ELR Citation: ELR 20185
No(s). 06-15285 (9th Cir. Jul 22, 2008)

The Ninth Circuit held that a Canadian corporation that markets and distributes electric power in the United States is a "foreign state" within the meaning of the Foreign Sovereign Immunities Act of 1976 and, therefore, is entitled to a federal bench trial in a case alleging it had "manipulated the California energy markets through Enron-style gaming and trading strategies." An entity is an organ of a foreign state (or political subdivision thereof) if it "engages in a public activity on behalf of the foreign government." When viewed holistically, the corporation can be seen as a wholly owned, second-tier subsidiary of British Columbia, created pursuant to an order of the Province. As such, it is a foreign state and subject to federal jurisdiction.