By Michael C. Dorf
On Wednesday, the Supreme Court unanimously rejected a lawsuit by the heirs of German Jewish art dealers who alleged that Nazi Hermann Goering had forced their ancestors to sell extremely valuable works for about a third of their market value. The bottom line in Federal Republic of Germany v. Philipp may well be defensible on the merits. A German cultural institution and a commission that investigates art stolen by the Nazis concluded that the particular works in question were actually sold at fair market value. That determination might be right and could be entitled to some sort of preclusive effect in any event.
However, the US Supreme Court's decision was not based on the merits or deference to another adjudication. Rather, the Court held that the Foreign Sovereign Immunities Act (FSIA) does not authorize suit, thus leaving intact Germany's foreign sovereign immunity. Put differently, the Court would have ruled against the heir-plaintiffs even if the evidence of uncompensated appropriation were rock solid. The Court so ruled despite the fact that the statutory text abrogates foreign sovereign immunity in cases "in which rights in property taken in violation of international law are in issue." Genocide violates international law, so the plaintiffs argued that art appropriated as part of a genocide fits the statutory language.
The unanimous opinion by Chief Justice Roberts rejects the plaintiffs' reading of the FSIA. In order to trigger the abrogation, the appropriation must violate the international law of property, not the international law of genocide, he says. Despite the Court's unanimity, that result was hardly foreordained. It also stands in tension with some very old moral wisdom. To be clear, I'm not saying the ruling is wrong; I am saying that the case ought to have occasioned more angst than it apparently did.
The key provision of the FSIA mirrors one that was enacted in response to the Supreme Court's decision in allowing Cuba to raise so-called act-of-state immunity in Banco Nacional de Cuba v. Sabbatino. An organ of the Castro government brought suit in a U.S. court seeking to recover money allegedly unlawfully retained. The defendant argued that the Cuban claim was invalid because it was predicated on an unlawful expropriation. SCOTUS sustained the Cuban government bank's objection to the defense under the act-of-state-doctrine, which is a close cousin of foreign sovereign immunity. The Sabbatino Court did not say whether international law at the time actually forbade uncompensated expropriations, holding instead that it was without power to adjudicate the question. Congress reversed that holding with respect to act-of-state immunity in a law known as the Second Hickenlooper Amendment. The relevant provision of the FSIA was adopted 12 years later using the same language for foreign sovereign immunity. If Sabbatino or a like case in which the foreign sovereign were the defendant were to arise today, neither act-of-state nor foreign sovereign immunity doctrine would bar a court from adjudicating a defense or (in a case in which the owner of the appropriated property sued as plaintiff) a claim that the expropriation violated international law.
As it happens, it's not clear whether expropriations (of the sort one sees when a communist regime comes to power and nationalizes the "means of production") even do violate international law. What is clear, Chief Justice Roberts says in Philipp, is that at most, international law bars uncompensated expropriations of property owned by foreigners. No one argues that there is an international law version of the Fifth Amendment's Takings Clause that applies to a state's expropriations of the property of its own citizens or subjects. Allowing for the possibility that the plaintiffs' ancestors were not German nationals and thus could obtain a different result on that ground on remand, the Court in Philipp holds that insofar as the ancestors were German nationals, the FSIA does not afford them any relief.
The opinion of the Chief Justice is reasonably persuasive as far as it goes, but it's worth noting a couple of key limitations. First and most consequentially, the Philipp opinion is not much of an exercise in textualism. Let us grant that the text of the FSIA calls on courts to look to the content of international law, which is itself external to the FSIA. Thus, one cannot fault CJ Roberts for looking beyond the statutory text to reach the conclusion that insofar as there is any international law limit on expropriations as such, it is one that only applies to the property of foreign nationals.
However, CJ Roberts does not stop at saying that international law distinguishes between expropriations of the property of nationals and foreigners. He also finds a basis for that distinction in the FSIA itself. And he similarly finds a basis for distinguishing between violations of the international law of property and other branches of international law, such as the prohibition on genocide. But how? The statutory language I quoted above (and which the Chief Justice quotes early in his opinion) refers broadly to "property taken in violation of international law," without any express limitation regarding either the victims' nationality or the branch of international law that the expropriation might violate.
Quoting Justice Scalia in another Title VII case, Justice Gorsuch (joined by the Chief Justice and the Democratic appointees) reminded us last year in Bostock v. Clayton County that we are governed by "the provisions of our laws rather than the principal concerns of our legislators." The Congress that forbade workplace "sex" discrimination thereby proscribed sexual harassment and discrimination based on sexual orientation and gender identity without specifically so intending. Likewise, perhaps the Congress that lifted foreign sovereign immunity and act-of-state immunity in cases "in which rights in property taken in violation of international law are in issue" thereby authorized suits to recover property of nationals expropriated in the course of a genocide, even though the Congress that adopted the key provision of the FSIA did not have that case specifically in mind.
The Philipp opinion avoids the plain-text conclusion through a number of arguments. I'll focus on the two strongest. First, the Chief Justice rightly notes that a consensus arose in the wake of the Second Hickenlooper Amendment that it lifted act-of-state immunity for allegedly unlawful expropriations of foreigners' property and where the violation concerned the international law of property. A good textualist allows for the possibility of terms of art and can take account of the objective context in which Congress legislated. Accordingly, here, a textualist could say (as Roberts says for the Court in Philipp) that when Congress borrowed the language of the Second Hickenlooper Amendment in the FSIA, it replanted not just the tree but also the soil within which it grew--i.e., the background consensus on the limitations that went with that language.
Second, CJ Roberts points to a number of ways in which other provisions of the FSIA would be anomalous if the expropriation provision were given the meaning the plaintiffs sought. For example, where Congress specifically authorized suits against sovereigns for serious human rights violations--including compensation for torture and murder--it included limitations that do not apply to the expropriation provision. Congress would have had no good reason to want to subject suits for property expropriations committed in the course of a serious human rights violation to be easier to bring than suits for the even graver offenses of torture and murder. Thus, Roberts infers, the limitations on suits for torture and murder show that Congress assumed that the FSIA did not cover expropriations based on a human rights violation.
Those are good arguments, and I find them ultimately persuasive. But here's the thing: Although self-described textualists allow that background assumptions and structural inferences from other statutory provisions are permissible tools, they do not always accept them as persuasive. For example, in King v. Burwell, the Court--in an opinion by CJ Roberts--construed the term health insurance "Exchange established by the State" to include such an exchange established by the federal government in states that chose not to create their own. The majority relied on the background purposes at which Congress aimed and on the evidence in other parts of the Affordable Care Act that indicated that Congress apparently assumed the federal government had the power to establish exchanges for states. And yet three Justices, including two Justices who join in Philipp--Thomas and Alito--dissented in King.
Am I saying that Justices Thomas and Alito are hypocrites? No. A textualist could find arguments rooted in background and statutory context unpersuasive in one context but persuasive in another. Maybe that's all that's going on here. What I am saying is that the fact that it's possible to reconcile Philipp with textualism doesn't mean that textualism or general principles of statutory construction are the only considerations in play in any case that is sufficiently contested to reach the Supreme Court.
What else is in play in Philipp? One would hope that moral considerations are. Unfortunately, morality does not play any obvious role for the Court. To be sure, the opinion doesn't condone genocide or Nazis or even stolen art. But it does pass over without remarking on what is at least an apparent oddity of the law as the Court sees it: It's easier for a foreigner to recover for an uncompensated taking accomplished as part of a state-run redistribution program than for a national to recover for an expropriation as part of a genocide.
That particular juxtaposition is especially jarring given a Biblical passage with which I would imagine most of the Justices would be familiar. In 1 Kings, chapter 21, we learn that Ahab coveted Naboth's vineyard to convert into a garden for himself. Ahab offered Naboth fair market value. In the King James Version linked above, Ahab tells Naboth, "I will give thee for it a better vineyard than it; or, if it seem good to thee, I will give thee the worth of it in money." Naboth refuses, because the land was an inheritance and he thinks that swapping it for better land or money would dishonor God and his ancestors. Ahab's wife Jezebel persuades him to have Naboth framed for blasphemy, a capital offense; he does so; Naboth is found guilty and executed; so Ahab then took the vineyard without having to pay at all.
A good deal for Ahab? Well, sure, except that God was not pleased, threatening Ahab with terrible punishments. The chapter ends oddly, with Ahab escaping the punishment because he repented but God simply delaying punishment in the plan of visiting it on Ahab's (innocent) descendants, but let's put that particular spot of trouble aside and focus on the morally sound admonition God prepares for Ahab in response to what he did to Naboth.
God asks: "Hast thou killed, and also taken possession?" Although the story does not dwell on the point, the moral seems pretty obvious: Killing to obtain someone's property is especially despicable.
Or, to put the point in terms of the Philipp case, one would think that obtaining property through genocide would be worse than failing to pay just compensation for an expropriation without also committing genocide. And yet the Supreme Court seems untroubled by the fact that genocide is nearly a mitigating factor in the case.