The future of transnational litigation in U.S. courts: distinct field or footnote?

Position:Proceedings of the 101st Annual Meeting of the American Society of International Law: The Future of International Law - Discussion

The panel was convened at 2:45 p.m., Friday, March 30, by its moderator, Paul Dubinsky of Wayne State University Law School, who introduced the panelists: Donald Francis Donovan of Debevoise & Plimpton LLP; Mathias W. Reimann of the University of Michigan Law School; and Linda Silberman of New York University School of Law. *


By Paul R. Dubinsky ([dagger])

Is international civil litigation a distinct field? Two decades ago, Gary Born and David Westin declared that an "emerging field" (1) with that name had indeed arrived. In a lengthy introduction to the first edition of International Civil Litigation in U.S. Courts, they announced that what might initially appear to be a collection of loosely related topics drawn from civil procedure, conflict of laws, and public international law was in fact a field unto itself, distinct in important ways from purely domestic litigation. For practicing lawyers, disputes involving foreign litigants, foreign law, or the interests of foreign countries brought into play a distinct body of substantive law and strategic considerations different from those in purely domestic suits. For students and scholars, the materials collected in the new volume were united by recurrent themes (2) that were not fully appreciated when various doctrines, e.g., act of state, forum non conveniens, were studied separately rather than as an integrated whole.

Twenty years later, have Born and other transnationalists (3) been proven right? At first blush, the answer would seem to be yes. In academia, a proliferation of new journals, (4) case books, (5) curricular innovations, (6) and AALS initiatives, (7) suggest that "transnational law" (8) and transnational litigation have come into their own. Similarly, in the world of law practice, firms and clients increasingly regard transnational dispute resolution as a separate specialty, practiced and marketed as such. (9) The purpose of this panel is to question whether the triumph of transnationalism suggested by these initial impressions is an accurate and complete picture of reality. Has litigation with a transnational dimension become so infused with specialized tools, policy concerns, and bodies of law as to be substantially distinct from litigation that is wholly domestic?

At the outset, one might ask what is at stake in this discussion? Whatever label one attaches to dispute resolution of this kind, certain facts on the ground are clear: In recent decades, litigation in U.S. courts with a foreign or international component has been growing in volume and also in complexity. (10) This growth has spawned an identifiable group of U.S. law firms (11) and U.S.-trained lawyers (12) specializing in disputes that cross national boundaries. Such lawyers have their own bar sections and committees. (13) In serving clients, they turn to an elite group of party-chosen arbitrators and firms that search for assets on a world-wide basis. (14) Sophisticated corporate clients faced with complex transnational suits increasingly weigh whether to turn to specialists rather than their regular outside counsel. So what turns on whether one formally coronates transnational litigation as a separate "field" or, rather, speaks of it less formally in terms of a "concentration" or a "niche?" The facts are the same. Does it matter what label we use?

Yes, it does. Labels signal stature, independence, and influence. In the 1950s, the emergence of a distinct field of study called "federal courts" (15) coincided with a growth in the prestige and power of the federal judiciary and the relative importance of federal law visa vis state law in addressing American society's most pressing social and economic problems, such as civil rights, environmental protection, efficient capital markets, and unfettered competition. Widespread recognition of transnational litigation as a separate field similarly would be an important data point for gauging the stature of international and comparative law within the U.S. legal system. (16) Thus, whether international litigation is a "field" is not here intended as a theoretical query about the nature of academic disciplines. The question is meant to prod us into assessing the extent of separation that now exists between the transnational and the domestic within the U.S. legal system and profession. Put differently, do U.S. lawyers, judges, and scholars approach disputes with a foreign or international dimension as functionally and intellectually distinct from disputes on a wholly domestic scale? Or is the presence of foreign parties, judicial cooperation treaties, and foreign laws regarded as a minor variation on familiar domestic frameworks and paradigms?

Professor Linda Silberman will address these questions from the perspective of efforts launched by the American Law Institute to federalize some of the law relating to international litigation in U.S. courts, specifically the law governing recognition of foreign-country judgments. Professor Mathias Reimann will provide a comparative perspective, a view from Europe, where a range of EU initiatives (especially those launched after the entry into force of the Treaty of Amsterdam) has ushered in changes in how the courts of EU member states adjudicate transnational disputes. Third, Donald Donovan will bring international arbitration into the discussion by asking to what degree international arbitration is distinct and separate from both domestic arbitration and international litigation. Finally, my remarks will approach the panel topic from yet another perspective, that of the judiciary in the United States, where recent case law of state and federal courts displays less enthusiasm for transnationalism than that shown by American academics, the practicing bar in the U.S., and our colleagues in Europe.

Applying Interstate Frameworks to Transnational Disputes

One way of categorizing civil litigation in the United States is to divide disputes into three categories: (1) strictly local disputes; (2) interstate disputes; and (3) transnational disputes. Local disputes are those in which all parties are not only American but also from the same state. Interstate disputes are those in which all parties are American but at least two opposing litigants are from different U.S. states. Transnational disputes are those in which at least one significant aspect of the case (typically one or more of the parties) is foreign. (17) This taxonomy, though admittedly simplistic, (18) can be useful. When state and federal cases are sorted in this way, a striking feature of American procedural law becomes apparent: American courts treat interstate and international disputes remarkably alike.

An example of this interstate-international equivalence is Babcock v. Jackson, (19), which like so many cases in the modern conflicts canon involves a car accident and the conflicting laws of two or more jurisdictions. (20) In refusing to apply Ontario's guest statute, the New York Court of Appeals found the place of the accident to be lacking in significance from the perspective of the central issue in the case, loss distribution. The laws of New York State applied because both litigants were from New York, whose policies on loss distribution traveled with the driver and passenger as they drove to Canada.

Babcock was a major milestone on the road from the First Restatement (21) to the Second Restatement (22) and then on to contemporary methodologies such as interest analysis. Notwithstanding the importance of the case and its straightforward fact pattern, students often do not notice that the case is transnational. At no point in either the majority opinion or the dissent does the foreign situs of the accident (Canada) seem to matter. At no point in evaluating the guest statute does the court exercise some of the caution and humility that might be advisable as one tries to determine the purpose behind a statute of a foreign country. (23) The majority just pushes ahead, presumably as it would have done had the accident taken place just across New York's border with Pennsylvania rather than with Canada. We are left to wonder whether the court has considered but rejected differential treatment based on the international, rather than the interstate, nature of the dispute. Perhaps the court has not considered differential treatment at all. (24) Notwithstanding the landmark nature of the case, neither opinion even mentions that the Court is making a major change in methodology in a case that is atypical--are that grows out of a transnational fact pattern rather than an interstate one.

Versions of this approach--equating the international with the interstate--were a feature of American procedural law even before Joseph Story formally introduced a new field, conflict of laws, into American jurisprudence. (25) Nineteenth-century American law is densely populated with examples of the international legal order (26) serving as an analogy for the new and evolving federal Union. (27) Because the law of nations was an established body of law, it was regularly consulted by courts seeking to solve interstate problems of first impression. (28) By the twentieth-century, analogies largely ran in the opposite direction; intellectual frameworks developed in the context of interstate jurisprudence were enlisted to solve a range of new transnational conundrums produced by a post-War commercial and financial world now populated by subsidiaries, intellectual property fights, and the Internet. (29)

The first concentrated attack on this interstate-international equivalence came soon after World War II, with the U.S. legal system encountering the world from a greatly enhanced position in terms of global juridical influence. (30) Criticism of approaching this wider world with a whole set of interstate principles and constraints in tow came from a small chorus of conflicts scholars. They argued that...

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