U.S. Supreme Court Weighs in on Foreign Sovereign Immunities Act

Earlier this month, the United States Supreme Court handed down a decision that discussed the application of the Foreign Sovereign Immunities Act (the “Act”) to personal injury cases brought against foreign governments. According to the Court’s decision, the “commercial activity” exception to the Act is limited to cases where the activity which constitutes the “gravamen” of the defendant’s allegedly negligent conduct is “based upon” commercial activity. More tenuous connections with commercial activity will not suffice.

train-1182888The Foreign Sovereign Immunities Act

The Act is a U.S. statute that grants immunity to foreign governments in most situations, including those arising out of personal injury accidents. One exception to the Act’s grant of immunity is where the case is “based upon a commercial activity carried on in the United States by [a] foreign state.”

OBB Personenverkehr AG v. Sachs

In the case, OBB Personenverkehr AG (“OBB”) v. Sachs, the plaintiff was injured in Austria as she was boarding a train. The company that operated the railway, OBB, was wholly owned by the Austrian government. Prior to leaving for Austria, the plaintiff purchased a “Eurorail” pass online from a U.S.-based travel agent. After sustaining serious injury from the incident, the woman filed a lawsuit against OBB in federal district court.

OBB asked the court hearing the case to dismiss the case against it based on the Act. The plaintiff responded that the sale of the Eurorail pass by the U.S.-based travel agent constituted commercial activity; thus, the “commercial activity” exception should apply and immunity should not attach.

The federal district court hearing the case agreed with OBB, and dismissed the case. However, on appeal to the Ninth Circuit Court of Appeals, the case was reversed. That court determined that the case was “based upon” the sale of the Eurorail pass, and that the agency relationship between the U.S.-based travel agent and OBB placed the case squarely within the “commercial activity” exception.

The U.S. Supreme Court’s Interpretation

The U.S. Supreme Court agreed with OBB that the case was not based upon any commercial activity occurring in the United States. The Court held that when assessing whether the commercial activity exception applies, the “conduct constituting the gravamen” of the case is what is to be considered. Here, because the allegedly negligent conduct giving rise to the case indisputably arose in Austria, the commercial activity exception did not apply and OBB was entitled to immunity.

Have You Been Injured While Abroad?

If you or a loved one has recently been injured while traveling aboard, you may be able to look to U.S. courts for help. Just because an injury occurs out of the country does not necessarily mean that the lawsuit must be filed abroad. Of course, these lawsuits can be complex, and often require the assistance of a dedicated personal injury attorney well versed in federal civil procedure as well as in personal injury law. To learn more about how you may be entitled to monetary compensation for your injuries, call the Indiana-based personal injury law firm of Parr Richey Obremskey Frandsen & Patterson at 888-765-7411 today.

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