US: Ruling creates divide over 1982 precedent on foreign trade

A recent ruling by a New York judge against a China-based maker of UBS cables has ignited debate and new discussion around a 1982 precedent of the Foreign Trade Antitrust Improvements Act. US District Judge Shira Scheindlin ruled against computer cable maker Lotes Co Ltd in a decision that barred the company from bringing its lawsuit against rivals into US courtrooms. Lotes initiated a suit against competitors, accusing them of limiting competition by refusing to license patents and pushing Lotes out of the market; neither Lotes nor the rivals named in the suit sell products in the US. The company wanted to sue in the US, however, arguing that the case had “direct, substantial, and reasonably foreseeable effect on US commerce” in anticompetitive ways. The argument was not enough for Judge Scheindlin, however; the Foreign Trade Antitrust Improvements Act of 1982 which is read to mean that claims made under the 1890 Sherman Act to not apply to cases causing only foreign injury. According to reports, the 1982 Act is widely considered to be worded awkwardly. The judge acknowledged a circuit split on the application of the 1982 law in her opinion, however.

Full Content: Thomson Reuters

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