The US Supreme Court [official website] on Wednesday heard oral arguments [transcript, PDF] in the case of Venezuela v. Helmerich & Payne International [SCOTUSblog materials]. The court granted certiorari [JURIST report] in June to determine whether the pleading standard for alleging that a case falls under the expropriation exception of the Foreign Sovereign Immunities Act (FSIA) [text] is more stringent than the “insubstantial and frivolous” standard for pleading jurisdiction in a federal-question statute. Under FSIA, foreign governments normally cannot be sued in US courts, but the two companies in the case relied on the act’s “expropriation” exception against Venezuela, which allows lawsuits against foreign governments to go forward in US courts when “rights in property taken in violation of international law are in issue” and there is a commercial connection to the US.

The dispute arose after Venezuela issued a decree appropriating the oil-drilling rigs of the two companies. Five of the eight presiding justices would need to agree to reverse the US Court of Appeals for the District of Columbia Circuit’s ruling [opinion, PDF] in favor of the companies. Currently, only Justice Anthony Kennedy seemed clearly in favor [SCOTUSblog report] of a higher bar to establish jurisdiction in FSIA cases brought against foreign governments, while the opinions of the other justices remained less clear. The main concern raised by the justices during oral arguments was the foreign relations implication of their ruling, as it would allow a US court to charge a foreign government of violating international law. A decision is expected some time next year.