they “enjoy the highest Status within international law.” CUSCLIN, 859 F.2d at 940. For example, a treaty that contravenes jus cogens is consid- ered under international law to be void ab initio. See Vienna Convention, art. 53; Restatement § 102 Comment k. Indeed. the supremacy of jus cogens extends over all rules of interna- tional law; norms that have attained the status of jus cogens “prevail over and invalidate international agreements and other rules of international law in conflict with them.” Restatement § 102 Comment k. A jus cogens norm is subject to modification or derogation only by a subsequent jus cogens norm. /d. The Sidermans claim that the prohibition against official torture has attained the status of a jus cogens norm. There is no doubt that the prohibition against official torture is a norm of customary international law, as the Second Circuit recog- nized more than ten years ago in the landmark case of Filartiga v. Pena-lrala, 630 F.2d 876 (2d Cir. 1980). Dr. Filartiga and his daughter, citizens of Paraguay, brought suit against Paraguayan officials who had tortured Dr. Filartiga’s son to death. They alleged jurisdiction under the Alien Tort Statute, which grants the district courts “original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” 28 U.S.C. § 1350. Dr. Filartiga claimed that the defendants’ torture of his son, perpetrated under color of offi- cial authority, violated a norm of customary international law prohibiting official torture, and the court agreed. Judge Kauf- 30a man, wnting for the court, explained that “there are few, if any, issues in international law today on which opinion seems to be so united as the limitations on a state's power to torture persons held in its custody.” 630 F.2d at 881. Judge Kaufman catalogued the evidence in support of this view, citing several declarations of the United Nations General Assembly and human rights conventions prohibiting torture,” modem municipal law to the same effect, and the works of jurists, and finally concluded “that official torture is now prohibited by the law of nations.” /d. at 884. Other authorities have also recognized that official torture is prohibited by customary international law. In Forti v. Suarez-Mason, 672 F. Supp. 1531, 1541 (N.D. Cal. 1987), a Suit predicated on atrocities committed by the same Argentine military government alleged to be responsible for the torture of Jose Siderman, the district court held that “official torture constitutes a cognizable violation of the law of nations,” and described the prohibition against official torture as “universal, obligatory, and definable.” Similarly, in Tel-Oren v. Libyan Arab Republic, 726 F.2d 774, 781 (D.C. Cir. 1984) (opinion of Edwards, J.), cert. denied, 470 U.S. 1003 (1985), which involved an action against the Palestine Liberation Organiza- tion for its acts of terrorism, Judge Edwards identified torture as a violation of customary international law. Judge Bork, although raising considerable opposition to the application of customary international law in U.S. courts, see id. at 801-19 ‘Sjudge Kaufman cited the Universal Declaration of Human Rights, G.A. Res. 217A(III), 3 U.N. GAOR Supp. (No. 16), U.N. Doc. A/810 (1948); Declarauon on the Protection of All Persons from Being Subjected to Torture, G.A. Res. 3452, 30 U.N. GAOR Supp. (No. 34) at 91, U.N. Doc. A/1034 (1975); Amencan Convention on Human Rights, Nov. 22, 1969, 36 O.A.S.T.S. 1, O.A.S. Official Records OEA/Ser. 4 v/II 23, doc 21, rev. 2 (1975); International Covenant on Civil and Political Rights, Annex to G.A. Res. 2200(XXI)a, 21 U.N. GAOR Supp. (No. 16), U.N. Doc. A/6316 (1966); European Convention for the Protection of Human Rights and Fundamental Freedoms, Art. 3, Council of Europe, Europ. T.S. No. 5, 213 U.N.T.S. 211 (1968). 3la (opinion of Bork, J.), at the same time conceded that the inter- national law prohibition against torture is not disputed. /d. at 820. The Restatement of Foreign Relations also holds to the view that customary international law prohibits official tor- ture. Restatement § 702(d). Finally, the world now has an international agreement focused specifically on the prohibi- tion against torture: The Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punish- ment, 39 U.N. GAOR Supp. (No. 51), 23 I.L.M. 1027 (1984) {hereinafter “Torture Convention”), which entered into force on June 26, 1987. The United States signed the Torture Con- vention in April 1988, the United States Senate gave its advice and consent in October 1988, see 136 Cong. Rec. $17486-92 (daily ed. October 27, 1990), and it now awaits the President's filing of the instrument of ratification with the Secretary-General of the United Nations.”* In light of the unanimous view of these authoritative voices, it would be unthinkable to conclude other than that "*The Torture Convention defines torture as any act by which severe pain or suffering, whether physical or mental, is intentionally inflicted on a person for such purposes as obtaining from him or a third person information or a confession, punishing him for an act he or a third person has committed or is suspected of having committed, or inumidating or coercing him or a third person, or for any reason based on discrimination of any kind, when such pain or suffering is inflicted by or at the instigation of or with the consent or acquiescence of a public offi- Cial or other person acting in an official Capacity. Torture Convention, art. 1. The agreement also calls on each state party to take measures to prevent torture within its termtory, id., art. 2, and to “ensure that all acts of torture are offenses under its criminal law,” id., art. 4. States parties must either prosecute or extradite persons charged with torture. /d., arts. 5-8. Each state party also must ensure that torture victims or their decedents “obiain{ } redress and ha[ve] an enforceable nght to fair and adequate compensation including the means for as full rehabilitation as possible.” /d., art. 14(1). Finally, the Torture Convention creates a “Committee against Torture,” which is responsible for receiving and reviewing states’ compliance with the agreement. /d., arts. 17-24. 32a acts of official torture violate customary intemational law. And while not all customary international law carries with it the force of a jus cogens norm, the prohibition against official torture has attained that status. In CUSCLIN, 859 F.2d at 941- 42, the D.C. Circuit announced that torture is one of a handful of acts that constitute violations of jus cogens. In Filartiga, though the court was not explicitly considering jus cogens, Judge Kaufman's survey of the universal condemnation of torture provides much support for the view that torture vio- lates jus cogens. In Judge Kaufman's words, “[a]mong the rights universally proclaimed by all nations, as we have noted, is the right to be free of physical torture.” 630 F.2d at 890. Supporting this case law is the Restatement, which recognizes the prohibition against official torture as one of only a few jus cogens norms. Restatement § 702 Comment n (also identify- ing jus cogens norms prohibiting genocide, slavery, murder or Causing disappearance of individuals, prolonged arbitrary detention, and systematic racial discrimination). Finally, there is widespread agreement among scholars that the prohibition against official torture has achieved the status of a jus cogens norm. See, e.g., Implied Waiver, supra, at 389, 393-94; Parker & Neylon, Jus Cogens: Compelling the Law of Human Rights, 12 Hastings Intl & Comp. L. Rev. 411, 437-39 (1989); Human Rights in Domestic Courts, supra, at 354 n.111; Randall, Universal Jurisdiction Under International Law, 66 Tex. L. Rev. 785, 830 (1988). Given this extraordinary consensus, we conclude that the right to be free from official torture is fundamental and uni- versal, a right deserving of the highest status under interna- tional law, a norm of jus cogens. The crack of the whip, the clamp of the thumb screw, the crush of the iron maiden, and, in these more efficient modem times, the shock of the electric cattle prod are forms of torture that the international order will not tolerate. To subject a person to such horrors is to commit one of the most egregious violations of the personal security and dignity of a human being. That states engage in official torture cannot be doubted, but all states believe it is wrong, 33a all that engage in torture deny it, and no state claims a sover- eign nght to torture its own citizens. See Filartiga, 630 F.2d at 884 (noting that no contemporary state asserts “a right to torture its Own or another nation’s citizens”); id. at n.15 (“The fact that the prohibition against torture is often honored in the breach does not diminish its binding effect as a norm of inter- national law.”). Under international law, any state that engages in official torture violates Jus cogens. The question in the present case is what flows from the Sidermans’ allegation that Argentina tortured Jose Siderman and thereby violated a jus cogens norm. The Sidermans con- tend that when a foreign state's act violates Jus cogens, the State is not entitled to sovereign immunity with respect to that act. This argument begins from the principle that jus cogens norms “enjoy the highest status within international law,” CUSCLIN, 859 F.2d at 940, and thus “prevail over and invali- date ... other rules of international law in conflict with them,” Restatement § 102 Comment k. The Sidermans argue that since sovereign immunity itself is a principle of interna- tional law, it is trumped by jus cogens. In short, they argue that when a state violates jus cogens, the cloak of immunity provided by international law falls away, leaving the state amenable to suit. As a matter of international law, the Sidermans’ argument carmes much force. We previously have recognized that “[s]overeign immunity is a principle of international law.” International Ass'n of Machinists & Aerospace Workers (IAM) v. Organization of Petroleum Exporting Countries (OPEC), 649 F.2d 1354, 1359 (9th Cir. 1981), cert. denied, 454 U.S. 1163 (1982). Chief Justice Marshall identified the foundation of the doctrine of sovereign immunity as the “perfect equality and absolute independence of sovereigns,” a State of affairs making it improper for one state to subject another to its jurisdiction. The Schooner Exchange, 11 U.S. (7 Cranch) at 137. As described by one scholar of international law, the doctrine of foreign sovereign immunity “is rooted in 34a two bases of international law, the notion of sovereignty and the notion of the equality of sovereigns.” Riesenfeld, Sovereign Immunity in Perspective, 19 Vand. J. Transnat’l L. 1 (1986). When Jack Tate, writing on behalf of the State Department, issued his famous letter in 1952, the United States was recognizing the trend in international law toward adoption of the restrictive principle of foreign sovereign immunity, under which states receive immunity for their sov- ereign acts (jure imperii) but not their private acts (jure gestionis). With the enactment of the FSIA, Congress explic- itly adopted the restrictive principle, identifying its origin in international law. 28 U.S.C. § 1602 (findings and declaration of purpose); see also H.R. Rep. No. 1487, 94th Cong., 2d Sess. 7, reprinted in 1976 U.S. Code Cong. & Admin. News 6604, 6605 (FSIA “would codify the so-called ‘restrictive’ principle of sovereign immunity, as presently recognized in international law”); id. at 8, 1976 U.S. Code Cong & Admin. News at 6606 (“Sovereign immunity is a doctrine of intema- tional law under which domestic courts, in appropriate cases, relinquish jurisdiction over a foreign state.”); id. at 9, 1976 U.S. Code Cong. & Admin. News at 6608 (‘“[S]Jovereign immunity is a question of international law to be determined by the courts.”’). The Sidermans posit that because sovereign immunity derives from international law, jus cogens supersedes it. “Jus cogens norms represent the fundamental duties incident to international life. They are an essential component of the modem law definition of sovereignty.” Jmplied Waiver, supra, at 392. International law does not recognize an act that violates jus Cogens aS a sovereign act. A State's violation of the jus cogens norm prohibiting official torture therefore would not be entitled to the immunity afforded by intermna- tional law. Unfortunately, we do not write on a clean slate. We deal not only with customary international law, but with an affirmative Act of Congress, the FSIA. We must interpret the 35a FSIA through the prism of Amerada Hess. Nothing in the text or legislative history of the FSIA explicitly addresses the effect violations of jus cogens might have on the FSIA’s cloak of immunity. Argentina contends that the Supreme Court's Statement in Amerada Hess that the FSIA grants immunity “in those cases involving alleged violations of international law that do not come within one of the FSIA’s exceptions,” 488 U.S. at 436, precludes the Sidermans’ reliance on jus cogens in this case. Clearly, the FSIA does not specifically provide for an exception to sovereign immunity based on jus cogens. In Amerada Hess, the Court had no occasion to consider acts of torture or other violations of the peremptory norms of inter- national law, and such violations admittedly differ in kind from transgressions of jus dispositivum, the norms derived from international agreements or customary international law with which the Amerada Hess Court dealt. However, the Court was so emphatic in its pronouncement “that immunity is granted in those cases involving alleged violations of inter- national law that do not come within one of the FSIA’s exceptions,” Amerada Hess, 488 U.S. at 436, and so specific in its formulation and method of approach, id. at 439 (“Having determined that the FSIA provides the sole basis for obtaining jurisdiction over a foreign state in federal court, we turn to whether any of the exceptions enumerated in the Act apply here’’), that we conclude that if violations of jus cogens committed outside the United States are to be exceptions to immunity, Congress must make them so. The fact that there has been [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386011_1172%3A1. Public record. Not legal advice.