As the U.S. mobile-phone industry strategizes how to counter state efforts to impose new regulations, taxes and antenna-siting moratoria on wireless carriers, it may want to keep tabs on another looming challenge for big wireless firms seeking profits in distant lands.
It is a side of globalization that is creating greater legal exposure for U.S. multinational companies. The financial stakes are huge.
Trial lawyers and activist regulators-maligned at times by industry for meddling too much in business-are not unique to the United States. They exist in other countries and do not consider U.S. companies off limits.
In some cases, foreign actors rely on their own rules to exert influence over U.S. companies. This was the case when the European Union slapped Microsoft Corp. with a $613 million fine for antitrust violations that the software behemoth undoubtedly will litigate well into the next millennium.
In other instances, companies can be targeted by foreign competitors in the international trade arena.
And then there is global forum shopping. Turns out the United States is a wildly popular venue for foreign plaintiffs, given our attractive judicial system where risks are relatively low and benefits relatively great for plaintiffs’ lawyers. What makes America really enticing for some lawyers is the Alien Torts Claim Act, a one-sentence measure signed into law by George Washington in 1789. No lie.
The Supreme Court last week heard oral argument in a case on whether the Alien Torts Claim Act allows foreign plaintiffs to sue in federal court for violations of international law.
Later this month, the Supreme Court will hear oral argument in a lawsuit pitting Intel Corp. against Advanced Micro Devices. The high court must determine the degree to which U.S. discovery rules can be used in a foreign or international investigation.
A number of U.S. courts have permitted foreign plaintiffs to sue in price-fixing cases under the Foreign Trade Antitrust Improvements Act, according to the U.S. Chamber Institute for Legal Reform. Foreign plaintiffs are also litigating in U.S. courts over product liability, environmental damage and human rights violations.
Perhaps most significant, as Princeton University’s Ken Kersch observes in the winter issue of The Public Interest, is an evolving practice among some Supreme Court Justices who take into account contemporary foreign law and international norms in fashioning their votes.
“An emerging vanguardist intellectual movement of prominent social scientists and political philosophers believes that traditional notions of sovereignty are outmoded and that global governance is the wave of the future,” writes Kersch. Kersch views the import of foreign and international law with great suspicion, arguing justices should be forced to justify their turn to this innovation of judicial diplomacy.
