III - State Jurisdiction and Immunities

Summary

OVERVIEW

During the course of 1999–2001, numerous cases involving transnational activity arose in U.S. courts, requiring those courts to consider various issues, such as whether they had jurisdiction over a foreign defendant, whether they should exercise jurisdiction over suit by a foreign plaintiff against a foreign defendant, and, if jurisdiction did exist, whether U.S. or foreign law should apply to the dispute. For instance, in BP Chemicals Ltd. v. Formosa Chemical & Fibre Corp., a U.K. corporation sued in U.S. court a Taiwanese corporation, alleging misappropriation of trade secrets. The Third Circuit Court of Appeals reviewed the contacts of the Taiwanese corporation with the United States, considered U.S. due process requirements as interpreted by the Supreme Court, and found that the district court had neither specific jurisdiction (based on foreign defendant contacts related to the litigation) nor general jurisdiction (based on continuous and systematic contacts unrelated to the litigation) over the Taiwanese corporation. At the same time, the court of appeals found that whether the U.K. corporation had a protectable interest in information licensed to a third party, and whether the Taiwanese corporation had acted unlawfully in acquiring such information, were issues governed by Taiwanese law, not U.S. law. In cases involving torts that occurred abroad, U.S. courts looked principally to the place of the tort as determining the substantive law to be applied, even if that law raised public policy concerns.

U.S. deference to the jurisdiction of foreign states, however, was far from uniform.