Opinion of the Court
Sonia Sotomayor
(Slip Opinion) OCTOBER TERM, 2024 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337 .
SUPREME COURT OF THE UNITED STATES
Syllabus
REPUBLIC OF HUNGARY ET AL. v. SIMON ET AL.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE DISTRICT OF COLUMBIA CIRCUIT
No. 23–867. Argued December 3, 2024—Decided February 21, 2025
The Foreign Sovereign Immunities Act of 1976 (FSIA) provides foreign
states with presumptive immunity from suit in the United States. 28
U. S. C. §1604 . To sue a foreign sovereign in United States courts,
plaintiffs must satisfy one of the exceptions to immunity set forth in
the FSIA. The FSIA’s expropriation exception permits claims when
“rights in property taken in violation of international law are in issue”
and either the property itself or any property “exchanged for” the ex-
propriated property has a commercial nexus to the United States. 28
U. S. C. §1605 (a)(3).
Respondents, Jewish survivors of the Hungarian Holocaust and
their heirs, sued Hungary and its national railway (MÁV) in federal
court, seeking damages for property allegedly seized during World War
II. Respondents’ complaint alleged that Hungary and MÁV liquidated
the expropriated property, commingled the proceeds with other gov-
ernment funds, and later used funds from those commingled accounts
in connection with commercial activities in the United States. The
District Court determined that this “commingling theory” satisfied
§1605(a)(3)’s commercial nexus requirement. The D. C. Circuit af-
firmed, reasoning that requiring plaintiffs to trace the particular funds
from the sale of their specific expropriated property to the United
States would make the exception a “nullity” in cases involving liqui-
dated property.
Held: Alleging commingling of funds alone cannot satisfy the commercial
nexus requirement of the FSIA’s expropriation exception. Pp. 9–22.
(a) The expropriation exception requires plaintiffs to trace either the
specific expropriated property itself or “any property exchanged for
such property” to the United States (or to the possession of a foreign
state instrumentality engaged in United States commercial activity).
2 REPUBLIC OF HUNGARY v. SIMON
Syllabus
The provision’s plain text treats tangible and fungible property alike:
For both kinds of property, plaintiffs must plead some facts that enable
the reasonable tracing of the property to the United States. Thus,
when property is expropriated and exchanged for cash that is then
commingled with other funds, plaintiffs must still plausibly allege that
the specific proceeds from their property have the required commercial
connection to the United States.
Plaintiffs might satisfy this requirement in various scenarios: for ex-
ample, by identifying a United States account holding proceeds from
expropriated property (as in Banco Nacional de Cuba v. Sabbatino, 376
U. S. 398 ), or by showing that a foreign sovereign spent all funds from
a commingled account in the United States shortly after the commin-
gling occurred. But an allegation that a foreign sovereign liquidated
property decades ago, commingled the proceeds with general funds,
and later used some portion of those funds for commercial activities in
the United States cannot establish a plausible nexus. This is espe-
cially true when commingled funds have been used for various activi-
ties worldwide or when the commingled funds are within a foreign sov-
ereign’s treasury.
The Court does not today address all circumstances where commin-
gling allegations might contribute to establishing the required nexus,
nor does the Court determine the applicability of common-law tracing
principles. The Court holds only that commingling allegations alone
cannot satisfy §1605(a)(3)’s commercial nexus requirement. Pp. 9–15.
(b) This interpretation aligns with the FSIA’s structure, history, and
purpose. The Act generally codifies the restrictive theory of sovereign
immunity, which shields foreign states from suits based on public (ra-
ther than commercial) acts. Although the FSIA allows claims based
on the public act of expropriation, this Court has previously rejected
the suggestion that Congress intended the exception to be a “radical
departure” from restrictive immunity principles. Federal Republic of
Germany v. Philipp, 592 U. S. 169, 183 .
The exception’s text mirrors the Second Hickenlooper Amendment,
which Congress enacted to permit adjudication of claims after Sab-
batino. In that case, the expropriated property’s proceeds were trace-
able to a segregated New York account. The FSIA’s text requiring
identification of specific property, combined with the facts of Sab-
batino, counsels against respondents’ expansive commingling theory.
Additionally, the Court interprets the FSIA to avoid producing fric-
tion in international relations or inviting reciprocal actions against the
United States in foreign courts. Congress included the commercial
nexus requirement and the “in violation of international law” limita-
tion to help ensure the exception would “conform fairly closely” with
international law. §1605(a)(3); Bolivarian Republic of Venezuela v.
Cite as: 604 U. S. ____ (2025) 3
Syllabus
Helmerich & Payne Int’l Drilling Co., 581 U. S. 170, 181 . Accepting
respondents’ theory would expand greatly the circumstances in which
foreign sovereigns could be sued in United States courts for public acts,
potentially inviting retaliatory measures against the United States.
Pp. 15–17.
(c) Respondents’ counterarguments are unpersuasive. First they
contend that §1605(a)(3) requires different treatment for fungible ver-
sus non-fungible property, but the statute’s text draws no such distinc-
tion. The ordinary meaning of “exchanged for” requires identifying the
specific property received in the exchange: here, the proceeds from sell-
ing the expropriated property. Commingling those proceeds with other
funds does not transform the entire commingled account into property
“exchanged for” the expropriated property. Indeed, the statute’s re-
quirement that property be “present in the United States” reinforces
the need to trace specific property, as Congress imposed this geo-
graphic constraint for “any” property, including money.
Second, respondents argue that the concerns about tracing raised in
Sabbatino support their position. But the text of §1605(a)(3), which
added the commercial nexus requirement not found in the Second
Hickenlooper Amendment, reflects Congress’s intent to limit the ex-
ception’s scope, not expand it. The Second Hickenlooper Amendment
itself, moreover, permitted claims based upon a confiscation or “traced
through” one. 23 U. S. C. §2370 (e)(2).
Finally, respondents contend that rejecting their commingling the-
ory would render the expropriation exception a nullity for liquidated
property claims. But the Court does not categorically reject all com-
mingling-based claims: It holds only that a commingling theory alone
cannot satisfy the commercial nexus requirement. This holding ac-
cords with the statute’s text and purpose of providing only a limited
departure from the restrictive theory of sovereign immunity. Pp. 17–
22.
77 F. 4th 1077 , vacated and remanded.
SOTOMAYOR, J., delivered the opinion for a unanimous Court.
Cite as: 604 U. S. ____ (2025) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
United States Reports. Readers are requested to notify the Reporter of
Decisions, Supreme Court of the United States, Washington, D. C. 20543,
pio@supremecourt.gov, of any typographical or other formal errors.
SUPREME COURT OF THE UNITED STATES
_________________
No. 23–867
_________________
REPUBLIC OF HUNGARY, ET AL., PETITIONERS v.
ROSALIE SIMON, ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT
[February 21, 2025]
JUSTICE SOTOMAYOR delivered the opinion of the Court.
To sue a foreign sovereign in the courts of the United
States, plaintiffs must follow the strictures of the Foreign
Sovereign Immunities Act of 1976 (FSIA). In general, the
FSIA provides that foreign sovereigns and their agencies
cannot be haled into this Nation’s courts at all, but the Act
sets forth exceptions to that general immunity. One such
exception is the expropriation exception. Plaintiffs may sue
foreign sovereigns who expropriate their property, provided
certain conditions are satisfied, including that the property
(or any property “exchanged for” the expropriated property)
has a commercial nexus to the United States. 28 U. S. C.
§1605 (a)(3).
Respondents, Jewish survivors of the Hungarian Holo-
caust and their heirs, filed this suit in the District Court for
the District of Columbia against Hungary and one of its
agencies, seeking damages for the alleged expropriation of
their property during World War II. Respondents maintain
that the expropriated property has had a commercial nexus
to the United States because the Hungarian defendants liq-
uidated it, commingled the proceeds from that property
with money in a government treasury account, and then
2 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
used, decades later, funds from that account in connection
with commercial activity in the United States. The issue
presented in this case is whether alleging commingling of
funds alone can satisfy the commercial nexus requirement
of the expropriation exception of the FSIA. The Court holds
that it cannot.
I
A
“This Court consistently has recognized that foreign sov-
ereign immunity ‘is a matter of grace and comity on the part
of the United States.’ ” Rubin v. Islamic Republic of Iran,
583 U. S. 202, 208 (2018) (quoting Verlinden B. V. v. Central
Bank of Nigeria, 461 U. S. 480, 486 (1983)). For much of
the Nation’s history, the United States adhered to the “clas-
sical” or “absolute” theory of foreign sovereign immunity.
Accordingly, “foreign states were ‘generally granted com-
plete immunity from suit’ in United States courts.” Argen-
tine Republic v. Amerada Hess Shipping Corp., 488 U. S.
428, 434, n. 1 (1989) (alteration omitted). Providing foreign
states with such immunity served important national inter-
ests and helped preserve the United States’ foreign rela-
tions. See, e.g., Bolivarian Republic of Venezuela v.
Helmerich & Payne Int’l Drilling Co., 581 U. S. 170, 179
(2017) (“To grant [foreign] sovereign entities an immunity
from suit in our courts both recognizes the absolute inde-
pendence of every sovereign authority and helps to induce
each nation state, as a matter of international comity, to
respect the independence and dignity of every other, includ-
ing our own” (internal quotation marks and alteration omit-
ted)).
In 1952, however, the State Department adopted a “re-
strictive” theory of foreign sovereign immunity, under
which a foreign sovereign generally is immune from civil
suit for sovereign acts but not for its commercial acts. See
Verlinden, 461 U. S., at 486–487. Based on the “increasing
Cite as: 604 U. S. ____ (2025) 3
Opinion of the Court
practice on the part of [foreign] governments of engaging in
commercial activities,” the Department concluded it was
“necessary [to have] a practice which will enable persons
doing business with them to have their rights determined
in the courts.” J. Tate, Changed Policy Concerning the
Granting of Sovereign Immunity to Foreign Governments,
26 Dept. State Bull. 984, 985 (1952). The United States was
not alone in adopting the restrictive theory; the Depart-
ment observed that an emerging consensus had developed
among nations in favor of this approach to sovereign im-
munity. Ibid.
Debates over the degree of immunity foreign sovereigns
should enjoy in this Nation’s courts followed. In August
1960, protesting a reduction in the U. S. sugar quota for
Cuba, Cuba expropriated $175,250.69 worth of sugar lo-
cated in its country but belonging to a subsidiary of Com-
pania Azucarera Vertientes-Camaguey de Cuba (CAV), a
Cuban corporation owned by American stockholders. See
Banco Nacional de Cuba v. Sabbatino, 376 U. S. 398 , 401–
407 (1964). Farr Whitlock & Co., a U. S. commodity broker,
had contracted with CAV to pay for the sugar in New York
for delivery to a Farr Whitlock customer in Morocco; but af-
ter Cuba expropriated the sugar, Farr Whitlock entered
into an identical contract with an instrumentality of the
Cuban Government. See id., at 401–404. Cuba then sent
the sugar to Morocco, where Farr Whitlock’s customer pur-
chased it. See id., at 405–406.
After receiving payment in New York from its customer,
however, Farr Whitlock refused to give the proceeds to
Cuba. See ibid. CAV had claimed it was the rightful owner
of the sugar, entitling it to the related proceeds, and agreed
to indemnify Farr Whitlock in return for a promise not to
turn the funds over to Cuba. See ibid. Shortly thereafter,
the New York Supreme Court served Farr Whitlock with an
order enjoining it from taking any action that might result
4 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
in the proceeds leaving New York. See ibid. Then, pursu-
ant to a subsequent court order, Farr Whitlock transferred
the proceeds to Sabbatino, a court-appointed temporary re-
ceiver of CAV’s New York assets, pending a judicial deter-
mination of the funds’ ownership. See ibid.
The National Bank of Cuba later brought suit in the
Southern District of New York, asserting its ownership in
the proceeds. Id., at 406 . Following a decision by the Court
of Appeals, the State Supreme Court terminated the CAV
receivership and the proceeds from the expropriated sugar
were placed in a New York escrow account. See id., at 407 .
The matter eventually reached this Court. The Court de-
clined to decide whether Cuba’s expropriation had violated
international law. Observing that there were “few if any
issues in international law today on which opinion seems to
be so divided as the limitations on a state’s power to expro-
priate the property of aliens,” id., at 428 , the Court instead
invoked the “act of state” doctrine. That doctrine (the Court
held) precludes United States courts from deciding the va-
lidity of a foreign sovereign’s public acts. See id., at 436–
437. The Court thus “presumed [the] validity” of Cuba’s ex-
propriation. Id., at 439 . In dissent, Justice White protested
that the Court’s holding effectively “validate[d]” Cuba’s
“lawless act.” Ibid.
Congress swiftly signaled its disapproval of Sabbatino.
Within months, it passed the Second Hickenlooper Amend-
ment to the Foreign Assistance Act of 1964. The amend-
ment prohibits courts from applying the act of state doc-
trine where a “righ[t] to property is asserted” based upon a
“taking . . . by an act of that state in violation of the princi-
ples of international law.” 22 U. S. C. §2370 (e)(2). The
amendment was broadly understood “to permit adjudica-
tion of claims the Sabbatino decision had avoided.” Federal
Republic of Germany v. Philipp, 592 U. S. 169, 179 (2021)
(collecting authorities).
There the law remained, until in 1976, Congress enacted
Cite as: 604 U. S. ____ (2025) 5
Opinion of the Court
the FSIA, the comprehensive statute that now “supplies the
ground rules for ‘obtaining jurisdiction over a foreign state
in the courts of this country.’ ” Id., at 175 (quoting
Amerada, 488 U. S., at 443 ). The Act provides foreign
states with presumptive immunity from suit in the United
States. 28 U. S. C. §1604 . Thus, “unless a specified excep-
tion applies, a federal court lacks subject-matter jurisdic-
tion over a claim against a foreign state.” Saudi Arabia v.
Nelson, 507 U. S. 349, 355 (1993) (citing Verlinden, 461
U. S., at 488–489). “For the most part, the Act codifie[d], as
a matter of federal law, the restrictive theory of sovereign
immunity.” Id., at 488 .
One of the FSIA’s specified exceptions, however, departs
from the restrictive theory: the expropriation exception.
§1605(a)(3). In crafting the exception addressing the expro-
priation of property, “Congress used language nearly iden-
tical to that of the Second Hickenlooper Amendment.”
Philipp, 592 U. S., at 179 . But Congress also added a limi-
tation to the expropriation exception not found in the Sec-
ond Hickenlooper Amendment: While the amendment per-
mits claims “based upon (or traced through) a confiscation
or other taking,” 22 U. S. C. §2370 (e)(2), the expropriation
exception requires that stolen property, or property ex-
changed for such property, have a commercial nexus to the
United States. Specifically, §1605(a)(3) allows individuals
to sue foreign sovereigns in United States courts when
“rights in property taken in violation of international law
are in issue and that property or any property exchanged
for such property is present in the United States in connec-
tion with a commercial activity carried on in the United
States by the foreign state.” Section 1605(a)(3) also allows
suit when “that [expropriated] property or any property ex-
changed for such property is owned or operated by an
agency or instrumentality of the foreign state and that
agency or instrumentality is engaged in a commercial activ-
ity in the United States.”
6 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
By permitting the exercise of jurisdiction over certain
public acts, “the expropriation exception . . . goes beyond
even the restrictive view” in subjecting foreign sovereigns
to suit. Philipp, 592 U. S., at 183 . As this Court has previ-
ously noted, it appears that “no other country has adopted
a comparable limitation on [foreign] sovereign immunity.”
Ibid.
B
The allegations in respondents’ complaint arise out of the
Hungarian Holocaust. According to their complaint, Win-
ston Churchill described the Hungarian Holocaust as
“ ‘probably the greatest and most horrible crime ever com-
mitted in the history of the world.’ ” App. 6. During World
War II, Hungary abetted the murder of over 500,000 Hun-
garian Jews, leaving just a fraction of Hungary’s prewar
Jewish population. Id., at 49. “Nowhere was the Holocaust
executed with such speed and ferocity as it was in Hun-
gary.” Id., at 5.
Hungary’s genocidal campaign included the mass confis-
cation of Jewish property. Per respondents’ complaint, of-
ficials from Hungary’s national railway, the Magyar
Államvasutak Zrt. (MÁV), robbed Hungarian Jews of their
possessions before transporting them to Nazi death camps.
Id., at 40–41. The Hungarian Government, moreover, “de-
clared all valuable objects owned by Jews—except for their
most personal items—part of the national wealth of Hun-
gary.” Simon v. Republic of Hungary, 77 F. 4th 1077, 1090
(CADC 2023) (Simon III).
Respondents are a group of Jewish survivors of the Hun-
garian Holocaust and their heirs who seek damages for a
variety of claims, including, inter alia, conversion, unjust
enrichment, civil conspiracy to commit tortious acts, and
aiding and abetting the conversion of their property, based
on Hungary and MÁV’s alleged seizure of their property.
Cite as: 604 U. S. ____ (2025) 7
Opinion of the Court
They claim that Hungary, after seizing their property, liq-
uidated it and deposited the proceeds in the Hungarian
treasury. There the funds became commingled with other
Hungarian Government funds, money Hungary has since
used for a wide variety of governmental and commercial op-
erations. Respondents’ complaint further alleges that MÁV
also liquidated the property it expropriated and deposited
the proceeds into commingled accounts that it owns today
and has used for a wide range of transactions.
In the 2000s, Hungary allegedly used funds from its
treasury to issue bonds in the United States and to pur-
chase military equipment here. See 579 F. Supp. 3d 91 ,
107–108 (DC 2021). MÁV also engages in commercial ac-
tivity in the United States, including by maintaining an
agency here that sells tickets, books reservations, and con-
ducts similar business. Ibid.
C
In 2010, respondents sued Hungary and MÁV, seeking
compensation for the seizure of their property during the
Holocaust. The procedural history of this case is lengthy.
It includes several appeals to the D. C. Circuit. See Simon
v. Republic of Hungary, 812 F. 3d 127 (CADC 2016) (Simon
I); Simon v. Republic of Hungary, 911 F. 3d 1172 (2018) (Si-
mon II); Simon III, 77 F. 4th 1077 . When the case previ-
ously reached this Court, we vacated the judgment in Si-
mon II and remanded the case for further proceedings
consistent with our decision in Philipp, 592 U. S., at 172 .
See Republic of Hungary v. Simon, 592 U. S. 207 (2021)
(per curiam).
As relevant here, respondents allege that Hungary and
MÁV are subject to the jurisdiction of United States courts
under the expropriation exception. To satisfy §1605(a)(3)’s
commercial nexus requirement, respondents rely on a “com-
mingling theory”: They “alleg[e] that the Hungarian de-
8 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
fendants liquidated the[ir] stolen property, mixed the re-
sulting funds with their general revenues, and devoted the
proceeds to funding various governmental and commercial
operations.” Simon I, 812 F. 3d, at 147 . Those commingled
funds, respondents maintain, were once “exchanged for”
their expropriated property and are now “property . . . pre-
sent in the United States in connection with a commercial
activity carried on in the United States by” Hungary.
§1605(a)(3). Among other things, Hungary allegedly used
commingled funds to issue bonds and purchase military
equipment in the United States in the 2000s; and MÁV al-
legedly still “own[s]” the same commingled funds. See 579
F. Supp. 3d, at 107–109; see also §1605(a)(3) (permitting
suit when “[expropriated] property or any property ex-
changed for such property is owned . . . by an agency . . . of
the foreign state and that agency . . . is engaged in a com-
mercial activity in the United States” (emphasis added)).
Following this Court’s remand on an unrelated question,
the District Court reaffirmed a prior determination that re-
spondents’ commingling theory satisfied the commercial
nexus element of §1605(a)(3). Id., at 122, n. 22. The D. C.
Circuit affirmed. It rejected Hungary’s assertion that re-
spondents needed to “ ‘produce evidence tracing property in
the United States or possessed by MÁV to property expro-
priated from them during World War II.’ ” 77 F. 4th, at
1118 . Instead, the court concluded that Congress, by in-
cluding the phrase “ ‘or any property exchanged for such
property’ ” in the expropriation exception, intended to cover
circumstances in which a foreign state converts stolen prop-
erty into cash and commingles the cash with other funds.
Ibid.
The court reasoned, moreover, that “[r]equiring plaintiffs
whose property was liquidated to allege and prove that they
have traced funds in the foreign state’s or instrumentality’s
possession to proceeds of the sale of their property would
Cite as: 604 U. S. ____ (2025) 9
Opinion of the Court
render the FSIA’s expropriation exception a nullity for vir-
tually all claims involving liquidation” of property. Ibid.
“Given the fungibility of money,” the court explained, “once
a foreign sovereign sells stolen property and mixes the pro-
ceeds with other funds in its possession, those proceeds or-
dinarily become untraceable to any specific future property
or transaction.” Ibid. The D. C. Circuit “decline[d] to as-
cribe to Congress an intent to create a safe harbor for for-
eign sovereigns who choose to commingle rather than seg-
regate or separately account for the proceeds from unlawful
takings.” Ibid.
The Court granted certiorari, 602 U. S. ___ (2024), to de-
cide “[w]hether historical commingling of assets suffices to
establish that proceeds of seized property have a commer-
cial nexus with the United States under the expropriation
exception to the Foreign Sovereign Immunities Act,” Pet.
for Cert. ii.
II
A
To establish federal jurisdiction under the expropriation
exception, plaintiffs must allege facts sufficient to raise a
plausible inference that either their property, or “any prop-
erty exchanged for such property,” is “present in the United
States in connection with a commercial activity carried on
in the United States by” the foreign sovereign, or that those
belongings are “owned or operated by” a foreign state
agency “engaged in a commercial activity in the United
States.”1 §1605(a)(3).
——————
1 In their petition for certiorari, Hungary and MÁV asked this Court to
answer two additional questions. First is whether this Court’s decision
in Bolivarian Republic of Venezuela v. Helmerich & Payne Int’l Drilling
Co., 581 U. S. 170 (2017), displaced the typical plausibility pleading
standard, for actions brought under the FSIA, with a heightened stand-
ard for factual allegations. Pet. for Cert. ii. It is unnecessary to resolve
this question, however, because the commingling theory cannot satisfy
10 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
As a general matter, respondents agree, §1605(a)(3) tasks
plaintiffs with identifying specific property, or particular
property exchanged for that property, “present in the
United States in connection with a commercial activity . . .
by the foreign state,” or owned by a foreign state agency en-
gaged in commercial activity in the United States. Ibid.
Specifically, plaintiffs must identify either the expropriated
property itself (“that property”) or “any property exchanged
for such property.” Ibid. Doing so inevitably requires that
plaintiffs show a tracing of some sort that explains the prop-
erty’s lineage and how it found itself in the United States
(or in the possession of a foreign sovereign agency that does
commercial activity here).
When the property at issue is tangible expropriated prop-
erty itself, a plaintiff must allege some facts that give rise
to a plausible inference that the property is in the United
States. Suppose a foreign sovereign expropriates and re-
tains for its collection a piece of art from a plaintiff. To
bring suit under §1605(a)(3), the plaintiff would have to put
forth some facts that support tracing that artwork to a lo-
cation in the United States or to the possession of an agency
of the sovereign with commercial activities in the United
——————
the lower of these two standards. The Court thus assumes without de-
ciding that the plausibility pleading standard applies here.
Hungary and MÁV’s second additional question concerns who bears
the burden of production to prove (or disprove) that expropriated prop-
erty has a commercial nexus with the United States. Ibid. The Govern-
ment asks the Court to answer a related question: Who bears the burden
of persuasion on that issue. Brief for United States as Amicus Curiae I.
The Court declines to answer either question. The parties agree that
respondents bear the burden of production. See Brief for Petitioners 39;
Brief for Respondents 37–38. And it is unnecessary to resolve who bears
the ultimate burden of persuasion because that question arises only after
a plaintiff has pleaded adequately that §1605(a)(3)’s commercial nexus
is satisfied, which respondents have not done here with their commin-
gling allegations.
Cite as: 604 U. S. ____ (2025) 11
Opinion of the Court
States. A complaint would fail if it instead identified an-
other unrelated artwork expropriated by the foreign state,
even if that other artwork had the requisite commercial
nexus to the United States. No one disputes that the phrase
“that property” in §1605(a)(3) refers only to the specific
piece of property taken from the plaintiff.
As respondents recognize, the same tracing requirement
would exist if the foreign sovereign were to exchange the
plaintiff ’s artwork for another tangible item. Brief for Re-
spondents 42–43. For example, suppose that the sovereign
trades the expropriated artwork for a different piece of art.
That transaction would not extinguish the plaintiff ’s ability
to sue: the other piece of art is, of course, property, and
§1605(a)(3) permits suit based on “any property exchanged”
for the expropriated property. (Emphasis added.) If the
plaintiff alleges facts sufficient to reasonably conclude that
the different piece of art can be traced to the United States,
§1605(a)(3)’s commercial nexus is satisfied. The plaintiff
could not merely allege, however, that the foreign sovereign
maintains an art collection in the United States. Nor would
it be sufficient for the plaintiff to allege that the collection
includes other art that is comparable to the exchanged-for
piece of art. Section 1605(a)(3)’s use of “exchanged for”
means the only relevant art is the one the foreign sovereign
received in return for the plaintiff ’s original artwork. Ibid.;
see also American Heritage Dictionary 457 (1975) (defining
“exchange” as “to relinquish (one thing for another”)).
Respondents’ commingling theory accepts all this, but
posits an exception to the statute’s tracing requirement
that applies only when a foreign sovereign converts expro-
priated property into money or other fungible property. Ac-
cording to the commingling theory, if a foreign sovereign
exchanges expropriated property for money, a plaintiff need
not identify the specific funds for which their property was
exchanged. Instead, respondents claim, a plaintiff need
only identify any fund that was, at any time, no matter how
12 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
remote, commingled with the proceeds of the foreign sover-
eign’s sale of the expropriated property. This commingling
theory thus does away with the tracing requirement im-
plicit in the phrase “exchanged for” within §1605(a)(3).
Section 1605(a)(3) contains no such exception. The plain
text of the expropriation exception treats all “property”
alike, whether that property is tangible (like a piece of art)
or fungible (like cash). Thus, if instead of exchanging the
expropriated artwork for another piece of art, the foreign
sovereign sells it and deposits the cash proceeds into a bank
account used for commercial activities, that mere fact does
not relieve plaintiffs from alleging some facts that enable
the reasonable tracing of those proceeds to the United
States.
As Sabbatino shows, one way a plaintiff can do so is by
identifying an account within the United States that holds
the proceeds from the sale of seized property. Similarly, a
plaintiff might satisfy §1605(a)(3)’s commercial nexus by al-
leging that a foreign sovereign, soon after commingling
funds from the sale of expropriated property, spent all the
funds from the commingled account in the United States as
part of its commercial activity here. It would follow that
the proceeds connected to the expropriated property would
likely be present in the United States. The same would be
true if the amount of commingled funds spent exceeds the
amount of the funds in the account unrelated to the alleged
expropriation. Put another way, suppose a foreign sover-
eign expropriates property and sells it for $1 million. If the
foreign state then deposits those proceeds into an account
containing $250,000 in other funds and immediately spends
$500,000 of the commingled funds for a commercial trans-
action in the United States, a plaintiff could rely on those
facts to satisfy §1605(a)(3)’s commercial nexus. Those facts
would establish that (at least) $250,000 of the $1 million
Cite as: 604 U. S. ____ (2025) 13
Opinion of the Court
proceeds “exchanged for” the expropriated property is “pre-
sent in the United States.” §1605(a)(3).2 These are merely
examples of how the tracing requirement might be met.
A plaintiff does not make the necessary showing, how-
ever, by alleging only that the foreign sovereign deposited
the proceeds from the sale of expropriated property into an
account at some time and eventually used that account for
commercial activity in the United States. That is because
an allegation of commingling alone does not give rise to a
plausible inference that the specific property “exchanged
for” the expropriated property, i.e., the cash proceeds from
the sale, is “present in the United States.” Ibid. To the
contrary, it will typically be indeterminate whether an ex-
penditure of commingled funds includes any of the proceeds
connected to the expropriated property. Commingling alle-
gations are therefore not enough on their own because they
do not allow for plausible tracing of specific funds. To con-
clude otherwise requires accepting an attenuated fiction
that commingling funds in an account, even if done decades
earlier, means the account today still contains funds at-
tributable to the sale of expropriated property.
The problem with such a fiction becomes especially clear
when a foreign sovereign has used commingled funds not
just for commercial activities in the United States but also
for commercial and governmental operations all over the
world, as is the case here. App. 33 (alleging that Hungary
“liquidated stolen property, mixed the resulting funds with
their general revenues, and devoted the proceeds to funding
various governmental and commercial operations”). In
such circumstances, it is no more likely that the funds re-
lated to the expropriated property ended up in the United
——————
2 The proximity in time between a foreign sovereign’s commingling of
proceeds from expropriated property with other money and its expendi-
ture of those commingled funds in the United States for commercial ac-
tivity may also be a relevant consideration in assessing whether a plain-
tiff has satisfied §1605(a)(3)’s commercial nexus.
14 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
States than that they ended up anywhere else in the world
or remained in Hungary. That is especially true when the
commingled funds are within a foreign sovereign’s treas-
ury, given that old and new revenues flow in and out of the
treasury in massive quantities over time. Thus, commin-
gling allegations alone cannot plausibly establish that any
of the relevant proceeds from expropriated property are in
the United States.
All this is not to say that, once funds are commingled,
plaintiffs will never be able to satisfy §1605(a)(3). As pre-
viously noted, there are scenarios in which a plaintiff might
satisfy §1605(a)(3)’s commercial nexus requirement when
expropriated property has been exchanged for cash and
that cash has been commingled with other funds. Supra,
at 12. The Court does not today purport to identify all cir-
cumstances in which commingling allegations may be part
of broader allegations that collectively satisfy §1605(a)(3)’s
commercial nexus. Instead, the Court holds only that an
allegation that a foreign sovereign liquidated expropriated
property, commingled the proceeds with other funds, and
then used some of those commingled funds for commercial
activities in the United States (or that a foreign instrumen-
tality retained such proceeds and then commingled them
with other funds) cannot itself establish the required com-
mercial nexus of §1605(a)(3).
Because respondents have disclaimed in this case the
utility of common-law tracing principles and rules from
other contexts, Tr. of Oral Arg. 76, we leave for another day
the extent to which they may prove helpful to courts tasked
with determining whether a plaintiff has satisfied
§1605(a)(3)’s commercial nexus when expropriated prop-
erty has been liquidated and commingled. Cf. Luis v.
United States, 578 U. S. 5, 22 (2016) (plurality opinion) (re-
ferring to “tracing rules governing commingled accounts” in
the trust-law context and citing 4 A. Scott, Law of Trusts
§518 (1956)). Courts should not import reflexively those
Cite as: 604 U. S. ____ (2025) 15
Opinion of the Court
principles and rules into this context, however, given the
baseline presumption of foreign sovereign immunity. Any
application of existing tracing principles and rules must be
consistent with the overall FSIA scheme and the expropri-
ation exception’s requirements.
B
This interpretation of §1605(a)(3) is further consistent
with the FSIA’s structure, history, and purpose. As a gen-
eral matter, litigants cannot sue foreign sovereigns in
United States courts. The FSIA “creates a baseline pre-
sumption of immunity from suit.” Philipp, 592 U. S., at
176 ; see 28 U. S. C. §1604 . To the extent the Act permits
litigation against foreign states, it usually requires that the
litigation be premised on the foreign state’s private, com-
mercial conduct. That is because the FSIA “ ‘largely codi-
fies’ the restrictive theory” of sovereign immunity, which
shields foreign states from being sued for their public acts.
Courts should “take seriously the Act’s general effort to pre-
serve a dichotomy between private and public acts.”
Philipp, 592 U. S., at 183 .
Although §1605(a)(3) allows plaintiffs to bring suit based
on the public act of expropriation, this Court has previously
“reject[ed] the suggestion that Congress intended the ex-
propriation exception to operate as a ‘radical departure’
from the ‘basic principles’ of the restrictive theory.” Id., at
183 (quoting Helmerich, 581 U. S., at 181 ). Yet reading
§1605(a)(3) as broadly as respondents do would undermine
those principles by expanding greatly the circumstances in
which foreign sovereigns can be brought into United States
courts for their public acts.
Moreover, Congress drafted the expropriation exception
“against th[e] legal and historical backdrop” that includes
not only the restrictive theory but also Sabbatino. Philipp,
592 U. S., at 181. Recall that the text of §1605(a)(3) mir-
rors, in part, that of the Second Hickenlooper Amendment,
16 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
which Congress enacted “to permit adjudication of claims
the Sabbatino decision had avoided.” Id., at 179. In Sab-
batino, “the proceeds . . . in controversy” could be traced to
a New York account that contained segregated funds at-
tributable only to the sale of expropriated sugar. 376 U. S.,
at 401 . The facts of Sabbatino, along with the FSIA’s plain
text requiring identification of distinct property seized, or
specific property exchanged for that property, with a com-
mercial nexus to the United States, counsel against the
commingling theory alone satisfying §1605(a)(3)’s commer-
cial nexus.
There is further good reason for the Court not to read
§1605(a)(3) so broadly as to permit a commingling theory
alone: the United States’ “reciprocal self-interest” in receiv-
ing sovereign immunity in foreign courts. National City
Bank of N. Y. v. Republic of China, 348 U. S. 356, 362
(1955). This Court “interpret[s] the FSIA as we do other
statutes affecting international relations: to avoid, where
possible, ‘producing friction in our relations with [other] na-
tions and leading some to reciprocate by granting their
courts permission to embroil the United States in expensive
and difficult litigation.’ ” Philipp, 592 U. S., at 184 (quoting
Helmerich, 581 U. S., at 183 ; alteration in original). Alt-
hough the expropriation exception is “unique” in how it de-
parts from the restrictive theory, Philipp, 592 U. S., at 183 ,
its drafters understood it to “ ‘conform fairly closely’ ” with
international law, Helmerich, 581 U. S., at 181 ; ibid. (ob-
serving that “this Court, like Congress, has paid special at-
tention” to the Government’s “views on sovereign immun-
ity”). That is why the exception requires a commercial
nexus with the United States and a taking of property “in
violation of international law.” §1605(a)(3). By including
this language, Congress hoped it “would diminish the like-
lihood that other nations would each go their own way,
thereby ‘subject[ing]’ the United States ‘abroad’ to more
Cite as: 604 U. S. ____ (2025) 17
Opinion of the Court
claims ‘than we permit in this country.’ ” Id., at 181 (quot-
ing Hearing on H. R. 3493 before the Subcommittee on
Claims and Governmental Relations of the House of Repre-
sentatives Committee on the Judiciary, 93d Cong., 1st
Sess., 18 (1973) (alteration in original)).
If respondents’ commingling theory were accepted,
§1605(a)(3) would impose a far greater limitation on foreign
sovereign immunity, expanding the set of circumstances in
which foreign sovereigns could be sued in United States
courts for public acts involving expropriation. The Govern-
ment represents that this would invite the very risk it
sought to avoid in helping draft §1605(a)(3): that foreign
states, in response, will subject the United States abroad to
“retaliatory or reciprocal actions” in their courts. Tr. of Oral
Arg. 31. The Court declines to interpret §1605(a)(3) in the
expansive manner that respondents seek.
III
A
Respondents do not resist that the plain text of
§1605(a)(3) requires plaintiffs to identify and trace their
specific expropriated property, or the particular property
exchanged for their expropriated property, to the United
States (or to the possession of a foreign instrumentality
that does commercial activity here) when the property in
question is nonfungible. Yet respondents insist that the
same statutory text does not require similar tracing when
the expropriated property is converted into cash. Instead,
respondents maintain, §1605(a)(3) is best read to support
their commingling theory in those circumstances. That ar-
gument is unpersuasive.
Respondents start from the undisputed premise that
money is property. From there, respondents argue that
money can be the “any property” that is “exchanged for” ex-
propriated property. §1605(a)(3). If a foreign sovereign
then commingles proceeds from the sale of expropriated
18 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
property with other funds, respondents explain, the pro-
ceeds do not lose their status as the property that was “ex-
changed for” the expropriated property. Thus, according to
respondents, when those commingled funds enter the
United States in connection with a foreign state’s commer-
cial activities (or enter the possession of a foreign agency
that does commercial activities in the United States), the
commercial nexus is satisfied because the commingled
funds came from an account where the expropriated pro-
ceeds were deposited. No further tracing is required, they
insist, because money is fungible. This fungibility means
any given dollar of the proceeds in an account is indistin-
guishable from, and thus exchangeable with, any dollar in
the commingled account.
Section 1605(a)(3)’s text does not support this theory. For
one, the expropriation exception does not draw any distinc-
tions between nonfungible and fungible property. Nothing
in the text of §1605(a)(3) establishes distinct tracing re-
quirements for the latter. Moreover, respondents’ commin-
gling theory distorts the ordinary meaning of “exchange.”
When a foreign sovereign sells expropriated property, the
cash proceeds it gets in return is the relevant property for
purposes of §1605(a)(3). This is because those proceeds
were “exchanged for” the expropriated property, and it is
this property a plaintiff must show is in the United States.
The other money in a foreign sovereign’s possession is irrel-
evant. Just as a foreign sovereign’s art collection in the
United States would be if it does not contain a plaintiff ’s
specific expropriated artwork or a piece of art exchanged for
that artwork.
Respondents do not argue that a foreign state’s cash re-
serves, if kept separate from proceeds of the sale of expro-
priated property, can qualify as “property exchanged for”
expropriated property. Nor could they: That separate cash
bears no relationship to the expropriated property. That a
Cite as: 604 U. S. ____ (2025) 19
Opinion of the Court
foreign sovereign may instead commingle expropriated pro-
ceeds with other unrelated funds does not change that con-
clusion. The only property the sovereign received in “ex-
change” for the expropriated property is the cash proceeds
it received in that transaction. Yet the commingling theory
requires accepting the idea that the entire account with
commingled funds should be regarded as property “ex-
changed for” the expropriated property, even if that ac-
count’s assets far outweigh what the foreign sovereign re-
ceived for selling the expropriated property.
The facts of this case underscore why this commingling
theory is inconsistent with the ordinary meaning of “ex-
changed for.” Respondents allege that Hungary used gen-
eral treasury funds to issue bonds and purchase military
equipment in the United States in the 2000s. That expendi-
ture, respondents maintain, permits their suit to proceed
under §1605(a)(3) because Hungary allegedly expropriated
their property during World War II, liquidated it, and then
commingled the proceeds with government funds. In the
intervening decades, however, Hungary has made count-
less transactions throughout several institutional collapses
and regime changes, resulting in billions in revenues flow-
ing in and out of its treasury. Against this historical back-
drop, it is implausible to say that the commingling Hungary
did in the 1940s, on its own, establishes that the money it
spent in the United States in the 2000s was “exchanged for”
the property Hungary allegedly expropriated from respond-
ents. The same is true for the assertion that any of MÁV’s
current possessions were “exchanged for” respondents’
property based solely on the fact that it allegedly liquidated
respondents’ property in the 1940s and then commingled
the proceeds with its general revenues, given that MÁV has
used those commingled funds in the intervening decades for
countless transactions as well. To say otherwise stretches
“exchange” to the point of breaking.
It is true that, because money is fungible, it will likely be
20 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
difficult to trace cash from the sale of expropriated property
after it is commingled. Section 1605(a)(3), however, con-
tains a further textual indication that reinforces its require-
ment of tracing specific property: When a foreign sovereign
is responsible for the expropriation, a suit may proceed only
if the property is “present in the United States.” Congress
was well aware that the location of money can become in-
determinate when it is commingled, but it nonetheless im-
posed this geographic constraint for “any” property, includ-
ing money. Ibid. (emphasis added); cf. 21 U. S. C.
§§853 (p)(1)(E), (2) (in the criminal forfeiture context, per-
mitting seizure of “any other property of the defendant”
when property “has been commingled with other property
which cannot be divided without difficulty”).
B
Respondents next argue that the concerns this Court
raised in Sabbatino about tracing expropriated property
helps their position. For instance, the Court observed that
“one would have difficulty determining after goods had
changed hands several times whether the particular arti-
cles in question were the product of ” expropriation. 376
U. S., at 434 . The Court also mentioned specifically the
“difficult tas[k] of ascertaining the origin of fungible goods.”
Ibid., n. 39. Congress nevertheless enacted the Second
Hickenlooper Amendment with those observations in mind,
and later passed the expropriation exception, which has
language nearly identical to that of the Second Hick-
enlooper Amendment. According to respondents, those ac-
tions reflect Congress’s intent to allow the adjudication of
expropriation claims generally, including those premised
on a commingling theory.
It is the statutory text of §1605(a)(3) that best reflects
Congress’s intent, however, and it does not support re-
spondents’ commingling theory for the reasons discussed.
Indeed, the expropriation exception permits only claims
Cite as: 604 U. S. ____ (2025) 21
Opinion of the Court
that show a commercial nexus between expropriated prop-
erty (or property exchanged for that property) and the
United States, a requirement not found in the Second Hick-
enlooper Amendment. Moreover, the Second Hickenlooper
Amendment allows claims “based upon (or traced through)
a confiscation or other taking,” 22 U. S. C. §2370 (e)(2) (em-
phasis added), underscoring the importance of alleging
some facts that enable the reasonable tracing of property to
the United States, in the §1605(a)(3) context, when claims
identify “property exchanged for [expropriated] property,”
28 U. S. C. §1605 (a)(3) (emphasis added). Thus, the expro-
priation exception’s roots in Sabbatino and the Second
Hickenlooper Amendment do not provide a compelling rea-
son to abandon the plain meaning of §1605(a)(3).3
C
Lastly, respondents argue from purpose. Like the D. C.
Circuit, they maintain that §1605(a)(3) will be rendered a
nullity if the commingling theory alone cannot plausibly es-
tablish a commercial nexus with the United States. The
commingling theory is necessary, they insist, because with-
out it, foreign sovereigns can “commingle the proceeds from
illegally taken property with general accounts” and thereby
“insulate [themselves] from suit [in the United States] un-
der the expropriation exception.” 77 F. 4th, at 1118 .
——————
3 Contrary to respondents’ assertions, moreover, the Second Hick-
enlooper Amendment was contemporaneously understood by courts to
permit adjudication of claims involving “specific and identifiable and
‘traceable’ property.” French v. Banco Nacional de Cuba, 23 N. Y. 2d 46,
61, 242 N. E. 2d 704, 714 (1968); see id., at 58, 242 N. E. 2d, at 712 (ob-
serving that the amendment was “restricted, manifestly, to the kind of
problem exemplified by the Sabbatino case itself, a claim of title or other
right to specific property which had been expropriated abroad” (emphasis
added)); see also Hunt v. Coastal States Gas Prod. Co., 583 S. W. 2d 322,
330, n. 6 (Tex. 1979) (“Although the amendment does not refer specifi-
cally to proceeds, it is clear that it was intended to apply to the property
as long as it is traceable”).
22 REPUBLIC OF HUNGARY v. SIMON
Opinion of the Court
The Court’s decision, however, does not categorically re-
ject claims premised on a commingling theory. The Court
holds only that a commingling theory cannot satisfy
§1605(a)(3)’s commercial nexus on its own. It is true that it
will be harder for plaintiffs to satisfy §1605(a)(3)’s commer-
cial nexus element when a foreign sovereign expropriates
property in violation of international law and liquidates it
if they cannot rely on a commingling theory alone. This
added difficulty in bringing some §1605(a)(3) claims,
though, does not make the expropriation exception a dead
letter for the reasons explained. Supra, at 12–14.
Respondents’ policy concerns, moreover, cannot “ ‘sur-
mount the plain language of the statute,’ ” Truck Insurance
Exchange v. Kaiser Gypsum Co., 602 U. S. 268, 284 (2024)
(quoting Arthur Andersen LLP v. Carlisle, 556 U. S. 624,
629 (2009)), especially given countervailing ones that better
conform to the plain text. Allowing plaintiffs to forgo alto-
gether the statute’s tracing requirements by pleading a
commingling theory could allow vastly more suits to pro-
ceed under §1605(a)(3), even though the expropriated prop-
erty would have an attenuated nexus to the United States.
This could, in turn, undermine the United States’ foreign
relations and reciprocal self-interest, as well as
§1605(a)(3)’s conformity with international law. As dis-
cussed, the Government helped craft §1605(a)(3) expressly
to avoid that outcome, supra, at 16–17, and Congress in-
tended for §1605(a)(3) to operate as only a limited depar-
ture from the restrictive theory, which provides foreign sov-
ereign immunity for public acts like expropriation.
* * *
Ultimately, today’s decision concerns only what plaintiffs
must plead to bring suit against foreign sovereigns for their
actions abroad in the courts of the United States. That a
particular claim cannot satisfy the expropriation exception
Cite as: 604 U. S. ____ (2025) 23
Opinion of the Court
means only that it cannot be brought here, not that it can-
not be brought in any forum. As the Government correctly
recognizes, “the moral imperative has been and continues
to be to provide some measure of justice to the victims of the
Holocaust, and to do so in their remaining lifetimes.” Brief
for United States as Amicus Curiae 26. The Government
also represents, however, that “[r]especting the limits in the
FSIA aids in the United States’ efforts to persuade foreign
nations to establish appropriate redress and compensation
mechanisms for human-rights violations, including the hor-
rendous human-rights violations perpetrated during the
Holocaust.” Ibid.
For the foregoing reasons, the Court concludes that a
commingling theory, without more, cannot satisfy the com-
mercial nexus requirement of §1605(a)(3). The judgment of
the Court of Appeals for the D. C. Circuit is vacated, and
the case is remanded for further proceedings consistent
with this opinion.
It is so ordered.