The Supreme Court will review the Second Circuit’s decision in Türkiye Halk Bankasi, A.Ş v. United States, a decision rejecting the argument that the United States cannot criminally prosecute a foreign company owned by a foreign sovereign. Paul Stephan has an excellent post about the case at the Transnational Litigation Blog.
I don’t want to comment on the details of the arguments in the briefs, though of course I’ll cover the decision when it comes. But it would be absurd, at least in my view, to think that the United States cannot prosecute a bank for bank fraud and money laundering, which is what happened here, just because the bank is majority-owned by a foreign state (leaving aside any objection to the idea of prosecuting corporations for crimes). And you could make the hypotheticals as absurd as you like. The Corporation for the Poisoning of the American Water Supply, majority owned by country X, opens an office near a US city and then sends its employees out with arsenic to drop in the reservoir. The plot is laid out in the corporate board’s minutes and posted online. The Corporation for the Purloining of Top Secret Information sets up shop in Palm Beach. And so the case really poses a test of the justices’ commitment to various theories of statutory interpretation and adherence to precedent. For example, there are statements in the cases that the FSIA is the exclusive means by which a US court can exercise jurisdiction over a foreign sovereign. But they were not criminal cases. Do our judges feel bound by the literal language of their dicta, or can they read their courts’ decisions flexibly, with an eye on what is sensible? The FSIA itself says that “a foreign state shall be immune from the jurisdiction of the courts of the United States and of the States,” unless an exception applies. But it’s obvious, when looking at the statute as a whole, that it refers to civil cases. Even if you think it applies to all cases, civil or criminal, it would seem necessary to apply the exceptions, too, and surely the commercial activity exception should apply here; but on the other hand, the Can the judges give the statute its sensible reading, or are they committed to reading it the way Matthew Harrison Brady reads the Bible in Inherit the Wind?
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