Comity be damned: the use of antisuit injunctions against the courts of a foreign nation.

Author:Roberson, Eric


Kaepa, Inc., an American shoe manufacturing corporation, and Achilles Corporation, a Japanese distributor, entered into a distributorship agreement in April, 1993.(1) By July of 1994, the two companies had suffered a falling out, and Kaepa filed suit in Texas state court, alleging fraud and negligent misrepresentation by Achilles to induce Kaepa to enter the agreement, and breach of contract by Achilles.(2) After having the case removed to federal court, Achilles brought suit in its home country alleging "mirror-image" claims that Kaepa induced Achilles to enter into the contract through fraud, and that Kaepa had been the one who breached the contract.(3) Such closely related claims would doubtless have qualified as "compulsory" counterclaims under Federal Rule of Civil Procedure 13(a) had they been brought in a U.S. federal court.(4) Instead, however, the claims were brought in a court of a foreign sovereign presumably not subject to American rules of court procedure, setting the stage for yet another round in what has become a recurring debate amongst the federal courts: how to balance the "interests of comity" between courts with the "equitable factors favoring an injunction."(5)

The district court with jurisdiction over the Kaepa action eventually ruled that Rule 13(a) applied, even with respect to the courts of Japan, and entered an injunction against Achilles's further pursuit of its claims in Japan.(6) Calling the Japanese action "`an absurd duplication of effort'"(7) that would "result in unwarranted inconvenience, expense, and vexation," the Fifth Circuit Court of Appeals affirmed the injunction.(8) Thus, the courts of a foreign sovereign, Japan, were entirely deprived of the right to hear a case brought before them, as a result of another sovereign's, the United States's, rule of court procedure.

The instinct that there is something untoward about a federal court enjoining proceedings in the courts of another sovereign on the basis of nothing more than a domestic rule of procedure has led to a rather sharp divide between the circuit courts(9) and a variety of scholarly treatments(10) on what standards to apply before taking any action. This lack of uniformity in issuing injunctions calls into question the significance and applicability of the Federal Rules of Civil Procedure outside of the federal judicial system; implicates concerns for federalism and comity between the courts;(11) and raises the specter of one of the nation's oldest statutes, the Anti-Injunction Act of 1793 (the "AIA").(12)

At the domestic level, there are several separate standards for judging the appropriateness of issuing an antisuit injunction against another court. If the two courts are both part of the federal court system, the standard is relatively lax, since the two courts can be assumed to share a common interest in the efficient management of the federal system.(13) However, when the two courts are from different sovereign court systems--that is, when one is a federal court while the other is a state court--the issuance of antisuit injunctions is generally barred by the AIA unless one of three conditions is met.(14)

In the international setting, however, a controversy has erupted between the circuit courts over how to handle the issuance of antisuit injunctions by a federal court against proceedings in the courts of a foreign sovereign.(15) A number of circuits use a standard akin to that governing the use of these injunctions between the federal courts--requiring nothing more than duplication of the parties and issues to justify the issuance of an injunction.(16) A second set of circuits seems to treat the international situation more like an injunction by a federal court against a state court, allowing their issuance only when necessary to protect the forum's jurisdiction or to prevent evasion of the forum's important public policies.(17)

This Comment will argue that the use of antisuit injunctions in the international setting closely resembles their use in the federal/state context, and therefore that the same concerns that motivated the passage of the AIA to govern injunctions between federal and state courts should dictate that a similar rule govern in the international context.(18)

Part I will examine the historical restrictions on the use of the antisuit injunction--the most invasive enforcement mechanism available for use by a U.S. federal court against a court of another sovereign. This Part also contains an introduction to the AIA, which was first passed in 1793 to drastically limit the use of precisely these types of injunctions by the federal courts against the state courts.

Part II will introduce the modern practice of issuing antisuit injunctions against foreign courts and will detail the rather dramatic split between the circuits on this issue. Part II will conclude by examining the various tests devised by the different circuit courts and the theories that support them.

Part III will merge the historical analyses in Parts I.A and II to develop a proposed solution to the dilemma of determining the appropriate circumstances under which to issue an antisuit injunction against the courts of a foreign sovereign. This Part will summarize how the courts and commentators have dealt with the issue, and will then engage in a brief analysis of some of the proposed solutions to the problem. Next, it will import the analysis of the AIA from Part I.B to argue that the same concerns which drove the enactment of the AIA should educate the debate over the international use of antisuit injunctions. Finally, based upon this analysis, this Comment will propose a solution to the challenges posed by the international use of antisuit injunctions.


    1. The Early History

      "Forasmuch as yourselves, My Lords, drive me to that necessity for awarding our injunctions ... you cannot hereafter any more justly blame me."(19) Antisuit injunctions have been called "the most practically important class of injunctions."(20) Certainly, they are one of the most ancient and well-established forms of injunction. Some of this device's early ancestors can be traced back as far as Ancient Rome.(21) In addition, it bears a marked similarity to several of the writs granted by the early English monarchs.(22) It was not until the rise of the Court of Chancery in the latter part of the fourteenth century, however, that this type of injunction emerged in its modern form.(23)

      The early common law courts of England "administered both law and equity."(24) With few legal precedents to rely on, these early courts were relatively free to tailor case-specific remedies.(25) By the thirteenth century, however, the common law courts began to lose their equitable nature and were becoming "rigid, technical, and overly formal."(26) This process of ossification set the stage for the rise of the Court of Chancery and the development of two separate, and often competing, English court systems.

      Chancery endeavored to fill gaps in the substance of the common law and to provide the equitable relief that the common law courts were no longer willing to dispense.(27) To this end, Chancery began using injunctions,(28) which likely were modeled on the earlier tradition of writs issued by the Crown. Thus, equitable injunctions were issued to compensate for a wide variety of deficiencies in the common law.(29) Those injunctions that were issued merely to plug holes in the law created relatively little resistance throughout the English court system, and even allowed for cooperation between the common law judges and Chancery.(30) Far more controversial, however, was the injunction issued in the name of equity in order to halt or prevent the initiation of proceedings in a court of law.(31) These antisuit injunctions constituted a direct challenge to the authority and legitimacy of the courts of law.(32)

      Both the early Chancellors and modern academic commentators have stressed that "it is well understood that [an] injunction to stay proceedings in courts of law is not directed against the court itself, but against the parties to the proceeding."(33) Nevertheless, it is not surprising that the common law judges did not look kindly on the issuance of injunctions of this nature.(34) The injunctions effectively deprived the judges of their power to hear cases(35) and set the stage for a centuries-long power struggle in England between the courts of law and the courts of equity.(36)

      Despite the animosity that antisuit injunctions generated amongst the common law courts, there can be little doubt that their use was necessary to the development and efficacy of the Court of Chancery.(37) Without the ability to interfere in such a manner, it would have been impossible for Chancery to "`carry out the jurisdiction it had assumed of controlling the law on the principles of equity and conscience.'"(38) Thus, much like modern courts, the early Court of Chancery had to balance the protection of important interests through antisuit injunctions with the concern for comity between the courts.

      Chancery's response to this dilemma was to develop a variety of rules to regulate the issuance of this invasive type of injunction.(39) Well into the sixteenth century, the Chancellor had "almost unfettered discretion" to grant injunctions.(40) But beginning with the tenure of Chancellor Thomas More (1529 to 1532), Chancery made a conscious effort to limit its issuance of the most offensive types of injunctions.(41) Over the next two centuries, successive Chancellors continued to add to the requirements necessary for an antisuit injunction to be issued.(42)

      By the time of the American Revolution, the antisuit injunction was, if not a disfavored device, a device used with circumspection.(43) Thus, it is not surprising that one of the first statutes passed in the early history of the United States was a restriction on the use of antisuit...

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