The United States Supreme Court recently ruled that a $1.29 billion arbitral award enforcement suit filed by Mauritius-based CC/Devas and India-based Devas Multimedia (plaintiffs) against India’s Antrix Corporation can proceed in US courts without the plaintiffs having to show that Antrix had “minimum contacts” with the United States. (Devas Mauritius Limited Vs Antrix Corporation)
The decision reversed a 2023 judgment of the Ninth Circuit Court of Appeals, which had dismissed the suit on the ground that Antrix, a government-owned Indian company, lacked sufficient connections to the US to support personal jurisdiction under the Foreign Sovereign Immunities Act (FSIA). The Supreme Court unanimously held that no such showing was required under the FSIA which governs suits against foreign states and their instrumentalities in US courts.
“Personal jurisdiction exists under the FSIA when an immunity exception applies and service is proper,” Justice Samuel Alito wrote for the Court. “Because the Ninth Circuit required more, we reverse the judgment below and remand the suit for further proceedings,” the US Supreme Court said.
Under the FSIA, the “direct effect” standard lifts sovereign immunity where a foreign state’s commercial activity causes a direct impact in the United States.
Courts interpret “direct effect” as an immediate consequence of the act, without intervening factors. The conduct need not occur in the US but the result—like unpaid dues to a US bank—must be tangible and foreseeable. This serves as a jurisdictional safeguard linking foreign conduct to US courts.
In 2005, Antrix Corporation Ltd, the commercial arm of the Indian Space Research Organisation (ISRO), had entered into a deal with Devas Multimedia Pvt. Ltd., a Bengaluru-based company. Under the agreement, Antrix was to lease transponders on two ISRO satellites to Devas, enabling it to offer satellite-based multimedia services across India using the S-band spectrum.
In 2011, the Indian government unilaterally cancelled the agreement, citing national security concerns and the need to reserve S-band spectrum for strategic purposes. This abrupt termination led Devas to initiate arbitration proceedings before the International Chamber of Commerce (ICC), alleging wrongful repudiation of contract.
In 2015, the ICC tribunal awarded Devas $562.5 million in damages. Separately, foreign investors in Devas initiated claims under bilateral investment treaties (BITs) against India, resulting in additional arbitration awards in their favor.
However, Antrix and the Indian government maintained that the deal was tainted by fraud from the outset. In 2021, the National Company Law Tribunal (NCLT) ordered the liquidation of Devas, calling it a sham entity. The Supreme Court of India
upheld this decision in 2022, holding that Devas was incorporated for a fraudulent purpose and had manipulated public resources.
In 2022, the Delhi High Court
set aside the ICC award on grounds of fraud, patent illegality and conflict with the public policy of India. The Court held that the Devas-Antrix deal was "entered into with a fraudulent intention" and that allowing enforcement of the award would “encourage fraud, something that the Indian legal system cannot countenance.” This was
upheld by the Supreme Court.
Parallely, Devas sought enforcement of the ICC award in multiple jurisdictions including the US. While the District Court confirmed the award, the Ninth Circuit Court reversed it on jurisdictional grounds.
The US Supreme Court disagreed. It held that FSIA’s text makes clear that once an immunity exception applies and service has been effected in accordance with the Act, personal jurisdiction “shall exist.” The Court declined to read an additional due process requirement into the relevant clause of the FSIA.
“Notably absent from the provision is any reference to ‘minimum contacts.’ And the Court declines to add what Congress left out,” the judgment stated.
Justice Alito emphasized that the FSIA was enacted to provide a comprehensive and predictable framework for suing foreign states in the US, replacing the earlier regime that depended on case-by-case executive discretion. Imposing an additional constitutional test, would contradict Congress’s carefully structured statutory scheme, the Court said.
The Court also noted that the FSIA’s immunity exceptions themselves require a sufficient nexus with the United States — for example, in the case of commercial activity or direct effects — and that these built-in requirements already address due process concerns.
However, the Supreme Court did not rule on Antrix’s alternative defenses, including the impact of the Indian court's setting aside of the award or whether the case should be dismissed on grounds such as forum non conveniens. These issues were left to be examined by the Ninth Circuit Court.
