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Key points:
- During the oral discussion a Turkiye Halk Bankasi AS v. United Statesthe Court raised several questions about whether a state-owned entity, Halkbank, was immune from United States criminal prosecution under the common law.
- The justices noted that the issue of common law immunity did not receive much attention in the Second Circuit’s opinion, suggesting that the Court may consider remanding the case to further develop the record on this point.
On January 17, 2023, the Supreme Court heard oral argument Turkiye Halk Bankasi AS v. United States. This case involves the US prosecution of Halkbank, a majority-owned commercial bank in Turkey. The government alleges Halkbank helped Iran evade US sanctions and lied to US authorities. Halkbank argues that it is immune from prosecution under both the Foreign Sovereign Immunities Act (“FSIA”) and the common law. The Second Circuit focused its analysis primarily on the FSIA and determined that Halkbank is not immune. As the Supreme Court evaluates Halkbank’s defense of immunity, it must grapple with several questions that could have a significant impact on how the United States approaches its regulation of foreign sovereigns and their instruments in the future
On January 10, 2023, we summarized the respective arguments of the parties in the lower courts and the possible consequences of the eventual ruling of the Supreme Court. The Court asked about many of these arguments and the possible consequences during oral argument, but the justices also focused on an issue that did not get much attention in the Second Circuit opinion (or in the Supreme Court’s writings of the parties). That issue is whether Halkbank is immune under the common law rather than the FSIA. Multiple justices questioned the possible availability of common law immunity and raised the possibility of remanding the case to the Second Circuit for further analysis. The Court emphasized that the Second Circuit devoted only a few paragraphs to common law immunity in its decision, suggesting that the record must develop further before the Court can decide the issue.
The Court is scheduled to issue a decision in June 2023, but given the questions the justices asked during oral argument, it may pause now to decide the merits and send the case back to the court of appeal to review it further and develop a further solution. full scan. When the Court ultimately issues a substantive ruling, that ruling could have a significant impact on whether and how the United States pursues foreign states and state-owned entities in the future.
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