Dr. Todd Tucker’s statement on Supreme Court ruling in the case of Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co.:
Today’s Supreme Court’s decision is an important step in ensuring Americans’ ability to fight monopolies in an era of globalization.
Had the Court of Appeals’ decision stood, foreign governments would be allowed to waltz into federal courts anytime their favored firms are challenged on anti-trust grounds, misrepresent their domestic laws, and get their companies off the hook for predatory behavior.
Ginsburg’s opinion reverses that decision and begins to set needed limits on such practices, which could otherwise become pervasive in 21st century markets increasingly dominated by state capitalist exporters. The first step of having better rules for the global economy is being able to enforce the ones we’ve already got.
Background: In Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co., the Court concluded that the Court of Appeals for the Second Circuit had improperly reversed a District Court decision. At the district level, a jury had determined that Chinese sellers of vitamin c were engaged in anti-trust violations and awarded treble damages to US purchasers. The appellate judges ruled — solely on the basis of Chinese ministry statements that were contradicted by evidence before the court (including prior Chinese government statements) — that the exporters were required under Chinese law to engage in the anti-competitive behavior. Applying comity doctrines of deference to foreign government statements, the appellate court reversed the lower court decision — effectively stopping anti-trust enforcement at the water’s edge, against congressional intention in the Sherman Act.
Dr. Tucker is a political scientist and fellow at the Roosevelt Institute, where he writes on global economic governance. He is author of Judge Knot, a book on law in the global economy released earlier this year that discusses the earlier Hebei decisions.