Foreign Judgment Enforcement

In recent years, there have been many lawsuits against businesses and individuals in U.S. courts for alleged conduct occurring outside the United States. The Supreme Court’s recent rulings limiting such cases – including Kiobel v. Royal Dutch Petroleum (2013) and Morrison v. National Australia Bank (2010) – will likely mean a new strategy for plaintiffs and their lawyers: lawsuits in foreign courts, followed by attempts to enforce any judgment in U.S. courts and seizing a company’s U.S. assets. This raises the troubling prospect of abusive and improper foreign judgments being enforced in the United States – in violation of the spirit and principles of the U.S. Constitution and our justice system. read more...

In an effort to standardize the state laws governing foreign judgment enforcement, the Uniform Law Commission (ULC) developed model statutes in 1962 and 2005. While some states have adopted laws based on these models, others have gone their own way. And even those states adopting a model law have differing judicial interpretations. These differing standards open the door to forum shopping by plaintiffs that seek enforcement under the most lax state standard.

The inadequacy of some state standards was highlighted by recent legal proceedings involving a $9 billion judgment against Chevron issued by an Ecuadorean court. Multiple U.S. courts have found that the Ecuadorian proceedings were tainted by fraud. But when Chevron sought an injunction against enforcement in U.S. courts, the Second Circuit Court of Appeals rejected the company’s request, holding that New York’s enforcement law did not allow a company to preemptively challenge the legitimacy of a foreign judgment. (Ultimately, the U.S. District Court for the Southern District ruled that the Ecuadorian judgement was the product of fraud and racketeering, and declared the judgment unenforceable under civil racketeering statutes.) Since then, the plaintiffs have sought to enforce the Ecuadorian judgment against Chevron in Canada. Those proceedings are ongoing.

To prevent abusive forum shopping, Congress should adopt uniform federal standards to govern the recognition and enforcement of foreign judgments. In addition, states that have not yet adopted the 2005 model act should consider doing so. Congress and the states should include a provision to allow judgement debtors like Chevron to bring a preemptive declaratory judgment action for non-recognition of abusive foreign judgements.


The ILR Research Review - Winter 2014

December 18, 2014 | This edition of the ILR Research Review offers valuable insights from the latest of ILR's research on perpetual prosecution, the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA), social media, and transnational litigation.

Federal Cases from Foreign Places: How the Supreme Court Has Limited Foreign Disputes From Flooding U.S. Courts

October 21, 2014 | This collection of essays examines the shifting legal landscape of federal claims by foreign plaintiffs in the federal courts and focuses on the most common statutes invoked by foreign plaintiffs, as well as the threshold issues of personal jurisdiction and pleading standards that govern such suits.

Additional Resources

All Results for Foreign Judgment Enforcement

Should State Law Rule the World? A Call for Caution in Applying State Law in Transnational Tort Cases

Author: Donald Earl Childress III, Pepperdine University School of Law | September 18, 2013 | Research

Corporations need to turn their attention to the application of U.S. state law in transnational tort cases following the Kiobel case. Encouraging caution on the part of federal and state courts interpreting state law and potential Congressional action is but a first step in resolving these important transnational human rights and business issues. Read More »

ILR Hosts Transnational Forum Shopping Symposium this Thursday at Pepperdine Law School

September 16, 2013 | News and Blog

This Thursday, the Institute for Legal Reform will feature former U.S. Attorney General Michael Mukasey as we host a special symposium on the issue of Transnational Forum Shopping at Pepperdine University School of Law in Malibu, CA. Read More »

U.S. Chamber Commends Supreme Court for Reining In Abuses of Alien Tort Statute

April 17, 2013 | Press Release

Decision limits the ability of plaintiffs to import foreign lawsuits into U.S. courts Read More »

John B. Bellinger, III on Transnational and Extraterritorial Litigation

October 26, 2012 | Video

At the 13th Annual Legal Reform Summit on October 24, 2012, we pulled aside John B. Bellinger, III, Partner, Arnold & Porter LLP , to discuss a the panel he moderated on the topic of trends in use of the U.S. courts by non-U.S. citizens and residents, as exemplified by recent U.S. Supreme Court decisions and the Ecuadorian litigation against Chevron Corporation. This panel also addressed the flip side of the coin: the spread in Europe and elsewhere of US-style litigation, especially class actions, against multinational companies. Watch »

U.S. Chamber Applauds Introduction of FOCUS Act in U.S. Senate

Author: Justin Hakes | February 03, 2012 | Press Release

WASHINGTON, D.C.-Lisa A. Rickard, president of the U.S. Chamber Institute for Legal Reform (ILR), made the following statement about the introduction of the Freedom from Over-Criminalization and Unjust Seizures (FOCUS) Act of 2012 in the U.S. Senate. The bill would, among other things, amend the Lacey Act to remove foreign law violations as a basis for prosecution in the United States and limit punishment for violations under the Act to civil penalties. Read More »

Confronting the New Breed of Transnational Litigation: Abusive Foreign Judgments

Author: William E. Thomson and Perlette Michèle Jura of Gibson Dunn | October 26, 2011 | Research

This article demonstrates why comity - when properly understood - requires that U.S. courts deny recognition and enforcement to foreign judgments that violate the U.S. Constitution and other deeply rooted domestic principles. Read More »

Think Globally, Sue Locally: Out-of-Court Tactics Employed by Plaintiffs, Their Lawyers, and Their Advocates in Transnational Tort Cases

Author: Jonathan Drimmer, partner at Steptoe & Johnson and adjunct professor of law at the Georgetown University Law Center | June 21, 2010 | Research

There has been a sharp rise in lawsuits brought against United States companies, as well as foreign companies with a substantial U.S. presence, that are premised on alleged personal or environmental injuries that occur overseas. Most of those transnational tort lawsuits have been filed in the United States by plaintiffs' class action firms, public interest attorneys, and Non-Governmental Organizations ("NGOs"); some have been brought in federal courts, while many more have been filed in state courts under traditional bases of jurisdiction. A growing number of notable actions also have been filed in foreign courts, with the plaintiffs seeking to obtain judgments they can enforce in the United States. Read More »

U.S. Chamber Launches Battle Against Importation of Foreign Lawsuits with New Coalition

March 24, 2004 | Press Release

WASHINGTON, D.C. - The United States Chamber of Commerce Institute for Legal Reform (ILR) today launched a new coalition to curb global forum shopping, a rising litigation trend in which foreign plaintiffs file lawsuits in U.S. courts to take advantage of the more permissive features of the American judicial system. Read More »

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