Sovereign Immunity. Nuovo Pignone, Inc, is an Italian company that designs and man-ufactures turbine systems. Nuovo sold a turbine system to Cabinda Gulf Oil Co (CABGOC). The system was manufactured, tested, and inspected in Italy, then sent to

Question

Louisiana for mount-ing on a platform by CABGOC's contractor. Nuovo sent a representative to consult on the mounting. The platform went to a CABGOC site off the coast of West Africa. Marcus Pere, an instrument technician at the site, was killed when a turbine within the system exploded. Pere's widow filed a suit in a federal district court against Nuovo and others. Nuovo claimed sovereign immunity on the ground that its majority shareholder at the time of the explosion was Ente Nazionale Idrocaburi, which was created by the government of Italy to lead its oil and gas exploration and development. Is Nuovo exempt from suit under the doctrine of sovereign immunity? Is it subject to suit under the "commercial activity" exception? Why or why not?

Answer 1

Sovereign immunity
The court held that because Ente Nazionale Idrocaburi was an "agent or instrumentality" of the Italian government, Nuovo was a "foreign state" entitled to sovereign immunity—unless an ex-ception applied. The court concluded that an exception did apply: Nuovo was not entitled to immunity because of its commercial activity in the United States. On Nuovo's appeal, the U.S. Court of Appeals for the Ninth Circuit reversed the second part of the lower court's decision, holding that Nuovo was not subject to suit under the commercial activity exception. The appel-late court explained that for this exception to apply, Pere's widow's suit must be "based upon . . . an act performed within the United States in connection with a commercial activity of the foreign state elsewhere." The "commercial activity . . . elsewhere" was the design and manu-facture of turbine systems. There was not, however, an act performed in the United States "in connection with" that activity. The act in the United States—Nuovo's sending a representative to Louisiana to consult on the final assembly—was not sufficiently "in connection with" the de-sign and manufacture of the system to subject Nuovo to liability. The court reasoned that the mounting of the system by CABGOC's contractor on its platform was not part of the design or manufacture of the system, which occurred in Italy. Thus, there was no connection between Nuovo's sending a representative to Louisiana and Pere's widow's suit.