Supplemental Brief — Federal Insurance Insurance Co. Co. v. Kingdom of Saudi Arabia (No. 08-640)

Z Supreme Court, U_S.

FILED

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IN THE

Supreme Court of the Anited States

FEDERAL INSURANCE COMPANY, ET AL..,

Petitioners,

KINGDOM OF SAUDI ARABIA, ET AL.,

Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Second Circuit

SUPPLEMENTAL BRIEF FOR RESPONDENTS

HRH CROWN PRINCE SULTAN BIN ABDULAZIZ

AL-SAUD, HRH PRINCE NAIF BIN ABDULAZIZ

AL-SAUD, HRH PRINCE SALMAN BIN ABDULAZIZ

AL-SAUD, AND HRH PRINCE TURKI AL-FAISAL

BIN ABDULAZIZ AL-SAUD

MICHAEL K. KELLOG« JEFFREY A. LAMKEN

Counsel of Record Counsel of Record

MARK C. HANSEN WILLIAM H. JEFFRESS

COLIN S. STRETCH SARA E. Krovt

KELLY P. DUNBAI JAMIE S. KILBERE

KELLOGG, HUBER. HANSED RORERT K. KRS

TODD, EVANS & FIGI MARTIN Vo TOrARO

P.t,.t4 BAKER BOTTS L.L..P

515 M Street. N.W 1299 Pennsvivania Avenue, NW

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Respondents HRH Crown Prince Sultan bin Abdul-

aziz al-Saud, HRH Prince Naif bin Abdulaziz al-

Saud, t!RH Prince Salman bin Abdulaziz al-Saud,

and H&M Prince Turki Al-Faisal bin Abdulaziz AlI-

Saud respectfully submit this supplemental brief

pursuant to this Court’s Rule 15.8 to advise the

Court of the Fourth Circuit’ recent decision in

Yousuf v. Samantar, No. 07-1893, 2009 WL 40942

(4th Cir. Jan. 8, 2009). In that case, a panel of the

Fourth Circuit held — as an alternative basis for deci-

sion — that “the FSIA does not apply to individuals.”

Id. at *1. Although the decision appears to diminish

the consensus among courts of appeals that the FSIA

applies to official-capacity suits against individuals,

it provides no basis for this Court’s review here.

First, Yousuf at most raises an academic issue con-

cerning the source of sovereign immunity for individ-

ual officers; it raises no issue about whether immu-

nity is available. As noted in the briefs in opposition,

everyone avrees that individual officers are entitled

to immunity for their official acts either under the

FSIA or under the common law. Because common-

law immunity is broader than the FSIA immunit\

the Second Circuit held to be available here, peti-

tioners cannot proceed against tne Princes even u

they prevail on the question they seek to raise. Se

HRH Crown Prince Sultan et al. Opp. 22-24: HRH

Prince Turki Opp. 25-26. The Yousuf court did not

dispute that individual officers could claim common.-

law immunity, emphasizing that the defendant

that case remained ‘tree te ursue on remand Mis

entitlement to “immunit irisll 1. r pre-FSIA

common law 009 WL 4094 it *1l1. And the

rence in Yi red tl OU serving

ture” from other authority because the decision was

“in keeping with thle] position” that “common law

immunities” continue to apply. /d. (Duncan, J.,

concurring in part and concurring in the judgment).

For that reason, any disagreement in reasoning

between Yousuf and the decision below lacks practi-

cal significance. What matters 1s whether officers are

immune, not the source of their immunity. No court

has ever suggested that the FSIA eliminated immu-

nity for individual officers; nor has any court sug-

gested that the common law would afford narrower

immunity than the FSIA (which is hardly surprising

because the FSIA codified common-law principles).

Unless a dispute arises over the scope and availabil-

ity of immunity, any conflict over the source of 1m-

munity is wholly academic.

Second, the decision in Yousuf is in any event

unlikely to be the last word from the Fourth Circuit

on the apphcability of the FSIA to individuals. As

an initial matter, it creates a direct conflict with that

Court’s prior decision in Velasco v. Government of

Indonesia, 370 F.3d 392 (4th Cir. 2004), which held

that the FSIA does provide immunity to government

officials sued in their individual capacity.

The Yousuf panel purported to distinguish Velasco

on the ground that Velasco addressed when “the acts

of an individual operate to bind a foreign sovereign,”

not whether the FSIA applies to individuals. 2009

WL 40942, at *6-*7 (emphasis omitted). But that is

incorrect. The plaintiff in Velasco sued the govern-

ment of Indonesia and several officials “in their offi-

cial capacities’ tor, inter alia, payment of a prom1s-

sorv note. 370 F.3d at 395-97. Following Chuidian

v. Philippine National Bank, 912 F.2d 1095 (9th Cir.

1990). and other cases, the Velasco court explained

that “|c]laims against the individual in [an] official

capacity are the practical equivalent of claims

against the foreign state.” 370 F.3d at 399.

The court then addressed whether issuance of the

promissory note constituted the commercial activity

of a foreign state within the meaning of the FSIA’s

commercial activities exception (28 U.S.C. § 1605(a)(2)),

such that the defendants (including the individual

defendants) were not immune from suit. See 370

F.3d at 398. The court concluded that the promis-

sory note was not issued pursuant to actual authority

and that the commercial activities exception there-

fore did not apply. See id. at 401. The court thus

held that “the District Court properly dismissed” all

claims in the case, including the claims against “the

individual Defendants ... in their official capacities,”

because all defendants were “immune from suit

under the FSIA.” Jd. at 402.

In hght of that clear holding — which petitioners

themselves have previously acknowledged, see Pet.

16 — the Yousuf panel’s statement that Velasco did

not address the issue is incorrect. That makes en

bane review extraordinarily likely. The decision,

moreover, 1s by 1ts terms 1n conflict with “a majority

of the courts,” 2009 WL 40942, at *3, and its analysis

is substantially incomplete even apart from its mis-

reading of Velasco. The panel simply ignores, for

example, the principle that an official-capacity suit is

In every meaningful sense a sult against the “foreign

state” itself and that the FSIA’s use of “including”

in the definition of “foreign state” means that the

definition is illustrative, not exhaustive. See HRH

Crown Prince Sultan et al. Opp. 13-14; HRH Prince

Turki Opp. 24. The dectsion also fails to address

Congresss recent amendment to the FSIA’s terror

4

ism exception. As the Second Circuit observed, that

amendment “evince[s] congressional recognition that

claims against individual officials of a foreign gov-

ernment must be brought within the confines of the

FSIA.” Pet. App. 2la. The Yousuf panel, however,

did not acknowledge or address the current statutory

language and instead appears to rest on an outdated

version of the statute, rendering the decision subject

to revisiting on that ground alone.

Given those many defects, and given that the

analysis of whether the FSIA affords immunity to

individual officers was unnecessary to the judgment

in that case,“ Yousuf has a dubious future even in the

Fourth Circuit. Indeed, because Yousuf’s contrary

holding came after Velasco, future Fourth Circuit

panels will be required to follow Velasco, not Yousuf,

even absent en banc review. See McMellon v. United

Stuies, 387 F.3d 329, 333 (4th Cir. 2004) (en banc)

(“|A]s to conflicts between panel opinions, application

of the basic rule that one panel cannot overrule

another requires a panel to follow the earlier of the

conflicting opinions.”). Yousuf thus does not support

petitioners request for review.

The petition for

denied.

MICHAEL K. KELLOGG

Counsel of Record

MARK C. HANSEN

COLIN S. STRETCH

KELLY P. DUNBAR

KELLOGG, HUBER, HANS!

TODD, EVANS & FIGEL

P.L.L.C

1615 M Street, N.W

Suite 400

Washington, D.C. 20036

(202) 326-7900

Counsel for Respondent

}

hin Abdulaziz Al-Saud

January 12, 2009

a

HRH Prince Turki Al-Faisal

writ

of certiorari should be

Respectfully submitted,

JEFFREY A. LAMKEN

Counsel of Record

WILLIAM H. JEFFRESS

SARA E. KROPF

JAMIE S. KILBERG

ROBERT K. KR)

MARTIN V. TOTARO

BAKER Botts L.L.P

1299 Pennsylvania Avenue, N.W

Washington, D.C. 20004-2400

(202) 639-7700

Counsel for Respondents

HRH Crown Prince Sultan bin

Abdulaziz al-Saud, HRH Prin €

Nauf bin Abdulaziz al-Saud,

mad HRH Prince Saiman bin

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