Jairo Sequeira v. Republic of Nicaragua, et al.

Section 1605(a)(1) of the Foreign Sovereign Immunities Act (“FSIA”) provides that a foreign state shall not be immune from the jurisdiction of United States Courts when the foreign state has waived its immunity explicitly. There is a split in the circuit courts in determining jurisdiction when faced with a contract containing an explicit waiver. Most courts have ruled that explicit waivers and jurisdiction is ascertained simply by reading the contract in which an explicit waiver is made. In the case below however, the Ninth Circuit Court of Appeals affirmed the district court’s approach of making a decision on the validity of the contract based on foreign contract law before determining jurisdiction by explicit waiver. The questions presented are:

1. Whether 1605(a)(1) of the FSIA waiver exception requires courts to determine jurisdiction based on whether or not a contract contains an explicit waiver prior to determining the validity of the contract by interpreting foreign law, and, if not, would the ruling on validity first prevent a party from finding jurisdiction elsewhere.

2. Whether a foreign state’s taking of a U.S. construction company and the property it is on, for the purpose of building houses to sell and rent, which leads to the non­ payment of dividends in the U.S., meets the direct effect doctrine of the FSIA 1605(a)(2) clause 3.

3. Is a written contractual promise by a foreign state to make payments in the U.S. in exchange for property in the foreign state considered property rights present in the U.S. in accordance with §1605(a)(3) clause one of the FSIA illegal taking exception?