The Export Group v. Reef Industries, Inc. and Mexican Coffee Institute

Summary

The Ninth Circuit reviewed the district court's order setting aside a default judgment against the Mexican Coffee Institute as void for lack of subject matter jurisdiction under the Foreign Sovereign Immunity Act. The court held that the tort exclusions in 28 U.S.C. § 1605(a)(5)(B) apply to the noncommercial tort exception and do not restrict the commercial-activity exception in § 1605(a)(2). The court also concluded that the Mexican Coffee Institute qualified as an agency or instrumentality of Mexico and reversed and remanded.

Holdings

1. The exclusions in § 1605(a)(5)(B) apply only to the noncommercial-tort exception in § 1605(a)(5) and do not restore sovereign immunity for tort claims arising from commercial activity encompassed by § 1605(a)(2).
2. The challenged footnote in Gregorian v. Izvestia was dictum, not a binding holding, because it was unnecessary to Gregorian's decision and addressed a claim based on noncommercial activity.
3. The Institute established in the district court that it was a dependency of the Mexican Ministry of Agriculture and Cattle and therefore qualified as an agency or instrumentality of the Mexican government under the FSIA.

Questions Presented

1. Whether the district court properly set aside the default judgment as void under Federal Rule of Civil Procedure 60(b)(4) for lack of subject matter jurisdiction under the FSIA.
2. Whether the FSIA's exceptions for enumerated noncommercial torts in 28 U.S.C. § 1605(a)(5)(B) limit the commercial-activity exception in § 1605(a)(2) when the alleged interference with contract rights arose from commercial activity.
3. Whether the Mexican Coffee Institute qualified as an agency or instrumentality of Mexico under the FSIA.
4. Whether the Export Group could rely on newly asserted facts on appeal to challenge the Institute's status as a Mexican government agency or instrumentality.

Disposition

reversed_and_remanded