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10/31/2018

An Interpretive Conundrum in Jam v . IFC
Michael Ramsey

The Supreme Court hears oral argument today in Jam v. International Finance Corporation (SCOTUSblog coverage here and here).  It's a statutory case with an interesting interpretive twist.

The International Finance Corporation (IFC), an international organization based in Washington D.C., claims it is immune from suit under the International Organizations Immunities Act (IOIA), a federal law enacted in 1945.  IOIA provides that  that international organizations “shall enjoy the same immunity from suit and every form of judicial process as is enjoyed by foreign governments.” 28 U. S. C. 288a(a)(b).  When the statute was enacted, foreign governments enjoyed almost complete immunity from suit, although courts would defer to an executive branch determination that immunity should not be applied.  Today, however, foreign governments have less in the way of immunity thanks to the Foreign Sovereign Immunities Act (FSIA), enacted in 1976.  Among other things, the FSIA provides an exception for immunity for commercial activities (which would likely include most of what the IFC does).

So when the IOIA said that the IFC gets the "same immunity" as foreign governments, did it mean the same immunity that foreign governments had in 1945, or the same immunity as foreign governments may have from time to time?

The issue splits foreign affairs law scholars, in a divide that crosses ideological and methodological lines.  For what it's worth, I joined an amicus brief in support of the IFC (that is, arguing for the 1945 version of immunity), along with some internationalist scholars with whom I rarely agree.  There is an impressive list of scholars on the other side, reflected in this amicus brief, and also this Lawfare post by Ingrid Wuerth (Vanderbilt) (with whom I often do agree).

I found it a close question, but I was mostly persuaded by this argument (developed in the IFC brief, and not really engaged in the opposing professors' amicus):  The IOIA additionally provides that "The President shall be authorized, in the light of the functions performed by any such international organization, by appropriate Executive order to withhold or withdraw from any such organization or its officers or employees any of the privileges, exemptions, and immunities provided for in this subchapter ..."  28 U.S.C 288.  That looks like a delegation to the President to allow a more flexible approach to immunity where appropriate, which is consistent with picking a near-absolute and fixed baseline immunity.  (The plaintiffs' brief and the opposing professors' amicus brief complain that using the 1945 baseline is unduly rigid, but that's simply not true once one considers the role of the President).  Then, when Congress enacted the FSIA, it made no reference to the IOIA or to international organizations, or to the President's role under IOIA.  I think that meant it was leaving their immunity to the President to decide under IOIA, rather than supplanting the President's role.   (This argument is somewhat parallel to the immunity of foreign governments officials, which is also not covered in the FSIA).

Notably, the briefs on both sides concentrate heavily on finding Congress' meaning at the time of enactment (so, it's another case of statutory originalism).

I can't resist this aside, though it's not in the briefs or part of the question presented at the Supreme Court:  The IFC should absolutely lose this case (as to immunity), despite our amicus.  The IFC's Charter (called its Article of Agreement) states: 

Actions may be brought against the [IFC] only in a court of competent jurisdiction in the territories of a member in which the Corporation has an office, has appointed an agent for the purpose of accepting service or notice of process, or has issued or guaranteed securities.

That looks like a waiver of immunity to me, and the IOIA specifically says international organizations may waive their immunity.  If that's right, there's no need for the Court to answer the question presented, because there's no immunity even under a 1945 version of immunity.  But in a preposterous opinion in Mendaro v. World Bank, 717 F.2d 610 (D.C. Cir. 1983), the D.C. Circuit read equivalent language in the World Bank charter to allow only a suit that “would benefit the organization over the long term.”  The D.C. Circuit in Jam dutifully followed Mendaro, although Judge Silberman's opinion for the panel expressed some doubt about it (calling it, with some understatement, "a bit strange"), and the Supreme Court did not take up the issue.