Transcript

IN THE SUPREME COURT OF THE UNITED STATES

ARGENTINE REPUBLIC, Petitioner v. AMERADA HESS SHIPPING CORPORATION, et al.

No. 87-1372

December 6, 1988

The above-entitled matter came on for oral argument before the Supreme Court of the United States at 10:05 o'clock a.m.

APPEARANCES:

BRUNO A. RISTAU, ESQ., Washington, D.C.; on behalf of the Petitioner.

CHARLES FRIED, ESQ., Solicitor General, Department of Justice, Washington, D.C.; as Amicus Curiae supporting the Petitioner.

DOUGLAS R. BURNETT, ESQ., New York, New York; on behalf of the Respondent.

PROCEEDINGS

10:05 a.m.

CHIEF JUSTICE REHNQUIST: We'll hear argument first this morning in No. 87-1372, Argentine Republic v. Amerada Hess Shipping Corporation.

Mr. Ristau, you may proceed whenever you're ready.

ORAL ARGUMENT OF BRUNO A. RISTAU ON BEHALF OF THE PETITIONER

MR. RISTAU: Mr. Chief Justice, and may it please the Court.

This case tenders for review by this Court the issue whether an American court is competent to hear tort claims asserted by aliens against a foreign state for a claimed infraction of international law committed by the foreign state's armed forces on the high seas in the course of hostilities with another state. The issue is unprecedented in this Court and, for that matter, unprecedented in any municipal court anywhere in the world.

The predicate facts are taken from the allegations of the complaint because the case was dismissed on motion by the United States District Court for the District -- Southern District of New York.

Respondents United Carriers and Amerada Hess are two Liberian corporations. United Carriers was the owner of a tanker registered in Liberia and flying the Liberian flag. Amerada Hess was the charterer of the tanker. The tanker was engaged in transporting crude oil from Alaska around the Cape to a refinery located in the Virgin Islands.

During the Malvinas/Falkland Island War between the Petitioner and the United Kingdom, it is alleged that aircraft of the Argentine Republic attacked the tanker in the South Atlantic causing damages. The tanker thereafter diverted to a Brazilian port where it was found that an undetonated bomb was lodged in one of the holds of the tanker. After remaining for about six weeks off the coast of Brazil, the owners of the tanker decided to scuttle the vessel in the mid-Atlantic along with its load of bunker oils belonging to Amerada Hess.

QUESTION: Was there any loss of life, Mr. Ristau?

MR. RISTAU: No, sir. No injury, no loss of life.

Three years later in 1985 both Respondents brought suit against Argentina in the district court in New York. United Carriers sued for the value of the tanker which --

QUESTION: Wasn't -- wasn't there interim litigation in the courts of Argentina?

MR. RISTAU: No, sir.

QUESTION: Do I get a misimpression from reading the briefs as to the --

MR. RISTAU: There was no interim litigation in the courts of Argentina, Justice Blackmun. The attorneys in their affidavits made of record in this Court assert one of them sought to retain Argentine counsel, but they were turned down because of conflicts that Argentine counsel perceived. They were also representing Argentina.

The other set of attorneys met with the legal adviser of the Argentine foreign office, and the reference to that, Your Honor, is in our -- in the Joint Appendix, page JA 87. The legal adviser in March of 1985 rendered the opinion that they ought to bring suit in Argentina. The legal adviser further advised them that the statute of limitations in his view was 10 years.

Two months later the Respondents resolved that they probably would not get an adequate remedy in Argentina. They came New York, filed their suit under the so-called Alien Tort Act invoking the jurisdiction of the Alien Tort Act which provides an essential --

QUESTION: Let me see if I understand that, that there was a determination there was not an adequate remedy in Argentina?

MR. RISTAU: By the attorneys for the Respondents, Your Honor.

QUESTION: Do you have any suggestion as to where they might go for a remedy?

MR. RISTAU: To begin with, my suggestion is, Your Honor, they should have tried to bring suit as they were advised by the Argentine official in the courts of Argentina.

If, on the other hand, it were to turn out that no remedy can be obtained under the domestic law of Argentina as, as Your Honor knows, under analogous circumstances, it couldn't be obtained against the United States in the courts of the United States under the Federal Tort Claims Act, then since they are nationals of a foreign state of Liberia, they ought to try the traditional international route of having Liberia espouse their claims against the Republic of Argentina. But they ought not to be able to bring these claims into a domestic forum of a third country where there is absolutely no connection between the underlying cause of action, the parties and the foreign state.

QUESTION: I understand your position. Where would Liberia assert its claim then on behalf of the shipowners?

MR. RISTAU: Liberia presumably, Your Honor, is -- has diplomatic relations, as I do know they do with Argentina, and they communicate that kind of an espousal through channels of diplomacy, the time-honored channels, in which states assert claims against each other.

QUESTION: So, you would relegate them then to diplomatic channels entirely.

MR. RISTAU: I would relegate them to diplomatic channels and such remedies as are obtainable under preexisting, traditional, and customary international law between two sovereign states.

Now, the Alien Tort Act --

QUESTION: I'm trying to avoid the cynicism of your answer, but go ahead.

MR. RISTAU: I apologize, Your Honor, if you -- if it came through badly.

The Alien Tort Act provides in relevant part that the district courts have jurisdiction to hear suits by an alien only -- by an alien for a tort only committed in violation of the Law of Nations or a treaty of the United States. The Respondents invoked that jurisdiction as the predicate for their suit in the Southern District.

One of them, Amerada Hess, also asserted that the district court could hear their claim under traditional admiralty jurisdiction, and in the further alternative, they claimed that the court could hear the case under some notion of universal jurisdictions, the universal jurisdiction which in their view any municipal court possesses in order to redress egregious violations of international law committee anywhere in the world by anybody.

Both Respondents expressly disclaimed reliance on the 1976 Foreign Sovereign Immunities Act as the jurisdictional basis for their suit, although both of them used the Foreign Sovereign Immunities Act's built-in service provision to serve the summons and complaint on the Minister of Foreign Affairs of Argentina in Buenos Aires.

On motion by Argentina, the district court dismissed the cases on the grounds that the Foreign Sovereign Immunities Act was the exclusive jurisdictional basis for suits brought in the courts of this country against foreign states.

QUESTION: Was that the only basis for the motion?

MR. RISTAU: That was the basis for the motion, Your Honor.

QUESTION: The only basis.

MR. RISTAU: That of subject matter jurisdiction and personal jurisdiction under the Foreign Sovereign Immunities Act.

QUESTION: That -- that was the only ground upon which they sought dismissal.

MR. RISTAU: That is correct, Your Honor.

The district court held that under the Foreign Sovereign Immunities Act, a foreign state was absolutely immune from the jurisdiction of federal and state courts unless the claim fell within one of the specific exceptions of the Act. The only exception that could arguably be drawn an issue here was the tort claims exception of the FSIA. but that required that both the tort and the damages occur in the United States. Here the tort occurred on the high seas thousands of miles away from United States territory, and the damages in all likelihood -- that they did not occur on the high seas. The financial damages occurred in Liberia where the corporations were incorporated.

On appeal, a divided panel of the Second Circuit reversed. The majority held that the Foreign Sovereign Immunities Act was not the jurisdictional -- sole jurisdictional basis for suits against foreign states where, as here, aliens complained that the military forces of a foreign state violated established norms of international law by attacking a commercial vessel on the high seas, the 1976 Foreign Sovereign Immunities Act was inapplicable.

Rather, the majority reached back to the 200-year old Alien Tort Statute and construed it as authorizing these suits. The majority held that even though suit against a foreign state under the Alien Tort Statute may not have been possible 200 years ago when the Alien Tort Statute was enacted as part of the first Judiciary Act, today the evolving standards of international law govern who is within the statute's jurisdictional grant. And the majority concluded that under present day norms of public international law, a foreign state could be subjected to suit in the municipal courts of other states for violations of international law.

The dissenting judge pointed out that although international law is part of the common law of the United States, subject matter jurisdiction in our courts, in federal courts, is not a matter of common law. Rather, jurisdiction exists only to the extent that Congress has expressly bestowed it. The governing jurisdictional statute here, the dissenter said, was manifestly the 1976 FSIA and under that Act, Argentina was absolutely immune from suit.

I submit it to the Court that the dissenting judge was absolutely correct, and that the majority's opinion cannot withstand analysis.

The Foreign Sovereign Immunities Act clearly provides in Section 1602 that claims of foreign states to Immunity should henceforth, meaning after 1976, the effective date of the Act, be decided by all United States courts in conformity with the principles of immunity set forth in that Act. The legislative history of the Act is replete with references that the FSIA was intended to preempt any and all other statutes dealing with the suability or potential suability of foreign states.

Only five years ago this Court unanimously in Verlincen v. Central Bank of Nigeria, in 461 U.S., held that the Act contains a comprehensive and all-embracing set of legal standards governing claims to immunity in every civil action against a foreign state. The majority below disregarded the explicit language of the statute, its clear and unequivocal legislative history, the unanimous decision of this Court in Verlinden in holding that there was some vestige of jurisdiction against foreign states under the 200 year old Alien Tort Statute. This, I submit, was clear error.

QUESTION: I take it you would say that even absent the Foreign Sovereign Immunities Act, there wouldn't have been jurisdiction under the alien provision.

MR. RISTAU: That's correct, sir.

QUESTION: But do you rely on that ground now? Do we have to get to the reach of the Foreign Sovereign Immunities Act?

MR. RISTAU: Well, it is my contention -- it's my principal submission, Justice White, that regardless of what the -- what the law may have been prior to 1976 --

QUESTION: What do you think it was before 1976?

MR. RISTAU: Clearly before 1976 a foreign state was not subject to suit in the municipal courts under the circumstances of this case.

QUESTION: Was that the Act cf State Doctrine or --

MR. RISTAU: No, that was not the Act of State Doctrine. **Both under the traditional sovereign immunity doctrine, the absolute immunity doctrine, which this Court embraced as late as 1926 in its famous case of Veritzl Brothers v. The Steamship Pizarro, the law in this country, as expounded by this Court, was absolute immunity.

QUESTION: So, this was a novel construction of the jurisdictional provision the court of appeals relied on.

MR. RISTAU: It clearly was a novel construction of the jurisdictional provision, Your Honor.

QUESTION: That being the Alien Tort Statute.

MR. RISTAU: That is correct, sir.

Now, the majority's further holding that the Foreign Sovereign Immunities Act, which incorporates the international doctrine -- the international restrictive doctrine of foreign sovereign immunity, did not touch this case because the restrictive doctrine only dealt with the commercial activities of a state.

That holding of the Second Circuit is bottomed on a fundamental misunderstanding of the whole restrictive theory of sovereign immunity because the restrictive theory too starts out with the general predicate that a foreign sovereign is -- is not subject to the jurisdiction of the municipal courts, and it then carves out certain exceptions to that absolute immunity. That is also the fundamental rule spelled out in Section 1604 of the Foreign Sovereign Immunities Act.

And the reason the restrictive theory deals with commercial activities primarily is because those are the exceptions to immunity, but the other leg of the restrictive theory that a foreign state for any other action is absolutely immune for governmental actions, sovereign actions, what is known in international law as activities jure imperil, exertions of the sovereign power, including where the exertion of the sovereign power may conceivably have violated international law. The remedy is not a lawsuit in the municipal courts of the state.

The FSIA, Your Honors should know, had a very long gestation period. It was the result of the most careful scrutiny by officials in the Departments of State and Justice over a period of some eight years. It was reviewed by several advisory groups of distinguished international lawyers and scholars, as well as representatives of the bar.

At no time during this long review was there even the remotest suggestion by anyone that there was jurisdiction -- conceivable jurisdiction against a foreign state under the old Alien Tort Statute. The only statute on the books then that specifically referred to suits against foreign states was the then version of the Diversity Statute. Congress expressly amended the Diversity Statute by taking out the language permitting suits against foreign states in diversity and making it absolutely clear that the sole jurisdictional predicate hereafter shall be the Foreign Sovereign Immunities Act, and under that Act, the Republic of Argentina is manifestly immune from suit for acts performed by its armed forces in the South Atlantic during the Malvinas conflict.

I'd to reserve five minutes for rebuttal, Mr. Chief Justice.

QUESTION: Thank you, Mr. Ristau.

General Fried, we'll hear now from you.

ORAL ARGUMENT OF CHARLES FRIED AS AMICUS CURIAE SUPPORTING THE PETITIONER

MR. FRIED: Thank you, Mr. Chief Justices, and may it please the Court.

First let me say that the recourse to diplomatic means to which reference was made in answer to a question by Justice Blackmun is by no means unavailing. To cite two recent examples, the United States has agreed to make compensation as a result of such representations as a result of the shooting down of the Iran airplane over -- over the Persian Gulf, and the Republic of Iraq has agreed, as a result of such representations, to make compensation to the United States as a result of the Stark incident. So, these are regularly invoked and often quite effective measures.

In any event, the Foreign Sovereign Immunities Act in terms closes the doors of any United States courts to this action. As Judge Kearse said below, immunity is the premise. That's Section 1604. And there is jurisdiction only if the action is grounded in one of the specified numbers of private or commercial acts.

Military action in wartime is, of course, a quintessentially public act. And as this Court said --

QUESTION: Mr. Fried? Mr. Fried, but for the Foreign Sovereign Immunities Act, do you think that jurisdiction might have been appropriate under the old Alien Tort Statute?

MR. FRIED: We do not. First, because prior to the Act and at the time of the Alien Tort Statute and throughout our history, the general rule of our law as the law of all nations is that sovereigns are immune for this kind of action. And it was only in 1952 with the Tate letter that we drew back from that for private and commercial acts.

But moreover, we do not believe that it is appropriate to awaken like Rip Van Winkle a statute of 200 years' age and which had been rarely, if ever, used until about 1980 to a use which it is most unlikely and to circumstances which it is most unlikely the draftsmen of that statute contemplated.

It is not a constitution we are construing there. It is a statute. And that statute probably was intended to cover acts for -- to give aliens a forum for acts which the United States is responsible or for which the Congress, as in the case of piracy, has decided to assume responsibility and not to allow acts by strangers against strangers for acts taking place in foreign ports. So, in our view the Alien Tort Statute would not provide jurisdiction for this -- for this lawsuit for a number of reasons.

But in any event --

QUESTION: So, this isn't a case of partial repealer.

MR. FRIED: Well, I think that Judge Carter in the district court -- or perhaps it was Judge Kearse -- got that just right. This is not a case of -- of repeal by implication. This is a case of a narrowing of jurisdiction at worst, and at best this is a case where, in fact, there was no jurisdiction to begin with. And there's a codification of what was understood to be the law of the United States and of every civilized nation prior to that time.

Now, the Foreign Sovereign Immunities Act, in addition to making a distinction between private or commercial acts and public acts, also sought to -- in order, as this Court said in Verlinden, to prevent our courts from becoming international courts of claims, which is, of course, precisely what plaintiffs are seeking to do here, has required in this Court's words some substantial contact with the United States. Of course, some substantial contact is entirely absent here.

So, Congress did think of this kind of claim and in general terms precluded it. To say they did not focus on this is like saying that a mathematician who speaks of all prime numbers had not focused on 43. I think that's a prime number. And it frustrates Congress' evident intent to prolong this litigation by what Judge Carter below called inventive arguments to invoke the Act's specified exceptions in far-fetched ways, such as suggesting that this was an act of piracy.

The United States condemns violations of international law. But we are troubled by the course on which the Court of Appeals for the Second Circuit has embarked. International relations are characterized by reciprocity. And as we do unto foreign nations in our courts, so very shortly we will be done unto in the courts of other countries.

Moreover, the Department of State is seeking to persuade foreign sovereigns voluntarily to submit to the jurisdiction of our courts under the Foreign Sovereign Immunities Act. That is a project which will not prosper if they can hope to encounter surprising and, I must say, eccentric legal rulings completely out of line with international practice and the plain words of our own legislation. It is striking, after all, that a -- that the United States itself would not be liable for these actions because the -- the Federal Tort Claims Act specifically excludes liability for actions in combatant activities by our armed forces.

We suggest that this lawsuit should terminate and that the evident intention of Congress should be respected.

If there are no further questions, I thank the Court for its attention.

QUESTION: Thank you, General Fried.

We'll hear now from you, Mr. Burnett.

ORAL ARGUMENT OF DOUGLAS R. BURNETT ON BEHALF OF THE RESPONDENTS

MR. BURNETT: Mr. Chief Justice, may it please the Court.

My opponents have omitted facts which decisively affect the outcome of this case. This ship was involved in the U.S. domestic water-borne trade. It traded exclusively between Valdez, Alaska and the U.S. Virgin Islands. The only commodity carried by this ship was Alaskan crude oil, a commodity which by law is prohibited from export. The products refined from this crude oil were consumed at least 83 percent in the continental United States and 17 percent were purchased directly by the United States government.

The warning message by the United States government of June 3, 1982 to both belligerents, the United Kingdom and to the Republic of Argentina, advised the belligerents that the Hercules was a neutral ship engaged in this country's domestic water-borne trade. It advised the belligerents that her neutral status was to be respected. It gave its course, speed and estimated time of arrival. In the same message were listed U.S. flag merchant ships in the South Atlantic.

Argentina's acts were directly responsible for bringing the ship to her destruction. On the prior voyage where the master of the ship deviated from his course to look for survivors from the torpedoed Argentine cruiser, General Belgrano, at that time indirect contact with the Argentine naval forces, there was no indication that on his following voyage the ship would be in danger.

The master, not content to rely on the official messages of the United States government, also sent out on a daily basis on the AMVER, the international lifesaving distress frequency, the ship's position, its course, its speed and its destination. Even on the day of the fatal attacks, two messages were sent to the Argentine Republic. The messages were acknowledge. Had at any time the Petitioner advised the master that his ship would be in danger, this event would never have occurred for although a warship captain may earn his pay by sailing into harm's way, the captain of a merchant ship earns his pay by avoiding harm's way and safely delivering the cargo entrusted to his care.

QUESTION: Mr. Burnett, what does all this have to do with jurisdiction? I mean, it may show great negligence, greater negligence. It may show, you know, gross negligence, but what does it have to do with jurisdiction?

MR. BURNETT: Your Honor, my opponent indicated that there was no injury occurring in the United States. Under Section 1605 --

QUESTION: Radio messages -- repeated radio messages show injury occurring in the United States.

MR. BURNETT: The domestic trade certainly shows that. The AMVER station which coordinates the messages in the United States -- and we have indicated that in our brief on pages 58 and 59.

The Argentine motive for the attack is unknown because the district court made no inquiry. It may be that the intention of Argentina was to take the Hercules as a prize. That would be the logical interpretation of the message following the third attack ordering the ship to come to course 270 and make for Argentine port or be subject to yet another attack. In such a case in an Argentine prize court, Argentina would have no immunity. It would stand in the shoes of an ordinary litigant.

It may well be that the attack was an unprovoked on a neutral ship on the high seas without warning in the same light as those acts for which Admirals Rader and Doenitz were convicted at Nuremberg and for which international law affords no immunity.

QUESTION: Excuse me. Could I -- what do you mean Argentina would have no immunity in Argentine prize court? Could it have been held liable or could it simply have been denied the prize?

MR. BURNETT: The law which we have set out on page 40 -- Argentina would have no immunity in its own domestic prize court. That's the answer to the question, Your Honor.

QUESTION: I don't think it is. Would Argentina have been held liable for damages for having towed it into port, or would it simply be denied the prize?

MR. BURNETT: Under the Law of Nations, which the Argentine prize court would be bound to **pride, Argentina could well be held liable for damages. There have been numerous cases by this Court, by numerous other courts around the world applying the Law of Nations. Even the United States would have no immunity for acts for which Argentina is here before this Court.

QUESTION: Well, then why did you feel the remedy in Argentine courts was inadequate?

MR. BURNETT: Well, it's inadequate because Argentina -- first of all, the decision of the Argentine Supreme Court of September 27, 1983, judgment 85-528 which appears in the record before the Second Circuit at page A-192 indicates that result. In this decision by Argentina's highest court, it states that under its present constitution it has no jurisdiction over acts of the armed forces arising out of the Malvinas War.

This with an opinion from Argentine counsel, one of six we attempted to retain, convinced us of the futility of pursuing the remedy in Argentina. And contrary to my colleague, there is, as is indicated on page 9 of our brief a reference to a official communication by the Ministry of Foreign Affairs dated may 24, 1984 returning the claim of Amerada Hess. And the Argentine attorney commented there is no doubt after this the matter remains in a dead way. We exhausted our remedies in Argentina.

Argentina, under the Laws of Nations, was the proper forum to bring the suit. That is a customary element of international law. There is nothing to stop belligerents from engaging in war, and in wars neutral ships do get sunk or damaged or lost. But the belligerent also has the obligation to convene a prize court or other suitable mechanism to redress the claims of the neutral litigants.

This Court, for example, in its history has decided 192 cases of prize. One hundred and twenty of these cases were decided before 1830. The predecessor of this Court, the Committee on the Case of Appeal and the federal Court of Appeals, decided 117 cases, all of them involving violations of the Law of Nations involving torts committed on the high seas. And the United States is not alone. As we indicated on page 40 of our brief, historically Argentine prize courts had exercised prize jurisdiction in a manner comporting with the customary Law of Nations.

Argentina's complaints about jurisdiction in this country are simply unfounded. Their presence in the U.S. court is self-inflicted. Not only did they refuse to convene a prize court, agree to a private arbitration such as France did with the Rainbow Warrior, such as the United States did in 1933 in the case where the U.S. Coast Guard sank a Canadian vessel accused of turning run, but they have avoided the diplomatic initiatives by the Republic of Liberia. As we indicated on page 8 of our brief -- and the record reflects that fact -- the Republic of Argentina has declined, rebuffed, the initiatives of the Republic of Liberia to pursue this matter diplomatically. We have no qualm that if diplomacy would resolve this dispute, we would be satisfied customary international would have been upheld.

QUESTION: The Republic of Liberia is not a party to this case.

MR. BURNETT: No, Your Honor. They have filed a amicus brief.

QUESTION: What does that have to do with this case?

MR. BURNETT: Just I wanted to bring to the Court's attention that diplomatic initiatives were exhausted as well before we resorted to litigation.

Chief Judge Feinberg's opinion was correct when he states that jurisdiction lies under the Alien Tort Statute and, as indicated in footnote 3 to his opinion, jurisdiction is also consistent with Section 1605(a)(5) of the Foreign Sovereign Immunities Act.

Section 1605 provides recovery for a claim of loss or injury occurring in the United States. However, the definition of the United States, as it's stated in Section 1603 and which is discussed at pages 50 and 53 of our brief --

QUESTION: Are those set forth at pages 50 and 53 -- those sections?

MR. BURNETT: The section, no, Your Honor. Our discussion of those sections is. The sections are set forth in the appendix.

The United States, as defined in Section 1603, states includes all territory and waters, continental and insular, subject to the jurisdiction of the United States. This language --

QUESTION: Where in the appendix are they set forth?

MR. BURNETT: On page 2a at the end of the appendix.

QUESTION: Of your brief?

MR. BURNETT: Yes, Your Honor.

QUESTION: Thank you.

MR. BURNETT: The words "and water, continental and insular" indicate that the high seas are to be included as historically they have always been included in the jurisdiction of the federal courts. Even before this country was established under the general maritime law, this was clearly included.

In a similar case, which is discussed in our brief, Cunard v. Mellon, which was a decision of this Court in 1922 --

QUESTION: Excuse me. Why do they have -- why do they have "continental or insular" in there if -- if they mean the high seas? "All territory and waters, continental or insular, subject to the jurisdiction of the United States."

MR. BURNETT: That indicates the seas that surround the United States, continental and insular, including the high seas.

QUESTION: Oh, I see. That's to make it clear that they mean seas that -- that surround land as opposed to --

MR. BURNETT: Yes, Your Honor.

QUESTION: It doesn't make any sense at all.

QUESTION: That's a strange construction.

QUESTION: It would make some sense if you think it means, you know, the territorial portion around an island or around the continent, that is, the normal territorial jurisdiction. But to think --

MR. BURNETT: Well --

QUESTION: -- it means the high seas is very strange.

MR. BURNETT: Well, Your Honor, I think what may be helpful in considering these words was the holding of the Court in Cunard v. Mellon, a case in 1922 where this Court was called upon to construe language in the Eighteenth Amendment, as well as two prohibition statutes, in a maritime context involving eight foreign ships and two American ships. And the language in the amendment, as we have set forth at our brief on the pages I indicated, page 50 to 53, that amendment only provided for jurisdiction in the United States territory subject to its jurisdiction. The Court concluded that "territory," that word, includes the three-mile territorial limit. Therefore, Congress -- we feel it was logical for Congress to ensure that the high seas were included to add those extra words regarding waters. And the --

QUESTION: But -- but the Mellon -- the Mellon case found only that marginal lands up to three miles --

MR. BURNETT: That's correct, Your Honor.

QUESTION: -- were within. And your case certainly is different from that.

MR. BURNETT: That's correct, Your Honor.

QUESTION: And we do have other statutes, do we not, that use the phrase "high seas"?

MR. BURNETT: We have a multitude of statutes that use high seas. Congress has enacted over seven or eight statutes extending jurisdiction on to the high seas, which is one more point which would indicate that it would be unusual for Congress through silence to disenfranchise American citizens as well as foreign citizens of their historic rights under the general maritime law.

QUESTION: But the section doesn't say high seas. Other statutes do talk about the high seas, don't they?

MR. BURNETT: Some statutes use the word "high seas," and there are other statutes that use the word "waters."

The consequences of -- of accepting the Petitioner's extreme argument that all jurisdiction under the FSIA stops at the three-mile limit are alarming. It cuts off the rights of U.S. citizens, as well as aliens. If the Hercules was a U.S. flag ship and on a voyage from Philadelphia to New York, it was attacked by Argentine armed forces four miles off the coast and those U.S. sailors -- those U.S. shipowners, having gone to Argentina, having exhausted their remedies in Argentina, under the Petitioner's theory, they would then be denied their historic remedies, including those existing under flag jurisdiction, under the general maritime law.

QUESTION: Mr. Burnett, doesn't the United States in some cases claim further than three miles? Don't they claim 200 miles in some cases?

MR. BURNETT: In terms of territorial waters, no, Your Honor. The official recognition of U.S. waters state is three miles for U.S. water. We recognize foreign state claims to 12 miles. We have an economic zone analysis which in certain economic areas confers upon this Court -- upon the United States an interest in waters out to 200 miles. But that is not territorial water. And the Geneva Convention on the High Seas, which is ratified by this country, makes it perfectly clear that the waters beyond the territorial sea, which for the United States is three miles, is the high seas.

QUESTION: Mr. Burnett, I -- I find it difficult to -- to find it so shocking that the United States would not allow suit in United States courts against a foreign country in these circumstances when it appears that the United States would not allow suit against the United States itself in United States courts in these circumstances.

What would have happened if this plane were a United States plane in similar circumstances in a wartime situation and had -- and had on the high seas, or whatever you want to call continental or insular seas, sent down a ship? Would suit -- would suit have been allowed against the United States under the Federal Tort Claims Act?

MR. BURNETT: Well, Your Honor, not under the Federal Tort Claims Act.

And the Solicitor General and the Petitioner are dead wrong on the law. The appropriate statute is the U.S. Prize Statute and in particular, 10 U.S.C. 7652(b) because Argentina and the United Kingdom were at war. The United States, when it is at war, when its naval forces commit torts on the high seas involving seizures of merchant ships, that statute provides jurisdiction. In particular, Section B provides jurisdiction where the ship is lost, destroyed or otherwise unable to come into **court. So, the United States --

QUESTION: After seizure. Before seizure? You mean you sink a ship and that's -- that's a prize?

MR. BURNETT: It's not -- prize is the act of seizure, Your Honor. It is -- in rem may also be present, but the statute makes it clear right in its words. It is divided into three sections. Section A is in rem. Section is jurisdiction when the ship has been destroyed, lost or unable to come into port. Section C is a situation where the prize is in the port of a co-belligerent.

QUESTION: I always thought destroyed, lost or unable to come into port means after you've -- you've taken charge of the ship and it has been lost and being towed in or it -- it has been destroyed in a storm after you've taken possession of it. But you -- you think sinking a ship is taking a prize.

MR. BURNETT: It triggers prize jurisdiction Your Honor, because the act of seizure is what triggers prize jurisdiction.

QUESTION: I'm not talking seizure. I'm talking putting a torpedo into a ship and sinking it. Is that a seizure.

MR. BURNETT: (Inaudible), Your Honor, the neutral has a claim under customary international law for compensation to its ship. Customary --

QUESTION: In prize court?

MR. BURNETT: Yes, Your Honor. That is the appropriate proceeding for that to proceed in.

QUESTION: You -- you have cases on that? That surprises me.

MR. BURNETT: Well, Your Honor, yes, we do. In 1806, Maley v. Shattuck. This was a case where the U.S. Navy attacked a ship, caused its loss, judgment against the United States. There is The Amiable Nancy. The Marianna Flora is another case. The United States Navy, the U.S. Frigate Alligator, in which a ship was attacked unjustly by the United States. Compensation was ordered.

As we have indicated, Justice Story in his Principles and Practices of Prize Law make it perfectly clear that if the ship is destroyed in the process of attempting to capture it or seize it -- if that occurs, the captor is liable and, in fact, a under customary international law, the burden becomes that much more severe on the captor because under customary international law, he's to board the ship, carry out an examination of the ship to determine if there is kind of a maritime equivalent of probable cause.

QUESTION: Are you limiting your -- your principle now to when it sunk in the process of trying to seize it? Is that the principle you're saying? It has to be --

MR. BURNETT: Your Honor, if the United States engages in war, if the armed forces --

QUESTION: Do you have any case where -- where the United States was not trying to seize a ship, but just trying to sink it, where an action in prize court was allowed?

MR. BURNETT: Del Col v. Arnold is a case in which the ship was lost as a result of a seizure. The Imalone was an arbitration with Canada in which the Coast Guard sank a ship and which compensation was awarded.

QUESTION: Trying to seize it or not trying to seize it?

MR. BURNETT: Your Honor, under customary international law, you can't go around sinking neutral ships on the high seas. And if you do so, the remedy under customary international law is you have to convene a prize court. The neutral has a right to transit the high seas.

QUESTION: Do you have any case where, without trying to seize a ship, a ship has been intentionally sunk -- no desire to seize it -- intentionally sunk where there has been a remedy in prize court? Yes or no? Do you know a case like that?

MR. BURNETT: I don't have a case on that point, Your honor.

QUESTION: Could -- could Iran have sued the United States under the Foreign Sovereignties Act or under any other -- the Allen Tort Law for the sinking of the plane?

MR. BURNETT: Well, in terms of jurisdiction, obviously the Foreign Sovereign Immunities Act would not be applicable. Jurisdiction would technically lie under the Allen Tort Statute and under the general maritime law because the seizure of the aircraft took place on the high seas.

QUESTION: Well, then it's a -- you define seizure very broadly. Shooting down a plane is a seizure.

MR. BURNETT: The destruction is a seizure, yes, Your Honor. That is -- Lord Stowell, when he cited the rule in 1819, England's greatest admiralty rule, he said if a captor destroys a neutral ship, the captor or his government is answerable.

QUESTION: The captor, yes.

MR. BURNETT: Argentina was the captor.

QUESTION: If he -- if he has taken possession of it and then sinks it. But if just goes out to sink it, that's a different question. And you tell us you have no case of that sort.

MR. BURNETT: The customary international law permits no destruction of neutral ships, and if there is a destruction of neutral ships, a prize court must be convened. That is the rule under customary international law.

QUESTION: But you -- you have no cases.

MR. BURNETT: I gave several cases to the Court.

QUESTION: Involving -- involving destruction without seizure, without intenced seizure or seizure.

MR. BURNETT: Well --

QUESTION: I mean, you keep saying it again and again, but in fact the only authority you have is that if you try to capture a ship and sink it or you capture it and then it sinks while you're towing it to port, you have an action in prize court.

MR. BURNETT: Well, I would just refer the Court once again to the prize statute. It says for any seizure of the United States, and if the ship is lost or destroyed --

QUESTION: Well --

MR. BURNETT: -- by the armed forces of the United States in the process of seizing the vessel or at whatever point you want to draw the line, the United States would have no immunity for that.

And in the case of the Vinces incident in the Persian Gulf, the -- the nice thing about admiralty and events on the high seas is there has been a tremendous history of jurisprudence. And the Marianna Flora, decided in 1830, is squarely on all fours with a possible suit under -- in that situation. And in that case, the Court, this Court, held that where the warship commander was acting in a reasonable belief to defend his ship and his crew, there is no violation of international law. So, although Iran may conceivably have jurisdiction, the customary international law certainly provides an adequate method for this Court to handle the situation. And what is more important, Iran would never be denied access to the courts to bring the claim.

And that is what makes this case stand out. It's not so much that another ship had been sunk in the course of a naval war, but to our review, this was the only case we could find of such outlaw behavior where a belligerent has refused to convene a prize court on international agreement, diplomatically done nothing. You can do a whole host of things to satisfy your obligation.

QUESTION: Supposing there were no -- you say there is some United States connection here because the ship was transporting oil from the North Slope of Alaska to the Virgin Islands. Supposing that the same cast of characters, but they -- they had no connection whatever with the United States. They were transporting oil from one foreign country to another. Would that make any difference in the way you analyze the case?

MR. BURNETT: Yes, it would, Your honor. Although jurisdiction would technically exist because, once again, there is a tort violation on the high seas, the United States would have no substantial relationship which would warrant this Court making an inquiry into it.

This Court has an interest in protecting the U.S. domestic trade. And if it's a voyage between --

QUESTION: Well, this Court -- this Court has --

MR. BURNETT: -- Kuwait and Japan and that --

QUESTION: Just -- just -- just a minute, Mr. Burnett. This Court doesn't have any -- any interest other -- in doing other than what Congress has said. Maybe you mean the United States has an interest.

MR. BURNETT: Well, Your Honor, I would submit that this Court has an obligation to construe these statutes so as not to violate neutral trade. And that was the holding of this Court in The Charming Betsey. And what we have at stake are those issues. But just because there's a violation of international law around the world does not mean that these Court -- or this Court is going to have anything beyond jurisdiction.

The scenarios which the Solicitor General would like to paint on this Court do not bear up to scrutiny. First of all, most of the scenarios they would envision are going to occur in foreign territory. There the plaintiff has a significant obstacle in the Act of State Doctrine. The Act of State Doctrine does not apply on the high seas because it's not foreign territory, it is the territory of all nations.

There must be a strong U.S. relationship. Here we have an overwhelming U.S. relationship. We have injury occurring in the United States in New York City. In most of those case there will not be that substantial U.S. interest.

Third, there must be denial of even procedural justice by the country involved. As I indicated, that is an exceedingly rare situation in many situations.

Forum nonconvenience would also apply in many of these cases.

And finally, it must be remembered, as Chief Judge Feinberg indicated in his opinion, the Allen Tort Statute, just as it was in its day, was for those special cases of violations of the Law of Nations. Not every violation of international law arises to that level of the Laws of Nations wherein you have jurisdiction under the Allen Tort Statute.

QUESTION: May I just clarify something? The Act of State Doctrine applies only if a state acts within its domestic borders?

MR. BURNETT That is correct, Your Honor.

QUESTION: And what's the cite? And what's your authority for that?

MR. BURNETT: It's just -- I believe we've addressed it. I don't have a citation, but the Act of State Doctrine -- I think in Sabbatino it was also discussed -- only applies --

QUESTION: So that when the United States acts on the act of -- on the high seas, it -- it is not protected by the Act of State Doctrine.

MR. BURNETT: No, Your Honor. The Act of State Doctrine applies for an inquiry by a court in activities which occur in a foreign country's territory. I think it's very illustrative --

QUESTION: Even if the decisions are made within the domestic limits and the consequences of the acts are felt outside the jurisdiction?

MR. BURNETT: Well, if you'll look at the case of KL 707, there the tort occurred over Russian territory, and the Court applied the Act of State Doctrine. That's an example of an event which may be a violation of international law, maybe reprehensible, but wherein the Act of State Doctrine applied because it occurred in the foreign territory.

Whether the Court applies the Act of State Doctrine is a -- is a consideration which is not before this Court because we submit the law is consistent that it must be in a foreign territory.

In the very first Attorney General's letter, which dealt with the Alien Tort Statute in 1795, certainly suggests this result. In that opinion letter by Attorney General William Bradford which involved a complaint against the United States for aiding and abetting an attack on the high seas which plundered an English settlement, there the Attorney General said that under the Alien Tort Statute, there would be no jurisdiction for events or activities which occur in the foreign territory. However, to the extent that they occurred on the high seas, there would be jurisdiction under that statute.

The Allen Tort Statute was primarily designed as a supplement to maritime jurisdiction. Oliver Ellsworth, when he drafted the Alien Tort Statute, as his notes indicate, was concerned with that statute in the maritime context. And as it exists in the maritime context, it is consistent with the Foreign Sovereign Immunities Act with 1605.

QUESTION: Mr. Burnett, what American interest was injured here?

MR. BURNETT: Your Honor, the interests which were injured were the disruption of the energy policies of the United States, the --

QUESTION: The politics of the United States?

MR. BURNETT: The energy policies of the United States whereby it --

QUESTION: The policy.

MR. BURNETT: -- has rights to utilize its natural resources.

QUESTION: The only thing that was injured was the policy.

MR. BURNETT: No, Your Honor. We had also the charter hire payment which was paid in New York City. We had the bunkers which were purchased in New York City, delivered in St. Croix. We had disruption to the Alaskan pipeline. This ship didn't make the voyage obviously --

QUESTION: That would destruct the Alaskan pipeline?

MR. BURNETT: The Hercules is the sea component link of an ocean transportation system which furnishes Alaskan crude oil to the eastern United States. It's analogous to a pipeline. It is the maritime component of that system. And the disruption of that system disrupted the refinery.

QUESTION: That -- that affects the Liberians, doesn't it?

MR. BURNETT: It certainly affects the Liberians, but it also affects the United States.

QUESTION: But the Liberians are **not part of the United States.

MR. BURNETT: That's correct, Your Honor. They are not.

QUESTION: That's right.

MR. BURNETT: But it certainly -- I would disagree with Your Honor that it affects the United States.

QUESTION: So, we'd **hear of every injury on the high seas can come into our courts. You're going to rewrite all the law.

MR. BURNETT: Your Honor, the injuries which occur on the high seas which are torts on the high seas -- by definition this Court held in The Belgenland that a tort, if it occurs in the high seas, this Court has jurisdiction. Whether the Court exercises its jurisdiction is another question. And there you have the question of forum nonconvenience or various other activities. But on the high seas, the United States has as much right as any other country to exercise its judicial jurisdiction to protect its national interests as those --

QUESTION: (Inaudible) could be nothing.

MR. BURNETT: Well, Your Honor, every interest --

QUESTION: Could be.

MR. BURNETT: I believe that every country has an interest in the safe preservation of transportation on the high seas. It is our position that that is why customary international law has evolved on this situation. It's not that --

QUESTION: Only -- it only applied to some countries?

MR. BURNETT: All countries, Your Honor.

QUESTION: I thought international law did apply to all countries.

MR. BURNETT: Yes, Your Honor. And all countries have equal rights on the high seas.

QUESTION: So, you went to Argentina and you couldn't win, so you come here.

MR. BURNETT: Your Honor --

QUESTION: If you don't win here, where will you go next?

MR. BURNETT: Your Honor, this is the court of last resort. Argentina will not consent to jurisdiction in the World Court.

When you indicated that we would not win in Argentina, on the merits we should win. We can't get a court. The rational court says they have no jurisdiction for acts of the Malvinas. Six of the top firms in Argentina say they cannot bring the court. The Ministry of Foreign Affairs sent back the claim. The diplomatic initiatives of Liberia have failed.

Now, this was the court of last resort. If we had brought this suit without going to Argentina, a simple of motion of forum nonconvenience would send us down to Buenos Aires because, once again, under customary international law, the proper forum is the captor's court. There is no ambiguity in international law on that point.

QUESTION: (Inaudible) federal court. Right?

MR. BURNETT: Yes, there's jurisdiction.

QUESTION: Including **?

MR. BURNETT: Well, yes, Your Honor.

Well, I -- I would like to comment on the Solicitor General's position with respect to foreign policy. It has flip-flopped several times since 1980. In 1980 in the Filartiga case, the Solicitor General stated that as an example of the type of action which could be brought under the Alien Tort Statute was the individual shipowner's right for compensation for destruction of his ship on the high seas.

They have now backed off from that. They now indicate that foreign policy is a predominant concern --

QUESTION: Excuse me. They -- they didn't say that that suit could be brought against a foreign sovereign under the Alien Tort Claims Act.

MR. BURNETT: Who else but the sovereign, as we've indicated, would be involved? When you destroy a ship on the high seas --

QUESTION: Only sovereigns can destroy ships on the high seas?

MR. BURNETT: Well, with the limited exception of pirates.

QUESTION: I didn't know there was that rule.

MR. BURNETT: Well, it's just logic, Your Honor. By principal analogy and reason, the principal violators of neutrality are going to be sovereigns either through their navies or by privateers acting under their letters of mark.

QUESTION: Thank you. Thank you, Mr. Burnett. Your time has expired.

Mr. Ristau, you have one minute remaining.

REBUTTAL ARGUMENT OF BRUNO A. RISTAU

MR. RISTAU: Thank you, Mr. Chief Justice. I would just like to try to answer your question, Your Honor.

The United States would not be subject to suit under the Federal Tort Claims Act with respect to the incident that happened over the Gulf for the simple reason, as this Court has many times declared, the Federal Tort Claims Statute does not apply to torts committed by the United States extraterritorially.

QUESTION: May I ask if there would have been prize court jurisdiction if instead of just sinking the ship, they had tried to capture the ship and pulled it into port, and then it was sunk on way into port?

MR. RISTAU: Under traditional prize law, Justice Stevens, yes. But you'll recall we haven't had and prize courts in this country since before the First World War. Argertina hasn't had any prize courts --

QUESTION: There would have been no claim of sovereign immunity on those facts. Is that right?

MR. RISTAU: That's correct. Traditionally, prize courts were established by belligerent powers to determine the lawfulness of a capture. The sine qua nor, as Justice Scalia indicated, was the res, that the thing be brought, either the vessel or the cargo to be adjudicated as a lawful prize of war. Absent the res, no prize court jurisdiction.

CHIEF JUSTICE REHNQUIST: Thank you, Mr. Ristau.

The case is submitted.

(Whereupon, at 11:02 o'clock a.m., the case in the above-entitled matter was submitted.)