Intersystemic Statutory Interpretation in Transnational Litigation

By McLean, Nicholas M. | The Yale Law Journal, October 2012 | Go to article overview
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Intersystemic Statutory Interpretation in Transnational Litigation


McLean, Nicholas M., The Yale Law Journal


In a recent article in the pages of this Journal, (1) Professor Abbe Gluck highlights an important phenomenon: federal courts do not generally apply state interpretive methodologies when construing state statutes. Gluck argues forcefully that this practice is incorrect as a doctrinal matter under Erie, and that the legal academy's failure to examine statutory interpretation from a self-consciously "intersystemic" perspective represents a significant gap in the literature. (2)

In this Comment, I extend Gluck's argument regarding the inconsistent and undertheorized nature of the federal approach to intersystemic statutory interpretation to a new context: federal courts' interpretation of the statutory law of foreign countries (3) in the course of transnational litigation. (4) I argue that when federal courts are called upon to interpret foreign statutes, they should make greater efforts to employ the interpretive approaches of the relevant foreign jurisdictions. This is particularly important because a number of foreign countries--like certain U.S. states, (5) but unlike the U.S. Supreme Court--accord the status of law (or, at least, law-like status) to methodologies of statutory interpretation. The practice of federal courts in this respect has been inconsistent, often disregarding key aspects of foreign interpretive methodology. Judicial practice is thus in tension with the policies that militate in favor of the use of foreign law in transnational litigation. (6)

I. FOREIGN LAW IN AMERICAN COURTS: CURRENT PRACTICE

Amid the globalizing forces of the world economy, federal courts are often called upon to apply and to interpret the laws of foreign countries. (7) A court sitting in diversity might apply a state choice-of-law rule that requires the court to apply the tort law of a foreign nation. (8) In a contract dispute, a federal court might apply foreign substantive law pursuant to an international agreement's choice-of-law clause. (9) In the realm of corporate law, a court might find, based on an application of the internal affairs doctrine, (10) that a foreign nation's procedural requirements govern a shareholder derivative suit. (11) Even the direct application of certain federal statutes may require U.S. courts to interpret foreign law: for example, under the anti-bribery Foreign Corrupt Practices Act, (12) a defendant may present the affirmative defense that an allegedly improper payment to a foreign official was "lawful under the written laws and regulations of the foreign official's ... country." (13) A federal court might also be called upon to review federal agencies' interpretations of foreign law in the context of administrative adjudication. (14) As a general matter, various policy arguments militating in favor of applying foreign law in litigation in domestic forums have been advanced, including international comity, (15) reciprocity, (16) predictability, (17) fairness, (18) and discouragement of forum shopping. (19)

In the United States, the process by which federal courts interpret foreign law is set out in Rule 44.1 of the Federal Rules of Civil Procedure:

   A party who intends to raise an issue about a foreign country's
   law must give notice by a pleading or other writing. In
   determining foreign law, the court may consider any relevant
   material or source, including testimony, whether or not
   submitted by a party or admissible under the Federal Rules of
   Evidence. The court's determination must be treated as a
   ruling on a question of law. (20)

Under the current procedural regime, which in some respects parallels the "all available data" test employed by federal courts when interpreting state law in the Erie context, (21) judges called upon to interpret foreign statutes have relied on a wide variety of sources. These sources have included foreign statutory text, (22) foreign case law, (23) and secondary materials. (24) In contrast to the state law determination process, however, expert testimony has also been a widely employed method of determining the content of foreign law; indeed, many courts regard expert testimony as the primary method for understanding foreign law.

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