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Summary of Opinion: Creighton Limited v. Government of the State of Qatar, No. 98-7063 (D.C. Cir. July 2, 1999)

Factual and Procedural Background

Creighton Limited, a Cayman Islands corporation with offices in Tennessee, contracted in 1982 with the Government of Qatar to build a hospital in Doha. The contract required Creighton to obtain a Qatari performance bond, maintain an office in Qatar to receive notices, provide that performance and interpretation of the contract would be under Qatari law, and specify that disputes would be finally settled under the Rules of Conciliation and Arbitration of the International Chamber of Commerce (ICC). Payments under the contract were made in Qatar in Qatari riyals.

In 1986 Qatar expelled Creighton from the site for alleged unsatisfactory performance. Creighton initiated ICC arbitration in Paris in 1987. The ICC awarded Creighton over $8 million in damages, interest, and attorney's fees. Qatar sought to set aside the award in French courts; the Supreme Court of France ultimately rejected Qatar's challenge. Creighton was nonetheless unable to enforce the award in France because particular Qatari assets in France were held immune from attachment; Creighton's appeal on that point remained pending in the French Supreme Court at the time of this opinion.

Creighton then filed suit in the United States District Court for the District of Columbia seeking enforcement of the Paris arbitral award. Qatar moved to dismiss, arguing (1) lack of subject matter jurisdiction under the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. §§ 1330, 1602–1611, and (2) lack of personal jurisdiction under the Due Process Clause of the Fifth Amendment. The district court dismissed for lack of personal jurisdiction. Creighton appealed.

Legal Issues Presented

  1. Whether the district court has subject matter jurisdiction to enforce a foreign arbitral award against a foreign state under the FSIA, in particular whether either the implied-waiver exception (28 U.S.C. § 1605(a)(1)) or the arbitration exception (28 U.S.C. § 1605(a)(6)) applies.
  2. Whether the district court has personal (in personam) jurisdiction over the foreign state consistent with the Due Process Clause of the Fifth Amendment, including whether Qatar waived any objection to personal jurisdiction by agreeing to arbitrate in France or whether Qatar has the requisite minimum contacts with the United States.

Arguments of the Parties

Appellant's (Creighton) Arguments

  • Qatar, by agreeing to arbitrate in France (a signatory to the New York Convention), implicitly waived its sovereign immunity and thus subject matter jurisdiction exists under the FSIA implied-waiver exception, 28 U.S.C. § 1605(a)(1).
  • Alternatively, subject matter jurisdiction exists under the arbitration exception, 28 U.S.C. § 1605(a)(6), because the New York Convention requires recognition and enforcement of awards rendered in a signatory state (France), and the award was rendered in Paris.
  • Qatar either waived its objection to personal jurisdiction by agreeing to arbitrate in France or, alternatively, Qatar has sufficient minimum contacts with the United States (through contracting with a U.S.-based company, negotiating contacts in Tennessee, contract modification signed in Tennessee, telexed status reports to Tennessee) to satisfy due process for personal jurisdiction.
  • Application of § 1605(a)(6) is properly applied despite the arbitration exception being added to the FSIA after the contract and arbitration commenced (Creighton argues jurisdictional statutes govern which tribunal may hear the case and thus are not impermissibly retroactive).

Appellee's (Qatar) Arguments

  • Qatar contended the district court lacks subject matter jurisdiction under the FSIA because Qatar did not waive immunity by agreeing to arbitrate in France — Qatar is not a signatory to the New York Convention and a foreign state's agreement to arbitrate in a Convention state does not, without more, constitute waiver to suit in the United States.
  • Qatar argued that application of the arbitration exception (§ 1605(a)(6)) would be impermissibly retroactive because it was added after the contract and arbitration began.
  • Qatar maintained that it lacks sufficient contacts with the United States to be subject to personal jurisdiction consistent with due process; the district court found Qatar's contacts insufficient for in personam jurisdiction.

Table of Precedents Cited

Precedent Rule or Principle Cited For (as stated in the opinion) Application by the Court in This Case
Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989) FSIA is "the sole basis for obtaining jurisdiction over a foreign state in our courts." Cited to establish that jurisdiction over a foreign state in U.S. courts is governed exclusively by the FSIA.
Saudi Arabia v. Nelson, 507 U.S. 349 (1993) Foreign state is presumptively immune from jurisdiction of U.S. courts. Used to state the presumption of sovereign immunity that FSIA creates.
Shapiro v. Republic of Bolivia, 930 F.2d 1013 (2d Cir. 1991) Courts have construed the implied waiver provision narrowly; "virtually unanimous" precedents. Relied upon to justify narrow construction of § 1605(a)(1) and the requirement of intent to waive immunity.
Princz v. Federal Republic of Germany, 26 F.3d 1166 (D.C. Cir. 1994) Implied waiver depends on indication of amenability to suit; requires intent to waive immunity. Cited for the intentionality requirement for finding implied waiver under § 1605(a)(1).
Foremost-McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d 438 (D.C. Cir. 1990) Courts rarely find waiver without strong evidence that the foreign state intended to waive immunity. Supported the court's narrow approach to implied waiver and the intent requirement.
Seetransport Wiking Trader v. Navimpex Centrala, 989 F.2d 572 (2d Cir. 1993) When a country is a signatory to the New York Convention, that signatory must have contemplated enforcement actions in other signatory states. Distinguished: Seetransport's reasoning applies where the defendant was a signatory to the Convention; Qatar was not, so Seetransport did not compel finding implied waiver here.
Frolova v. Union of Soviet Socialist Republics, 761 F.2d 370 (7th Cir. 1985) Most courts refuse to find implied waiver to suit in American courts from arbitration clauses specifying arbitration in a country other than the U.S. Used as authority for rejecting a broad reading of implied waiver from arbitration abroad.
Maritime Int'l Nominees Estab. v. Republic of Guinea, 693 F.2d 1094 (D.C. Cir. 1982) Courts have generally assumed Congress did not endorse literal wording of House Report; examples of implied waiver in legislative history were typically unambiguous. Cited for the proposition that implied waiver examples in legislative history are narrow and require clear indications of waiver.
Argentine Republic v. Amerada Hess Shipping Corp. (again), 488 U.S. at 442-43 Signing an international agreement that does not mention waiver of immunity to suit in U.S. courts does not constitute waiver under § 1605(a)(1). Applied to reject the notion that Qatar's agreement to arbitrate abroad, without mention of U.S. jurisdiction, impliedly waived immunity here.
Cargill Int'l S.A. v. M/T Pavel Dybenko, 991 F.2d 1012 (2d Cir. 1993) New York Convention is the sort of treaty Congress intended to include in the § 1605(a)(6) arbitration exception. Used to support the conclusion that the New York Convention falls within the arbitration exception added in 1988.
Chromalloy Aeroservices v. Arab Republic of Egypt, 939 F. Supp. 907 (D.D.C. 1996) Support for treating the New York Convention as fitting the arbitration exception. Cited as additional authority that § 1605(a)(6) covers New York Convention awards.
Landgraf v. USI Film Prods., 511 U.S. 244 (1994) Intervening statutes conferring or ousting jurisdiction are regularly applied; application of a new jurisdictional rule usually takes away no substantive right but changes the tribunal. Relied upon to conclude that applying § 1605(a)(6) (enacted after the contract) is not impermissibly retroactive because it is jurisdictional.
McGee v. International Life Ins. Co., 355 U.S. 220 (1957) Long-arm statutes enacted after contract formation can provide a forum to enforce substantive rights without altering those rights. Analogized to support nonretroactivity of applying § 1605(a)(6) to enforcement proceedings.
United States v. Olano, 507 U.S. 725 (1993) Distinction between waiver (intentional relinquishment) and forfeiture (failure to timely assert a right). Used to explain difference between § 1605(a)(1) (waiver) and § 1605(a)(6) (forfeiture-type denial of immunity) and why (a)(6) does not imply waiver of due process objection.
Republic of Argentina v. Weltover, Inc., 504 U.S. 607 (1992) Questioning whether the personal jurisdiction requirement of the due process clause applies to foreign states (cites prior holding that a State of the Union is not a "person" for the clause). Noted as part of the doctrinal backdrop, but the court proceeded on the parties' assumption that due process personal jurisdiction protection applied to Qatar.
South Carolina v. Katzenbach, 383 U.S. 301 (1966) Cited by Weltover reference (contextual). Included in background citation regarding whether a foreign state is a "person" under due process analysis; no independent application beyond that context.
Flatova v. Islamic Republic of Iran, 999 F. Supp. 1 (D.D.C. 1998) District court decision treating personal jurisdiction requirement as not applying to foreign states. Mentioned as an example of a district court holding; the panel did not adopt that view and proceeded on the parties' assumption.
Victory Transport Inc. v. Comisaria General de Abastecimientos y Transportes, 336 F.2d 354 (2d Cir. 1964) Agreement to arbitrate in New York implied consent to jurisdiction of courts that could compel arbitration in New York, not waiver of jurisdiction elsewhere. Relied upon to show precedent limits implied waiver of personal jurisdiction to the forum specified in the arbitration agreement.
Microfibres, Inc. v. McDevitt-Askew, 20 F. Supp. 2d 316 (D.R.I. 1998) Agreement to litigate contractual disputes in a jurisdiction implicitly waives right to challenge personal jurisdiction in that jurisdiction. Used to support the point that waiver-by-agreement is forum-specific, not a general waiver of jurisdiction elsewhere.
Inso Corp. v. Dekotec Handelsges, 999 F. Supp. 165 (D. Mass. 1998) Contractual stipulation to a particular forum implies consent to personal jurisdiction in that forum. Same purpose as Microfibres: to show the forum-specific nature of waiver by contractual agreement.
Baker v. General Motors Corp., 522 U.S. 222 (1998) Discusses limits on recognizing judgments entered by courts that lacked personal jurisdiction. Invoked in analogy to illustrate why a forum-specific waiver should not be automatically transmuted into nationwide waiver via reciprocal enforcement clauses.
Pennoyer v. Neff, 95 U.S. 714 (1877) Traditional personal-jurisdiction principles (historic limits on courts exercising jurisdiction over nonresidents). Referenced in the discussion of historical limits on personal jurisdiction and enforceability of judgments from fora that lacked jurisdiction.
D'Arcy v. Ketchum, 52 U.S. (11 How.) 165 (1850) Historical authority on jurisdictional limits. Cited in the same context as Pennoyer to illustrate historical limitations on recognizing judgments lacking jurisdiction.
International Shoe Co. v. Washington, 326 U.S. 310 (1945) Due process requires minimum contacts such that suit does not offend traditional notions of fair play and substantial justice. The court applied International Shoe as the controlling standard for evaluating Qatar's contacts with the United States.
Insurance Corp. of Ireland v. Compagnie Des Bauxites, 456 U.S. 694 (1982) Personal-jurisdiction requirement can be waived by agreement to submit to jurisdiction. Cited for the proposition that personal-jurisdiction protections are individual liberty interests and may be waived by consent.
United Transp. Union-Illinois Legis. Bd. v. STB, 175 F.3d 163 (D.C. Cir. 1999) Used to explain the court proceeds on the disputes as framed by parties. Cited to justify proceeding on the parties' framing that the due process protections apply to Qatar.
Afram Export Corp. v. Metallurgiki Halyps, S.A., 772 F.2d 1358 (7th Cir. 1985) Noted as an example where courts assume foreign companies have the same rights to object to extraterritorial personal jurisdiction as U.S. citizens. Mentioned to highlight that the assumption Qatar gets due process protection is unchecked by Qatar's own challenge to that doctrinal point.
Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) Contract alone with an out-of-state party does not automatically establish sufficient minimum contacts; consider prior negotiations, future consequences, terms, and course of dealing. Applied to reject Creighton's contention that contracting with a U.S. company alone established minimum contacts for Qatar.
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980) Defendant must reasonably anticipate being haled into court where suit is filed. Used to underscore the foreseeability requirement for minimum contacts.
Hanson v. Denckla, 357 U.S. 235 (1958) Essential that defendant purposely avail itself of the privilege of conducting activities in the forum. Applied to analyze whether Qatar purposefully availed itself of U.S. laws; court found it did not.
Health Communications, Inc. v. Mariner Corp., 860 F.2d 460 (D.C. Cir. 1988) Purchaser's selection of an out-of-state seller does not constitute purposeful availment by the purchaser of seller's forum. Analogous controlling case; used to explain why Qatar's contacts (as the seller/host country) did not purposefully avail it of U.S. jurisdiction simply because Creighton was based in Tennessee.
Rein v. Socialist People's Libyan Arab Jamahiriya, 162 F.3d 748 (2d Cir. 1998) Not all FSIA amendments require minimum contacts; example distinguishing later amendments. Cited to show that later amendments (like § 1605(a)(6)) may not incorporate the same minimum-contacts requirements as earlier provisions.

Court's Reasoning and Analysis

The court divided its analysis into two distinct jurisdictional inquiries: (A) subject matter jurisdiction under the FSIA and related treaties (the New York Convention), and (B) personal jurisdiction under the Due Process Clause.

A. Subject Matter Jurisdiction

The court first recognized that enforcement of a foreign arbitral award in the United States is governed by the New York Convention and implementing U.S. legislation (9 U.S.C. § 201 et seq.), and that the award here, rendered in Paris, falls within the scope of the Convention and is therefore a matter that U.S. district courts have original jurisdiction to hear (9 U.S.C. § 203). The dispositive FSIA issue was whether Qatar is immune from suit under the FSIA, or whether one of the statute's exceptions applies.

1. Implied Waiver — 28 U.S.C. § 1605(a)(1)

Creighton argued that Qatar's agreement to arbitrate in France impliedly waived sovereign immunity under § 1605(a)(1). The court observed that its precedents construe implied waiver narrowly and require evidence that the foreign state intended to waive immunity. The court cited its own and other circuits' cases demonstrating that the implied-waiver exception requires a clear showing of intent to be amenable to suit. Because Qatar was not a signatory to the New York Convention and Creighton provided no other evidence that Qatar intended to waive immunity to suit in the United States, the court held that § 1605(a)(1) did not apply.

2. Arbitration Exception — 28 U.S.C. § 1605(a)(6)

Congress added § 1605(a)(6) in 1988, which removes immunity in actions "to confirm an award made pursuant to ... an agreement to arbitrate" when the agreement or award is governed by a treaty calling for recognition and enforcement of arbitral awards. The court concluded that the New York Convention fits naturally within that exception and that Qatar did not contest that by textual terms the exception applies because the award was rendered in a signatory state (France).

Qatar argued that applying § 1605(a)(6) would be impermissibly retroactive because the contract and arbitration predated the amendment. The court relied on Landgraf and McGee to explain that application of an intervening jurisdictional statute is not impermissibly retroactive when it concerns which tribunal may hear enforcement claims rather than altering substantive rights. Thus, the court held that § 1605(a)(6) properly confers subject matter jurisdiction over Creighton's action to confirm the ICC award.

B. Personal Jurisdiction (Due Process)

The court proceeded, as the parties framed the dispute, under the assumption that Qatar is entitled to the protections of the Fifth Amendment due process personal-jurisdiction requirement (even though the Supreme Court had queried whether such protection applies to foreign states). The court treated two lines of argument: waiver of personal-jurisdiction objection by agreeing to arbitrate in France, and the assertion that Qatar had sufficient minimum contacts with the United States.

1. Waiver

Creighton argued that by agreeing to arbitrate in France, Qatar implicitly waived its due-process objection to being haled into U.S. courts to enforce the award. The court rejected this argument for multiple reasons:

  • Section 1605(a)(6) is an arbitration-based statutory exception to immunity, not a waiver provision; it lacks the intentionality element inherent in § 1605(a)(1). Waiver (intentional relinquishment) and forfeiture (statutory denial of immunity) are distinct concepts under controlling precedent.
  • The court found no authority supporting the proposition that agreeing to arbitrate in one foreign forum constitutes waiver of personal-jurisdiction objections in a different forum. Precedent shows that contractual or arbitration-based waivers of jurisdiction tend to be forum-specific (i.e., consenting to jurisdiction in the chosen forum, not elsewhere).
  • The court analogized the New York Convention's reciprocal enforcement clause to the Full Faith and Credit Clause and rejected a "bootstrap" argument that a waiver in one forum should automatically produce nationwide personal jurisdiction elsewhere.

For these reasons, the court held that Qatar did not waive its objection to personal jurisdiction in the United States by agreeing to arbitrate in France.

2. Minimum Contacts

The court applied the International Shoe minimum-contacts test (and subsequent clarifications such as Burger King) to decide whether Qatar's contacts with the United States were sufficient to satisfy due process. Creighton pointed to negotiating contacts with Creighton's Tennessee office, a contract modification signed in Tennessee, and telexed weekly status reports to Tennessee, in addition to the fact that Creighton is based in the United States.

The court concluded that these contacts did not show purposeful availment of U.S. laws by Qatar. It emphasized that mere contracting with a U.S. company does not automatically create sufficient contacts in the company's forum and that Qatar's contract was made, performed, and paid in Qatar under Qatari law. The court relied on Health Communications (a controlling, analogous D.C. Circuit case) to explain that a purchaser's selection of an out-of-state seller (or here, a foreign contracting government interacting with a U.S.-based company) does not amount to purposeful availment by the foreign party. Accordingly, the court found Qatar's contacts insufficient to satisfy minimum contacts and thus insufficient for constitutional personal jurisdiction.

Holding and Implications

Holding: The court held that the district court had subject matter jurisdiction to entertain Creighton's action to confirm the ICC arbitral award under the FSIA arbitration exception, 28 U.S.C. § 1605(a)(6), but that the district court lacked personal jurisdiction over the Government of Qatar under the Due Process Clause. The court therefore affirmed the district court's judgment dismissing Creighton's suit for lack of personal jurisdiction. The panel's disposition was:

Affirmed.

Implications: The direct effect is that Creighton cannot enforce the Paris ICC award in the District of Columbia because the court lacks personal jurisdiction over Qatar, even though subject matter jurisdiction would be available under § 1605(a)(6). The opinion clarifies that (1) agreeing to arbitrate in another country's territory that is a signatory to the New York Convention does not, by itself, create an implied waiver of sovereign immunity under § 1605(a)(1) when the foreign state is not a Convention signatory, (2) § 1605(a)(6) applies to confer subject matter jurisdiction to confirm an award rendered in a Convention country and is not impermissibly retroactive, and (3) the arbitration exception does not automatically waive a foreign state's constitutional due-process objection to in personam jurisdiction in the United States. The opinion does not announce a novel broad rule expanding personal jurisdiction over foreign states; instead it affirms the continued need for forum-specific waiver or constitutionally adequate minimum contacts for personal jurisdiction.

Notes on Sources

This summary is based exclusively on the text of the opinion provided and does not include information beyond what the opinion contains.

Creighton Limited, Appellant v. Go

GINSBURG, Circuit Judge:

Creighton Limited, a Cayman Islands corporation with offices in Tennessee, contracted with the Government of the State of Qatar to build a hospital in Doha, the Qatari capital. Following a dispute over its performance, Creighton obtained an arbitral award against Qatar from the International Chamber of Commerce in Paris. Creighton now seeks to enforce the award in the United States District Court for the District of Columbia. Qatar claims the court lacks subject matter jurisdiction over the action pursuant to the Foreign Sovereign Immunities Act of 1976, 28 U.S.C. §§ 1330, 1602-1611, and lacks personal jurisdiction over Qatar pursuant to the Due Process Clause of the Fifth Amendment to the Constitution of the United States. We hold that the district court has subject matter jurisdiction but affirm its dismissal of Creighton's suit for lack of personal jurisdiction.

I. Background

In the late 1970s the Government of Qatar decided to build a new hospital in Doha. Creighton obtained the necessary Qatari sponsor, submitted the low bid, and in 1982 contracted with Qatar to build the hospital. The contract required Creighton to obtain a performance bond from a Qatari issuer and to maintain an office in Qatar, to which notices under the contract would be sent. Qatar was to pay Creighton in Qatar, and in fact all payments were made there in Qatari riyals. The contract provided that it was to be performed and interpreted under Qatari law and that all disputes were to "be finally settled under the Rules of Conciliation and Arbitration of the International Chamber of Commerce."

In 1986 Qatar expelled Creighton from the construction site for unsatisfactory performance. Creighton contested its expulsion by commencing arbitration before the ICC in 1987. Because the contract did not specify a place for arbitration, the ICC decided to conduct the arbitration in Paris. Qatar willingly participated in the arbitration, which resulted in an order for Qatar to pay Creighton damages, interest, and attorney's fees totaling over $8 million. Qatar then filed a court action in France to set aside the award as invalid under French law, which the Supreme Court of France ultimately rejected. Nonetheless, Creighton has been unable to enforce the award in France. It attempted to attach Qatari assets located there but the Superior Court of Paris held the particular assets in question were immune from attachment under French law. Creighton's appeal of that decision is now pending before the Supreme Court of France.

Meanwhile, Creighton filed this action seeking enforcement of the award in the United States District Court for the District of Columbia; Qatar moved to dismiss on a number of grounds. The district court granted the motion on the ground that it lacks personal jurisdiction over Qatar because Qatar does not have sufficient contact with the United States to make it amenable to suit here consistent with the due process requirement of the fifth amendment.

II. Analysis

Qatar claims the district court lacks both subject matter jurisdiction over this action, pursuant to the Foreign Sovereign Immunities Act, and personal jurisdiction over Qatar, pursuant to the due process clause. Under the FSIA, the district court has subject matter jurisdiction of a civil action against a foreign state only if "the foreign state is not entitled to immunity either under [the immunity provisions of the FSIA itself, 28 U.S.C. §§ 1605- 1607] or under any applicable international agreement." 28 U.S.C. § 1330(a).

Creighton claims that by agreeing to arbitrate in France Qatar impliedly waived both its sovereign immunity, thereby conferring subject matter jurisdiction upon the court, see id. § 1605(a)(1) (6), and its due process objection, thereby conferring personal jurisdiction upon the court. Alternatively, Creighton claims that Qatar's agreement to arbitrate in France confers subject matter jurisdiction, see id. § 1605(a)(6), and its contacts with the United States are sufficient to satisfy the constitutional requirements of personal jurisdiction. Although we hold below (in Part II.A.2.b) that the court has subject matter jurisdiction pursuant to § 1605(a)(6), we find it necessary also to discuss § 1605(a)(1) because one of Creighton's due process arguments (see Part II.B.1) presupposes that Qatar, by agreeing to arbitrate in France, waived its immunity pursuant to § 1605(a)(1). We cannot resolve that due process argument without addressing the claim about § 1605(a)(1) upon which it is predicated.

A. Subject Matter Jurisdiction

There are two prerequisites to the district court having subject matter jurisdiction over this case. First, there must be a basis upon which a court in the United States may enforce a foreign arbitral award; and second, Qatar must not enjoy sovereign immunity from such an enforcement action. We discuss each requirement separately.

1. The New York Convention

Both France and the United States, but not Qatar, are parties to the so-called New York Convention, a multilateral treaty providing for "the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of such awards are sought." Convention on the Recognition and Enforcement of Foreign Arbitral Awards, opened for signature June 10, 1958, art. I.1, 21 U.S.T. 2517, reprinted in 9 U.S.C.A. § 201 (historical and statutory note). The U.S. legislation implementing the Convention declares that

[a]n action or proceeding falling under the Convention shall be deemed to arise under the laws and treaties of the United States. The district courts of the United States . . . shall have original jurisdiction over such an action or proceeding, regardless of the amount in controversy.

9 U.S.C. § 203.

That the New York Convention applies to the arbitral award Creighton obtained against Qatar in France, and that the award is therefore enforceable in United States courts, is undisputed. See Restatement (Third) of Foreign Relations Law § 487 comment b (1987) ("the critical element is the place of the award: if that place is in the territory of a party to the Convention, all other Convention states are required to recognize and enforce the award, regardless of the citizenship or domicile of the parties to the arbitration"). If Qatar were a private party, then there could be no doubt about the subject matter jurisdiction of the district court; because it is a foreign state, however, we must consider the effect of the FSIA upon the court's power to hear this case.

2. Sovereign Immunity

The FSIA is "the sole basis for obtaining jurisdiction over a foreign state in our courts." Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 434 (1989). A foreign state is "presumptively immune from the jurisdiction of United States courts," Saudi Arabia v. Nelson, 507 U.S. 349, 355 (1993), that is, the state is immune unless the particular lawsuit comes within an exception in the FSIA. See 28 U.S.C. § 1604. Creighton claims that the exceptions for an implied waiver and for arbitration, see id. § 1605(a)(1), (6), apply to this case.

a. Implied Waiver

The former exception provides:

(a) A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case —
(1) in which the foreign state has waived its immunity . . . by implication.

Id. § 1605(a)(1). Creighton claims that Qatar, by agreeing to arbitrate in France, implicitly waived its sovereign immunity in the United States for, by virtue of the New York Convention, Qatar was "on notice" that an arbitral award rendered in France would be enforceable in this country. Qatar responds that "the FSIA and decisions applying it make clear that a sovereign's agreement to arbitrate in a New York Convention state is not a waiver of immunity to suit in the U.S. unless the foreign sovereign is also party to the New York Convention."

The FSIA does not define an implied waiver. We have, however, followed the "virtually unanimous" precedents construing the implied waiver provision narrowly. Shapiro v. Republic of Bolivia, 930 F.2d 1013, 1017 (2d Cir. 1991). In particular, we have held that implicit in § 1605(a)(1) is the requirement that the foreign state have intended to waive its sovereign immunity. See Princz v. Federal Republic of Germany, 26 F.3d 1166, 1174 (1994) ("[A]n implied waiver depends upon the foreign government's having at some point indicated its amenability to suit"); Foremost-McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d 438, 444 (D.C. Cir. 1990) ("courts rarely find that a nation has waived its sovereign immunity . . . without strong evidence that this is what the foreign state intended").

The closest Creighton comes to arguing that Qatar intended to waive its sovereign immunity is in pointing to this statement in the House Report accompanying the FSIA: "the courts have found [implicit] waivers in cases where a foreign state has agreed to arbitration in another country." H.R. Rep. No. 94-1487, at 18 (1976), reprinted in 1976 U.S.C.C.A.N. 6604, 6617. Creighton claims Qatar's agreement to arbitrate in France should be deemed an implicit waiver of its sovereign immunity in U.S. courts. Cf. id. (explaining courts have also found such waivers "where a foreign state has agreed that the law of a particular country should govern a contract").

We follow the Second Circuit in rejecting such a broad reading of the "implicit waiver" exception.

[I]f the language of the legislative history [were] applied literally, a foreign government would be subject to the United States's jurisdiction simply because it agreed to have the contract governed by another country's laws, or agreed to arbitrate in a country other than itself, even though the agreement made no reference to the United States. Such an interpretation of § 1605(a)(1)'s "implicit waiver" exception would vastly increase the jurisdiction of the federal courts over matters involving sensitive foreign relations.

Seetransport Wiking Trader v. Navimpex Centrala, 989 F.2d 572, 577 (2d Cir. 1993); see also Frolova v. Union of Soviet Socialist Republics, 761 F.2d 370, 377 (7th Cir. 1985) ("[M]ost courts have refused to find an implicit waiver of immunity to suit in American courts from a contract clause providing for arbitration in a country other than the United States"); Maritime Int'l Nominees Estab. v. Republic of Guinea, 693 F.2d 1094, 1102 n. 13 (D.C. Cir. 1982) (courts "have generally assumed . . . that Congress did not endorse the literal wording of the House Report"). Indeed, the intentionality "requirement is also reflected in the examples of implied waiver set forth in the legislative history of § 1605(a)(1), all of which arise either from the foreign state's agreement (to arbitration or to a particular choice of law) or from its filing a responsive pleading without raising the defense of sovereign immunity." Princz, 26 F.3d at 1174; see also Shapiro, 930 F.2d at 1017 (explaining that legislative history lists examples of implicit waiver "in which the waiver was unmistakable, and courts have been reluctant to find an implied waiver where the circumstances were not similarly unambiguous"); Maritime Int'l, 693 F.2d at 1103 ("A key reason why pre-FSIA cases [referred to in the legislative history] found that an agreement to arbitrate in the United States waived immunity from suit was that such agreements could only be effective if deemed to contemplate a role for United States courts").

The Supreme Court has also read § 1605(a)(1) to require an intention to waive immunity in the United States, though concededly upon facts rather different from those present here. Argentina was sued in the United States for allegedly sinking a Liberian tanker owned by U.S. interests during the war between Great Britain and Argentina over the Falkland Islands. Although Argentina had signed international treaties setting forth substantive rules of conduct and stating that compensation would be paid for certain wrongs, the Court held "we [do not] see how a foreign state can waive its immunity under § 1605(a)(1) by signing an international agreement that contains no mention of a waiver of immunity to suit in United States courts or even the availability of a cause of action in the United States." Argentine Republic, 488 U.S. at 442-43.

Creighton seeks support in three cases in which the court found an implied waiver where a foreign government had agreed (like Qatar) to arbitrate in the territory of a state that had signed the New York Convention. See Seetransport, 989 F.2d at 578-79; M.B.L. Int'l Contractors v. Republic of Trinidad Tobago, 725 F. Supp. 52, 54-55 (D.D.C. 1989); Ipitrade Int'l S.A. v. Federal Republic of Nigeria, 465 F. Supp. 824, 826 (D.D.C. 1978). In each of these cases, however, the defendant sovereign was (unlike Qatar) a signatory to the Convention. In Seetransport the Second Circuit reasoned, correctly we think, that "when a country becomes a signatory to the Convention, by the very provisions of the Convention, the signatory state must have contemplated enforcement actions in other signatory states." 989 F.2d at 578.

Qatar not having signed the Convention, we do not think that its agreement to arbitrate in a signatory country, without more, demonstrates the requisite intent to waive its sovereign immunity in the United States. As Creighton directs us to no other evidence of such an intent, we hold that § 1605(a)(1) does not confer subject matter jurisdiction upon the district court.

b. Arbitration

The Congress added the following exception to the FSIA in 1988:

A foreign state shall not be immune from the jurisdiction of courts of the United States or of the States in any case . . . in which the action is brought . . . to confirm an award made pursuant to . . . an agreement to arbitrate, if . . . the agreement or award is or may be governed by a treaty or other international agreement in force for the United States calling for the recognition and enforcement of arbitral awards.

28 U.S.C. § 1605(a)(6). Qatar does not contest Creighton's assertion that because the New York Convention calls for enforcement of any arbitral award rendered within the jurisdiction of a signatory country, the quoted exception applies by its terms to this action. Indeed, it has been said with authority that the New York Convention "is exactly the sort of treaty Congress intended to include in the arbitration exception." Cargill Int'l S.A. v. M/T Pavel Dybenko, 991 F.2d 1012, 1018 (2d Cir. 1993); see also Chromalloy Aeroservices v. Arab Republic of Egypt, 939 F. Supp. 907, 909 (D.D.C. 1996).

Qatar's sole defense is that application of the arbitral exception here would be impermissibly retroactive because it was added to the statute after the contract was signed, indeed after the Paris arbitration was commenced. In reply, Creighton suggests that because the FSIA is a jurisdictional statute, its application to events that occurred before it was enacted would not be retroactive, for the FSIA speaks not to the primary conduct of the parties but rather to the question of which tribunal may enforce the arbitral award.

As the Supreme Court has pointed out, it

regularly applie[s] intervening statutes conferring or ousting jurisdiction, whether or not jurisdiction lay when the underlying conduct occurred or when the suit was filed. . . . Application of a new jurisdictional rule usually takes away no substantive right but simply changes the tribunal that is to hear the case. Present law normally governs in such situations because jurisdictional statutes speak to the power of the court rather than to the rights or obligations of the parties.

Landgraf v. USI Film Prods., 511 U.S. 244, 274 (1994). So it is in this case, for § 1605(a)(6) does not affect the contractual right of the parties to arbitration but only the tribunal that may hear a dispute concerning the enforcement of an arbitral award. See McGee v. International Life Ins. Co., 355 U.S. 220, 224 (1957) (holding long-arm statute enacted after parties entered into contract "did nothing more than to provide petitioner with a California forum to enforce whatever substantive rights she might have against respondent"). Under established principles, therefore, application of § 1605(a)(6) is not retroactive, let alone impermissibly retroactive, and Qatar does not claim that a different result should obtain simply because a foreign state is affected by the change in a jurisdictional statute. See Princz, 26 F.3d at 1171 (postulating, though not deciding, that application of 1976 version of FSIA to acts committed before 1952 would not be retroactive because it "would not alter Germany's liability under the applicable substantive law in force at the time, i.e. it would just remove the bar of sovereign immunity to the plaintiff's vindicating his rights under that law"). Accordingly, we hold that the district court has subject matter jurisdiction over this case pursuant to the arbitration exception in § 1605(a)(6).

B. Personal Jurisdiction

Not long ago we determined that the requirements of the FSIA for personal jurisdiction, see 28 U.S.C. § 1330(b), "do not affect the constitutional in personam jurisdiction requirement [of] the due process clause of the Fifth Amendment." Foremost-McKesson, 905 F.2d at 442 n. 10; see also Maritime Int'l, 693 F.2d at 1105 n. 18 ("Of course, a finding of FSIA personal jurisdiction, which would rest in part on a finding of non-immunity, must comport with the demands of due process, and Congress intended that the Act satisfy those demands"); Gilson v. Republic of Ireland, 682 F.2d 1022, 1028 (D.C. Cir. 1982) ("a statute cannot grant personal jurisdiction where the Constitution forbids it"). More recently, however, the Supreme Court questioned whether the personal jurisdiction requirement of the due process clause applies at all to foreign states, citing its prior holding that a State of the Union is not a "person" for purposes of that clause. See Republic of Argentina v. Weltover, Inc., 504 U.S. 607, 619 (1992) (citing South Carolina v. Katzenbach, 383 U.S. 301, 323-24 (1966)). And the district court in turn has held that the requirement of personal jurisdiction does not apply to a foreign state. See Flatova v. Islamic Republic of Iran, 999 F. Supp. 1, 19-21 (D.D.C. 1998).

"Personal jurisdiction over a foreign state shall exist as to every claim for relief over which the district courts have jurisdiction under subsection (a) where service has been made under section 1608 of this title."

Nonetheless, Creighton does not argue the point. Rather, Creighton claims that Qatar's entitlement to due process is satisfied because Qatar waived its objections to personal jurisdiction by agreeing to arbitrate in France or, in the alternative, because Qatar has the requisite minimum contacts with the United States. We take the dispute as the parties frame it, of course. See United Transp. Union-Illinois Legis. Bd. v. STB, 175 F.3d 163, 1999 WL 279754, at *4 (D.C. Cir. May 7, 1999); cf. Afram Export Corp. v. Metallurgiki Halyps, S.A., 772 F.2d 1358, 1362 (7th Cir. 1985) ("Countless cases assume that foreign companies have all the rights of U.S. citizens to object to extraterritorial assertions of personal jurisdiction. The assumption has never to our knowledge actually been examined"). Accordingly, we proceed upon the unchallenged assumption that Qatar must be afforded the protection it claims under the due process clause.

1. Waiver

For a court to assert personal jurisdiction over a defendant not physically present in the forum, the defendant normally must "have certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice." International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). Because this "personal jurisdiction requirement recognizes and protects an individual liberty interest," however, like other individual rights it may be waived — for example, if the defendant agrees "to submit to the jurisdiction of a given court." Insurance Corp. of Ireland, Ltd. v. Compagnie Des Bauxites, 456 U.S. 694, 702, 704 (1982).

Relying upon the legislative history of the FSIA, Creighton claims that we need not engage in a separate due process analysis of Qatar's contacts with the United States because the Congress designed all the exceptions to sovereign immunity in the FSIA to comport with due process. The House Report explains:

The requirements of minimum jurisdictional contacts and adequate notice are embodied in the provision [namely, 28 U.S.C. § 1605(a)(1)-(5)]. Cf. International Shoe Co. v. Washington, 326 U.S. 310 (1945), and McGee v. International Life Insurance Co., 355 U.S. 220, 223 (1957). . . .
Significantly, each of the immunity provisions in the bill . . . requires some connection between the lawsuit and the United States, or an express or implied waiver by the foreign state of its immunity from jurisdiction. These immunity provisions, therefore, prescribe the necessary contacts which must exist before our courts can exercise personal jurisdiction.

H.R. Rep. No. 94-1487, at 13, reprinted in 1976 U.S.C.C.A.N. at 6612. Creighton reasons that because Qatar impliedly waived its sovereign immunity under § 1605(a)(1), and alternatively because subject matter jurisdiction is proper under what it terms the "arbitral waiver" provision of § 1605(a)(6), Qatar has necessarily waived its objection to personal jurisdiction. The predicate for the first of these arguments we rejected when we held (in Part II.A.2.a) that Qatar did not impliedly waive its sovereign immunity under § 1605(a)(1). We now consider the second argument.

The House Report upon which Creighton relies accompanied the original 1976 legislation. As noted above, § 1605(a)(6) was added to the FSIA only in 1988. The 1976 legislative history, whatever it might be worth as a guide to the original Act, has little if any bearing upon the later amendment. Cf. Rein v. Socialist People's Libyan Arab Jamahiriya, 162 F.3d 748, 761 (2d Cir. 1998) ("The elements of § 1605(a)(7) [enacted in 1996], unlike those of the commercial activities exception [in § 1605(a)(2), which was enacted in 1976], do not entail any finding of minimum contacts").

In any event, Creighton's argument proceeds from a mistaken premise, for unlike § 1605(a)(1), § 1605(a)(6) deals not with waiver but with forfeiture. Cf. United States v. Olano, 507 U.S. 725, 733 (1993) ("Waiver is different from forfeiture. Whereas forfeiture is the failure to make the timely assertion of a right, waiver is the intentional relinquishment or abandonment of a known right"). Section 1605(a)(6) reflects the decision of the Congress to deny a foreign state immunity from suit in the United States if that state has agreed to arbitrate in any country that is party to a treaty (such as the New York Convention) calling for the enforcement of an arbitral award. Unlike subsection (a)(1), subsection (a)(6) contains no intentionality requirement. Therefore, although subsection (a)(6) confers subject matter jurisdiction upon the court, it does not follow that Qatar waived its objection to personal jurisdiction.

Although we have held that Qatar did not, by agreeing to arbitrate in France, waive its sovereign immunity under § 1605(a)(1), it is conceivable (though as we shall see, unlikely) that a different conclusion could follow with regard to whether Qatar waived its objection to personal jurisdiction under the due process clause. Creighton, however, has not cited, nor are we aware of, any authority for the proposition that an agreement to arbitrate in one forum constitutes a waiver of the right to challenge personal jurisdiction in another. On the contrary, the decisions of which we are aware have held that an implicit waiver of personal jurisdiction in a defendant's agreement to litigate or to arbitrate in a particular jurisdiction is applicable only within that jurisdiction. See Victory Transport Inc. v. Comisaria General de Abastecimientos y Transportes, 336 F.2d 354, 363 (2d Cir. 1964) ("By agreeing to arbitrate in New York, where the United States Arbitration Act makes such agreements specifically enforceable, the [government of Spain] must be deemed to have consented to the jurisdiction of the court that could compel the arbitration proceeding in New York. To hold otherwise would be to render the arbitration clause a nullity"); Microfibres, Inc. v. McDevitt-Askew, 20 F. Supp.2d 316, 322 (D.R.I. 1998) (holding agreement to litigate contractual disputes in Rhode Island implicitly waived right to challenge personal jurisdiction there); Inso Corp. v. Dekotec Handelsges, 999 F. Supp. 165, 167 (D. Mass. 1998) (holding "contractual stipulation to a particular forum implies consent to personal jurisdiction in that forum").

While the analogy is imperfect, we think it instructive to compare the New York Convention to the Full Faith and Credit Clause of the United States Constitution: "Full Faith and Credit shall be given in each State to the . . . judicial Proceedings of every other State." Art. IV, § 1; see also 28 U.S.C. § 1738. It is implausible that a defendant in Connecticut who had agreed to arbitrate all disputes in New York, and thereby implicitly waived any objection to personal jurisdiction in a suit brought in New York to enforce the resulting arbitral award, also waived its objection to personal jurisdiction in such an action brought in California merely because the full faith and credit clause would make a valid New York judgment enforceable in the courts of California. Indeed, to accept such a bootstrap argument, under which the courts in every state would have personal jurisdiction over a defendant who had waived its objection in any one state, would in this context eviscerate an important limitation upon the principle of full faith and credit — that "a judgment need not be honored if it was entered by a court that lacked personal . . . jurisdiction." 18 Charles A. Wright et al., Federal Practice and Procedure § 4467, at 634 (2d ed. 1981); see also Baker v. General Motors Corp., 522 U.S. 222, 233 (1998); Pennoyer v. Neff, 95 U.S. 714, 729-33 (1877); D'Arcy v. Ketchum, 52 U.S. (11 How.) 165, 175-76 (1850). It seems to us likewise implausible that Qatar, by agreeing to arbitrate in France, a signatory to a treaty containing a similar reciprocal "recognition and enforcement" clause, should be deemed thereby to have waived its right to challenge personal jurisdiction in the United States.

For these reasons we hold that Qatar did not waive its objection to personal jurisdiction in the United States by agreeing to arbitrate in France.

2. Minimum Contacts

As noted above, when lack of personal jurisdiction is raised as a defense, due process requires that for the case to go forward the absent defendant must "have [had] certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice." International Shoe, 326 U.S. at 316. The defendant's contacts with the forum must be of a quality that it "should reasonably anticipate being haled into court" there. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). It is "essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253 (1958).

We note that Qatar does not argue that due process requires that a foreign state have contacts with the forum state as opposed to the United States in general. See SEC v. Vision Communications, Inc., 74 F.3d 287, 289 (D.C. Cir. 1996) (suggesting the latter).

Creighton claims that Qatar has the requisite minimum contacts mainly because Qatar entered into a contract with a company based in the United States. Because that contract provided for ICC arbitration of all disputes and (according to Creighton) Qatari law does not recognize or enforce arbitral awards, "it was certainly foreseeable that Creighton would seek to enforce any award in its favor . . . in the United States." In addition Creighton asserts that Qatar contacted Creighton in Tennessee during the negotiations leading to the contract in order to clarify an apparent error in Creighton's bid, Creighton signed a modification to the contract in Tennessee, and during construction Qatar telexed weekly status reports to Creighton's offices in Tennessee.

These contacts, however, do not demonstrate that Qatar purposefully availed itself of the laws of the United States and hence should reasonably have anticipated the risk of being haled into court here. Creighton's reliance upon the mere fact that Qatar contracted with a United States company (and the concomitant foreseeability that the company might try to bring suit in the United States) is misplaced, for the Supreme Court has squarely rejected the proposition that "an individual's contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum." Burger King v. Rudzewicz, 471 U.S. 462, 478 (1985) (emphasis in original).

Our doubt about the adequacy of Qatar's contacts with the United States is increased when we consider "prior negotiations and contemplated future consequences, along with the terms of the contract and the parties' actual course of dealing." Id. at 479. As Qatar notes, the contract was offered, accepted, and performed in Qatar pursuant to a sponsorship arrangement between Creighton and a Qatari contractor. The contract was made subject to the laws of Qatar, payment was made in Qatari riyals to Creighton's bank account in Qatar, and the alleged breach occurred in Qatar.

Overall, it seems Qatar's contacts with Creighton in Tennessee were necessitated by Creighton's decision to base itself there, and are not instances of Qatar purposefully availing itself of the benefits of the laws of Tennessee or of the United States. See id. at 475 ("Th[e] purposeful availment requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral activity of another party or a third person"). As we explained in an analogous — indeed, controlling — case, Creighton

seems to confuse a distant purchaser "reaching out" to a seller in the forum state with a seller "reaching out" to a distant state in order to do business there. At least if it circulates its wares there, the seller purposefully avails itself of forum state law. By contrast, a purchaser who selects an out-of-state seller's goods or services based on their economic merit does not thereby purposefully avail itself of the seller's state law, and does not merely by purchasing from the seller submit to the laws of the jurisdiction in which the seller is located or from which it ships merchandise. Of course, a seller suing in its home state might argue that an out-of-state buyer has availed itself of that forum's laws in the sense that the buyer typically could have sued the seller in the forum state for breach of contract had the need arisen. In light of Burger King, however, this contingent type of "contact" is plainly not enough, as it would alone and automatically extend personal jurisdiction over all buyers in interstate contract actions, without regard to the parties' actual course of dealing and its relation to the forum.

Health Communications, Inc. v. Mariner Corp., 860 F.2d 460, 464-65 (D.C. Cir. 1988). We therefore conclude that Qatar lacks the minimum contacts with the United States that would make it amenable to suit here consistent with due process.

III. Conclusion

For the foregoing reasons, we hold that the district court had subject matter jurisdiction over this suit but lacked personal jurisdiction over Qatar. The judgment of the district court is therefore

Affirmed.

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CREIGHTON LTD. v. GOV. OF THE STATE OF QATAR
(Jul 2, 1999)