The FDIC can also claim sovereign immunity based on the Federal Tort Claims Act (FTCA).
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Without sovereign immunity, governments would spend fortunes and tie up personnel defending themselves in courts around the globe.
"There's Pennsylvania appellate case law that has found that Penn State is not entitled to sovereign immunity, " he said.
In 1976, Congress passed the Foreign Sovereign Immunities Act (FSIA), which effectively codified the restrictive view of sovereign immunity.
Worse, individual bondholders might pursue their claims in the courts, where Pakistan might try to invoke its sovereign immunity.
The Justice Department declined to comment on the matter of sovereign immunity.
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Despite a sovereign immunity defense from the IRS, the Bankruptcy Court held that the debtor corporation could recover the extra funds on fraudulent transfer grounds.
In addition to arguing sovereign immunity, the tribe argued that the records would reveal confidential financial information and force them to change their banking practices.
Further, due to the sovereign immunity conferred on the states by The Constitution, the opportunity to push the state into involuntary bankruptcy is out of the question.
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The basis for both the trial court's dismissal of the complaint and the Second Circuit's affirmation of that ruling is the complex area of the law known as sovereign immunity.
The Trustee and the Mets had worked something out and the Court was prepared to dismiss the interpleader, but the IRS wanted there to be summary judgment based on sovereign immunity.
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Predictably, the Miccosukee Tribe claimed protection under sovereign immunity.
The basis for sovereign immunity is clear: Governments need to know that other countries' governments will not allow their citizens to lodge lawsuits in their home courts for any perceived wrong committed by the foreign power.
Most of all, conservatives should worry about a Supreme Court that brushes aside the text of the constitution to promote an idea as alien to democratic values as sovereign immunity, even in the name of states' rights.
The Justice Department also argues that the court doesn't have the right to determine the constitutionality of the law in this case because of " sovereign immunity, " a long-standing legal principle that exempts the government from lawsuits unless the government consents.
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Orin Kerr, a professor at George Washington University Law School and former computer-crime attorney at the Justice Department, said sovereign immunity usually is applied in lawsuits against the government that seek monetary damages, not in cases disputing the constitutionality of a law.
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The fourth quarter of 2012 may prove to be the period when the United States finally lost immunity from the global sovereign debt crisis.
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