United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 27, 2000 Decided June 16, 2000
No. 99-7032
Phoenix Consulting, Inc.,
Appellee
v.
Republic of Angola,
Appellant
Appeal from the United States District Court
for the District of Columbia
(No. 97cv01824)
Daniel Wolf argued the cause and filed the briefs for
appellant.
Richard S. Sternberg argued the cause and filed the brief
for appellee.
Before: Edwards, Chief Judge, Ginsburg, and Rogers,
Circuit Judges.
Opinion for the Court filed by Circuit Judge Ginsburg.
Ginsburg, Circuit Judge: Phoenix Consulting sued the
Republic of Angola for breach of contract, and Angola moved
to dismiss the suit for lack of subject matter jurisdiction
under the Foreign Sovereign Immunities Act of 1976 (FSIA),
28 U.S.C. ss 1330, 1602-1611. The district court, accepting
as true for purposes of the motion the plaintiff's allegation
that Angola had executed a contractual waiver of immunity,
denied Angola's motion. Angola appeals from the court's
order.
Because Angola's motion to dismiss raised a factual chal-
lenge to the court's subject matter jurisdiction under the
FSIA, the district court erred in accepting as true the
jurisdictional facts alleged by the plaintiff. Instead, the court
should have settled any contested jurisdictional facts neces-
sary to decide Angola's motion to dismiss. We therefore
remand the matter to the district court for further proceed-
ings consistent with this opinion.
I. Background
Phoenix Consulting, Inc., a United States affiliate of Phoe-
nix Holdings, Ltd. of the United Kingdom (hereinafter col-
lectively referred to as Phoenix), entered into an agency
contract with Eduardo Neto Sangueve. Sangueve was au-
thorized to negotiate the sale to the Republic of Angola of a
prefabricated building owned by Phoenix and stored in An-
gola.
Sangueve proposed the sale in a meeting with Jose Anibal
Rocha, Angola's Minister of Territorial Administration. The
outcome of this meeting and the subsequent chain of events
are disputed by the parties. Phoenix claims that Rocha, on
behalf of Angola, contracted to purchase the building for
$325,000 (U.S.), and that Angola had its agents remove the
building from storage but never paid for it. Angola, in
contrast, maintains that Rocha merely took Phoenix's propos-
al under consideration, and that neither he nor any other
Angolan official contracted to purchase the building. Angola
professes to have no knowledge of who removed the building
from storage.
Phoenix filed suit in the Superior Court of the District of
Columbia claiming Angola had breached its contract or, alter-
natively, had converted Phoenix's property or been unjustly
enriched. After default judgment was entered in favor of
Phoenix, Angola removed the case to the United States
District Court for the District of Columbia. Angola then
successfully moved the district court to vacate the default
judgment and, prior to filing an answer to the complaint,
moved to dismiss for, among other reasons, lack of subject
matter jurisdiction under the FSIA. In response, Phoenix
invoked three exceptions to immunity under the FSIA, any
one of which would provide the district court with subject
matter jurisdiction: waiver, 28 U.S.C. s 1605(a)(1); commer-
cial activity, id. s 1605(a)(2); and a taking of property in
violation of international law, id. s 1605(a)(3). In support of
the waiver exception, Phoenix proffered evidence that Rocha,
as Angola's agent, had executed a written sales contract
containing a choice of law provision subjecting the contract to
the jurisdiction and laws of the United States--which, accord-
ing to the legislative history of the FSIA, would by implica-
tion have waived Angola's immunity from suit. See H.R. Rep.
No. 94-1487, at 18 (1976), reprinted in 1976 U.S.C.C.A.N.
6604, 6616-17. Angola replied with Rocha's sworn declara-
tion that the signature on the written contract was a forgery
and that Angola had never agreed to any contract, much less
one containing a waiver provision.
The district court denied Angola's motion to dismiss. First
it held that the choice of law provision would constitute a
waiver of sovereign immunity. Then, stating that "[o]n mo-
tion to dismiss, the court is to consider all allegations of
jurisdictional facts in [the plaintiff's] favor," the court con-
cluded that Phoenix's allegation that Angola had executed the
written contract would, if proven, establish that Angola had
waived its sovereign immunity.
Angola brings this interlocutory appeal of the district
court's order pursuant to 28 U.S.C. s 1291 and the collateral
order doctrine of Cohen v. Beneficial Indus. Loan Corp., 337
U.S. 541 (1949). See Jungquist v. Sheikh Sultan Bin Khali-
fa, 115 F.3d 1020, 1025-26 (D.C. Cir. 1997); Foremost-
McKesson, Inc. v. Islamic Republic of Iran, 905 F.2d 438, 443
(D.C. Cir. 1990). Upon appeal, Angola raises only the follow-
ing question of law: May a district court resolve a sovereign
defendant's factual challenge to the court's subject matter
jurisdiction under the FSIA by accepting as true the plain-
tiff's allegations of jurisdictional facts?
II. Analysis
Under the FSIA a foreign state is immune from the
jurisdiction of both the federal and the state courts, except as
provided by international agreements, see 28 U.S.C.
s 1330(a); id. s 1604, by nine specifically enumerated excep-
tions, see id. s 1605(a)(1)-(7), (b), (d), and by certain other
exceptions relating to counterclaims in actions brought by the
foreign state itself, see id. s 1607. If no exception applies, a
foreign sovereign's immunity under the FSIA is complete:
The district court lacks subject matter jurisdiction over the
plaintiff's case, see id. s 1330(a). Thus the sovereign has "an
immunity from trial and the attendant burdens of litigation,
and not just a defense to liability on the merits." Foremost-
McKesson, 905 F.2d at 443. In order to preserve the full
scope of that immunity, the district court must make the
"critical preliminary determination" of its own jurisdiction as
early in the litigation as possible; to defer the question is to
"frustrate the significance and benefit of entitlement to immu-
nity from suit." Id. at 449.
The FSIA establishes a specific framework for determining
whether a sovereign is immune from suit and consequently
whether the district court has jurisdiction. As a threshold
matter, if the sovereign makes a "conscious decision to take
part in the litigation," then it must assert its immunity under
the FSIA either before or in its responsive pleading.
Foremost-McKesson, 905 F.2d at 443-45. This requirement
holds even though FSIA immunity is jurisdictional because
failure to assert the immunity after consciously deciding to
participate in the litigation may constitute an implied waiver
of immunity, 28 U.S.C. s 1605(a)(1), which invests the court
with subject matter jurisdiction under 28 U.S.C. s 1330(a).
See H.R. Rep. No. 94-1487, at 18 (1976), reprinted in 1976
U.S.C.C.A.N. 6604, 6616-17.*
Once the defendant has asserted the jurisdictional defense
of immunity under the FSIA, the court's focus shifts to the
exceptions to immunity laid out in 28 U.S.C. ss 1604, 1605,
and 1607. "In accordance with the restrictive view of sover-
eign immunity reflected in the FSIA," the defendant bears
the burden of proving that the plaintiff's allegations do not
bring its case within a statutory exception to immunity.
Transamerican S.S. Corp. v. Somali Democratic Republic,
767 F.2d 998, 1002 (D.C. Cir. 1985); see Princz v. Federal
Republic of Germany, 26 F.3d 1166, 1171 (D.C. Cir. 1994).
By moving to dismiss, the defendant may challenge either the
legal sufficiency or the factual underpinning of an exception,
and how the district court proceeds to resolve the motion to
dismiss depends upon whether the motion presents a factual
challenge.
If the defendant challenges only the legal sufficiency of the
plaintiff's jurisdictional allegations, then the district court
should take the plaintiff's factual allegations as true and
determine whether they bring the case within any of the
exceptions to immunity invoked by the plaintiff. See, e.g.,
Saudi Arabia v. Nelson, 507 U.S. 349, 351, 361 (1993) (disput-
ed allegations forming basis for suit, even if true, not "com-
mercial activity" within meaning of exception therefor);
Princz, 26 F.3d at 1172 (disputed allegations of use of U.S.
mail and banking system, even if true, not "direct effect in the
United States" of commercial activity within meaning of
exception); Foremost-McKesson, 905 F.2d at 450 (undisputed
__________
* This court has not yet addressed whether and upon what facts
"the intentionality requirement implicit in s 1605(a)(1)," Princz v.
Federal Republic of Germany, 26 F.3d 1166, 1174 (D.C. Cir. 1994),
might allow a sovereign defendant to claim immunity after con-
sciously deciding to take part in the proceeding and filing a respon-
sive pleading. See Alpha Therapeutic Corp. v. Nippon Hoso Kyo-
kai, 199 F.3d 1078 (9th Cir. 1999) (no waiver where in-house counsel
of public broadcaster, unaware of pleading requirement when filing
answer, raised FSIA promptly upon discovering requirement less
than three months after complaint filed).
allegations of "commercial activity" adequate to survive mo-
tion to dismiss). In some cases, however, the motion to
dismiss will present a dispute over the factual basis of the
court's subject matter jurisdiction under the FSIA, that is,
either contest a jurisdictional fact alleged by the plaintiff, see,
e.g., Filetech S.A. v. France Telecom S.A., 157 F.3d 922, 931-
32 (2d Cir. 1998) (factual dispute whether sufficient commer-
cial activity for jurisdiction), or raise a mixed question of law
and fact, see, e.g., Foremost-McKesson, 905 F.2d at 448-49
(dispute whether person alleged to have harmed plaintiff was
agent of sovereign). When the defendant has thus challenged
the factual basis of the court's jurisdiction, the court may not
deny the motion to dismiss merely by assuming the truth of
the facts alleged by the plaintiff and disputed by the defen-
dant. Instead, the court must go beyond the pleadings and
resolve any disputed issues of fact the resolution of which is
necessary to a ruling upon the motion to dismiss. See
Jungquist, 115 F.3d at 1027-28; Foremost-McKesson, 905
F.2d at 448-49; see also Filetech, 157 F.3d at 932; Moran v.
Saudi Arabia, 27 F.3d 169, 172 (5th Cir. 1994); Gould v.
Pechiney Ugine Kuhlmann, 853 F.2d 445, 451 (6th Cir. 1988);
cf. Herbert v. National Academy of Sciences, 974 F.2d 192,
197-98 (D.C. Cir. 1992) (affirming district court's resolution of
disputed facts necessary for subject matter jurisdiction under
Copyright Act). The district court retains "considerable lati-
tude in devising the procedures it will follow to ferret out the
facts pertinent to jurisdiction," but it must give the plaintiff
"ample opportunity to secure and present evidence relevant
to the existence of jurisdiction." Prakash v. American Uni-
versity, 727 F.2d 1174, 1179-80 (D.C. Cir. 1984). In order to
avoid burdening a sovereign that proves to be immune from
suit, however, jurisdictional discovery should be carefully
controlled and limited, see Foremost-McKesson, 905 F.2d at
449; it should not be authorized at all if the defendant raises
either a different jurisdictional or an "other non-merits
ground[ ] such as forum non-conveniens [or] personal jurisdic-
tion" the resolution of which would impose a lesser burden
upon the defendant, In re Papandreou, 139 F.3d 247, 254-55
(D.C. Cir. 1998).
With these principles in mind, we see that in ruling upon
Angola's motion to dismiss the district court erred by assum-
ing the truth of an allegation of jurisdictional fact contested
by the defendant. When Angola asserted immunity under
the FSIA, Phoenix invoked the waiver exception thereto and
presented evidence that Angola had executed a written con-
tract waiving its immunity under the FSIA. Angola respond-
ed with a challenge to the facts upon which Phoenix relied for
the waiver exception: It presented evidence that the written
contract was a forgery and that it had never agreed to waive
its immunity from suit. The district court was required to
resolve this factual dispute material to its subject matter
jurisdiction; and in order to preserve the significance and
benefit of a foreign sovereign's immunity from suit under the
FSIA, the court could not "postpon[e] the determination of
subject matter jurisdiction until some point during or after
trial." Gould, 853 F.2d at 451. We therefore remand this
matter to the district court for further consideration whether
it has subject matter jurisdiction under the FSIA.
III. Conclusion
For the foregoing reasons, the order of the district court is
reversed in part and the case remanded for further proceed-
ings consistent with this opinion.
So ordered.