Supreme Court Case OBB Personenverkehr AG vs. Sachs
On December 1st, 2015, the Supreme Court ruled that California resident Carol Sachs whom was injured in a train accident in Austria could not sue the Austrian Railroad Service in a US court. The Supreme Court decision can be found here.
The Federal Sovereign Immunities Act (FSIA)
Sachs argued that she had bought the train ticket online in California from a travel agent based in Massachusetts, and that therefore her lawsuit should be admissible in the federal court in California.
The crux of her claim was based on the exception in the Foreign Sovereign Immunities Act (FSIA). Under the FSIA, foreign states are generally protected with the exception for claims ‘based upon a commercial activity carried on in the United States.’ Sachs argued that the exception applied.
The Supreme Court disagreed. The exception was not satisfied. The conduct constituting the core of the lawsuit, i.e. the wrongful conduct, took place in Austria. Therefore, the lawsuit should be filed in Austria according to the Supreme Court.
Aruba and its agencies and instrumentalities are entitled to immunity under the FSIA
Aruba is an independent country within the Dutch Kingdom. In prior diplomatic dealings with the United States, the Dutch Kingdom has consistently acted on behalf of itself and on behalf of (ex)Antilles and Aruba. In the Case Lasagne v. Divi Hotels(see below), the U.S. District Court for the Southern District of New York concluded that the three aforementioned entities are treated as a single foreign state for the purpose of the action.
Therefore, in principle a lawsuit filed in a US court against Aruba or an Aruba governmental entity (overheidsstichting of overheids-NV) for actions that took place in Aruba would most probably be dismissed for lack of subject matter jurisdiction. Aruba as well as its agencies and instrumentalities would be protected under the FSIA, unless the exception of commercial activity is satisfied.
Lasagne v. Divi Hotels: Aruba’s solicitation of American tourists in the US lacks connection for US court jurisdiction
Lasagne was a guest at the Divi Hotel in Aruba and sustained injuries following a boating accident while snorkeling. Lasagne filed suit against the Divi Hotels with the U.S. District Court for the Southern District of New York. The Divi Hotels filed a third-party complaint against The Dutch Kingdom, Antilles and Aruba on the basis of the commercial activity exception. The court decision on the third-party complaint can be found here.
The Divi Hotels argued that the solicitation of tourists in the United States by Aruba (as well as the Dutch Kingdom as a whole) constitutes a commercial activity carried on in the United States. The court disagreed. According to the court, even assuming that Aruba’s solicitation of American tourists is an act performed in the United States in connection with commercial activity in Aruba, such activity lacks a sufficient connection between Aruba and the instant cause of action to form a basis for jurisdiction. The court dismissed the complaint.
Daimler v. Bauman: no lawsuit in the US against foreign corporation for actions outside the US
The possibility to file a lawsuit with a US court against a foreign corporation for actions that did not take place in the US is also exceedingly limited. On the basis of the ruling in the Daimler v. Bauman Case of January 13th, 2014, foreign corporations without a principle place of business in the US cannot, in principle, be sued in the US for actions that have nothing to do with the state where the lawsuit is filed.
Lawsuit should be filed with the Aruba court
On the basis of the above, US residents are advised to file a lawsuit with the Aruba court instead of the US court for actions that transpired in Aruba, caused or performed by Aruba, or Aruba government entities, or Aruba based corporations.