Case No. 16-1220 | 2d Cir.
Federal courts obviously have the authority to interpret U.S. law, but are federal courts required defer to a foreign sovereign’s interpretation of its own law when that foreign sovereign appears as amicus curiae? Some circuit courts have held that a court must defer to a foreign sovereign’s interpretation of its own law, while other circuits have found that there is no legal basis for mandatory deference.
Petitioners allege, on behalf of two classes of Vitamin C purchasers, that Respondent conspired to fix prices and restrict supply to the United States in violation of the Sherman Act, which prohibits unreasonable restraints on trade. Respondent, a China-based company, defended itself only by asserting that Chinese trade law compelled them to fix prices and restrict the supply.
In the district court, the Ministry of Commerce of the People’s Republic of China (“the Ministry”) appeared as amicus curiae to explain its regulatory system. The district court, however, found that the Ministry’s statements were in conflict with statements made to the World Trade Organization on a related issue. The Second Circuit found that the Ministry’s participation as amicus curiae and its explanation of the regulatory system were reasonable in light of the circumstances, and therefore the court is “bound to defer.” Animal Sci. Prods. v. Hebei Welcome Pharm. Co., 837 F.3d 175, 189 (2d Cir. 2016). No matter how the Supreme Court rules, there may be longstanding impacts on foreign trade, particularly amidst the recent trade tariffs and a looming trade war with China.