Sovereign immunity

Theresa Guirlando (Plaintiff) filed a lawsuit against T.C. Ziraat Bankasi A.S. bank (Defendant), claiming that Defendant was negligent and enabled the theft of money from her Turkish bank account. It was Mevlut Cicek , Plaintiff’s own husband who withdrew most of her life savings from the Turkish bank account. Plaintiff is a 67-year-old U.S. citizen, who in 2006 had married Cicek apparently within the U.S. Cicek, however, was an illegal alien at the time and the U.S. had deported him to Turkey in 2007. Upon Cicek’s request, Plaintiff had sold her house and car and followed him to Turkey, carrying a check for $251,156.63.

Cicek took Plaintiff to a Defendant’s branch bank to deposit the check. The bank employees allegedly made Plaintiff put the money into a joint account with Cicek thus enabling him to withdraw $200,000 later on. Plaintiff also found out that Cicek was already married to another woman. Upon her return to the U.S., Plaintiff filed the present lawsuit against Defendant in a New York federal court.

All parties agree that Defendant bank is an instrumentality of the Turkish Government. The District Court dismissed for lack of subject matter jurisdiction under section 1605(a)(2) of the Foreign Sovereign Immunities Act (FSIA), because the Defendant’s alleged actions did not cause a direct effect in the U.S. Plaintiff noted a timely appeal. The Second Circuit affirms.

The “commercial activity exception” of FSIA section 1605 provides that a foreign state or its instrumentality shall not be immune from the jurisdiction of the U.S. courts if the action is based upon an act outside the U.S. that caused a direct effect in the U.S. The mere fact that a foreign state’s commercial activity outside the U.S. caused physical or financial injury to a U.S. citizen, however, does not amount to producing a direct effect in the U.S.

“Plaintiff’s complaint alleges principally that, in Turkey, Defendant’s employees [1] told her, falsely, that she could not open an individual checking account into which to deposit her Citibank check, [2] caused her to open a disjunctive joint account from which funds could be withdrawn by one joint owner without the consent of the other, rather than an account for which the consent of both owners would be required for a withdrawal, and [3] notified Cicek, rather than Plaintiff, when the funds had arrived in the new account with Defendant.

She asserts that these acts had a direct effect in the United States both because...

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