Business And Its Legal Environment (Mgmt 246)

1. Business And Its Legal Environment (Mgmt 246) International Business Law (“the second” Chapter 13) Professor Charles H. Smith Spring 2011

2. Conflict Between Treaty and State Statute • Case study – claims based on California statute enacted in 1999 that permit cases to be filed against private German and Japanese companies for damages suffered by World War II P.O.W.’s who were forced to provide slave labor to these companies. • 1953 treaty between U.S. and Japan that formally ended World War II between the two countries included provision that each country, on behalf of its citizens, gave up private claims by its citizens. • Does the 1953 treaty justify dismissing these claims? Why would U.S. give up its citizens’ claims?

3. CONFLICT BETWEEN “AMERICAN FOREIGN POLICY” AND STATE STATUTE • Case study – American Ins. Ass’n v. Garamendi, 539 U.S. 396 (2003) dealt with post-WW2 attempts by Holocaust victims’ survivors to collect on life insurance policies in Germany suspended due to London Debt Agreement in 1953; in mid-1990’s, German courts lifted suspension of these claims. • In 2001, President Clinton signed executive agreement with Germany to create foundation (funded by German gov’t and private firms) to provide compensation for these claims; no prohibition of lawsuits but “U.S. policy interests favor dismissal on any valid legal ground.” • U.S. Supreme Court ruled claims under California law on life insurance policies prohibited since preempted by American foreign policy. • Why did claimants wait so long to pursue these claims (other than waiting for German courts to lift suspension of these claims)?

4. Impact of Import Laws • Case study – Vittoria North America, L.L.C. v. Euro-Asia Imports, Inc. (pages 391-94) featured importation of “gray market” or “parallel import” goods. • EAI had been importing Vittoria tires into the U.S. since the early 1980’s without VNA’s consent (violation of Tariff Act of 1930). • Dispute as to whether VNA (U.S. company) entitled to protection under the Act • Did VNA own the “Vittoria” trademark? – courts ruled “yes.” • Was there “common control” of Vittoria Italy (Italian company) and VNA? – courts ruled “no” (see analysis on pages 393-94).

5. Impact of Import Laws cont. • Case study – Marubeni America Corp. v. United States (pages 404-06), where the issue was whether Nissan Pathfinder is a “passenger vehicle” or “truck” for tariff purposes. • Import duty on “passenger vehicle” is 2.5%, while import duty on “truck” is 25% (why such a difference?). • How did the Court of Appeals decide this issue? Why?