Skip to main content Accessibility help
×
Home
Hostname: page-component-55597f9d44-qcsxw Total loading time: 0.23 Render date: 2022-08-10T08:29:39.694Z Has data issue: true Feature Flags: { "shouldUseShareProductTool": true, "shouldUseHypothesis": true, "isUnsiloEnabled": true, "useRatesEcommerce": false, "useNewApi": true } hasContentIssue true

Article contents

The Presumption Against Extraterritoriality in Two Steps

Published online by Cambridge University Press:  20 January 2017

William S. Dodge*
Affiliation:
University of California, Davis, School of Law
Rights & Permissions[Opens in a new window]

Extract

HTML view is not available for this content. However, as you have access to this content, a full PDF is available via the ‘Save PDF’ action button.

For the past twenty-five years, the presumption against extraterritoriality has been the Supreme Court’s principal tool for determining the geographic scope of federal statutes. In 2010, Morrison v. National Australia Bank used the presumption to decide the scope of Section 10(b) of the Securities Exchange Act, which prohibits securities fraud. Morrison approached the question in two steps. First, it looked for a “clear indication of extraterritoriality” to rebut the presumption and found none. Second, it looked to see if application of the statute would be domestic or extraterritorial by examining the “focus” of the provision. Plaintiffs argued that applying Section 10(b) would be domestic because the alleged fraud occurred in the United States, although they had bought their shares in Australia. The Court disagreed, holding that application of Section 10(b) would be extraterritorial because “the focus of the Exchange Act is not upon the place where the deception originated, but upon purchases and sales of securities in the United States,” and in this case the transaction occurred abroad.

Type
AGORA: Reflections on RJR Nabisco v. European Community
Copyright
Copyright © American Society of International Law 2016

References

1 EEOC v. Arabian American Oil Co., 499 U.S. 244 (1991), revived the presumption as a canon of statutory interpretation in 1991. Apart from a brief mention in 1989, see Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 440 (1989), the Supreme Court had not applied the presumption to determine the geographic scope of a federal statute since 1949. See Foley Bros. v. Filardo, 336 U.S. 281 (1949).

2 Morrison v. Nat’l Australia Bank Ltd., 561 U.S. 247 (2010).

3 Id. at 255-65.

4 Id. at 266.

5 RJR Nabisco, Inc. v. European Community, 136 S. Ct. 2090, 2101, slip op. at 9 (2016). Part II of the opinion was joined by all seven participating Justices. Justice Scalia passed away before oral argument. Justice Sotomayor was recused because she heard an earlier incarnation of the case as a judge on the Second Circuit. See European Community v. RJR Nabisco, Inc., 424 F.3d 175 (2005) (Sotomayor, J.), cert. denied, 546 U.S. 1092 (2006).

6 RJR, 136 S. Ct. at 2101, slip op. at 9. The Court also said: “We must ask this question regardless of whether the statute in question regulates conduct, affords relief, or merely confers jurisdiction.” Id. The Court was trying, in a shorthand way, to describe its application of the presumption to the implied cause of action under the jurisdictional Alien Tort Statute in Kiobel v. Royal Dutch Petroleum, 133 S. Ct. 1659 (2013). For explanation why the presumption against extraterritoriality does not apply to jurisdictional statutes, even after RJR, see William S. Dodge, The Presumption Against Extraterritoriality Still Does Not Apply to Jurisdictional Statutes, Opinio Juris (July 1, 2016, 4:57 PM).

7 RJR, 136 S. Ct. at 2101, slip op. at 9.

8 Id.

9 18 U.S.C. §§ 1961-1968.

10 Id. § 1964(c).

11 Id. § 1957(d)(2).

12 RJR, 136 S. Ct. at 2111, slip op. at 27.

13 Id. at 2101-02, slip op. at 9-11.

14 Id. at 2102, slip op. at 11.

15 Id.

16 Morrison, 561 U.S. at 265.

17 Sale v. Haitian Centers Council, Inc., 509 U.S. 155, 177 (1993).

18 Foley Bros. v. Filardo, 336 U.S. 281, 285 (1949).

19 RJR, 136 S. Ct. at 2103, slip op. at 13.

20 Id.

21 Id.

22 Id. at 2104, slip op. at 14.

23 Id.

24 Id.

25 Id. at 2103, slip op. at 13.

26 It seems harder to justify a distinction between Section 1962(a) and (b). If Congress was not concerned about investment in foreign enterprises, why should it be considered about control of foreign enterprises?

27 RJR, 136 S. Ct. at 2100, slip op. at 8 (quoting Morrison, 561 U.S. at 266).

28 Id. at 2104, slip op. at 15.

29 Id. at 2103, slip op. at 14.

30 See, e.g., United States v. Ali, 718 F.3d 929, 939 (D.C. Cir. 2013) (“Generally, the extraterritorial reach of an ancillary offense like aiding and abetting or conspiracy is coterminous with that of the underlying criminal statute.”).

31 RJR, 136 S. Ct. at 2106, slip op. at 19.

32 See, e.g., Morrison, 561 U.S. at 265; Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 455-56 (2007).

33 RJR, 136 S. Ct. at 2108, slip op. at 22.

34 Id.

35 Id. at 2109-10, slip op. at 25-26.

36 Id. at 2110, slip op. at 27.

37 Id. at 2113, slip op. at 4 (Ginsburg, J., concurring in part and dissenting in part).

38 Id. at 2113-14, slip op. at 5-6 (Ginsburg, J., concurring in part and dissenting in part).

39 Id . at 2101, slip op. at 9.

40 Id. at 2110, slip op. at 27.

41 Id. at 2102, slip op. 11.

42 Morrison, 561 U.S. at 266.

43 Absolute Activist Value Master Fund Ltd. v. Ficeto, 677 F.3d 60, 69 (2d Cir. 2012).

44 F. Hoffman-La Roche Ltd. v. Empagran, S.A., 542 U.S. 155, 165 (2004); see also Hartford Fire Ins. Co. v. California, 509 U.S. 764, 796 (1993) (“[T]he Sherman Act applies to foreign conduct that was meant to produce and did in fact produce some substantial effect in the United States.”).

45 Hartford Fire, 509 U.S. at 770-77 (describing alleged boycott).

46 RJR, 136 S. Ct. at 2101, slip op. at 9.

47 In fact, the Court did not apply the presumption in either Empagran or Hartford Fire.

48 RJR, 136 S. Ct. at 2100, slip op. at 8.

49 Morrison, 561 U.S. at 261.

You have Access
4
Cited by

Save article to Kindle

To save this article to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

The Presumption Against Extraterritoriality in Two Steps
Available formats
×

Save article to Dropbox

To save this article to your Dropbox account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you used this feature, you will be asked to authorise Cambridge Core to connect with your Dropbox account. Find out more about saving content to Dropbox.

The Presumption Against Extraterritoriality in Two Steps
Available formats
×

Save article to Google Drive

To save this article to your Google Drive account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you used this feature, you will be asked to authorise Cambridge Core to connect with your Google Drive account. Find out more about saving content to Google Drive.

The Presumption Against Extraterritoriality in Two Steps
Available formats
×
×

Reply to: Submit a response

Please enter your response.

Your details

Please enter a valid email address.

Conflicting interests

Do you have any conflicting interests? *