Jam v. International Finance Corp.
Jam v. International Finance Corp. | |
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Argument | Oral argument |
Case history | |
Prior |
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Subsequent | Remanded, 760 F. App'x 11 (D.C. Cir. 2019) |
Holding | |
The International Organizations Immunities Act grants international organizations the same immunity from suit that foreign governments have under the Foreign Sovereign Immunities Act. | |
Court membership | |
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Case opinions | |
Majority | Roberts, joined by Thomas, Ginsburg, Alito, Sotomayor, Kagan, Gorsuch |
Dissent | Breyer |
Kavanaugh took no part in the consideration or decision of the case. | |
Laws applied | |
International Organizations Immunities Act, Foreign Sovereign Immunities Act |
Jam v. International Finance Corp., 586 U.S. ___ (2019), was a
This case is notable because for the first time the Court established that US-based international organizations, such as the World Bank and the Inter-American Development Bank, could be sued if their overseas investment activities caused harm in local communities. It overturned a decades-old standard established in the aftermath of World War II when newly-formed international agencies were first being established with headquarters in the United States.[2]
Background
The
In the 2000s, the IFC provided $450 million USD to Coastal Gujarat Power Ltd. to fund the construction of the Tata Mundra power plant in Gujarat, a coastal state in western India.[2] As part of the lending agreement (the IFC's Performance Standards on Environmental and Social Sustainability), the IFC requires loan recipients, including the power plant, to adhere to stringent human rights safeguards and environmental protections. The agreement allowed the IFC to revoke financial support for the plant if the plant failed to adhere to these requirements.[3]
However, the plant, which opened in 2012, emitted pollution which drained into local waterways and farmland, damaging the environment and creating hardship for local fishermen in the
In lower courts
Since the IFC's headquarters were in Washington, DC, the plaintiffs filed suit in the
However, starting in the 1950s, the State Department began to adopt a narrower view of foreign sovereign immunity. Under this new interpretation, foreign governments would continue to enjoy nearly absolute immunity for acts conducted in their capacity as national governments. However, they could be sued in federal court for actions taken when acting as private commercial entities.[5] This more-restrictive view of sovereign immunity, including the waiver of immunity for commercial activities, was eventually codified by Congress into the Foreign Sovereign Immunities Act (FSIA) of 1972.
The IFC successfully argued that international organizations should retain the more expansive version of sovereign immunity that was standard when the IOIA was enacted in 1945, not the more restrictive view that was adopted starting in the 1950s.
Supreme Court opinion
Justice Brett Kavanaugh, who was formerly on the DC Circuit Court which heard the case originally, recused himself and did not participate in the consideration of this case.[5]
In a 7–1 decision authored by Chief Justice John Roberts, the Supreme Court reversed the Circuit Court's opinion.[1][9] According to the Supreme Court, the most natural reading of the IOIA was that Congress intended to permanently tie the sovereign immunity enjoyed by international organizations and the immunity enjoyed by foreign governments. When Congress established the exception for commercial activities in the Foreign Sovereign Immunities Act of 1972, that exception was 'inherited' by international organizations, who (in the language of the IOIA), "enjoy the same immunity from suit […] as foreign governments".[9][2] Moreover, the Chief Justice refused to adopt a purpose-focused analysis that would have distinguished between the granting of immunity to states based on principles of comity and reciprocity, compared to international organizational immunity based on the need to carry out their functions without undue interference. In his decision, Roberts also noted that the IOIA only establishes a default set of rules and that international organizations may, in their charters, specify that they have absolute immunity from lawsuits and that the International Finance Corporation's charter did not include such a clause.[10]
In a dissent, Justice Stephen Breyer stated that Congress's purpose in enacting the IOIA was to confer the same type of immunity to international organizations that foreign governments enjoyed in 1945, when the statute was first enacted. He also encourages a "purpose-based" interpretation framework for the statute, noting that in 1945 Congress was attempting to create a safe harbor for newly created multilateral organizations, including the United Nations (UN), the International Monetary Fund (IMF), and the World Bank, and that the founding charters of these organizations required member states to grant them broad immunity from suit.[2][9]
As a result of the Supreme Court's ruling, the case was remanded to the lower courts for further proceedings.[11]
References
- ^ a b Jam v. Int'l Fin. Corp., No. 17-1011, 586 U.S. ___ (2019).
- ^ a b c d McDonnell, Tim (March 7, 2019). "U.S. Supreme Court Rules That World Bank Can Be Sued". NPR. Retrieved November 26, 2019.
- ^ a b c Kerber, Jasmine (May 29, 2019). "Lawyers, Stanford professors discuss Supreme Court ruling on environmental law and human rights". Stanford Daily. Retrieved November 26, 2019.
- D.D.C.2016).
- ^ a b c Howe, Amy (October 24, 2018). "Argument preview: Court to consider immunity for international organizations". SCOTUSBlog. Retrieved November 25, 2019.
- D.C. Cir.2017).
- ^ Howe, Amy (May 21, 2018). "Justices grant four new cases". SCOTUSBlog. Retrieved November 25, 2019.
- ^ Wheeler, Lidia (October 31, 2018). "Justices weigh if international organizations can be sued". The Hill. Retrieved November 26, 2019.
- ^ a b c Howe, Amy (February 27, 2019). "Opinion analysis: Justices hold that international organizations do not have near-complete immunity". SCOTUSBlog. Retrieved November 26, 2019.
- ^ Hushon, Jeremy (June 19, 2019). "Development banks: Immunity from lawsuits". Norton Rose Fulbright. Retrieved November 26, 2019.
- ^ Jam v. Int'l Fin. Corp., 760 F. App'x 11 (D.C. Cir. 2019).
External links
- Text of Jam v. Int'l Fin. Corp., No. 17-1011, 586 U.S. ___ (2019) is available from: Justia Oyez (oral argument audio) Supreme Court (slip opinion)