49 Winter 2026 hypothetical circumstances, the Supreme Court conceded that its ruling will “typically” result in a thwarting of Congress’s intention by making it “harder for plaintiffs to satisfy § 1605(a)(3)’s commercial nexus element when a foreign sovereign expropriates property in violation of international law and liquidates it.”30 The best the Court could say for its severe constriction of the exception is that the “added difficulty … does not make the expropriation exception a dead letter.”31 Actually, the Court’s limitation does render the exception virtually unusable. Its application is now confined to primitive barter economies lacking bank accounts and inept regimes that don’t liquidate the property they illegally seized; that makes no sense. In enacting the exception, Congress understood both the intangible nature of money and that expropriating regimes surely have banks and are not exceptionally inept. Notable recent examples of the latter include the Soviet Union, Nazi Germany, Cuba, Libya, and Venezuela. Expropriation from Stateless Persons Is a Violation of International Law The Restatement (Second) of Foreign Relations Law of the United States (1965), “in effect when Congress enacted the FSIA, … bears authoritative weight in interpreting the Act.”32 According to the Second Restatement, (i) the taking of an alien’s property is “wrongful under international law” when certain conditions are met (including here); (ii) in these circumstances, an “alien” is one who is “not a national of the respondent state”; and (iii) both foreign nationals and stateless persons are aliens “for purposes of the responsibility of a state for injury.”33 Thus the domestic takings rule does not apply, and the expropriation of a stateless person’s property is a violation of international law. Nevertheless, confusing remedies with substantive legal violations, the D.C. Circuit Court mistakenly focused upon the fact that, procedurally, international law provides no remedy to stateless persons for the violation.34 The court incorrectly concluded from the absence of a remedy under international law that the substantive violation as to stateless persons was somehow unclear. But the absence of a remedy under international law is irrelevant to the expropriation exception. The foreign sovereign loses immunity because of the substantive “violation of international law.”35 Once immunity is gone, the American court will independently afford an appropriate remedy under its domestic law. The Circuit Court should have concluded that Hungary’s 30. Id., at 129, 138. 31. Id., at 138. 32. Supra note 6, at 1097. 33. Second Restatement §§ 185 and 171 and Comment g to § 175. 34. “[I]nternational law customarily concerns relations among sovereign states, not relations between states and individuals.” Philipp, 592 U.S. at 176. 35. 28 U.S.C. § 1605(a)(3). 36. Supra note 2, at 138. 37. Id., at 121. 38. Id. (quotation marks and citation omitted). 39. Recently, the Congressional Research Service observed that in a series of recent decisions culminating in Simon, the Supreme Court has concluded that “Congress intended the FSIA’s expropriation exception to be relatively narrow.” The Service suggested that Congress may clarify its intentions by adding a “provision explaining how the statute should be interpreted.” See Karen Sokol, “The Foreign Sovereign Immunities Act’s Expropriation Exception,” LIBRARY OF CONGRESS (Sept. 10, 2025), available at https://www.congress.gov/crs-product/ LSB11361 property confiscations violated international law and then, remaining faithful to the statutory language, ended its analysis with a finding that Hungary’s immunity was nullified. Congress Can Correct the Courts’ Mistakes Over the course of Simon, the D.C. Circuit Court and Supreme Court have, as the Supreme Court conceded, “added difficulty” to the bringing of claims Congress intended to be heard in American courts.36 This is not the first time the courts have favored foreign nations’ objections to being adjudicated in American courts over the intentions of Congress. Congress “swiftly signaled its disapproval” of an earlier Supreme Court decision by amending the relevant statute.37 “The amendment was broadly understood to permit adjudication of claims the … decision had avoided.”38 As it has done previously, Congress can readily correct the courts’ errors and clarify that (1) a foreign state that expropriates property in violation of international law cannot evade being sued in American courts simply by liquidating that property and commingling the proceeds in its national treasury, and (2) under the expropriation exception, a stateless person is an alien outside the domestic takings rule of international law.39
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