Anglo-Iberia v. Lodderhose, No. 08-2666 (2d Cir. 2010)

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08-2666-cv (L), 08-2836-cv (XAP) Anglo-Iberia v. Lodderhose 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term 2009 (Argued: October 27, 2009 Decided: March 29, 2010) Docket Nos. 08-2666-cv (L), 08-2836-cv (XAP) -----------------------------------------------------x ANGLO-IBERIA UNDERWRITING MANAGEMENT COMPANY, Plaintiff-Counter-Defendant-AppellantCross-Appellee, INDUSTRIAL RE INTERNATIONAL, INC., Plaintiff-Appellant-Cross-Appellee, -- v. -P.T. JAMSOSTEK (PERSERO) and REPUBLIC OF INDONESIA, Defendants-Appellees-Cross-Appellants, Daniel J. Lodderhose and Security Resources International, Inc., Defendants-Counter-Claimants-Cross-Defendants, Security Resources International, Inc., GC Insurance Brokers, Limited, CG Intermediaries Limited, Peter I. Greengrass, Leslie J. Cooper and A.J. Smith, Defendants-Counter-Claimants, Prio Adhi Sartano, Consolidated Defendant. -----------------------------------------------------x B e f o r e : WALKER, McLAUGHLIN, and RAGGI, Circuit Judges. Anglo-Iberia Underwriting Management Company and Industrial 1 1 Re International, Inc., appeal from an order of the United States 2 District Court for the Southern District of New York (Donald C. 3 Pogue, Judge, of the United States Court of International Trade, 4 sitting by designation) that dismissed their negligent 5 supervision claim against P.T. Jamsostek (Persero) and the 6 Republic of Indonesia for lack of subject matter jurisdiction 7 under the Foreign Sovereign Immunities Act ( FSIA ). 8 conclude that P.T. Jamsostek (Persero) and the Republic of 9 Indonesia were not engaged in commercial activity for purposes Because we 10 of the FSIA, and that, even assuming arguendo that they were 11 involved in commercial activity, their alleged negligent 12 supervision of Jamsostek employees was not in connection with 13 such commercial activity, we AFFIRM the district court s 14 dismissal of the claim for lack of subject matter jurisdiction. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 AFFIRMED. JOHN R. KEOUGH, III (Cody D. Constable, Peter C. Dee, on the brief), Waesche, Sheinbaum & O Regan, P.C., New York, NY, for Plaintiffs-Appellants-CrossAppellees. FRANK PANOPOULOS (Carolyn B. Lamm, Nicole Erb, Claire DeLelle, on the brief), White & Case LLP, Washington, DC, for DefendantsAppellees-Cross-Appellants. JOHN M. WALKER, JR., Circuit Judge: Anglo-Iberia Underwriting Management Company and Industrial Re International, Inc. (collectively, Anglo-Iberia ) appeal from 2 1 an order of the United States District Court for the Southern 2 District of New York (Donald C. Pogue, Judge, of the United 3 States Court of International Trade, sitting by designation) that 4 dismissed Anglo-Iberia s negligent supervision claim against the 5 Indonesian state-owned social security insurer, P.T. Jamsostek 6 (Persero) ( Jamsostek ), and the Republic of Indonesia 7 ( Indonesia ) for lack of subject matter jurisdiction under the 8 Foreign Sovereign Immunities Act ( FSIA ), 28 U.S.C. §§ 1330, 9 1602-1611. Because we conclude that neither Jamsostek nor 10 Indonesia was involved in commercial activity for purposes of 11 the FSIA, 28 U.S.C. § 1605(a)(2), and that, even assuming 12 arguendo that they were involved in commercial activity, 13 Jamsostek s alleged failure to supervise its employees was not 14 in connection with such commercial activity, id., we AFFIRM the 15 district court s dismissal of Anglo-Iberia s claim for lack of 16 subject matter jurisdiction. 17 BACKGROUND 18 This case comes before this court for a second time, see 19 Anglo-Iberia Underwriting Mgmt. Co. v. Lodderhose, 235 F. App x 20 776 (2d Cir. 2007) (summary order) ( Anglo-Iberia I ), and 21 involves only the negligent supervision claim we remanded in 22 Anglo-Iberia I. 23 court s dismissal on remand of Anglo-Iberia s claim that 24 Jamsostek negligently supervised its employee, Prio Adhi Sartono, Specifically, this appeal concerns the district 3 1 as well as other Jamsostek employees who acted together with 2 Sartono to perpetrate an international commercial reinsurance 3 fraud scheme to Anglo-Iberia s detriment. 4 Iberia, Jamsostek s negligent supervision of its employees 5 enabled Sartono to commit commercial reinsurance fraud against 6 Anglo-Iberia while Sartono was in Colorado pursuing a Jamsostek- 7 sponsored MBA.1 8 lacked subject matter jurisdiction over Anglo-Iberia s negligent 9 supervision claim against Jamsostek and Indonesia because According to Anglo- On remand, the district court concluded that it 10 Jamsostek s activities were not commercial in nature and did not 11 fall within a FSIA-enumerated exception to sovereign immunity. 12 See Anglo-Iberia Underwriting Mgmt. Co. v. Lodderhose, No. 97- 13 0084 (DCP), 2008 WL 190364, at *1, *4-5 14 2008). 15 order and the opinions below,2 and set forth the relevant facts 1 2 3 4 5 6 We assume familiarity with this court s May 2007 summary 1 1 2 3 4 5 6 7 8 9 10 (S.D.N.Y. Jan. 22, 2 The district court imposed damages, and reasonable attorney s fees and costs, against, inter alia, individual defendants Sartono and Daniel J. Lodderhose. See Anglo-Iberia Underwriting Mgmt. Co. v. Lodderhose, 287 F. Supp. 2d 454 (S.D.N.Y. 2003); Anglo-Iberia Underwriting Mgmt. Co. v. Lodderhose, 282 F. Supp. 2d 126 (S.D.N.Y. 2003). The district court denied Anglo-Iberia s motion for reconsideration in an unpublished, two-page order dated April 30, 2008. See Special App. 18-19. More detailed descriptions of the events giving rise to Sartono s fraud are available at AngloIberia Underwriting Mgmt. Co. v. Lodderhose, 224 F. Supp. 2d 679, 681-84 (S.D.N.Y. 2002); Anglo-Iberia Underwriting Mgmt. Co. v. PT Jamsostek, No. 97 Civ. 5116 HB, 1999 WL 76909, at *2-5 (S.D.N.Y. Feb. 16, 1999); and Anglo-Iberia Underwiting Mgmt. Co. v. PT Jamsostek, No. 97 Civ. 5116(HB), 1998 WL 289711, at *1-2 (S.D.N.Y. June 4, 1998). 4 1 in the discussion section only insofar as necessary to resolve 2 the instant appeal. DISCUSSION 3 4 I. FSIA Generally and Standard of Review 5 The FSIA provides the sole basis for obtaining 6 jurisdiction over a foreign state in federal court. 7 Dichter, 563 F.3d 9, 12 (2d Cir. 2009) (quoting Argentine 8 Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 439 9 (1989)). Matar v. In general, a foreign state or an agency or 10 instrumentality of a foreign state, 28 U.S.C. § 1603(b), is 11 immune from federal court jurisdiction unless a specific 12 exception to the FSIA applies, Matar, 563 F.3d at 12. 13 28 U.S.C. § 1604; Kato v. Ishihara, 360 F.3d 106, 107-08 (2d Cir. 14 2004) ( The FSIA codifies the restrictive theory of sovereign 15 immunity, under which foreign sovereigns and their agencies or 16 instrumentalities enjoy immunity from suit in United States 17 courts, subject to a few, enumerated statutory exceptions. 18 (internal quotation marks, citations, and alterations omitted)). 19 See also The burden is on the defendant seeking sovereign immunity to 20 show it is a foreign sovereign. 21 defendant makes this showing, the burden then shifts to the 22 plaintiff to show that a FSIA-enumerated exception to sovereign 23 immunity applies. 24 involves a review of the allegations in the complaint, the Id. Matar, 563 F.3d at 12. Once the Determining whether this burden is met 5 1 undisputed facts, if any, placed before the court by the parties, 2 and if the plaintiff comes forward with sufficient evidence to 3 carry its burden of production on this issue resolution of 4 disputed issues of facts. 5 2001, 538 F.3d 71, 80 (2d Cir. 2008) (internal quotation marks 6 and alterations omitted). 7 evidence outside the pleadings and hold an evidentiary hearing, 8 if it believes one is warranted, in resolving the question of 9 jurisdiction. In re Terrorist Attacks on Sept. 11, The district court may look to See Filetech S.A. v. France Telecom S.A., 157 F.3d 10 922, 932 (2d Cir. 1998). The ultimate burden of persuasion 11 remains with the party seeking sovereign immunity. 12 Terrorist Attacks on Sept. 11, 2001, 538 F.3d at 80; see also 13 Robinson v. Gov t of Malaysia, 269 F.3d 133, 141 n.8 (2d Cir. 14 2001) (noting that the defendant must show that the alleged 15 exception does not apply by a preponderance of the evidence ). See In re 16 The parties do not dispute that Jamsostek and Indonesia are 17 foreign sovereigns presumptively entitled to sovereign immunity. 18 Rather, the issue in contention is whether an exception to their 19 sovereign immunity applies. 20 decision concerning subject matter jurisdiction under the FSIA 21 for clear error as to factual findings, and de novo as to legal 22 conclusions. 23 138). 24 II. We review a district court s Matar, 563 F.3d at 12 (citing Robinson, 269 F.3d at FSIA s Commercial Activity Exception 6 1 FSIA s commercial activity exception the only FSIA 2 exception that Anglo-Iberia invokes abrogates sovereign 3 immunity in cases in which the action is based upon 4 5 6 7 8 9 10 11 12 13 14 15 16 28 U.S.C. § 1605(a)(2). 17 the FSIA as either a regular course of commercial conduct or a 18 particular commercial transaction or act. 19 The commercial character of a defendant s conduct, transaction, 20 or act is determined by reference to the nature of the course of 21 conduct or particular transaction or act, rather than by 22 reference to its purpose. 23 argue that the first clause of the commercial activity 24 exception applies, cf. Anglo-Iberia, 2008 WL 190364, at *2 n.6 25 (rejecting Anglo-Iberia s arguments under the first clause of the 26 exception), the issue for this appeal is whether Anglo-Iberia has 27 shown that Jamsostek and Indonesia are subject to federal court 28 jurisdiction under either the second or third clauses of the 29 commercial activity exception. 30 [1] a commercial activity carried on in the United States by the foreign state; or upon [2] an act performed in the United States in connection with a commercial activity of the foreign state elsewhere; or upon [3] an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect in the United States. A commercial activity is defined under Id. 28 U.S.C. § 1603(d). Because Anglo-Iberia does not As an initial matter, we note that under both the second and 7 1 third clauses of the commercial activity exception, Anglo- 2 Iberia must show that its negligent supervision claim is grounded 3 upon an act in connection with the commercial activity of 4 Jamsostek and Indonesia elsewhere. 5 Thus, should Anglo-Iberia fail to establish that its claim is 6 connected to Jamsostek and Indonesia s commercial activity, if 7 any, in Indonesia, Anglo-Iberia s claim necessarily fails. 8 Because we conclude that Anglo-Iberia s negligent supervision 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 See 28 U.S.C. § 1605(a)(2).3 3 A primary difference between the second and third clauses of the commercial activity exception is the location of the relevant act upon which the plaintiff s claim is based, although in both clauses that act must be in connection with a commercial activity of the foreign state elsewhere. 28 U.S.C. § 1605(a)(2). Thus, Anglo-Iberia argues under the second clause of the commercial activity exception that its negligent supervision claim is based upon (1) the acts [Jamsostek] performed in the United States by supervising and administering its job training program with Sartono and other employees . . . , in connection with its employment of Sartono and the other wrongdoing employees at its commercial offices in Indonesia conducting insurance business, and (2) Anglo-Iberia s act of depositing [reinsurance] premiums in a New York bank . . . and the commercial activity of [Jamsostek] in supervising its employees in Indonesia. See Kensington Int l Ltd. v. Itoua, 505 F.3d 147, 157 (2d Cir. 2007) (noting that the second clause of the commercial activity exception is generally understood to apply to non-commercial acts in the United States that relate to commercial acts abroad (internal quotation marks and emphasis omitted)). Meanwhile, Anglo-Iberia claims under the third clause of the commercial activity exception that [Jamsostek] s negligent supervision of its employees in Indonesia and Monaco in connection with commercial activity of [Jamsostek] in Indonesia caused a direct effect in the United States, thereby causing Anglo-Iberia to enter the reinsurance transactions with [Jamsostek] s employees and incur financial losses in the United States. 8 1 claim is not based upon an act in connection with a commercial 2 activity of [Jamsostek and Indonesia] elsewhere, 28 U.S.C. 3 § 1605(a)(2), we reject Anglo-Iberia s contention that it has 4 sustained its burden under the FSIA of going forward with 5 evidence showing that immunity should not be granted. 6 Robinson, 269 F.3d at 141. See 7 We reach this conclusion because Anglo-Iberia has not 8 demonstrated that Jamsostek and Indonesia were involved in 9 commercial activity for purposes of the FSIA. In Republic of 10 Argentina v. Weltover, 504 U.S. 607 (1992), the Supreme Court 11 explained that a foreign state engages in commercial activity 12 when a foreign government acts, not as a regulator of a market, 13 but in the manner of a private player within it, and thus, that 14 sovereign immunity does not bar a suit based upon a foreign 15 state s participation in the marketplace in the manner of a 16 private citizen or corporation. 17 Court reiterated this principle in Saudi Arabia v. Nelson, 507 18 U.S. 349 (1993), wherein it explained that a state engages in 19 commercial activity [under the FSIA] where it exercises only 20 those powers that can also be exercised by private citizens, as 21 distinct from those powers peculiar to sovereigns. 22 differently, a foreign state engages in commercial activity for 23 purposes of [the FSIA] only where it acts in the manner of a 24 private player within the market. 504 U.S. at 614. 9 The Supreme Put 507 U.S. at 360 (internal 1 quotation marks omitted); see also Hanil Bank v. PT. Bank Negara 2 Indonesia (Persero), 148 F.3d 127, 131 (2d Cir. 1998). 3 Thus, to determine the nature of a sovereign s act, we ask 4 not whether the foreign government is acting with a profit 5 motive or instead with the aim of fulfilling uniquely sovereign 6 objectives but rather whether the particular actions that the 7 foreign state performs (whatever the motive behind them) are the 8 type of actions by which a private party engages in trade and 9 traffic or commerce. Weltover, 504 U.S. at 614; see also 10 Nelson, 507 U.S. at 360-61. We begin this inquiry by examining 11 the act of the foreign sovereign that serves as the basis for the 12 plaintiff s claim. 13 586 (2d Cir. 2006) (identifying this as a threshold step in 14 assessing [a party s] reliance on the commercial activity 15 exception ). 16 Jamostek s alleged negligent supervision of Sartono and other 17 employees in connection with Jamsostek s provision of health 18 insurance in Indonesia.4 1 2 3 4 5 6 7 8 9 10 11 4 See Garb v. Republic of Poland, 440 F.3d 579, Here, the basis of Anglo-Iberia s claim is We thus look to whether the actions We conclude that the district court properly rejected AngloIberia s claim under the second clause of the commercial activity exception for the reasons set forth in its opinion. See Anglo-Iberia, 2008 WL 190364, at *2 n.6 (explaining that the proper focus is on Jamsostek s alleged negligent supervision with respect to its insurance activities in Indonesia because Jamsostek s support of Sartono in a U.S.-based MBA program was purely incidental to his employment). We similarly reject AngloIberia s argument that jurisdiction exists under the FSIA on the basis of its act of depositing reinsurance premiums in a New York bank. 10 1 Jamsostek performs with respect to its role as Indonesia s 2 default health insurer are the type of actions by which a private 3 party engages in trade and traffic or commerce. 4 Anglo-Iberia argues that it properly invoked the commercial 5 activity exception because Jamsostek competes with private 6 insurers in providing health insurance to Indonesians and acts 7 akin to a private insurer in its hiring, training, employment, 8 and supervision of employees to perform non-discretionary duties 9 such as locating health care providers, processing and verifying 10 health insurance claims, collecting health insurance premiums, 11 and preparing reports.5 12 behaves like a private insurer, Anglo-Iberia mischaracterizes the 13 nature of the acts Jamsostek performs in its capacity as the 14 default health insurer, under Indonesia s national social 15 security program, which . . . Jamsostek operates and 16 administers. 17 district court correctly found, Jamsostek does not sell 18 insurance to workers or to employers in any traditional sense 19 and does not otherwise compete in the marketplace like a private 20 insurer. 1 2 3 4 5 6 7 8 However, in arguing that Jamsostek Anglo-Iberia, 2008 WL 190364, at *4. Id. at *5. As the Rather, as the default health insurer under 5 While Anglo-Iberia also argues, inter alia, that Jamsostek s employees day-to-day activities of processing health claims and collecting health insurance premiums mirror the activities of a private insurer s employees, we properly focus our commercial activity analysis on the particular actions that the foreign state performs, and not on the particular actions of any specific Jamsostek employee. Weltover, 504 U.S. at 614 (emphasis added); see also Kato, 360 F.3d at 111-12. 11 1 Indonesia s national social security program, Jamsostek provides 2 a general floor for health insurance for all workers in 3 Indonesia and ensures that Indonesian employers with at least 4 ten employees comply with the governmental mandate that they 5 provide, at a minimum, basic health insurance coverage to their 6 workers. 7 Id.6 Thus, we agree with the district court that, for purposes of 8 our analysis under Weltover, the nature of Jamsostek s hiring, 9 supervision, and employment of Sartono and other employees is 10 directly concerned with employment in the provision of a 11 governmental program of health benefits through collection of 12 employer contributions and payroll deductions and that such 13 employment is by nature non-commercial. 14 Anglo-Iberia s argument to the contrary, to hold otherwise and 15 look only to the fact of employment for purposes of our 16 commercial activity analysis would allow the exception to 17 swallow the rule of presumptive sovereign immunity codified in 18 the FSIA. 19 Id. at *4. Despite See id. at *4 n.10. Based on the record evidence, we easily conclude that 20 Jamsostek s acts of providing basic health insurance to 21 Indonesia s workforce and monitoring employers compliance with 1 2 3 4 5 6 Contrary to Anglo-Iberia s arguments, these qualities define the nature of Indonesia s national health insurance system, not merely its purpose, because a private insurer could not compel employers to purchase coverage. Cf. Weltover, 504 U.S. at 61617. 12 1 the governmental mandate under the national social security 2 program are carried out in its capacity as Indonesia s default 3 health insurer. 4 to those of an independent actor in the private marketplace of 5 potential health insurers. 6 the contrary, Jamsostek s actions in connection with the 7 administration of Indonesia s national health insurance program 8 are sovereign in nature and do not suffice to bring it within the 9 commercial activity exception to the FSIA. Jamsostek s insurance operations do not equate Despite Anglo-Iberia s assertions to Compare Nelson, 507 10 U.S. at 361 (holding that conduct peculiarly sovereign in 11 nature does not satisfy the commercial activity exception), 12 and Jungquist v. Sheikh Sultan Bin Khalifa Al Nahyan, 115 F.3d 13 1020, 1030 (D.C. Cir. 1997) (holding that officials actions in 14 administering a government health program were uniquely 15 sovereign in nature despite relat[ing] in certain respects to 16 commercial activity ), with Weltover, 504 U.S. at 615 (concluding 17 that Argentina s issuance of government bonds to refinance its 18 debt was commercial in nature because the bonds in almost all 19 respects [are] garden-variety debt instruments . . . [that] may 20 be held by private parties . . . [and] are negotiable and may be 21 traded on the international market ). 22 Anglo-Iberia s argument under the commercial activity 23 exception also fails for a second reason: 24 negligence was not in connection with its health insurance 13 Jamsostek s alleged 1 activities in Indonesia. Even assuming arguendo and contrary to 2 fact that the nature of Jamsostek s insurance activities were 3 commercial and not sovereign, Anglo-Iberia has not shown a 4 sufficient nexus between Jamsostek s alleged negligent 5 supervision and its alleged commercial activity for purposes of 6 abrogating Jamsostek s presumptive sovereign immunity under the 7 FSIA. 8 connection, as used in the FSIA, is a term of art, and we 9 interpret it narrowly. We have made clear that [t]he statutory term in Garb, 440 F.3d at 587. As such, acts 10 are in connection with . . . commercial activity so long as 11 there is a substantive connection or a causal link between 12 them and the commercial activity. 13 and alterations omitted); see also Drexel Burnham Lambert Group 14 Inc. v. Comm. of Receivers for A.W. Galadari, 12 F.3d 317, 330 15 (2d Cir. 1993) (declining to read § 1605(a)(2) s connection 16 language to include tangential commercial activities to which 17 the acts forming the basis of the claim have only an attenuated 18 connection ). 19 Id. (internal quotation marks Here, we cannot conclude that Jamsostek s alleged negligent 20 supervision of Sartono and his colleagues was in connection 21 with its provision of basic health insurance in Indonesia. 22 commercial reinsurance scheme that is said to have injured Anglo- 23 Iberia was Sartono s alone and wholly unrelated to any negligent 24 supervision by Jamsostek with respect to its insurance activities 14 The 1 in Indonesia. Indeed, during the relevant time period, Sartono 2 was relieved of his regular employment responsibilities, was 3 unauthorized to conduct any commercial reinsurance activities, 4 and was prohibited from conducting Jamsostek business in Monaco, 5 the United States, or elsewhere abroad. 6 WL 190364, at *1 (adopting earlier district court findings). 7 addition, whatever assistance Sartono s Jamsostek-based 8 colleagues rendered to Sartono was provided solely at the 9 direction of Sartono, primarily occurred off-premises, did not See Anglo-Iberia, 2008 In 10 involve Jamsostek s business accounts, and was plainly unrelated 11 to Jamsostek s administration of Indonesia s social security 12 program. 13 to stop Sartono from enlisting the help of a few of his Jamsostek 14 colleagues, some of whom claimed to be acting unwittingly, in 15 establishing a fraudulent side business. 16 demonstrates nothing more than the barest connection between 17 Anglo-Iberia s alleged injuries by Sartono and Jamsostek s 18 alleged negligent supervision of Sartono and others with respect 19 to its social insurance activities in Indonesia. 20 Weltover, 504 U.S. at 614-15 (concluding that Argentina s act of 21 unilaterally extending its payment obligations was in connection 22 with its commercial activity of issuing bonds), with O Bryan v. 23 Holy See, 556 F.3d 361, 380 (6th Cir. 2009) (holding commercial 24 activity exception inapplicable to plaintiff s claims of In essence, Anglo-Iberia faults Jamsostek for failing 15 The record, however, Compare 1 negligent supervision because the gravamen of plaintiff s 2 claims did not truly sound[ ] in commercial activity ), cert. 3 denied, 130 S. Ct. 361 (2009), and Stena Rederi AB v. Comision de 4 Contratos del Comite Ejecutivo General, 923 F.2d 380, 386 (5th 5 Cir. 1991) ( Not only must there be a jurisdictional nexus 6 between the United States and the commercial acts of the foreign 7 sovereign, there must be a connection between the plaintiff s 8 cause of action and the commercial acts of the foreign 9 sovereign. ). 10 Thus, even if we were to conclude contrary to fact that 11 Jamsostek s administration of Indonesia s national health 12 insurance program and its employment of Sartono and his 13 colleagues were commercial in nature, Jamsostek s alleged 14 negligent supervision of these employees is not sufficiently 15 connected to its insurance operations in Indonesia to satisfy the 16 in connection with requirement of FSIA s commercial activity 17 exception. 18 would be to abrogate a foreign sovereign s immunity solely on the 19 basis of an employment relationship and would allow Anglo-Iberia 20 to recast what is effectively a fraud claim, lacking any 21 significant nexus to Jamsostek s insurance activities in 22 Indonesia, as a negligent supervision claim sufficient to bring 23 Jamsostek within FSIA s commercial activity exception. 24 Nelson, 507 U.S. at 363. To conclude otherwise under the facts of this case 16 See 1 We therefore conclude that Anglo-Iberia has failed to 2 demonstrate that Jamsostek is subject to jurisdiction under 3 FSIA s commercial activity exception. 4 that Anglo-Iberia has failed to demonstrate that Indonesia is 5 subject to jurisdiction under the FSIA because Anglo-Iberia s 6 claim against Indonesia rests on the success of its allegations 7 against Jamsostek and because Anglo-Iberia has not overcome the 8 presumption that Jamsostek is a juridical entit[y] distinct and 9 independent from Indonesia. We similarly conclude First Nat l City Bank v. Banco Para 10 El Comercio Exterior de Cuba, 462 U.S. 611, 627-29, 632 (1983). 11 Having concluded that Anglo-Iberia s negligent supervision claim 12 fails to satisfy the commercial activity exception set forth 13 under 28 U.S.C. § 1605(a)(2), we do not reach Anglo-Iberia s 14 remaining arguments on appeal or Jamsostek and Indonesia s 15 16 arguments on cross-appeal.7 CONCLUSION 17 18 For the forgoing reasons, the district court s dismissal of 19 Anglo-Iberia s negligent supervision claim for lack of subject 20 matter jurisdiction is AFFIRMED. 1 2 3 4 5 6 7 8 7 Specifically, we do not reach Jamsostek and Indonesia s challenge to the district court s holding that if Jamsostek s negligent supervision were in connection with a commercial activity, it had a direct effect in the United States within the meaning of 28 U.S.C. § 1605(a)(2). We also decline to reach Jamsostek and Indonesia s argument that the torts exception, see 28 U.S.C. § 1605(a)(5), bars Anglo-Iberia s negligent supervision claim. 17

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