Amicus Curiae Brief — Animal Sci. Prods., Inc. v. Hebei Welcome Pharm. Co., 137 S. Ct. 2320 (2017) (No. 16-1220)

No. 16-1220

—_——S¥__

In the Supreme Court of the United States

ANIMAL SCIENCE PRODUCTS, INC., ET AL., PETITIONERS

v.

HEBEI WELCOME PHARMACEUTICAL Co. LTD., ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

NOEL J. FRANCISCO

Solicitor General

Counsel of Record

—— DELRAHIM

Assistant Attorney General

MALCOLM L. STEWART

Deputy Solicitor General

BRIAN H. FLETCHER

Assistant to the Solicitor

General

KRISTEN C. LIMARZI

JAMES J. FREDRICKS

FRANCES MARSHALL

Attorneys

ee of Justice

.C. 20530-0001

Se riefs(@usdoj.gov

(202) 514-2217

QUESTIONS PRESENTED

1. Whether the court of appeals erred by reviewing

a pretrial order denying a motion to dismiss in an appeal

from a final judgment entered after a trial on the merits.

2. Whether a federal court determining foreign law

under Federal Rule of Civil Procedure 44.1 is required

to treat as conclusive a submission from the foreign gov-

ernment characterizing its own law.

3. Whether a district court may invoke principles of

international comity to dismiss a private suit brought

under the Sherman Act, 15 U.S.C. 1 et seq.

(I)

TABLE OF CONTENTS

Page

ee ee ee 1

| ES ee ea Oe a TT ee 1

EE vey ee eee en ee 5

I. This Court should review the court of appeals’

holding that the Ministry’s amicus brief

conclusively established the content of

CR BGP cccarcevercsnccsncnsecessnsseescsnasenesnsestennesessveseosssossonsee 6

A. A foreign government’s characterization of

its own law is entitled to substantial weight,

but it is NOt CONCIUBIVE ..........00ceeeeeeeeeeeersereeerenenes 6

B. The court of appeals erred by treating the

Ministry’s amicus brief as conclusive and

disregarding other relevant materials................. i)

C. The court of appeals’ error warrants further

SURIUD ccnesaccssncsresnoumsscsssenesesmeenanneqeansessanannsseneemesees 12

Il. This Court should deny review of petitioners’

contention that the court of appeals erred by

re ee ee

a 13

Ill. ose contention that courts may not

dismiss Sherman Act claims based on

international comity does not warrant this

Se GE ccnnctseersisonemmiennmemen 17

CRIS cccacesmtitimesteinercensieminnnmnieiin 23

TABLE OF AUTHORITIES

Cases:

Access Telecom, Inc. v. MCI Telecomms. Corp.,

197 F.3d 694 (5th Cir. 1999), cert. denied,

ae 7

Arbaugh v. Y & H Corp., 546 U. S. “500, 514-516 (2006)...... 16

(111)

IV

Cases—Continued: Page

Associated Gen. Contractors of Cal., Inc. v.

California State Council of Carpenters,

GBD UE. GED COD evccsscscsscscnsescsssssssssecsscensnscvcsssssecncssocesooes 18

Bodum USA, Inc. v. La Cafetiere, Inc., 621 F.3d 624

COUR Gai, BR ceccsncscscccccsscsscsncsecsensnctnnssnssnsesemansmasasvestesneeneeees 7

Cooper v. Tokyo Elec. Power Co., 860 F.3d 1193

(tds Cir. BOUT) ..ncceccsccorsccesecesccsccsccesencsscssensseossessocssscessssseceees 16

Cutter v. Wilkinson, 544 US. TOD (ZOO) .....ccccceceeeercerneeneees 17

Empagran S.A. v. F. Hoffman-Laroche Ltd.,

417 F.3d 1267 (D.C. Cir. 2005), cert. denied,

SOD TE, GIy Ga ccccnsncsctectcrvsecssssesssnssrmtnsesnnsccnee 22

Exxon Shipping Co. v. Baker, 554 U.S. 471 (2008)............ 16

F. Hoffmann-La Roche Ltd. v. Empagran S.A.,

GE TE, TI GO cceccccncsssensresccertsnnmemnpscrsceamennsscees 18, 21

Gronowski v. Spencer, 424 ¥ 3d 285 (2d Cir. 2005) .......... 16

Gucci Am., Inc. v. Weixing Li, 768 F.3d 122

GRE Gir. BBB cccccercsssccsncssssssssccvenicssmncesnssesseesasememenensscsranees 16

Hartford Fire Ins. Co. v. California, 509 U.S. 764

GF ccencesecnsnnessctansseqscesnermmespentniseiasenncseccsecensetecesenoenes 17, 20

Hilton v. Guyot, 159 U.S. 113 (1895) gunsdunapnetuciusevtsesnamnesesans 18

Industrial Inv. Dev. Corp. v. Mitsui & Co., 671 F.2d

876 (5th Cir. 1982), vacated, 460 U.S. 1007 (1983)........... 22

Mannington Mills, Inc. v. Congoleum Corp.,

595 F.2d 1287 (Bd Cir. 1979) .....cccccccesceceeeseeseenereeeenes 4, 18, 19

Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,

476 U.S. B74 (19B6).........ccccsccscsscsessssesssssssessvssessossessrssessensass 8

McKesson HBOC, Inc. v. Islamic Republic of Iran,

271 F.3d 1101 (D.C. Cir. 2001), cert. denied,

537 U.S. 941 (2002), vacated in part on other

grounds, 320 F.3d 280 (D.C. Cir. 2008) .......ccccccccccceneees 8, 13

Monosodium Glutamate Antitrust Litig., In re,

GEE FB ES Ge Ga. Be Phcccenccsnssecsscssszscencesssnsincesacsecscsee 22

Cases—Continued: Page

Oil Spill by the Amoco Cadiz, In re, 954 F.2d 1279

CHU GI i cteticssccsseneseninrnnnitemncerantenncsnnionensinsemnesenens 7,13

Ortiz v. Jordan, 562 U.S. 180 (2011) ......cccceceseseeeee 14, 15, 16

Quackenbush v. Allstate Ins. Co., 517 U.S. 706 (1996)...... 14

Société Nationale Industrielle Aérospatiale v.

United States Dist. Court, 482 U.S. 522 (1987) ........cc0000- 8

Timberlane Lumber Co. v. Bank of Am.,

549 F.2d G97 (Sth Cir. 1976)..........0esescersssesescsseseees 4, 18, 19

United States v. Baker Hughes Inc., 731 F. Supp. 3

CAT Bi ecercentatasctiaciitcamtitntrortipntanetionpenmmnigeanaininn 20

United States v. Juvenile Male, 560 U.S. 558 (2010)......... 11

United States v. McNab, 331 F.3d 1228

(11th Cir. 2003), cert. denied, 540 U.S. 1177

i cencisstesinsesecinninssetsinnscnninitnemdatcintenpetanimenieimnse 7, 8, 13

United States v. Pink, 315 U.S. 208 (1942) ......cccceeseeee 10, 11

United States v. Williams, 504 U.S. 36 (1992) ......:ccccceree 22

W.S. Kirkpatrick & Co. v. Environmental Tectonics

Corp., Intl, BB U.S. 400 (1900)...ccsrrcccoccorsecceccseccsevsesescssees 19

Treaties, statutes, and rules:

European Convention on Information on Foreign

Law art. 8, June 7, 1968, 720 U.N.T.S. 154 .......:cccccseeseeee 12

Organization of American States, Inter-American

Convention on Proof of and Information on Foreign

Law art. 6, May 8, 1979, O.A.S.T.S. No. 538,

RE Faas Ba cceerrenttcscereneernsesemnstetinninviverninnesenenanese 12

Foreign Trade Antitrust Improvements Act of 1982,

Pub. L. No. 97-290, Tit. IV, § 402, 96 Stat. 1246

CD a GD cactitsidenteseeniteniintineinintannsntciigencetticnseminnnenis 17, 18

Be Fi CN ass ct ciretectrinaiestimnnsciesictncennenineansatanianieeteits 21

Bhavana Ast, US UEC. 1 66 BBG, cccccecerecsescrsevsessceesveseseneevescesen 1

BED Wh EBAD. B sccccnccevcoreconserinsesounravenesceqnnesesnaioesnesteenesosnsenenuene 1

Rules—Continued: Page

Fed. R. Civ. P.:

MIT stccntenstusasioonesnivecnettnadiininanidinntend 6, 7, 10, 13, 16

Rule 44.1 advisory committee’s note (1996)

i icccssassascosnscevssnnnsesteinnessaccvsinndstiesineedsonreninecesenanets 6

IIIT incon iacactcei nindtnanstentanneiianiniiisadeneanipanants 15, 16

ITNT inns ceassictendintesncigiieatnietiadsingtaastapeiecniaten 14, 15, 16

i ee hs Be ot aicacincticerissincisenmematpcciornendstnicinatoligiaiadeaes 7

Miscellaneous:

H.R. Rep. No. 686, 97th Cong., 2d Sess. (1982)............:.00++ 19

U.S. Dep’t of Justice & Fed. Trade Comm'n,

Antitrust Guidelines for International

Enforcement and Cooperation (2017) .......eereereereneee 20

9A Charles Alan Wright & Arthur R. Miller,

Federal Practice and Procedure (3d ed. 2008) ............-0+ 7

15A Charles Alan Wright et al., Federal Practice

And Procedure (2d Od. 1992) ......0..0..ecercsrssessesseseseressesereeees 14

In the Supreme Court of the Gnited States

No. 16-1220

ANIMAL SCIENCE PRODUCTS, INC., ET AL., PETITIONERS

v.

HEBEI WELCOME PHARMACEUTICAL Co, LTD., ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

INTEREST OF THE UNITED STATES

This brief is submitted in response to the Court’s or-

der inviting the Solicitor General to express the views

of the United States. In the view of the United States,

the petition for a writ of certiorari should be granted,

limited to the second question presented.

STATEMENT

1. Petitioners are U.S. purchasers of vitamin C. Re-

spondents are Chinese manufacturers and exporters of

vitamin C. In 2005, petitioners filed suits alleging that

respondents had violated Section 1 of the Sherman Act,

15 U.S.C. 1, by fixing the prices and quantities of vita-

min C exported to the United States. Petitioners al-

leged that the conspiracy was accomplished through a

membership entity known as the China Chamber of

Commerce of Medicines and Health Products Import-

ers and Exporters (Chamber). Pet. App. 2a, 4a-5a.

(1)

2

a. Respondents moved to dismiss the complaints.

They did not deny that they had fixed the prices and

quantities of vitamin C exports. Instead, they asserted

that their actions had been required by Chinese law,

and that petitioners’ claims were therefore barred by

the act of state doctrine, the foreign sovereign compul-

sion doctrine, and principles of international comity.

Pet. App. 6a. The Ministry of Commerce of the People’s

Republic of China (Ministry) filed an amicus brief sup-

porting respondents. J/bid.; see id. at 189a-223a. The

Ministry represented that it was the authority within

the Chinese government responsible for regulating for-

eign trade, id. at 190a; that the Chamber was a state-

supervised entity authorized to regulate vitamin C ex-

ports, id. at 201la; and that the alleged conspiracy had

been “a regulatory pricing regime mandated by the gov-

ernment of China,” id. at 197a.

Petitioners disputed that account of Chinese law.

They noted, for example, that the Chamber had publicly

described the agreement on vitamin C prices and

quantities as a “self-regulated agreement” that was

adopted “voluntarily” and “without any government in-

tervention.” Pet. App. 173a-174a (emphases and cita-

tion omitted). Petitioners also submitted evidence ac-

quired through limited discovery, which in their view

showed that respondents had “voluntarily restricted ex-

port volume and fixed prices.” Jd. at 175a.

The district court denied respondents’ motion to dis-

miss. Pet. App. 157a-188a. The court held that the Min-

istry’s description of Chinese law was “entitled to sub-

stantial deference,” but it declined to treat the Minis-

try’s brief as “conclusive,” in part because “the plain

language of the documentary evidence submitted by

[petitioners] contradict{ed] the Ministry’s position.” /d.

3

at 181la; see id. at 179a. The court concluded that the

record was “too ambiguous to foreclose further inquiry

into the voluntariness of [respondents’] actions.” /d. at

186a.

b. After further discovery, respondents moved for

summary judgment. Pet. App. 10a. The Ministry sub-

mitted a statement reiterating its position that Chinese

law had compelled respondents’ conduct. Jd. at 97a

n.24. Petitioners cited additional evidence supporting

their contrary view, including documents in which

China had represented to the World Trade Organiza-

tion (WTO) that it “gave up export administration of .. .

vitamin C” in 2002. Jd. at 74a (citation omitted).

The district court denied respondents’ motion for

summary judgment. Pet. App. 54a-156a. The court con-

cluded that, although a foreign government’s character-

ization of its law warrants deference, it is not “entitled

to absolute and conclusive deference.” /d. at 97a. Here,

the court “respectfully decline[d] to defer to the Minis-

try’s interpretation.” /d. at 117a. The court explained

that the Ministry’s submissions had “fail[ed] to address

critical provisions of the [governing legal regime] that,

on their face, undermine its interpretation.” /d. at 119a;

see id. at 97a & n.24. The court also noted that the Min-

istry’s most recent statement did not cite legal authori-

ties “to support its broad assertions” and read like a

“carefully crafted and phrased litigation position” ra-

ther than a “straightforward explanation of Chinese

law.” Jd. at 120a. And the court emphasized that the

Ministry had “maj|de] no attempt to explain China’s rep-

resentations [to the WTO] that it gave up export admin-

istration of vitamin C.” Jd. at 121a.

4

The district court then held that Chinese law did not

require respondents to fix the price and quantity of vit-

amin C exports. Pet. App. 122a-155a. Inter alia, the

court concluded that exporters had the authority to sus-

pend the legal regime that assertedly required them to

adhere to agreed-upon prices. /d. at 123a-125a. The

court also concluded that, even if Chinese law required

respondents to agree on and adhere to minimum prices,

it did not compel their agreement to limit quantities. /d.

at 126a-127a. The court stated that the factual record

reinforced its understanding, because there was no evi-

dence that Chinese exporters had faced penalties for

failing to adhere to agreed-upon quantities or for “fail-

ing to reach agreements in the first instance.” /d. at

151a; see id. at 149a-151la.

ce. The case was tried to a jury, which found that re-

spondents had conspired to fix the price and limit the

output of vitamin C. The district court entered judg-

ment for petitioners, awarding $147 million in damages

and permanently enjoining respondents from further

violations of the Sherman Act. Pet. App. 11a.

2. The court of appeals reversed. Pet. App. la-38a.

The court held that “the district court erred in denying

[respondents’] motion to dismiss” based on comity, and

it therefore declined to “address the subsequent stages

of th[e] litigation.” Jd. at 2a & n.2.

The court of appeals explained that, “[t]o determine

whether to abstain from asserting jurisdiction on comity

grounds,” a court hearing a Sherman Act suit should ap-

ply a “multi-factor balancing test” drawn from Timber-

lane Lumber Co. v. Bank of America, 549 F.2d 597 (9th

Cir. 1976) (Timberlane), and Mannington Mills, Inc. v.

Congoleum Corp., 595 F.2d 1287 (3d Cir. 1979). Pet.

App. 14a-15a. In this case, the court focused primarily

5

on the first factor, which asks whether there was a “true

conflict” between U.S. and Chinese law. /d. at 18a.

The court of appeals concluded that the existence of

a true conflict “hinges on the amount of deference” that

is owed to the Ministry’s characterization of Chinese

law. Pet. App. 20a. The court acknowledged that there

is “competing authority” on that question, and that

some courts have declined to “accept such statements

as conclusive.” Jd. at 20a-2la. But the court held that,

when a foreign sovereign “directly participates in U.S.

court proceedings” and offers an interpretation that is

“reasonable under the circumstances,” “a U.S. court is

bound to defer.” Jd. at 25a. The court then held, based

on the Ministry’s submissions, that “Chinese law re-

quired [respondents] to engage in activities in China

that constituted antitrust violations here in the United

States.” /bid. The court limited itself to the analysis in

the Ministry’s brief and did not consider the apparently

contradictory statements or other evidence identified

by the district court. /d. at 27a-33a.

Having found a true conflict, the court of appeals

stated that the remaining comity factors “clearly weigh

in favor of U.S. courts abstaining from asserting juris-

diction.” Pet. App. i ».. Jnter alia, the court noted that

respondents are Chinese companies, that their conduct

had occurred in China, and that (according to the Min-

istry) this suit had “negatively affected U.S.-China re-

lations.” Jd. at 34a-35.

DISCUSSION

The petition for a writ of certiorari should be

granted, limited to the second question presented. That

question seeks review of the court of appeals’ holding

that the Ministry’s brief conclusively established the

content of Chinese law during the prior period of time

6

that is at issue in this case. A federal court determining

foreign law should give substantial weight to a foreign

government’s characterization of its own law. But a sub-

mission from a foreign government need not be treated

as conclusive in all cireumstances, and it does not pre-

clude the court from considering other relevant mate-

rial. The court of appeals’ contrary holding warrants

further review because it departs from the decisions of

other circuits on an important question of federal law.

Petitioners also contend that the court of appeals

erred by reviewing the denial of respondents’ motion to

dismiss, and that courts may never dismiss Sherman

Act claims based on considerations of comity. Those ad-

ditional questions do not warrant this Court’s review.

They do not implicate any conflict among the circuits,

and they were neither briefed below nor expressly ad-

dressed by the court of appeals.

I. THIS COURT SHOULD REVIEW THE COURT OF

APPEALS’ HOLDING THAT THE MINISTRY’S AMICUS

BRIEF CONCLUSIVELY ESTABLISHED THE CON.-

TENT OF CHINESE LAW

A. A Foreign Government's Characterization Of Its Own

Law Is Entitled To Substantial Weight, But It Is Not

Conclusive

Federal Rule of Civil Procedure 44.1 was adopted in

1966 to establish an “effective procedure for raising and

determining an issue concerning the law of a foreign

country.” Fed. R. Civ. P. 44.1 advisory committee’s

note (1966) (Adoption). The rule states that the deter-

mination of foreign law is a “question of law” for the

court rather than a question of fact for the jury. Fed.

R. Civ. P. 44.1. It further provides that, “[i}n determin-

ing foreign law, the court may consider any relevant

7

material or source, including testimony, whether or not

submitted by a party or admissible under the Federal

Rules of Evidence.” Jbid.; see Fed. R. Crim. P. 26.1

(similar).

Rule 44.1 reflects a judgment that courts should have

“maximum flexibility about the material to be consid-

ered and the methodology to be employed in determin-

ing foreign law in a particular case.” 9A Charles Alan

Wright & Arthur R. Miller, Federal Practice and Pro-

cedure § 2444, at 349 (3d ed. 2008). Courts rely on a

variety of materials, including “(s)tatutes, administra-

tive material, and judicial decisions”; “expert testi-

mony” interpreting those primary sources; and “any

other information” that may be probative. /d. at 342-

343; see, ¢.g., Bodum USA, Inc. v. La Cafetiere, Inc.,

621 F.3d 624, 628 (7th Cir. 2010).

Federal courts considering questions of foreign law

are sometimes presented with the views of the relevant

foreign government. The foreign government may be a

party to the suit, see, ¢.g., /n re Oil Spill by the Amoco

Cadiz, 954 F.2d 1279, 1312 (7th Cir. 1992) (Amoco Ca-

diz), or (as in this case) it may express its views through

an amicus brief or similar submission, Pet. App. 189a-

223a; see, e.g., United States v. McNab, 331 F.3d 1228,

1239-1240 & n.23 (11th Cir. 2003), cert. denied, 540 U.S.

1177 (2004). A federal court determining foreign law

may also consider views that the relevant foreign gov-

ernment has expressed in another context. See, e.g., Ac-

cess Telecom, Inc. v. MCI Telecomms. Corp., 197 F.3d

694, 714 (5th Cir. 1999), cert. denied, 531 U.S. 917

(2000).

A federal court should afford substantial weight to a

foreign government’s characterization of its own law.

That weight reflects “the spirit of cooperation in which

8

a domestic tribunal approaches the resolution of cases

touching the laws and interests of other sovereign

states.” Société Nationale Industrielle Aérospatiale v.

United States Dist. Court, 482 U.S. 522, 543 n.27 (1987).

It also makes practical sense. “Among the most logical!

sources for [a] court to look to in its determination of

foreign law are the [relevant] foreign officials,” who are

familiar with the context and the nuances of the foreign

legal system. McNab, 331 F.3d at 1241.

Federal courts should not, however, treat a foreign

government’s characterizations as conclusive in all cir-

cumstances. When “a foreign government changes its

original position” or otherwise makes conflicting state-

ments, a court is not bound to accept its most recent

statement, or the one offered in litigation. McNab, 331

F.3d at 1241. A court likewise need not credit a state-

ment that is unclear or unsupported, or that fails to ad-

dress relevant authorities. See, e.g., McKesson HBOC,

Inc. v. Islamic Republic of Iran, 271 F.3d 1101, 1108-

1109 (D.C. Cir. 2001) (McKesson), cert. denied, 537 U.S.

941 (2002), vacated in part on other grounds, 320 F.3d

280 (D.C. Cir. 2003). The precise weight to be given to

a foreign government’s statement turns on factors in-

cluding the statement’s clarity, thoroughness, and sup-

port; its context and purpose; the authority of the entity

making it; its consistency with past statements; and any

other corroborating or contradictory evidence. '

' In Matsushita Electric Industrial Co. v. Zenith Radio Corp.,

475 U.S. 574 (1986) (Matsushita), the United States suggested a

more deferential approach, arguing that when a foreign government

submits a statement characterizing its own law, federal courts “gen-

erally” must “accept that statement at face value.” U.S. Amicus Br.

at 23, Matsushita, supra (No. 83-2004). But the Matsushita brief

clarified that courts are not bound to accept “[p]lainly ambiguous or

9

B. The Court Of Appeals Erred By Treating The Ministry's

Amicus Brief As Conclusive And Disregarding Other

Relevant Materials

1. The court of appeals held that, when a foreign gov-

ernment “directly participates in U.S. court proceed-

ings” and offers a characterization of its jaw that is “rea-

sonable under the circumstances,” the court “is bound to

defer.” Pet. App. 25a. That formulation would not nec-

essarily be problematic if the qualifier “reasonable un-

der the circumstances” allowed a court to assess the rea-

sonableness of the foreign government’s statements

in light of all relevant circumstances. The totality of

the court of appeals’ opinion, however, indicates that

it adopted and applied a far more deferential standard,

under which a court is bound to accept a foreign

government’s characterization—and may not consider

other material—unless that characterization is facially

unreasonable.

Thus, the court of appeals disagreed with decisions

holding that U.S. courts need not treat a foreign gov-

ernment’s characterization as “conclusive.” bet. App.

21a. The court also stated that, if deference “is to mean

anything, it must mean that a U.S. court not embark on

a challenge to a foreign government’s official represen-

tation.” Jd. at 25a-26a. Most importantly, in concluding

internally inconsistent statements,” and it added that courts may

look behind a foreign government’s statement in “extraordinary cir-

cumstances.” Jbid. More recently, in McNab, the United States

endorsed what had by then become the courts of appeals’ genera!

practice of affording “substantial—but measured—deference to a

foreign nation’s representations.” U.S. Br. in Opp. at 16-17, McNab

v. United States, 540 U.S. 1177 (2004) (No. 03-622). That more nu-

anced approach is consistent with the position advocated here. To

the extent the Matsushita brief suggested a different standard, it

no longer reflects the views of the United States.

10

that the Ministry’s brief was a “reasonable” characteri-

zation warranting deference, id. at 27a, the court lim-

ited its inquiry to the four corners of the brief and the

sources cited therein, id. at 27a-29a.

The court of appeals thus did not acknowledge the

Chamber’s public statement that respondents had “vol-

untarily” agreed on prices and quantities “without any

government intervention.” Pet. App. 173a-174a (em-

phases and citation omitted). It also did not address the

district court’s conclusion that the Ministry’s submis-

sions “fail[ed] to address key provisions” of the govern-

ing legal regime. /d. at 119a; see id. at 97a & n.24. And

because the court concluded that the Ministry’s amicus

brief precluded consideration of other material, it did

not address the more extensive record developed at

summary judgment, including, in particular, China’s

representation to the WTO that it had “glilve[n] up

export administration of ... vitamin C.” /d. at 74a

(citation omitted). Those circumstances are, at mini-

mum, relevant to the weight that the Ministry’s brief

should receive. A standard that does not permit a

court even to consider such information is inconsistent

with federal courts’ responsibility to “determin|e] foreign

law” based on “any relevant material or source.” Fed.

R. Civ. P. 44.1.

2. The court of appeals believed that its rigid ap-

proach was compelled by United States v. Pink, 315 U.S.

203 (1942). Pet. App. 20a, 22a-23a. In Pink, which pre-

ceded the adoption of Rule 44.1, the United States had

obtained an “official declaration by the Commissariat of

Justice” of the Soviet Union defining the extraterrito-

rial reach of a Russian decree. 315 U.S. at 218. The

Court concluded that, because “the evidence supported

[a] finding” that “the Commissariat for Justice had]

11

power to interpret existing Russian law,” the “official

declaration |wa]s conclusive so far as the intended ex-

traterritorial effect of the Russian decree [wa]s con-

cerned.” /d. at 220.

Because the Commissariat was empowered to render

an authoritative construction of Russian law, the official

declaration in Pink was in some respects analogous to a

state supreme court’s answer to a question of state law

certified by a federal court. Cf. United States v. Juve-

nile Male, 560 U.S. 558, 561 (2010) (per curiam). There

was also apparently no indication that the declaration

was incomplete or inconsistent with the Soviet Union’s

past statements on the question. This Court’s holding

that the Commissariat’s declaration was “conclusive”

under those circumstances does not suggest that every

submission by a foreign government is entitled to the

same weight.

3. The court of appeals also reasoned that a foreign

government’s characterization of its own laws should be

afforded “the same respect and treatment that we

would expect our government to receive in comparable

matters.” Pet. App. 26a. That concern for reciprocity

is sound, but it does not support the court’s conclusion.

When the Department of Justice litigates questions of

U.S. law in foreign tribunals, it expects that its views

will be afforded substantial weight, and that its charac-

terizations of U.S. law will be accepted because they are

accurate and well-supported. But the Department his-

torically has not argued that foreign courts are bound

to accept its characterizations or precluded from con-

sidering other relevant material. And the Department

is not aware of any foreign-court decision holding that

12

the Department’s representations are entitled to such

conclusive weight.’

C. The Court Of Appeals’ Error Warrants Further Review

The degree of deference that a court owes to a for-

eign government’s characterization of its own law is an

important and recurring question, and foreign sover-

eigns considering making their views known to federal

courts should understand the standards that will be ap-

plied to their submissions. The court of appeals’ deci-

sion warrants further review because it departs from

the decisions of other circuits and creates uncertainty

about the proper treatment of foreign governments’

characterizatio: ¢ of their laws.

The court «* appeals acknowledged that there is

“competing authority” on the question presented, and it

expressly disagreed with the Seventh Circuit’s decision

in Amoco Cadiz. Pet. App. 20a-21la. Respondents ob-

serve (Br. in Opp. 23-24) that the court in Amoco Cadiz

ultimately adopted the French government’s interpre-

tation of French law. The court did so, however, only

because it found that interpretation “plausible” based

* The understanding that a government's expressed view of its

own law is entitled to substantial but not conclusive weight is con-

sistent with two international treaties that establish mechanisms by

which one state may obtain from another an official statement char-

acterizing its laws. Those treaties specify that “[t)he information

given in reply shall not bind the judicial authority from which the

request emanated.” European Convention on Information on For-

eign Law art. 8, June 7, 1968, 720 U.N.T.S. 154; see Organization of

American States, Inter-American Convention on Proof of and Infor-

mation on Foreign Law art. 6, May 8, 1979, O.A.S.T.S. No. 538, 1439

U.N.T.S. 111 (similar). Although the United States is not a party to

those treaties, they further confirm that the court of appeals’ rule is

out of step with international practice.

13

on all of the circumstances, including the French gov-

ernment’s statements in other contexts. 954 F.2d at

1312. The Seventh Circuit did not treat the French gov-

ernment’s submission as conclusive.

Other courts of appeals have rejected foreign gov-

ernments’ characterizations of their own laws even

where, as here, those governments appeared in U.S.

court. In McNab, for example, the Eleventh Circuit de-

clined to accept “the Honduran government’s current

interpretation of its laws,” as reflected in an amicus

brief, because that interpretation was inconsistent with

earlier statements by Honduran officials. 331 F.3d at

1242. And in McKesson, the D.C. Circuit rejected

“Tran’s contention that its corporate law requires share-

holders * * * to physically appear at a company’s office

*** in order to collect dividends.” 271 F.3d at 1108.

The D.C. Circuit declined to adopt that construction be-

cause it was not supported by the affidavits submitted

by Lran’s experts. /d. at 1108-1109. The approach re-

flected in those decisions is consistent with the role of

federal courts under Rule 44.1, and inconsistent with

the rule of conclusive deference that the Second Circuit

applied in this case.

Il. THIS COURT SHOULD DENY REVIEW OF PETITION-

ERS’ CONTENTION THAT THE COURT OF APPEALS

ERRED BY REVIEWING THE DENIAL OF RESPOND-

ENTS’ MOTION TO DISMISS

Petitioners contend (Pet. 19-22) that the court of ap-

peals erred by reviewing the denial of respondents’ mo-

tion to dismiss in an appeal from a judgment following

a trial on the merits. Petitioners are correct that the

denial of the motion to dismiss was effectively super-

seded when the district court revisited the comity issue

later in the litigation. But the comity question was

14

properly before the court of appeals, and the court’s

unexplained decision to focus on the motion to dismiss

does not appear to have affected its ultimate conclusion.

That decision thus does not warrant this Court’s review,

particularly because the issue was not briefed below or

expressly addressed by the court of appeals.

A. “The general rule is that ‘a party is entitled to a

single appeal, to be deferred until final judgment has

been entered, in which claims of district court error

at any stage of the litigation may be ventilated.’”

Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 712

(1996) (citation omitted). Accordingly, although most

inverlocutory orders are not themselves appealable, an

“appeal from [a] final judgment opens the record and

permits review of all rulings that led up to the judg-

ment.” 15A Charles Alan Wright et al., Federal Prac-

tice and Procedure § 3905.1, at 250 (2d ed. 1992).

In some circumstances, however, an interlocutory

order is effectively superseded by subsequent develop-

ments in the district court. In Ortiz v. Jordan, 562 U.S.

180 (2011), for example, this Court held that a court of

appeals generally may not review “an order denying

summary judgment after a full trial on the merits” be-

cause “the full record developed [at trial] supersedes the

record existing at the time of the summary-judgment

motion.” Jd. at 184. A defendant is still free to challenge

the sufficiency of the plaintiff’s proof, but that challenge

“must be evaluated in light of the character and quality

of the evidence received in court.” /bid.

In this case, respondents raised their comity defense

in a motion to dismiss, a motion for summary judgment,

and a motion for judgment as a matter of law under

Rule 50(b). Pet. App. 41a & n.3. Each time, the district

court rejected that defense based on a progressively

15

more developed record. Under the circumstances, the

court of appeals erred in focusing on the “denial of [re-

spondents’] motion to dismiss” and ignoring “the subse-

quent stages of th[e] litigation.” /d. at 2a n.2. The dis-

trict court ultimately decided the comity question based

on a more complete record, which “supersede[d] the

record existing at the time of the [motion to dismiss].”

Ortiz, 562 U.S. at 184.

B. Although it was erroneous, the court of appeals’

focus on the motion to dismiss does not appear to have

affected the outcome below and would not likely affect

any proceedings on remand. Because the court incor-

rectly believed that the Ministry’s brief had to be ac-

cepted as conclusive, it declined to consider other mate-

rial in the motion-to-dismiss record—a conclusion that

would have applied equally to the more extensive record

developed later. And if this Court grants review and

holds that the Ministry’s brief is not entitled to conclu-

sive weight, the court of appeals can reconsider the

foreign-law issue on remand in light of all of the perti-

nent record materials.*

Petitioners assert (Pet. 22) that the court of appeals’

focus on the motion to dismiss was dispositive because

“(rjespondents’ failure to raise comity as a defense in

their pre-verdict Rule 50(a) motion barred them from

seeking relief on that ground in their post-verdict Rule

50(b) motion, and on any appeal.” It is true that, absent

a Rule 50(b) motion, “an appellate court is ‘powerless’

to review the sufficiency of the evidence after trial.”

® Indeed, the court of appeals stated that, but for the Ministry’s

brief, “the district court’s careful and thorough treatment of the ev-

idence before it *** at both the motion to dismiss and summary

judgment stages would have been entirely appropriate.” Pet. App.

30a n.10.

16

Ortiz, 562 U.S. at 189 (citation omitted). It is also true

that “[a] motion under Rule 50( ) ‘: not allowed unless

the movant sought relief on similar grounds” under

Rule 50(a). Exxon Shipping Co. v. Baker, 554 U.S. 471,

485 n.5 (2008). For two reasons, however, those princi-

ples did not preclude the court of appeals from deciding

the comity question.

First, comity does not concern “the sufficiency of the

evidence.” Ortiz, 562 U.S. at 189. Both the determina-

tion of foreign law and the ultimate decision whether to

dismiss a claim on comity grounds are made by the

court, not the jury. Fed. R. Civ. P. 44.1; see Pet. App.

42a. Indeed, “given the important role that comity

plays” in protecting interests that transcend the parties

to a particular case, a court may overlook a party’s fail-

ure to raise the issue. Gucci Am., Inc. v. Weixing Li,

768 F.3d 122, 138-140 (2d Cir. 2014).*

Second, petitioners have forfeited their Rule 50(a)

argument. Petitioners did not object when respondents

raised comity in their Rule 50(b) motion. D. Ct. Doc.

702, at 24-31 (May 10, 2013). Where, as here, “the non-

moving party fails to object to a Rule 50(b) motion on

the grounds of waiver, the objection itself is deemed

waived.” Gronowski v. Spencer, 424 F.3d 285, 297 (2d

Cir. 2005). And petitioners forfeited the argument again

by failing to raise it on appeal. Pet. C.A. Br. 44-45.

* Contrary to respondents’ suggestion (Br. in Opp. 15), principles

of international comity do not bear on the court’s subject-matter ju-

risdiction. See Cooper v. Tokyo Eler. Power Co., 860 F.3d 1193,

1209-1210 (9th Cir. 2017); ef. Arbaugh v. \ & H Corp., 546 U.S. 500,

514-516 (2006). Courts thus have the power, but not a jurisdictional

obligation, to raise comity sua sponte.

17

C. The comity issue thus was properly before the

court of appeals, even though the court erred by focus-

ing on the motion to dismiss rather than on the full rec-

ord. Petitioners assert (Pet. 19-20) that this aspect of

the court of appeals’ decision conflicts with decisions of

the Fifth, Sixth, and Tenth Circuits holding that a court

of appeals may not review the denial of a motion to dis-

miss after a trial on the merits. But those decisions in-

volved motions to dismiss for failure to plead facts suf-

ficient to state a claim, not motions based on interna-

tional comity. And even if the court of appeals’ decision

created a circuit conflict, this case would not be an ap-

propriate vehicle in which to resolve it because the issue

was neither briefed below nor explicitly addressed by

the court of appeals. See Cutter v. Wilkinson, 544 U.S.

709, 718 n.7 (2005) (“[Wl]e are a court of review, not of

first view.”).

Ill. PETITIONERS’ CONTENTION THAT COURTS MAY

NOT DISMISS SHERMAN ACT CLAIMS BASED ON

INTERNATIONAL COMITY DOES NOT WARRANT

THIS COURT’S REVIEW

Petitioners contend (Pet. 29-34) that a federal court

may never invoke principles of comity to dismiss a Sher-

man Act claim. Petitioners did not raise that argument

below, and the court of appeals’ implicit conclusion that

comity-based dismissals are sometimes permissible

does not conflict with any decision of this Court or an-

other court of appeals. Further review is not warranted.

A. This Court has long held that “the Sherman Act

applies to foreign conduct that was meant to produce

and did in fact produce some substantial effect in the

United States.” Hartford Fire Ins. Co. v. California,

509 U.S. 764, 796 (1993). In Section 402 of the Foreign

Trade Antitrust Improvements Act of 1982 (FTAIA),

18

Pub. L. No. 97-290, Tit. IV, 96 Stat 1246 (15 U.S.C. 6a),

Congress confirmed that understanding and clarified

the application of the Sherman Act to conduct involving

foreign commerce. Under the FTAIA, the Sherman Act

generally does not reach “commercial activities taking

place abroad, wnless those activities adversely affect

domestic commerce” or “imports to the United States.”

F. Hoffmann-La Roche Ltd. v. Empagran S.A., 542 U.S.

155, 161 (2004) (Ekmpagran).

Comity is often described as “the recognition which

one nation allows within its territory to the legislative,

executive or judicial acts of another nation, having due

regard both to international duty and convenience, and

to the rights of its own citizens or of other persons who

are under the protection of its laws.” Hilton v. Guyot,

159 U.S. 113, 164 (1895). The Sherman Act does not ex-

pressly incorporate principles of comity. But the comity

doctrine had already been established when the Sher-

man Act was enacted, see, e.g., id. at 165-166, and it thus

formed a part of the “contemporary legal context in

which Congress acted,” Associated Gen. Contractors of

Cal., Inc. v. California State Council of Carpenters, 459

U.S. 519, 532 (1983). This Court has often looked to that

context in “ascertain[ing] the intended scope” and ap-

plication of the Sherman Act’s broadly worded provi-

sions. /bid.

Consistent with that understanding, courts of ap-

peals have long held that courts may, in unusual cireum-

stances, dismiss private Sherman Act claims based on

principles of comity. See, e.g., Mannington Mills, Inc.

v. Congoleum Corp., 595 F.2d 1287, 1297-1298 (3d Cir.

1979); Timberlane Lumber Co. v. Bank of Am., 549 F.2d

597, 613-615 (9th Cir. 1976). Those courts have consid-

ered a variety of factors, including:

19

[T]he degree of conflict with foreign law or policy,

the nationality or allegiance of the parties and the lo-

cations or principal places of business of corpora-

tions, the extent to which enforcement by either

state can be expected to achieve compliance, the rel-

ative significance of effects on the United States as

compared with those elsewhere, the extent to which

there is explicit purpose to harm or affect American

commerce, the foreseeability of such effect, and the

relative importance to the violations charged of con-

duct within the United States as compared with con-

duct abroad.

Timberlane, 549 F.2d at 614; see Mannington Mills,

595 F.2d at 1297-1298 (similar ten-factor test). Con-

gress did not disturb those decisions when it enacted

the FTAIA. To the contrary, the House Report accom-

panying the FTAIA cited Timberlane and specified that

the FTAIA “would have no effect on the courts’ ability

to employ notions of comity.” H.R. Rep. No. 686, 97th

Cong., 2d Sess. 13 (1982).

Comity-based dismissals should be rare, because

Congress unambiguously intended the Sherman Act to

reach foreign conduct and because federal courts “have

the power, and ordinarily the obligation, to decide cases

and controversies properly presented to them.” W-.S.

Kirkpatrick & Co. v. Environmental Tectonics Corp.,

Int'l, 493 U.S. 400, 409 (1990). But in the United States’

view, federal courts may, in extraordinary circum-

stances, dismiss private Sherman Act claims based on

principles of comity.°

® Although courts may engage in a comity analysis in private

Sherman Act suits, they should not do so in actions brought by fed-

eral agencies. The government’s decision to bring an enforcement

action “represents a determination that the importance of antitrust

20

B. The United States does not endorse all aspects of

the court of appeals’ comity analysis. For example, un-

der the circumstances presented here, respondents’ ar-

gument that Chinese law required them to engage in

the challenged conduct might have been better analyzed

under the rubric of the foreign sovereign compulsion

doctrine rather than through a comity analysis. Cf. U.S.

Dep’t of Justice & Fed. Trade Comm'n, Antitrust

Guidelines for International Enforcement and Cooper-

ation § 4.2.2, at 32-34 (2017). The court also gave inad-

equate weight to the interests of the U.S. victims of the

alleged price-fixing cartel and to the interests of the

United States in enforcement of its antitrust laws. Pet.

App. 34a-35a. Conversely, the court gave too much

weight to China’s objections to this suit. /d. at 35a. Un-

like a statement from the Executive Branch, a foreign

sovereign’s objection to a suit does not, in itself, neces-

sarily indicate that the case will harm U.S. foreign rela-

tions. But petitioners do not seek this Court’s review of

the court of appeals’ specific application of comity prin-

ciples; they argue that the court should not have per-

formed a comity analysis at all. That aspect of the

court’s decision does not conflict with any decision of

this Court or another court of appeals.

1. In Hartford Fire, this Court declined to decide

whether a court may dismiss a Sherman Act claim based

on comity. 509 U.S. at 798. The Court has not explicitly

enforcement outweighs any relevant foreign policy concerns.” U.S.

Dep’t of Justice & Fed. Trade Comm'n, Antitrust Guidelines for

International Enforcement and Cooperation § 4.1, at 28 (2017).

Given the primacy of the Executive Branch in the realm of foreign

policy, courts should not “second-guess the executive branch’s judg-

ment as to the proper role of comity concerns” in antitrust enforce-

ment actions. United States v. Baker Hughes Inc., 731 F. Supp. 3,

6 n.5 (D.D.C. 1990).

21

revisited that issue in the intervening years, but peti-

tioners assert (Pet. 31-32) that the Court implicitly fore-

closed comity-based dismissals in Empagran. That is

not correct. In Empagran, the Court considered the

F'TAIA’s directive that the Sherman Act reaches con-

duct involving non-import foreign commerce only if the

conduct’s effect on U.S. commerce “gives rise to a

claim” under the Sherman Act. 15 U.S.C. 6a(2); see Hm-

pagran, 542 U.S. at 174. The Court held that, when a

Sherman Act violation “adversely affects both custom-

ers outside the United States and customers within the

United States, but the adverse foreign effect is inde-

pendent of any adverse domestic effect,” a plaintiff who

suffers only foreign harm may not sue. 542 U.S. at 164.

In reaching that conclusion, this Court rejected the

plaintiffs’ argument that courts should deal with the

problems posed by foreign-injury cases by “abstaining

where comity considerations so dictate.” Empagran,

542 U.S. at 168. The Court deemed that approach “too

complex,” and instead interpreted the FTAIA to “ex-

clude independent foreign injury cases across the

board.” Ibid. In so holding, however, the Court did not

purport to resolve the question left open in Hartford

Fire or to bar courts from invoking comity principles in

cases that fall within the scope of the Sherman Act as

clarified by the FTAIA.

2. Petitioners are also wrong in asserting (Pet. 32-

33) that other courts of appeals have rejected the ap-

proach to comity reflected in Timberlane and Man-

nington Mills. To the contrary, one of the decisions

they cite “commend|[ed] the[] analysis” in those cases

and agreed that “[a] district court should not apply the

antitrust laws to foreign conduct or foreign actors if

22

such application would violate principles of comity.” /n-

dustrial Inv. Dev. Corp. v. Mitsui & Co., 671 F.2d 876,

884 & n.7 (5th Cir. 1982), vacated, 460 U.S. 1007 (1983).

The remaining decisions on which petitioners rely

simply interpreted the Sherman Act’s extraterritorial!

reach; they did not address any case-specific comity ar-

guments, much less hold that such arguments are cate-

gorically foreclosed. Jn re Monosodium Glutamate An-

titrust Litig., 477 F.3d 535, 538-539 (8th Cir. 2007); Bm-

pagran S.A. v. F. Hoffmann-Laroche Ltd., 417 F.3d

1267, 1271 (D.C. Cir. 2005), cert. denied, 546 U.S. 1092

(2006).

C. Even if the comity question otherwise warranted

this Court’s review, this case would not be an appropri-

ate vehicle in which to consider it. As petitioners

acknowledge (Reply Br. 13), they did not argue below

that comity-based dismissals are categorically imper-

missible, and the court of appeals therefore did not con-

sider that argument. This Court’s “traditional rule

*** precludes a grant of certiorari” where, as here,

“‘the question presented was not pressed or passed

upon below.’” United States v. Williams, 504 U.S. 36,

41 (1992) (citation omitted). Petitioners identify no

sound reason to depart from that rule here.

23

CONCLUSION

The petition for a writ of certiorari should be

granted, limited to the second question presented.

Respectfully submitted.

NOEL J. FRANCISCO

Solicitor

NOVEMBER 2017