CC/Devas (Mauritius) Limited v. Antrix Corp. Ltd.

Issues

When seeking to enforce an international arbitration award in U.S. court, must parties show a sufficient connection with the United States?

This case asks whether plaintiffs must prove minimum contacts before federal courts may assert personal jurisdiction over foreign states sued under the Foreign Sovereign Immunities Act. Antrix, which is an Indian state-owned corporation, repudiated its contract with Devas, which is a private Indian corporation. Devas argues that federal courts in the United States can exercise personal jurisdiction to enforce the arbitration award Devas had won. Antrix counters that because their dispute lacks minimum contact with the United States, federal courts in the United States lack personal jurisdiction to enforce the arbitration award. The outcome of this case has significant implications for international relations and post-judgment asset discovery.

Questions as Framed for the Court by the Parties

Whether plaintiffs must prove minimum contacts before federal courts may assert personal jurisdiction over foreign states sued under the Foreign Sovereign Immunities Act.

Facts

Petitioner Devas Multimedia Private Ltd. (“Devas”) is a private Indian corporation. Respondent Antrix Corp. Ltd. (“Antrix”) is a corporation owned by the Government of India. In 2005, Devas and Antrix entered into an agreement wherein Antrix would build and operate satellites that would provide S-band spectrum to Devas. The agreement contained an arbitration clause. The arbitration clause required arbitration to be conducted in New Delhi, India, and stated that any decision or award from the arbitration would be final and binding. Prior to any arbitration proceeding, disputes must be referred to both parties' senior management for resolution. If there is no resolution from this referral, each party is to appoint one arbitrator , with the two appointed arbitrators selecting a third arbitrator. The agreement finally stated that the arbitration would be governed by the rules of the International Chamber of Commerce (“ICC”) or the United Nations Commission on International Trade Law (“UNCITRAL”).

In February 2011, Antrix repudiated the agreement. As a result, Devas started arbitration proceedings in accordance with the ICC. Antrix initially refused to follow the agreed-upon arbitration rules by not nominating an arbitrator. Rather, Antrix followed UNCITRAL procedures and nominated an arbitrator under those rules. Antrix then petitioned the Supreme Court of India requesting that they order the arbitration to follow UNCITRAL rules. In May 2013, the Supreme Court of India ruled that the arbitration would go forward under the ICC rules.

In September 2015, the ICC arbitration panel concluded that Antrix wrongfully repudiated the agreement and awarded Devas $562.5 million plus interest. After the award, Devas sought to enforce the award in a New Delhi court. The next month, Antrix filed a petition to set the award aside in a Bangalore court. The issue of which court has jurisdiction is still unresolved.

In September 2018, Devas filed a petition in the United States District Court for the Western District of Washington to enforce the award. Antrix filed a motion to dismiss. The District Court concluded that a minimum contacts analysis was not necessary. Further, the District Court concluded that even under a minimum contacts test, personal jurisdiction over Antrix was proper and ultimately enforced the award.

The Ninth Circuit Court of Appeals reversed, finding that the District Court should have conducted a minimum contacts analysis to find personal jurisdiction over Antrix. The Ninth Circuit found this analysis to be necessary because the Foreign Sovereign Immunities Act requires that personal jurisdiction be present, and cases hold that this personal jurisdiction analysis is not different for a foreign state. The Ninth Circuit also found that the District Court made an error when finding that Antrix has the required minimum contacts for personal jurisdiction. Under this prong of the analysis, the Ninth Circuit specifically found that the Antrix did not have enough activity in the United States because their contact with the United States was incidental and isolated. For example, the District Court found Antrix’s contact with the United States, including meetings in 2003 and 2009, were insufficiently significant, in part, because they were not purposeful.

The United States Supreme Court granted Devas’ petition for certiorari , consolidating two cases involving the same parties and addressing the same issue, on October 4, 2024.

Analysis

LANGUAGE OF THE FOREIGN SOVEREIGN IMMUNITIES ACT (FSIA)

Devas argues that the plain language of the FSIA precludes a minimum contacts requirement. More specifically, Devas highlights that the words “every” and “shall” connote that district courts are required to exercise personal jurisdiction whenever there is subject matter jurisdiction and service in accordance with Section 1608. Since meeting the two requirements warrant an exercise of personal jurisdiction, Devas claims that the FSIA disclaims a minimum contacts requirement.

Furthermore, Devas contends that the Ninth Circuit conflated a minimal contacts requirement for subject matter jurisdiction and an exception for commercial activity with a minimal contacts requirement for personal jurisdiction. Devas also notes that the “direct effect” required for subject matter jurisdiction does not equal the minimal contacts test established in International Shoe Co. v. FTC . Finally, Devas states that the Ninth Circuit derived its ruling from the House Committee report rather than the statute, which is the controlling law and clearly lacks any reference to a minimum contacts requirement.

Devas posits that a minimum contacts requirement is not only absent in Section 1330(b) but also in the text of the arbitral exception. According to Devas, the legislative history demonstrates that Congress expressly rejected an attempt to include such a requirement in the arbitral exception, affirming what the plain text provides. In addition, Devas argues that reading the FSIA to require minimum contacts would cause the United States to violate its international obligations. Devas notes that requiring minimum contacts would violate pre-existing international obligations and that Congress was aware of violating such agreements if it required minimum contacts when it enacted the arbitral exception.

Antrix counters that the FSIA stripped the sovereign immunity of foreign sovereigns and their instrumentalities only in cases involving some form of substantial contact with the United States. Antrix argues that the original exceptions under FSIA required a connection between the United States and the dispute as a prerequisite for the exercise of jurisdiction over a foreign state or instrumentality. Antrix also claims that Congress wrote the FSIA to assure foreign states that decisions to subject them to suit would be subject to due process, which requires minimum jurisdictional contacts and adequate notice. Antrix adds that Congress drafted the FSIA to embody basic principles of international law, which traditionally limited jurisdiction conduct with sufficient contacts to the United States. Antrix notes that FSIA’s later enacted anti-terrorism exception, consistent with its earlier enactments, requires a meaningful connection to the United States.

Antrix asserts that arbitration exception also requires a substantial connection to the United States because it confers jurisdiction on matters arbitrable under U.S. law, which excludes matters concerning entirely foreign commerce. Antrix argues that legislative history supports the reading of the arbitration exception to exclude matters concerning entirely foreign transactions because Congress was focused on arbitrations that involved U.S. businesses. Furthermore, Antrix claims that the New York Convention confers jurisdiction on matters arbitrable on domestic law and that U.S. courts routinely apply minimum-contact limits to private party disputes under the Convention.

Finally, Antrix argues that reading out a minimum contacts requirement would conflict with the presumption against extraterritoriality. In particular, Antrix notes the lack of textual evidence in the FSIA that supports an exception to this presumption. Antrix adds that there is no evidence that Congress intended to cover purely foreign disputes, that the absence of clear language conferring jurisdiction on matters without substantial connection to the U.S. favors an assumption of immunity, and that exercising jurisdiction on foreign states and instruments without such requirement would be impractical.

DUE PROCESS CLAUSE AND WHETHER IT REQUIRES MINIMUM CONTACTS

Devas contends that the Fifth Amendment’s Due Process Clause does not require a showing of minimum contacts for the assertion of personal jurisdiction over a foreign state. Devas argues that the Fifth Amendment’s Due Process Clause does not require a showing of minimum contacts because a foreign state is not a “person” entitled to due process under the Fifth Amendment. Devas states that the Court has also held that the word “person” in the context of the Due Process Clause of the Fifth Amendment cannot be expanded to encompass the State of the Union. Devas supports this claim by citing Alexander Hamilton and Chief Justice Marshall, both of whom suggested that foreign nations are immune to suit, which in turn implies that the framers could not have envisioned foreign states as “persons” for the purposes of the Fifth Amendment. Devas extends this logic to conclude that since Antrix is the alter ego of its parent sovereign, the Republic of India, Antrix is not a “person” for due process purposes.

Devas also argues that Congress can extend personal jurisdiction and abrogate the immunity of foreign states if it desires. Devas supports this argument by citing Justice Washington, who stated that Congress can vest in the courts an extra-territorial jurisdiction, and Judge Bumatay, who claimed that the Fifth Amendment’s Due Process Clause does not require minimum contacts for foreign states Moreover, Devas notes that the Fifth Amendment due process does not impose constitutional limits on federal courts’ exercise of personal jurisdiction if Congress expressly expanded the process and that the FSIA implements protections beyond the minimal Constitutional protections of notice and an opportunity to be heard. Finally, Devas asserts that when the United States interacts with foreign sovereigns, it exercises inherent authority vested in the political branches and that the Due Process Clause does not allow the judiciary to supplement the framework that Congress and the President erected in the FSIA with the minimum contact regime from International Shoe Co. v. Washington .

Antrix counters that precedents have held that due process protection applies to foreign corporations, and that the Due Process Clause requires a constitutionally sufficient relationship between the defendant and the forum. Antrix also points out that the question of whether Antrix is a “person” or not for the purposes of due process protection does not arise because Antrix is a foreign corporation rather than a foreign sovereign. Moreover, Antrix notes that where the FSIA strips a sovereign of immunity in a civil case to treat it like a private individual, the foreign sovereign may object to personal jurisdiction like a foreign individual might.

Antrix also argues that Devas was wrong in claiming that the Fifth Amendment Due Process Clause only requires congressionally authorized service of process to subject foreign defendants in federal court. Instead, Antrix contends that precedent has established that both service of process and connection to the forum are required to exercise personal jurisdiction over foreign defendants. Finally, Antrix notes that the Fifth Amendment’s framers’ intentions are no longer relevant because applying those standards today would overtly limit the venues in which a federal civil suit could be brought.

Discussion

INTERNATIONAL RELATIONS

In Support of Devas, Mark B. Feldman argues that public policy weighs in favor of enforcing international arbitrations. Feldman elaborates that the New York Convention, which is an agreement that the United States entered with 172 other nations concerning the recognition of international arbitration decisions, was crafted to further international trade interests through arbitration enforcement. Feldman warns that, if the United States does not recognize this arbitration award, other nations will not comply with the New York Convention, thus raising the costs of conducting international business worldwide. Feldman then asserts that arbitration, which reduces business costs, has reduced utility without a sufficient legal framework to back it up. Feldman concludes by finding that the United States’ history shows a policy for supporting international arbitration and that the present arbitration award favoring Devas should be upheld in accordance with this policy because of the importance of international trade security.

In Support of Antrix, the Republic of India (“India”) argues that recognizing the arbitration award would offend the principle of comity , the legal acceptance of another nation’s judicial decisions by another nation, by disregarding the Delhi High Court and the Indian Supreme Court’s dismissal of the arbitration award. India supports this statement by claiming that there has never been a question as to the validity of the Indian judiciary. Furthermore, India posits that the United States has a policy of not questioning the integrity of the courts of other sovereign nations and that comity requires this policy for international cooperation. Lastly, India claims that the agreement entered into between Devas and Antrix required that any award given through arbitration would be governed by the laws of India and thus can only be enforced via India law. Therefore, India argues that if the United States were to enforce the arbitration award that had been set aside by Indian courts, they would be enforcing an award that does not exist, and thus implicitly finding that the Indian courts were not competent in their judgment.

POST-JUDGMENT ASSET DISCOVERY

In Support of Devas, the United States Council for International Business (“Council”) argues that, if the Court adopts the Ninth Circuit’s approach in requiring Devas to show that Antrix has a sufficient connection to the United States before being able to enforce their arbitration award, international creditors will have a harder time locating the assets of their opponent. Elaborating, Council states that, when attempting to enforce an international arbitration judgment, parties often do not know sufficient information about their opponent’s assets, including their location. This lack of information makes it necessary for the United States to allow parties seeking to enforce international arbitration awards to conduct discovery through the United States courts; it is unlikely that they would be able to locate the assets needed to satisfy the judgment otherwise. Even more importantly, Council claims that if the Ninth Circuit’s sufficient connection requirement was upheld, parties attempting to enforce an arbitration judgment may not be able to satisfy this test because they may not be aware of their opponent having assets in the United States that would create such a sufficient connection.

In Support of Antrix, India argues that discovery procedures in the United States concerning foreign states following a judgment for the purpose of finding assets can, in some cases, rise to the level of a due process concern, where the losing party must undergo an intrusive investigation into their assets. Furthermore, India asserts that if losing parties refuse to undergo this invasive inquiry into their global assets, they may be subject to massive fines, with some being up to $80,000 per week of noncompliance. India further points out that foreign states are treated unequally in this regard when compared with private parties. On this point, India states that if a foreign state is itself a creditor and seeks to enforce a judgment in the same way as is being done against them in this case, it cannot do so without establishing the minimum contacts requirement. The same limitation exists for a foreign state attempting to get discovery of a private party’s assets.

Conclusion


Richard Han and Ty Lisi

Alex Strohl

Additional Resources