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REWIND: International Business News #93

In this week’s REWIND of international business law news, a New York judge resuscitates a colonial law to allow a lawsuit against U.S. companies for doing business with the South African apartheid regime, India braces for a potential United States downgrade of its intellectual property rights classification, and New York authorities poise to charge area car dealerships in a scheme to export luxury cars to China.

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  • Last week in New York, a Southern District judge defied the federal appellate court by not dismissing a 12-year-old lawsuit which accuses large U.S. companies of violating human rights by doing business with the apartheid regime of South Africa.  Judge Scheindlin’s holding relies upon the Alien Tort Statute of 1789 to allow non-U.S. citizens to pursue cases in U.S. courts over alleged violations of international law.  In her decision, she authorized plaintiffs to provide evidence that the companies’ activities “touch and concern” the territory of the United States.   Ford Motor Co. and IBM Corp. are the only remaining defendants.
  • Sources say that India will bring the United States before the World Trade Organization if the U.S. adds New Delhi to its Priority Foreign Country list for intellectual property rights.  American pharmaceutical companies and lobbyists have been pressing Washington to downgrade India’s status to this lowest classification.  A “Priority Foreign Country” is assigned to countries that deny adequate and effective protection to intellectual property rights, or fair and equitable market protection to U.S. persons who rely upon such protection under the United States Trade Act.  The Office of the U.S. Trade Representative is set to release its annual Special 301 Report on April 30, in which it is expected to outline possible sanctions against India that may cramp trade and commerce between the two countries.
  • An investigation by the New York State attorney general may lead to charges against certain luxury car dealerships in the metropolitan region for exporting luxury cars to China.   Possible charges relate to deceptive trade practices or falsifying documents to conceal that the cars were newly purchased.  In recent months, prosecutors in New Jersey, Florida, Ohio and South Carolina have brought actions against similar exporting of vehicles.  Because of such high demand for luxury automobiles, new cars may be resold in Shanghai or Beijing for double or triple the price, so it is not hard to imagine businesses trying to take advantage of the profit potential.