## Facts

- Helmerich & Payne International Drilling Co. (H&P International), a U.S. company, operated in Venezuela through its wholly owned Venezuelan subsidiary, Helmerich & Payne de Venezuela, C.A. (H&P‑V).
- H&P‑V provided drilling rigs and services to Venezuela’s state oil entities under multiple contracts; by 2008–2009, PDVSA allegedly owed over $100 million in unpaid invoices.
- After H&P decided not to renew contracts and began withdrawing rigs, Venezuelan National Guard and PDVSA personnel allegedly blockaded H&P’s premises in June 2010, preventing removal of rigs.
- President Hugo Chávez issued a decree expropriating H&P‑V’s assets; plaintiffs alleged the taking was uncompensated and discriminatory toward foreign investors.
- Plaintiffs sued Venezuela, PDVSA, and a PDVSA subsidiary in federal court under the Foreign Sovereign Immunities Act (FSIA), invoking the expropriation exception (§ 1605(a)(3)) and, separately, the commercial-activity exception (§ 1605(a)(2)).
- After the Supreme Court rejected a “non-frivolous” jurisdiction test for the expropriation exception and required a legally valid claim that property was taken in violation of international law, the case returned to the D.C. Circuit to apply that standard.

## Issues

1. Whether H&P‑V’s expropriation claim was barred by the domestic-takings rule because H&P‑V was a Venezuelan national under international law.
2. Whether customary international law recognizes an exception making a domestic taking an international-law violation when motivated by discrimination against foreign shareholders.
3. Whether H&P International adequately alleged that Venezuela took the parent’s own property (not merely the subsidiary’s assets or the parent’s shareholder interest) in violation of international law for purposes of FSIA § 1605(a)(3).

## Decision

- The D.C. Circuit held that H&P‑V was a Venezuelan company under international law; expropriation of its property was a domestic taking and therefore not a taking “in violation of international law” under FSIA § 1605(a)(3).
- The court rejected the argument that discriminatory intent toward foreign owners converts an expropriation of a domestically incorporated company into a customary-international-law violation.
- The court held that H&P International sufficiently alleged a taking of the parent’s own property interests (including contractual rights and related assets alleged to belong directly to the parent), satisfying the Supreme Court’s merits-linked jurisdictional standard at the pleading stage.
- The court affirmed in part and remanded for further proceedings consistent with these rulings.

## Legal Principles

- FSIA expropriation-exception jurisdiction requires a legally valid claim that specific property was taken and that the taking violated international law; a merely “non-frivolous” allegation is insufficient.
- Under the domestic-takings rule, a sovereign’s expropriation of property from its own national (including a corporation incorporated under its laws) generally does not violate international law.
- Corporate nationality for international-law purposes is ordinarily determined by place of incorporation; a subsidiary’s separate legal identity is not displaced by foreign shareholder ownership.
- Shareholders generally may not treat a corporation’s assets as their own property for international-law expropriation claims, but a parent may proceed if it plausibly pleads the taking of property rights held directly by the parent (e.g., its own contractual rights).

## Conclusion

The D.C. Circuit applied the Supreme Court’s stricter FSIA expropriation-exception test by dismissing the Venezuelan subsidiary’s expropriation claim as a non-actionable domestic taking, rejecting a discrimination-based customary-law theory, and allowing the U.S. parent’s expropriation theory to proceed based on allegations that Venezuela took the parent’s own property interests.


Helmerich & Payne Int’l Drilling Co. v. Bolivarian Republic of Venezuela, 743 F. App’x 442 (D.C. Cir. 2018)