German Heirs Allowed to Sue in U.S. for Nazi Art Seizures

A party does not have to exhaust all available foreign remedies before suing a foreign entity in the United States under the Foreign Sovereign Immunities Act’s (FSIA) expropriation exception, according to at least one federal circuit court.

In Philipp v. Federal Republic of Germany, the U.S. Court of Appeals for the District of Columbia Circuit rejected Germany’s argument that the heirs of Jewish art dealers must assert claims related to Nazi seizures in German courts before any other jurisdiction.

ABA Section of Litigation leaders agree this decision will likely impact many other litigants filing suit under FSIA’s expropriation exception, which creates jurisdiction for claims against foreign governments that might otherwise enjoy immunity from suit. Nonetheless, the decision does create some limits on the exercise of jurisdiction against entities without a presence in the United States, raising further questions regarding the scope of relief available under this statute.