Butters v. Vance International , 225 F.3d 462 ( 2000 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
NYLA BUTTERS, an individual,
Plaintiff-Appellant,
v.
VANCE INTERNATIONAL,
No. 99-2184
INCORPORATED, a Corporation; VANCE
EXECUTIVE PROTECTION,
INCORPORATED; PAT BURKE; GREGG
HALL; DOES 1-100, inclusive,
Defendants-Appellees.
Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Claude M. Hilton, Chief District Judge.
(CA-99-27-A)
Argued: June 6, 2000
Decided: September 11, 2000
Before WILKINSON, Chief Judge, MURNAGHAN,*
Circuit Judge, and Henry M. HERLONG, Jr.,
United States District Judge for the District of South Carolina,
sitting by designation.
_________________________________________________________________
Affirmed by published opinion. Chief Judge Wilkinson wrote the
opinion, in which Judge Herlong joined.
_________________________________________________________________
*Judge Murnaghan heard oral argument in this case but died prior to
the time the decision was filed. The decision is filed by a quorum of the
panel pursuant to 28 U.S.C. § 46(d).
COUNSEL
ARGUED: Kevin Todd Barnes, LAW OFFICES OF KEVIN T.
BARNES, Los Angeles, California, for Appellant. Douglas Bennett
Mishkin, PATTON BOGGS, L.L.P., McLean, Virginia, for Appel-
lees. ON BRIEF: Annette Kay Rubin, Leesburg, Virginia, for Appel-
lant. Lisa A. Lavelle, Alyssa T. Senzel, PATTON BOGGS, L.L.P.,
McLean, Virginia, for Appellees.
_________________________________________________________________
OPINION
WILKINSON, Chief Judge:
Appellant Nyla Butters brought suit against her employer, Vance
International, claiming that Vance discriminated against her on the
basis of gender. The district court held that Vance was entitled to
immunity from Butters' suit under the Foreign Sovereign Immunities
Act, 28 U.S.C. §§ 1602-1611, because Vance's client, the Kingdom
of Saudi Arabia, was responsible for Butters not being promoted.
Finding no error, we affirm.
I.
Vance International, headquartered in Oakton, Virginia, provides
security services to corporations and foreign sovereigns. In October
1994, Saudi Arabia hired Vance to augment the security provided to
Princess Anud, a wife of Saudi King Fahad, while the Princess was
undergoing medical treatments in California. The Saudi military was
responsible for protecting Princess Anud. The Princess' residence in
Bel Air, California was referred to as "Gold." Saudi Arabian Colonel
Mohammed Al-Ajiji supervised all security at the site -- three Saudi
military officers and the Vance agents. Saudi Captain Abdullah was
second in command. The Saudi government paid Vance for its ser-
vices.
In August 1995, Vance hired Nyla Butters as a part-time, at-will
security agent. From 1995 until April 14, 1998, Vance assigned But-
ters to Gold for various extended periods. Butters served both as a
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"resident agent" guarding various locations around the premises and
as a "protectee agent" assigned to a particular member of the Saudi
royal family. The chain of command among Vance agents at Gold
was, from lowest to highest, resident agent, protectee agent, command
post agent, and detail leader. On several occasions, Butters temporar-
ily worked in Gold's command post.
In early April 1998, Vance supervisors at Gold recommended that
Butters serve a full rotation in the command post. In Colonel Moham-
med's absence, Captain Abdullah rejected the recommendation.
When Colonel Mohammed returned, Gregg Hall, the Vance detail
leader, spoke with Mohammed. Colonel Mohammed denied Hall's
request for Butters to serve a rotation in the command post. Colonel
Mohammed told Hall that such an assignment was unacceptable
under Islamic law, and Saudis would consider it inappropriate for
their officers to spend long periods of time in a command post with
a woman present. This in turn could have political ramifications at
home for the Saudi royal family. Mohammed also informed Hall that
the Princess and her contingent wanted to speak only to male officers
when they called the command post. In total, three Vance supervisors
recommended Butters for the assignment. Saudi military officers
denied every request.
On April 12, 1998, Hall told Butters that because of the Saudi deci-
sion, Butters could not be assigned a rotation in Gold's command
post. Butters decided to leave Gold after her shift on April 14, 1998,
and never return. As Butters left without giving Vance two weeks
notice, her personnel record was updated with the notation "DNR,"
meaning that Vance would not call Butters for future work.
On May 28, 1998, Butters filed a charge of gender discrimination
with the California Department of Fair Employment and Housing. On
October 15, 1998, Butters filed suit against Vance in California state
court. Vance removed the case on diversity grounds to the United
States District Court for the Central District of California. The district
court dismissed some of Butters' claims and, pursuant to a venue
clause in Butters' employment contract, transferred the remainder to
the Eastern District of Virginia. Butters' remaining claims were for
discriminatory constructive termination, retaliatory constructive ter-
mination, and wrongful constructive termination in violation of public
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policy under California's Fair Employment and Housing Act. Vance
filed a motion for summary judgment with respect to these counts.
On July 30, 1999, the district court granted Vance's motion, find-
ing Vance immune from Butters' suit under the Foreign Sovereign
Immunities Act (FSIA). See 28 U.S.C. §§ 1602-1611 (1994). Under
the FSIA, "a foreign state shall be immune from the jurisdiction of the
courts of the United States and of the States except as provided in sec-
tions 1605 to 1607 of this chapter." 28 U.S.C.§ 1604. The district
court held that derivative FSIA immunity attached to Vance because
it was "acting under the direct military orders of Colonel Mohammed
when [it] did not allow the plaintiff to work a full rotation in the com-
mand center." Butters appeals.
II.
Butters first contends that FSIA immunity does not attach to Vance
because the action here was a "commercial activity." See 28 U.S.C.
§ 1605(a)(2). Section 1605(a)(2) provides,"A foreign state shall not
be immune from the jurisdiction of courts of the United States or of
the States in any case in which the action is based upon a commercial
activity carried on in the United States by the foreign state . . . ." Id.
The FSIA defines "commercial activity" as"a regular course of
commercial conduct or a particular commercial transaction or act. The
commercial character of an activity shall be determined by reference
to the nature of the course of conduct or particular transaction or act,
rather than by reference to its purpose." 28 U.S.C. § 1603(d). In Saudi
Arabia v. Nelson, the Supreme Court stated,"a state is immune from
the jurisdiction of foreign courts as to its sovereign or public acts
(jure imperii), but not as to those that are private or commercial in
character (jure gestionis)." 507 U.S. 349, 359-60 (1993). The Court
elaborated on the distinction: "[A] state engages in commercial activ-
ity . . . where it exercises `only those powers that can also be exer-
cised by private citizens,' as distinct from those`powers peculiar to
sovereigns.'" Id. at 360 (quoting Republic of Argentina v. Weltover,
Inc., 504 U.S. 607, 614 (1992)).
The relevant act here -- a foreign sovereign's decision as to how
best to secure the safety of its leaders -- is quintessentially an act "pe-
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culiar to sovereigns." See Nelson, 507 U.S. at 361 ("[A] foreign
state's exercise of the power of its police has long been understood
. . . as peculiarly sovereign in nature."). Indeed, it is difficult to imag-
ine an act closer to the core of a nation's sovereignty. Providing
security for the royal family in this country is not a commercial act
in which the state is acting "in the manner of a private player within
the market." Id. at 360 (internal quotation marks omitted); see also id.
at 362 ("Exercise of the powers of police and penal officers is not the
sort of action by which private parties can engage in commerce.").
One of the main concerns of the immunity framework adopted by
the FSIA is to accommodate "the interests of foreign states in avoid-
ing the embarrassment of defending the propriety of political acts
before a foreign court." See Broadbent v. Organization of American
States, 628 F.2d 27, 33 (D.C. Cir. 1980). These acts often have politi-
cal, cultural, and religious components. Judicial interference with
them would have serious foreign policy ramifications for the United
States. We thus decline to require the Saudi government to justify to
us the arrangements it believes are best suited to ensure the safety of
its royal family.
III.
Butters next argues that Vance is not entitled to immunity since
Vance, as opposed to the Saudi officials, was responsible for the deci-
sion not to promote Butters.
A.
If Vance was following Saudi Arabia's orders not to promote But-
ters, Vance would be entitled to derivative immunity under the FSIA.
In Alicog v. Kingdom of Saudi Arabia, the Fifth Circuit affirmed a
district court holding that agents enjoy derivative immunity when fol-
lowing the commands of a foreign sovereign employer. 860 F. Supp.
379 (S.D. Tex. 1994), aff'd, 79 F.3d 1145 (5th Cir. 1996). In that
case, Saudi Arabia hired Majid Afifi, an American citizen, to work for
Prince Saad during a visit to the United States. On orders from Afifi
and the Saudi consul, the Prince's guards prevented two of the
Prince's servants from leaving the hotel unless accompanied by an
escort. See id. at 381. The servants sued Afifi, among others, for false
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imprisonment. The court concluded that Afifi was immune from suit
since "he merely repeated the prince's request that the plaintiffs not
leave the [hotel] without the prince's permission and an accompany-
ing guard." See id. at 384-85.
This conclusion did no more than recognize well-settled law that
contractors and common law agents acting within the scope of their
employment for the United States have derivative sovereign immu-
nity. For instance, in Yearsley v. W.A. Ross Constr. Co., 309 U.S. 18,
21-22 (1940), the Supreme Court held that sovereign immunity
derivatively extended to a private contractor who, pursuant to a con-
tract with the United States Government, constructed dikes that
caused the erosion of the plaintiff's land. The Court held that because
the contractor had not exceeded his authority under his valid contract
with the United States, his acts amounted to "the act[s] of the govern-
ment." Yearsley, 309 U.S. at 21-22.
Sovereign immunity exists because it is in the public interest to
protect the exercise of certain governmental functions. This public
interest remains intact when the government delegates that function
down the chain of command. As a result, courts define the scope of
sovereign immunity by the nature of the function being performed --
not by the office or the position of the particular employee involved.
See Barr v. Matteo, 360 U.S. 564, 572-73 (1959) (plurality opinion).
Imposing liability on private agents of the government would directly
impede the significant governmental interest in the completion of its
work. As a result, courts have extended derivative immunity to pri-
vate contractors, "particularly in light of the government's unques-
tioned need to delegate governmental functions." Mangold v. Analytic
Servs., Inc., 77 F.3d 1442, 1448 (4th Cir. 1996); see also City of
Worcester v. HCA Management Co., Inc., 753 F. Supp. 31, 37-38 (D.
Mass. 1990) ("[P]ursuant to sovereign immunity, a private company
which contracts with the federal government to perform the duties of
the government will not be held liable for its actions on behalf of the
government.").
It is but a small step to extend this privilege to the private agents
of foreign governments. All sovereigns need flexibility to hire private
agents to aid them in conducting their governmental functions. This
is especially true for foreign sovereigns given their lack of human
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resources while operating within the United States. To abrogate
immunity would discourage American companies from entering law-
ful agreements with foreign governments and from respecting their
wishes even as to sovereign acts. Under the circumstances here,
imposing civil liability on the private agents of Saudi Arabia would
significantly impede the Saudi government's sovereign interest in
protecting its leaders while they are in the United States.
B.
Butters argues, however, that Vance, not Saudi Arabia, actually
made the decision not to promote Butters. If this were the case, Vance
would not be entitled to derivative immunity under the FSIA. As the
district court correctly found, however, the evidence here establishes
that the Saudi military officers, Colonel Mohammed and Captain
Abdullah, decided not to promote Butters.
Three different Vance supervisors recommended Butters for a rota-
tion in the command post. Their recommendations, however, fell on
deaf ears. When one supervisor approached Captain Abdullah, who
was in charge of Gold in Colonel Mohammed's absence, Abdullah
stated that Butters could not be given a full command post rotation.
When Colonel Mohammed returned, Vance supervisor Gregg Hall
spent 45 minutes trying to convince the Colonel"that Nyla was the
best person for the command post." Colonel Mohammed, however,
did not budge.*
Butters has not sufficiently called into question Vance's position
_________________________________________________________________
*Butters argues that the statements made by Colonel Mohammed and
Captain Abdullah to the Vance supervisors constitute hearsay. Butters'
argument, however, is misplaced. The statements made by these Saudi
military officers are not offered "to prove the truth of the matter
asserted." Fed. R. Evid. 801(c). Rather the significance of the statements
is solely the fact that they were made -- i.e., that the Saudis were respon-
sible for the fact that Butters was not promoted. Id.; see also 30B
Michael H. Graham, Federal Practice and Procedure§ 7005 (Interim ed.
2000) ("[T]estimony by an agent as to a statement by the principal grant-
ing him authority to act as agent is not hearsay. . . . Instructions to an
individual to do something are also not hearsay.").
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that Saudi Arabia was responsible for the decision not to promote her.
First, Butters attempts to portray Patrick Burke, the Vice President of
Vance, as the true decision-maker. Butters relies, however, on her
own deposition testimony reporting an incident in which a Vance
supervisor told Butters that Burke did not "trust" her. Not only is this
statement hearsay, it also fails to contradict Burke's deposition testi-
mony that he was unaware that Butters even wanted to work in the
command post. Second, Butters relies on her deposition testimony
that a junior Saudi officer informed her that he did not believe Colo-
nel Mohammed was responsible for the directive. Again the statement
is hearsay. In addition, no evidence suggests that this junior officer
had any personal knowledge regarding why Butters was denied the
assignment. As a result, Butters has failed "by affidavits or as other-
wise provided in this rule, [to] set forth specific facts showing that
there is a genuine issue for trial." Fed. R. Civ. P. 56(e); see also
Celotex Corp. v. Catrett, 477 U.S. 317 (1986).
IV.
Any type of governmental immunity reflects a trade-off between
the possibility that an official's wrongdoing will remain unpunished
and the risk that government functions will be impaired. See Harlow
v. Fitzgerald, 457 U.S. 800, 813-14 (1982) ("The resolution of immu-
nity questions inherently requires a balance between the evils inevita-
ble in any available alternative."). FSIA immunity presupposes a
tolerance for the sovereign decisions of other countries that may
reflect legal norms and cultural values quite different from our own.
Here Saudi Arabia made a decision to protect a member of its royal
family in a manner consistent with Islamic law and custom. The Act
requires not that we approve of the diverse cultural or political moti-
vations that may underlie another sovereign's acts, but that we respect
them. We thus affirm the judgment.
AFFIRMED
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