The Second Circuit Court of Appeals issued a mixed ruling in *Yerkyn v. Yakovlevich*, finding that while a district court erred on one jurisdictional issue, Kazakhstan's National Security Committee remains immune from lawsuits in U.S. courts under foreign sovereign immunity principles.
Kazakhstani businessman Amirkhanov Yerkyn appealed from a judgment by the U.S. District Court for the Eastern District of New York that dismissed his claims against the National Security Committee of Kazakhstan and denied him leave to replead violations under the Racketeer Influenced and Corrupt Organizations Act.
Yerkyn alleged that he was wrongfully detained and coerced into signing unfavorable business agreements while imprisoned in Kazakhstan in order to secure his release. The businessman claimed that the National Security Committee and co-defendants Klebanov Alexandr Yakovlevich and Kan Sergey Vladimirovich orchestrated the coercive agreements.
The case presented complex questions of jurisdiction and foreign sovereign immunity. Judge LaShann DeArcy Hall of the Eastern District of New York had originally dismissed Yerkyn's claims and denied him leave to file a second amended complaint, determining that the proposed pleading was futile because Yerkyn had not adequately alleged a domestic injury under the RICO statute.
On appeal, Yerkyn challenged the district court's determination regarding domestic injury requirements under RICO. The Second Circuit, in an opinion decided Jan. 16, 2026, and argued April 10, 2025, found that the district court had erred in its analysis of domestic injury and subject-matter jurisdiction.
The appeals court held that "the district court erred in its determination that the lack of a domestic injury deprived it of subject-matter jurisdiction over the claims contained in Amirkhanov's SAC." This finding suggests that RICO claims with sufficient domestic connections can proceed even when the underlying conduct occurred abroad.
However, the Second Circuit ultimately upheld the dismissal on different grounds. The court ruled that it "lacked subject-matter jurisdiction over all claims brought against the NSC, since it is an instrumentality of a foreign sovereign, and therefore not subject to any exception under the Foreign Sovereign Immunities Act."
The Foreign Sovereign Immunities Act, codified at 28 U.S.C. §§ 1330, 1602-1611, generally protects foreign governments and their agencies from lawsuits in U.S. courts unless specific exceptions apply. The Second Circuit determined that none of the statutory exceptions applied to Kazakhstan's National Security Committee in this case.
The ruling creates important precedent for cross-border litigation involving foreign government agencies. While the court recognized that domestic injuries from foreign conduct can support RICO jurisdiction, it reaffirmed strong protections for foreign sovereign instrumentalities under U.S. law.
The case highlights the challenges faced by plaintiffs seeking to hold foreign government agencies accountable in U.S. courts for alleged misconduct abroad. Even when plaintiffs can demonstrate domestic effects of foreign conduct, sovereign immunity principles may still bar such lawsuits.
Yerkyn's allegations painted a picture of state-sponsored coercion designed to force unfavorable business concessions. The businessman claimed he was compelled to sign agreements while detained, raising questions about the intersection of commercial disputes and state power in international business relationships.
The Second Circuit panel consisted of Circuit Judges Wesley, Sullivan, and Park. The case was originally filed in 2023 in the Eastern District of New York under case number 23-cv-2399.
The ruling also addressed Yerkyn's failure to state adequate claims against the individual defendants, though the court's analysis of those claims was not fully detailed in the available portion of the opinion.
For practitioners handling international litigation, the decision underscores the importance of carefully analyzing both jurisdictional requirements and sovereign immunity defenses early in case development. The ruling suggests that while RICO's domestic injury requirement may be more flexible than some courts have interpreted, foreign sovereign immunity remains a formidable barrier to recovery against government instrumentalities.
The case reflects broader tensions in international law between accountability for alleged government misconduct and respect for sovereign immunity principles. As cross-border business relationships become increasingly complex, courts continue to grapple with the appropriate scope of U.S. jurisdiction over foreign government actions.
The decision may prompt legislative or diplomatic discussions about potential reforms to sovereign immunity doctrines, particularly in cases involving alleged coercion of business relationships. However, any such changes would require careful consideration of reciprocity principles and international comity concerns.
For now, the Second Circuit's ruling in *Yerkyn v. Yakovlevich* stands as an important reminder that foreign sovereign immunity remains a robust protection for government instrumentalities, even in cases alleging serious misconduct with domestic effects.