Clifford Chance

Supreme Court Hears Oral Argument in Case Challenging International Organizations' Immunity from Suit

November 2, 2018

The U.S. Supreme Court heard oral argument on October 31, 2018 in Budha Ismail Jam v. International Finance Corporation (No. 17-1011), which addresses the scope of international organizations' immunity from suit. The issue in Jam is whether international organizations enjoy virtually absolute immunity from civil suit in the United States, or whether they should have the same restrictive immunity as foreign sovereigns enjoy under the Foreign Sovereign Immunities Act ("FSIA"). Under the FSIA, notwithstanding their general immunity from suit, foreign sovereigns can be sued for conduct constituting "commercial activity." Allowing suit against international organizations, especially those involved in economic development activities, could dramatically increase those organizations' litigation and liability risk in the United States.

Jam marks the first time the Supreme Court has addressed this issue, and it poses significant implications for international organizations. A decision is expected in the first half of 2019.

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