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Republic of Hungary v. Simon (2025) (2024 Hungary SCOTUS)

No. 23-867 SCOTUS · Decided SCOTUS

Cert Granted: Jun 24, 2024 Argued: Dec 3, 2024 Decided: Feb 21, 2025

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Decision

Opinion Sonia Sotomayor

The Law · How the Case Works

Opinion of the Court

Sonia Sotomayor

Overview

Republic of Hungary v. Simon held that Holocaust survivors and their heirs cannot establish the commercial nexus required to invoke the Foreign Sovereign Immunities Act's expropriation exception by alleging only that Hungary commingled the proceeds of expropriated property with funds in a government treasury account. The Court ruled in Hungary's favor, finding that commingling allegations alone are insufficient to link the expropriated property to commercial activity in the United States, as the FSIA's text requires.

The Facts

Facts

Jewish survivors of the Hungarian Holocaust and their heirs sued Hungary and a Hungarian state agency in federal court, alleging that Hungary expropriated their property during World War II. The plaintiffs argued that the FSIA's expropriation exception applied because Hungary had liquidated the expropriated property, commingled the proceeds in a government treasury, and later used funds from that account in commercial activity in the United States.

The Issue

Issue

Whether alleging that a foreign sovereign commingled expropriated property proceeds with other government funds, which were later used in U.S. commercial activity, satisfies the FSIA expropriation exception's commercial nexus requirement.

The Rules

Rule

Commingling of expropriated property proceeds with a government treasury account does not alone satisfy the FSIA's requirement that the expropriated property (or property exchanged for it) have a commercial nexus to the United States. The nexus must be traced to the specific property taken, not merely to fungible funds that passed through a common account.

The Application

Analysis

Plaintiffs argued that Hungary's liquidation and commingling of their expropriated property in a government treasury satisfied the expropriation exception because funds from that account later financed U.S. Commercial activity. The Court rejected this theory, applying the statutory requirement of a nexus to the specific property taken, not merely to fungible funds; commingling destroyed the required traceability by rendering the expropriated property indistinguishable from other government revenues. By reversing the D.C. Circuit, the Court held that this broken chain of connection meant Hungary retained sovereign immunity. The plaintiffs had failed to demonstrate that the identified property itself, rather than a pooled account, had a commercial nexus to the United States.

The Conclusion

Conclusion

The Court reversed the D.C. Circuit, holding that Hungary retains sovereign immunity. Plaintiffs must demonstrate a traceable commercial nexus between the specific expropriated property and U.S. commercial activity. Commingling alone breaks the required connection.

The Record · 1 original document