W. S. Kirkpatrick Co. v. Environmental Tectonics Corporation International

Syllabus According to respondent's complaint, petitioners obtained a construction contract from the Nigerian Government by bribing Nigerian officials. Nigerian law prohibits both the payment and the receipt of such bribes. Respondent, an unsuccessful bidder for the contract, filed an action for damages against petitioners and others under various federal and state statutes. The District Court ruled that the suit was barred by the act of state doctrine, which in its view precluded judicial inquiry into the motivation of a sovereign act that would result in embarrassment to the sovereign, or constitute interference with the conduct of United States foreign policy. The court granted summary judgment for petitioners because resolution of the case in favor of respondent would require imputing to foreign officials an unlawful motivation (the obtaining of bribes), and accordingly might embarrass the Executive Branch in its conduct of foreign relations. The Court of Appeals reversed and remanded the case for trial, holding that on the facts of this case the doctrine did not apply because no embarrassment of the Executive in its conduct of foreign affairs was evident. Held: The act of state doctrine does not apply because nothing in the present suit requires a court to declare invalid the official act of a foreign sovereign. See, e.g., Ricaud v. American Metal Co., 246 U.S. 304, 38 S.Ct. 312, 62 L.Ed. 733. It does not suffice that the facts necessary to establish respondent's claim will also establish that the Nigerian contract was unlawful, since the contract's legality is simply not a question that the District Court must decide. American Banana Co. v. United Fruit Co., 213 U.S. 347, 357-358, 29 S.Ct. 511, 513, 53 L.Ed. 826 (Holmes, J.), distinguished. Nor does it suffice that judgment in favor of respondents will require the court to impute to foreign officials improper motivation in the performance of official acts. To say that international comity, respect for the sovereignty of foreign nations, and the avoidance of embarrassment to the Executive Branch in its conduct of foreign relations are the policies underlying the act of state doctrine is not to say that the doctrine is applicable whenever those policies are implicated. The doctrine is not a rule of abstention which prohibits courts from deciding properly presented cases or controversies simply because the Executive's conduct of foreign relations may be adversely affected; it is a rule of decision which requires that, in the process of deciding, the acts of foreign sovereigns taken within their own jurisdictions be deemed valid. Pp. 404-410. 847 F.2d 1052 (CA3 1988), affirmed. SCALIA, J., delivered the opinion for a unanimous Court. Edward Brodsky, New York City, for petitioners. Thomas B. Rutter, for respondent. Thomas W. Merrill for the U.S., as amicus curiae, in support of the respondent, by special leave of Court. Justice SCALIA delivered the opinion of the Court.