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KELLER v. TRANSPORTES AEREOS MILITARES ECUADORIANO

January 28, 1985

MICHAEL L. KELLER, Plaintiff,
v.
TRANSPORTES AEREOS MILITARES ECUADORIANOS, et al., Defendants



The opinion of the court was delivered by: RICHEY

 INTRODUCTION

 Before the Court are motions to dismiss filed by both defendants herein, Transportes Aereos Militares Ecuadorianos ("TAME") and Transportes Aereos Nacionales Ecuadorianos ("TAME C.A."). Upon consideration of the motions, supporting memoranda, opposing memoranda, and the entire record herein, the Court, by Order of even date herewith, grants the motions and dismisses this case for lack of subject matter and personal jurisdiction.

 BACKGROUND

 The plaintiff, Michael L. Keller, is the administrator of the Estates of Leonard William Keller and Joseph Felix Keller, both of whom were killed in the July, 1983 crash of an aircraft owned by defendant TAME and operated by defendant TAME C.A. The crash occurred near Cuenca, Ecuador.

 TAME was created as a Department of the Ecuadorian Air Force by Supreme Decree No. 1020 issued by the Government of Ecuador's Military Counsil and published in the Official Register of Ecuador on June 18, 1964. Defendant TAME owns 99.97 percent of the stock of defendant TAME C.A.

 Plaintiff filed this suit on June 12, 1984. On October 17, 1984, after defendants filed their motions to dismiss, this Court issued an order permitting plaintiff to conduct discovery before responding to the motions to dismiss. Plaintiff has now responded, and the motions are fully briefed and ripe for decision.

 BECAUSE DEFENDANTS ARE "FOREIGN STATES" UNDER THE FOREIGN SOVEREIGN IMMUNITIES ACT, THIS COURT HAS JURISDICTION UNLESS DEFENDANTS ARE IMMUNE FROM SUIT

 The Foreign Sovereign Immunities Act ("FSIA") specifically grants subject matter jurisdiction over "any nonjury civil action against a foreign state as defined in section 1603(a) of this title as to any claim for relief in personam with respect to which the foreign state is not entitled to immunity . . . under sections 1605-1607 of this title." 28 U.S.C. § 1330(a). *fn1"

 The above-quoted section only applies to defendants who qualify as "foreign states" under the act. However, it is clear that defendant TAME is a foreign state as that term is defined in 28 U.S.C. §§ 1603(b) and 1603(a), and plaintiff so concedes. Plaintiff's admission that TAME is a "foreign state" also means that co-defendant TAME C.A. is a "foreign state". Under 28 U.S.C. § 1603(a), the definition of a "foreign state" includes an "instrumentality of a foregin state." The statute then defines an "agency or instrumentality of a foreign state" as any entity "a majority of whose shares . . . is owned by a foreign state." 28 U.S.C. § 1603(b)(2). Because TAME, a foreign state, owns a majority of shares of TAME C.A., the latter is an "instrumentality of a foreign state" by virtue of 28 U.S.C. § 1603(b)(2), and thus a "foreign state" by virtue of 28 U.S.C. § 1603(a). Therefore, according to § 1330, this Court has jurisdiction if, and only if, TAME and TAME C.A. are not entitled to immunity under 28 U.S.C. §§ 1605-1607. See Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 485, 76 L. Ed. 2d 81, 103 S. Ct. 1962 (1983).

 Plaintiff claims that defendant TAME has waived its immunity within the meaning of 28 U.S.C. § 1605(a)(1). Plaintiff also claims that defendant TAME C.A. falls within an exception to immunity under § 1605(a)(2). However, as demonstrated below, neither exception applies to this case, and the defendants remain immune from suit.

 TAME HAS NOT WAIVED ITS IMMUNITY, AND MUST BE DISMISSED

 Plaintiff asserts that TAME has waived its sovereign immunity, and thus 28 U.S.C. § 1605(a)(1) establishes subject matter jurisdiction. ...


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