Explicit Waiver of Sovereign Immunity Through Contractual Provisions under the FSIA

Introduction

In Williams v. Federal Government of Nigeria, 24-2329 (2d Cir. Apr. 9, 2025), the United States Court of Appeals for the Second Circuit addressed whether the Federal Government of Nigeria and its Attorney General were entitled to sovereign immunity under the Foreign Sovereign Immunities Act (“FSIA”). Dr. Louis Emovbira Williams had obtained a default judgment in the United Kingdom enforcing a 1993 instrument known as the “Fidelity Guarantee and Abiding Memorandum of Understanding of Assurance” (“Fidelity Guarantee”). When Nigeria failed to comply with that judgment, Williams sued in New York state court to enforce payment. Nigeria removed the case under the FSIA and moved to dismiss for lack of subject-matter jurisdiction, arguing that it retained sovereign immunity. The district court denied the motion, finding an explicit waiver of immunity in the Fidelity Guarantee. Nigeria appealed.

Summary of the Judgment

The Second Circuit affirmed the district court’s refusal to dismiss Williams’ enforcement action. It held that:

1. Under 28 U.S.C. § 1605(a)(1), a foreign state is not immune if it has “waived its immunity either explicitly or by implication.” The Fidelity Guarantee’s language constituted an “explicit” waiver because it was clear, unambiguous, and encompassed “any court,” including U.S. courts.
2. Pursuant to paragraph 21 of the Fidelity Guarantee, the Federal Government of Nigeria and the Central Bank of Nigeria agreed that Dr. Williams could choose any forum—U.K., Nigeria, or elsewhere—to enforce his monetary claims, and that defenses including state immunity, acts of state, and state privileges were “waived without any equivocation or doubt whatsoever.”
3. Other provisions (paragraphs 18 and 20) further reinforced that Nigeria had “deemed to have waived any immunity” from execution for the amounts owed under the agreement.
4. The court also declined to give issue-preclusive effect to the U.K. default judgment’s holding that paragraph 21 was not a “prior agreement” submitting Nigeria to U.K. jurisdiction, because the federal issue—whether the agreement waived U.S. sovereign immunity—was distinct from the U.K. court’s narrower contract-formation inquiry.

Analysis

Precedents Cited

1. Capital Ventures Int’l v. Republic of Argentina, 552 F.3d 289 (2d Cir. 2009): This decision held that a contractual clause waiving immunity “in any court” amounts to an explicit waiver under § 1605(a)(1), even if it does not explicitly mention U.S. courts or appears alongside clauses referring to foreign jurisdictions. The Williams court relied on Capital Ventures to confirm that the Fidelity Guarantee’s broad language sufficed.

2. Arch Trading Corp. v. Republic of Ecuador, 839 F.3d 193 (2d Cir. 2016): Reinforced the principle that, in resolving jurisdictional questions under the FSIA, courts may consider evidence beyond the pleadings, including contractual instruments and extrinsic materials relevant to immunity.

3. Pablo Star Ltd. v. Welsh Gov., 961 F.3d 555 (2d Cir. 2020): Clarified that orders denying FSIA immunity are immediately appealable under the collateral-order doctrine. This permitted Nigeria’s interlocutory appeal.

Legal Reasoning

The court’s analysis focused on § 1605(a)(1) of the FSIA, which states that a foreign state “shall not be immune” if it has “waived its immunity either explicitly or by implication.” Drawing on Capital Ventures, the panel reaffirmed that “explicit” requires “clear and unambiguous” language. It reviewed the Fidelity Guarantee’s text:

• Paragraph 21(1) allows Williams to bring proceedings “in the UK or Nigeria or any other country.”
• Paragraph 21(3) stipulates that “neither the Nigerian State nor the [Central Bank of Nigeria] shall raise or invoke any defences . . . including . . . state immunities,” and that these defenses are “waived without any equivocation and doubt whatsoever.”
• Paragraph 18 bars objections based on state or central-bank ownership of funds in “any jurisdiction.”
• Paragraph 20 deems Nigeria to have “waived any immunity from levying of execution” on the amounts due.

Because this language is broader than what Capital Ventures deemed sufficient—and because it expressly mentions “any court” or “any jurisdiction”—the Second Circuit concluded that Nigeria had explicitly waived its immunity before U.S. state and federal courts.

On issue preclusion, the court applied traditional federal collateral-estoppel rules and held that the U.K. ruling did not address the same legal question. The U.K. court had considered whether paragraph 21 constituted a “prior agreement” by which Nigeria submitted to U.K. jurisdiction; here, the U.S. court was concerned solely with waiver of sovereign immunity under the FSIA, regardless of whether the Nigerian sovereign was technically a “party” to the contract. Because the issues were not identical, preclusion did not apply.

Impact

This decision signals to foreign states that contractual commitments containing broad waiver clauses—especially those referencing “any court” or “any jurisdiction”—can subject them to suit in U.S. courts under the FSIA. It clarifies that:

• Waivers need not mention the United States by name so long as they are clear and unambiguous.
• Courts will enforce anti-immunity clauses even if the primary dispute arose in a foreign forum.
• Issue preclusion will not bar FSIA immunity questions simply because a foreign court reached a different conclusion on a related contractual provision.

Practitioners should draft indemnity agreements, guarantees, and settlement instruments with precision when negotiating sovereign-immunity waivers, and governments should be cautious about broad waiver language.

Complex Concepts Simplified

FSIA (Foreign Sovereign Immunities Act): A federal law establishing when and how foreign governments can be sued in U.S. courts. By default, foreign states are immune, but there are statutory exceptions.

Explicit Waiver: A contract term in which a state clearly and unambiguously agrees not to claim sovereign immunity. If such language exists, courts have jurisdiction.

Collateral Order Doctrine: A legal principle allowing certain decisions—like denials of sovereign immunity—to be appealed immediately, even if the case is not over.

Issue Preclusion (Collateral Estoppel): Prevents a party from re-litigating an issue already decided in a prior case—if the issue is identical, actually litigated, essential to the judgment, and decided in a final judgment.

Conclusion

Williams v. Federal Government of Nigeria reaffirms that a foreign state’s clear contractual waiver of immunity will strip it of FSIA protection in U.S. courts. The Second Circuit’s application of Capital Ventures underscores that waiver clauses referring to “any court” suffice, and that U.K. rulings on related but distinct questions do not bind U.S. courts. This decision strengthens enforcement of cross-border monetary judgments against states and highlights the importance of explicit drafting when sovereign immunity is at stake.