Justia U.S. Supreme Court Opinion Summaries
Articles Posted in International Law
Republic of Argentina v. NML Capital, Ltd.
After the Republic of Argentina defaulted on its external debt, NML, one of its bondholders, prevailed in 11 debt-collection actions filed against Argentina in New York. To execute its judgments, NML sought discovery of Argentina’s property, serving subpoenas on nonparty banks for records relating to global financial transactions. The district court granted motions to compel compliance. The Second Circuit affirmed, rejecting Argentina’s argument that the order transgressed the Foreign Sovereign Immunities Act of 1976 (FSIA), 28 U.S.C. 1330, 1602. The Supreme Court affirmed; the FSIA does not immunize a foreign-sovereign judgment debtor from post-judgment discovery of information concerning its extraterritorial assets. The FSIA replaced factor-intensive loosely-common-law-based immunity with “a comprehensive framework for resolving any claim of sovereign immunity” so that any sort of immunity defense made by a foreign sovereign in a U.S. court must stand or fall on its text. The FSIA established jurisdictional immunity, section 1604, which was waived here. FSIA execution immunity under sections 1609, 1610, 1611, generally shields “property in the United States of a foreign state” from attachment, arrest, and execution. Nothing forbids or limits discovery in aid of execution of a foreign-sovereign judgment debtor’s assets. Even if Argentina is correct that section 1609 execution immunity implies coextensive discovery-¬in-aid-of-execution immunity, there would be no protection from discovery a foreign sovereign’s extraterritorial assets. Section 1609 immunizes only foreign-state property “in the United States.” The prospect that NML’s general request for information about Argentina’s worldwide assets may turn up information about property that Argentina regards as immune does not mean that NML cannot pursue its discovery. View "Republic of Argentina v. NML Capital, Ltd." on Justia Law
BG Group plc v. Republic of Argentina
An investment treaty between the U.K. and Argentina authorizes a party to submit a dispute to “the competent tribunal of the Contracting Party in whose territory the investment was made,” and permits arbitration if, 18 months after such submission, the tribunal has not made a final decision. BG, a British firm, had an interest in MetroGAS, an Argentine entity licensed to distribute natural gas in Buenos Aires. At the time of BG’s investment, Argentine law provided that gas tariffs would be calculated in U.S. dollars and would be set at levels sufficient to assure gas distribution firms a reasonable return. Argentina later changed the calculation basis to pesos. Profits became losses. BG sought arbitration, which was conducted in Washington, D. C. BG claimed that Argentina had violated the Treaty, which forbids expropriation of investments and requires each nation to give investors fair and equitable treatment. Argentina denied the claims and argued that the arbitrators lacked jurisdiction because BG had not complied with the local litigation requirement. The arbitration panel concluded that Argentina’s enactment of laws that hindered recourse to its judiciary excused compliance and that Argentina had not expropriated BG’s investment but had denied fair and equitable treatment. The district court confirmed the award. The District of Columbia Circuit vacated, holding that the arbitrators lacked jurisdiction. The Supreme Court reversed. The local litigation requirement was a matter for arbitrators to interpret and apply; courts should review that interpretation with deference. Courts presume that the parties intended arbitrators to decide disputes about application of procedural preconditions to arbitration, including claims of waiver, delay, defense to arbitrability, time limits, notice, laches, or estoppel. The provision is procedural; it determines when the contractual duty to arbitrate arises, not whether there is a duty to arbitrate. It is a claims-processing rule. The fact that contract is a treaty does not make a difference. The Treaty contains no evidence that the parties had intentions contrary to the ordinary presumptions about who should decide threshold arbitration issues. View "BG Group plc v. Republic of Argentina" on Justia Law
Posted in:
Arbitration & Mediation, International Law
Lozano v. Montoya Alvarez
Alvarez and Lozano lived with their daughter in London until November 2008, when Alvarez and the child moved to a women’s shelter. In July 2009, they left the U.K., ultimately settling in New York. Lozano did not locate them until November 2010. He filed a Petition for Return of Child pursuant to the Hague Convention on the Civil Aspects of International Child Abduction. Under the Convention, if a parent files a petition within one year of the child’s removal, a court “shall order the return of the child forthwith.” When the petition is filed after that period, the court is to order return, “unless it is demonstrated that the child is now settled in its new environment.” Because it was filed more than one year after removal, the district court denied the petition, finding that the child was now settled. The Second Circuit and Supreme Court affirmed. There is no presumption that equitable tolling applies to treaties and the parties to the Convention did not intend that it apply to the one-year period. The International Child Abduction Remedies Act, 42 U. S. C. 11601–11610, enacted to implement the Convention, neither addresses equitable tolling nor purports to alter the Convention and, therefore, does not affect this conclusion. Even if the Convention were subject to a presumption that statutes of limitations may be tolled, the one-year period is not a statute of limitations. The remedy available to the left-behind parent continues to be available after one year; expiration of one year simply mandates consideration of a third party’s interests. The drafters did not choose to delay the period’s commencement until discovery of the child’s location. View "Lozano v. Montoya Alvarez" on Justia Law
Posted in:
Family Law, International Law
Daimler AG v. Bauman
Residents of Argentina sued Daimler, a German company, in a California federal district court, alleging that Mercedes-Benz Argentina, a Daimler subsidiary, collaborated with state security forces during Argentina’s 1976–1983 “Dirty War” to kidnap, detain, torture, and kill MB Argentina workers, related to the plaintiffs. They asserted claims under the Alien Tort Statute and the Torture Victim Protection Act of 1991, and under California and Argentina law. Personal jurisdiction was predicated on the California contacts of Mercedes-Benz USA (MBUSA), another Daimler subsidiary, incorporated in Delaware with its principal place of business in New Jersey. MBUSA distributes Daimler-manufactured vehicles to independent U.S. dealerships, including some in California. The district court dismissed. The Ninth Circuit reversed, holding that MBUSA, which it assumed to fall within the California courts’ all-purpose jurisdiction, was Daimler’s “agent” for jurisdictional purposes. The Supreme Court reversed. Daimler is not amenable to suit in California for injuries allegedly caused by MB Argentina outside the U.S. California’s long-arm statute allows the exercise of personal jurisdiction to the full extent permissible under the U. S. Constitution. Even if California is home to MBUSA, Daimler’s affiliations with California are not sufficient to subject it to the general jurisdiction of that State’s courts. The proper inquiry is whether a foreign corporation’s “affiliations with the State are so ‘continuous and systematic’ as to render [it] essentially at home in the forum State.” Neither Daimler nor MBUSA is incorporated in California; neither has its principal place of business there. If Daimler’s California activities sufficed to allow adjudication of this case in California, the same global reach would presumably be available in every other state in which MBUSA’s sales are sizable.
View "Daimler AG v. Bauman" on Justia Law
Posted in:
International Law, International Trade
Republic of Argentina v. NML Capital, Ltd.
After the Republic of Argentina defaulted on its external debt, NML, one of its bondholders, prevailed in 11 debt-collection actions filed against Argentina in New York. To execute its judgments, NML sought discovery of Argentina’s property, serving subpoenas on nonparty banks for records relating to global financial transactions. The district court granted motions to compel compliance. The Second Circuit affirmed, rejecting Argentina’s argument that the order transgressed the Foreign Sovereign Immunities Act of 1976 (FSIA), 28 U.S.C. 1330, 1602. The Supreme Court affirmed; the FSIA does not immunize a foreign-sovereign judgment debtor from post-judgment discovery of information concerning its extraterritorial assets. The FSIA replaced factor-intensive loosely-common-law-based immunity with “a comprehensive framework for resolving any claim of sovereign immunity” so that any sort of immunity defense made by a foreign sovereign in a U.S. court must stand or fall on its text. The FSIA established jurisdictional immunity, section 1604, which was waived here. FSIA execution immunity under sections 1609, 1610, 1611, generally shields “property in the United States of a foreign state” from attachment, arrest, and execution. Nothing forbids or limits discovery in aid of execution of a foreign-sovereign judgment debtor’s assets. Even if Argentina is correct that section 1609 execution immunity implies coextensive discovery-¬in-aid-of-execution immunity, there would be no protection from discovery a foreign sovereign’s extraterritorial assets. Section 1609 immunizes only foreign-state property “in the United States.” The prospect that NML’s general request for information about Argentina’s worldwide assets may turn up information about property that Argentina regards as immune does not mean that NML cannot pursue its discovery. View "Republic of Argentina v. NML Capital, Ltd." on Justia Law
Lozano v. Montoya Alvarez
Alvarez and Lozano lived with their daughter in London until November 2008, when Alvarez and the child moved to a women’s shelter. In July 2009, they left the U.K., ultimately settling in New York. Lozano did not locate them until November 2010. He filed a Petition for Return of Child pursuant to the Hague Convention on the Civil Aspects of International Child Abduction. Under the Convention, if a parent files a petition within one year of the child’s removal, a court “shall order the return of the child forthwith.” When the petition is filed after that period, the court is to order return, “unless it is demonstrated that the child is now settled in its new environment.” Because it was filed more than one year after removal, the district court denied the petition, finding that the child was now settled. The Second Circuit and Supreme Court affirmed. There is no presumption that equitable tolling applies to treaties and the parties to the Convention did not intend that it apply to the one-year period. The International Child Abduction Remedies Act, 42 U. S. C. 11601–11610, enacted to implement the Convention, neither addresses equitable tolling nor purports to alter the Convention and, therefore, does not affect this conclusion. Even if the Convention were subject to a presumption that statutes of limitations may be tolled, the one-year period is not a statute of limitations. The remedy available to the left-behind parent continues to be available after one year; expiration of one year simply mandates consideration of a third party’s interests. The drafters did not choose to delay the period’s commencement until discovery of the child’s location. View "Lozano v. Montoya Alvarez" on Justia Law
Daimler AG v. Bauman
Residents of Argentina sued Daimler, a German company, in a California federal district court, alleging that Mercedes-Benz Argentina, a Daimler subsidiary, collaborated with state security forces during Argentina’s 1976–1983 “Dirty War” to kidnap, detain, torture, and kill MB Argentina workers, related to the plaintiffs. They asserted claims under the Alien Tort Statute and the Torture Victim Protection Act of 1991, and under California and Argentina law. Personal jurisdiction was predicated on the California contacts of Mercedes-Benz USA (MBUSA), another Daimler subsidiary, incorporated in Delaware with its principal place of business in New Jersey. MBUSA distributes Daimler-manufactured vehicles to independent U.S. dealerships, including some in California. The district court dismissed. The Ninth Circuit reversed, holding that MBUSA, which it assumed to fall within the California courts’ all-purpose jurisdiction, was Daimler’s “agent” for jurisdictional purposes. The Supreme Court reversed. Daimler is not amenable to suit in California for injuries allegedly caused by MB Argentina outside the U.S. California’s long-arm statute allows the exercise of personal jurisdiction to the full extent permissible under the U. S. Constitution. Even if California is home to MBUSA, Daimler’s affiliations with California are not sufficient to subject it to the general jurisdiction of that State’s courts. The proper inquiry is whether a foreign corporation’s “affiliations with the State are so ‘continuous and systematic’ as to render [it] essentially at home in the forum State.” Neither Daimler nor MBUSA is incorporated in California; neither has its principal place of business there. If Daimler’s California activities sufficed to allow adjudication of this case in California, the same global reach would presumably be available in every other state in which MBUSA’s sales are sizable.
View "Daimler AG v. Bauman" on Justia Law
PPL Corp. v. Comm’r of Internal Revenue
In 1997, the United Kingdom imposed a one-time “windfall tax” on 32 U. K. companies privatized between 1984 and 1996 by the Conservative government. The companies had been sold to private parties through an initial sale of shares, known as “flotation.” Many of the companies became more efficient and earned substantial profits in the process. PPL, part owner of a privatized company, claimed a credit for its share of the bill in its 1997 federal income-tax return, relying on IRC section 901(b)(1), which states that any “income, war profits, and excess profits taxes” paid overseas are creditable against U. S. income taxes. Treasury Regulation 1.901–2(a)(1) states that a foreign tax is creditable if its “predominant character” “is that of an income tax in the U. S. sense.” The IRS rejected PPL’s claim, but the Tax Court held that the U. K. windfall tax was creditable. The Third Circuit reversed. A unanimous Supreme Court reversed, holding that the U. K. tax is creditable under section 901. Creditability depends on whether the tax, if enacted in the U. S., would be an income, war profits, or excess profits tax. A tax’s predominant character is that of an income tax “[i]f ... the foreign tax is likely to reach net gain in the normal circumstances in which it applies.” The windfall tax’s predominant character is that of an excess profits tax, a category of income tax in the U. S. sense. The Labour government’s conception of “profit-making value” as a backward¬-looking analysis of historic profits is not a typical valuation method; it is a tax on realized net income disguised as a tax on the difference between two values, one of which is a fictitious value calculated using an imputed price-to-earnings ratio. The windfall tax is economically equivalent to the difference between the profits each company actually earned and the amount the Labour government believed it should have earned given its flotation value. For most companies, the substantive effect was a 51.71 percent tax on all profits above a threshold, “a classic excess profits tax.” View "PPL Corp. v. Comm'r of Internal Revenue" on Justia Law
Kiobel v. Royal Dutch Petroleum Co.
Nigerian nationals, having been granted asylum in the U.S., filed suit under the Alien Tort Statute (ATS), alleging that Dutch, British, and Nigerian corporations aided and abetted the Nigerian Government in committing violations of the law of nations in Nigeria. The complaint alleges that in the 1990s Nigerian government forces attacked villages, beating, raping, killing, and arresting residents and destroying or looting property and that the corporations provided food, transportation, compensation, and a staging ground. The ATS provides that “district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States,” 28 U. S. C. 1350. On interlocutory appeal, the Second Circuit dismissed, holding that the law of nations does not recognize corporate liability. The Supreme Court affirmed. The presumption against extraterritoriality applies to ATS claims. The danger of unwarranted judicial interference in foreign policy is magnified where the question is not what Congress has done but what courts may do. Nothing in the ATS indicates extraterritorial reach. Violations of the law of nations affecting aliens can occur either within or outside the United States. The question is whether the court has authority to recognize a cause of action under U. S. law to enforce a norm of international law. There is no indication that Congress expected causes of action to be brought under the statute for violations of the law of nations occurring abroad. View "Kiobel v. Royal Dutch Petroleum Co." on Justia Law
Kirtsaeng v. John Wiley & Sons, Inc.
Wiley, an academic publisher, often assigns to its foreign subsidiary (WileyAsia) rights to publish, print, and sell Wiley’s English language textbooks abroad. WileyAsia’s books state that they are not to be taken (without permission) into the U.S. When Kirtsaeng moved to the U.S., he asked friends to buy foreign edition English-language textbooks in Thai book shops, where they sold at low prices, and mail them to him. He sold the books at a profit. Wiley claimed that Kirtsaeng’s unauthorized importation and resale was an infringement of Wiley’s 17 U.S.C. 106(3) exclusive rights to distribute its copyrighted work and section 602’s import prohibition. Kirtsaeng cited section 109(a)’s “first sale” doctrine, which provides that “the owner of a particular copy or phonorecord lawfully made under this title ... is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.” The district court held that the defense did not apply to goods manufactured abroad. The jury found that Kirtsaeng had willfully infringed Wiley’s American copyrights and assessed damages. The Second Circuit affirmed, concluding that section 109(a)’s “lawfully made under this title” language indicated that the “first sale” doctrine does not apply to copies of American copyrighted works manufactured abroad. The Supreme Court reversed; the “first sale” doctrine applies to copies of a copyrighted work lawfully made abroad. Section 109(a) says nothing about geography. A geographical interpretation of the first-sale doctrine could re¬quire libraries to obtain permission before circulating the many books in their collections that were printed overseas; potential practical problems are too serious, extensive, and likely to come about to be dismissed as insignificant—particularly in light of the ever-growing importance of foreign trade to America. View "Kirtsaeng v. John Wiley & Sons, Inc." on Justia Law