Article III, Section 2, Clause 1 — Foreign States or Citizens

ArtIII.S2.C1.18.1 Controversies Between a State or its Citizens and Foreign States or Citizens

Article III allows federal courts to exercise jurisdiction over controversies “between a State, or the Citizens thereof, and foreign States, Citizens or Subjects.”¹ However, two post-ratification developments have limited the scope of federal court jurisdiction under this provision. First, the Supreme Court has applied the law of nations to hold that foreign states are generally immune from suit in U.S. federal courts without their consent.² That immunity extends to suits brought by American states against foreign nations.³ Second, the Court has construed the Eleventh Amendment to bar suits by foreign states against a state of the United States.⁴

In addition to the foregoing limits, the grants of jurisdiction in Article III, Section 2, Clause 1 are not self-executing. Instead, the constitutional text sets the maximum extent of federal court jurisdiction and leaves Congress discretion to determine how much of that jurisdiction to grant.⁵ Congress has always granted the federal courts less expansive jurisdiction than the Constitution authorizes, including with respect to cases involving foreign states or citizens. In 28 U.S.C. § 1332, Congress granted federal courts jurisdiction over disputes where “the matter in controversy” exceeds $75,000 between “citizens of a State and citizens or subjects of a foreign state” (except claims between citizens of a state and lawful permanent residents of the same state) or “a foreign state . . . as plaintiff and citizens of a State or of different States.”⁶

Article III does not provide for federal court jurisdiction over disputes between one or more foreign states or their subjects to which no U.S. state or citizen is a party. However, suits that fall outside the scope of the constitutional and statutory grants of jurisdiction over suits between a state or its citizens and foreign states or citizens may proceed in federal court if they fall within another grant of Article III jurisdiction, for example because they involve questions arising under a federal law or treaty.⁷

ArtIII.S2.C1.18.2 Suits Involving Foreign States

The Constitution authorizes federal courts to hear certain cases involving foreign states, but does not expressly provide foreign states a right of access to U.S. federal courts. Nonetheless, the Supreme Court has held that “[a] foreign sovereign, as well as any other foreign person, who has a demand of a civil nature against any person here, may prosecute it in our courts.”¹ The Court based that holding in part on general international law principles of comity² and in part on the fact that “[t]he Constitution expressly extends the judicial power to controversies between a State, or citizens thereof, and foreign States, citizens, or subjects, without reference to the subject-matter of the controversy.”³

While foreign states may sue in U.S. court, the Supreme Court has repeatedly applied the doctrine of sovereign immunity to hold that a foreign state cannot be sued in federal court unless it consents to the suit.⁴ The doctrine of foreign sovereign immunity is not rooted in the text of the Constitution, but instead derives from “the principle of comity.”⁵ Foreign sovereign immunity is not absolute. For instance, the Court has held that once a foreign government avails itself of the privilege of suing in the courts of the United States, it subjects itself to the procedures and rules of decision governing those courts and accepts whatever liabilities the court may decide to be a reasonable incident of bringing the suit.⁶ Thus, the Court has held that a foreign nation instituting a suit in federal court cannot invoke sovereign immunity as a defense to a counterclaim arising from of the same transaction.⁷ The Court has extended that holding to deny a defense of sovereign immunity on a counterclaim that was not related to the sovereign’s initial claim but that was limited to the amount of the sovereign’s claim, so it functioned as a setoff to the non-sovereign defendant’s liability.⁸

The political branches of the federal government, rather than the courts, are primarily responsible for determining when a foreign state may sue in federal court or claim sovereign immunity.⁹ Only a government that has been recognized by the political branches as the authorized government of the foreign state may maintain a suit on behalf of a national sovereign in the courts of the United States.¹⁰ Likewise, as the responsible agency for the conduct of foreign affairs, the State Department is generally responsible for suggesting to the courts that a sovereign be granted immunity from a particular suit.¹¹

ArtIII.S2.C1.18.3 Limits on Jurisdiction

The Supreme Court has narrowly construed the grant of jurisdiction over suits between a state or its citizens and foreign states or citizens. As in cases involving diversity jurisdiction,¹ suits brought in federal court under this provision must clearly state in the record the citizenship of the parties. In 1809, the Supreme Court ruled that a federal court could not take jurisdiction of a case where the record described the plaintiffs as aliens and subjects of the United Kingdom, while the defendants were described as “late of the district of Maryland” but were not designated as citizens of Maryland.² Twenty years later, the Court narrowly construed Section 11 of the Judiciary Act of 1789, which granted the federal courts jurisdiction over cases where an alien was a party, in order to keep it within the limits of this clause.³ The Court held that the judicial power did not apply to private suits in which an alien is a party, unless a citizen is the adverse party.⁴ The Court extended this interpretation in 1870, holding that if there is more than one plaintiff or defendant in a case, each plaintiff must be competent to sue and each defendant must be liable to suit.⁵ However, the Court has held that these rules do not preclude a suit between citizens of the same state if the plaintiffs are merely nominal parties and are suing on behalf of an alien.⁶

The constitutional grant of jurisdiction over suits between a state or its citizens and foreign states or citizens does not apply to suits involving Indian tribes. In Cherokee Nation v. Georgia, Chief Justice John Marshall concluded that the Cherokee Nation was “a state” in the sense that it was “a distinct political society, separated from others, capable of managing its own affairs and governing itself.”⁷ However, he concluded, the tribe was not “a state of the union”; nor was it a “foreign state” within the meaning of Article III’s text, since it was a part of the United States and dependent upon it.⁸