Case of the Day: Baylay v. Eithad Airways

Etihad Airways A380

The case of the day is Baylay v. Etihad Airways P.J.S.C. (7th Cir. 2018). Martin Baylay, a British national, was a pilot for Etihad, an Abu Dhabi corporation (and, apparently, an instrumentality of the UAE). Baylay alleged that he was assaulted by Saravdeep Mann, another crew member, during a layover in Chicago. Mann was arrested and released on bond, but he then fled the country with Etihad’s help. The story was covered in the news at back in 2015.

Baylay sued Mann Etihad, and others for damages. Etihad moved to dismiss on the grounds that Baylay’s common law claims were barred by the exclusivity provisions of the Illinois Workers’ Compensation Act. Baylay appealed from that decision. His argument was that under the FSIA, only a court could have jurisdiction over Etihad, and therefore, it was error to conclude that Baylay had to pursue his claims before the Illinois Workers’ Compensation Commission, an administrative agency. The court rejected the argument.

The FSIA (28 U.S.C. § 1604) provides that a foreign state “shall be immune from the jurisdiction of courts of the United State or of the States” unless one of the FSIA exceptions to immunity applies. Baylay took this to mean that only courts, not administrative agencies, can decide the merits of a claim against a foreign sovereign. The court disagreed, holding that in a state law claim, once a court had determined that the foreign state is not immune from jurisdiction, state law provisions requiring a claim to be heard in an administrative tribunal govern. The court explained that the FSIA meant to commit immunity decisions to courts, nothing more. Under § 1606, foreign sovereigns are liable to the same extent as private parties when they are not immune from suit.

I think the outcome is right in the unusual circumstances of the case. But suppose Baylay had brought his claim in the worker’s compensation administrative agency in the first instance. Surely if Baylay had claimed FSIA immunity, the administrative agency would have been competent to decide whether the immunity claim had merit. I think this has to be so for two reasons.

First, if the administrative agency cannot decide the immunity issue, then there is a kind of a Catch-22: the claimant necessarily loses when he brings the claim in the correct forum, and he necessarily loses when he brings the claim in the court. Another way to put this: if the administrative agency cannot rule on the immunity issue, then the foreign sovereign’s assertion of immunity is conclusive, which can’t be right.

Second, the purpose of the FSIA was to take immunity decisions out of the State Department and put them in the courts. Immunity decisions under the FSIA are supposed to be legal decisions, not political decisions. Yes, an administrative agency is in the executive branch, not the judicial branch. But its decisions are legal, not political. And I don’t know about Illinois specifically, but in general, administrative decisions are subject to judicial review, unlike, say, State Department suggestions of immunity in the old days.

So I think this Seventh Circuit was right to conclude that where a court had already held that FSIA immunity did not apply, an injured worker could be required to pursue his claims against his foreign sovereign employer in an administrative forum rather than in court. But I think the outcome should be the same even if the injured worker pursued his claims in the worker’s compensation agency in the first instance.

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