Federal Republic of Germany v. Philipp

Facts of the Case

Provided by Oyez

In 1929, just weeks before the October 1929 global stock market crash, several Jewish art dealers in Germany purchased a collection of medieval reliquaries. During the ensuing global depression, the dealers sold about half the pieces and stored the remainder in the Netherlands. Nazi leaders negotiated with the dealers to buy the remaining pieces; the parties dispute whether this negotiation was made under coercive circumstances. After World War II, the collection was transferred to Stiftung Preussischer Kulturbesitz (“SPK”), a German governmental institution that holds the cultural artifacts of former Prussia, and has been on display in a German museum nearly continuously since then.

In 2014, heirs of the Jewish art dealers—respondents in this case—participated in a non-binding mediation process before the Advisory Commission for the Return of Cultural Property Seized as a Result of Nazi Persecution, Especially Jewish Property (the “Advisory Commission”). In what the heirs describe as a “predetermined conclusion, and against the evidence,” the Advisory Commission recommended against restitution of the collection.

The respondents filed a lawsuit in federal court in the District of Columbia, invoking the expropriation exception of the Foreign Sovereign Immunities Act, which abrogates foreign sovereign immunity when “rights in property taken in violation of international law are in issue,” as the jurisdictional basis for their claims. Germany and SPK moved to dismiss, and the district court largely denied the motion, holding the claims fell within the scope of the expropriation exception. Germany and SPK appealed, and the U.S. Appeals Court for D.C. affirmed as to jurisdiction, reiterating its holding in a prior case that a genocidal taking is a violation of international law and rejecting Germany’s and SPK’s argument based on principles of international comity.

Questions

Does the “expropriation exception” of the Foreign Sovereign Immunities Act provide jurisdiction over claims that a foreign sovereign has violated international human-rights law when taking property from its own national within its own borders?
Does the doctrine of international comity preclude the exercise of jurisdiction in this case?

Conclusions

The expropriation exception of the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. §1605(a)(3), incorporates the domestic takings rule, which recognizes that a foreign sovereign’s taking of its own nationals’ property is not a violation of international law. Chief Justice John Roberts delivered the majority opinion for a unanimous Court.

FSIA immunizes foreign sovereigns from the jurisdiction of United States courts, subject to several specific exceptions, including the so-called expropriation exception, which abrogates immunity in any case “in which rights in property taken in violation of international law are in issue.” 28 U.S.C. §1605(a)(3). The taking of property by a foreign sovereign from its own nationals, at issue in this case, does not violate international law because it does not interfere with relations among states. Known as the domestic takings rule, this principle has endured, notwithstanding developments in other areas of international human rights law. The text of FSIA’s expropriation exception supports this interpretation, as do other provisions of FSIA. Because Germany took property from its own citizens, that act did not violate international law and thus cannot be the basis for an exemption to sovereign immunity under the FSIA’s expropriation exemption.