In my April 9 guest blogpost, “Auer Deference with a Foreign Twist,” I discussed the issues before the Court in Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co. Ltd. The case involved a federal class action antitrust and price-fixing jury trial verdict for $147 million against two Chinese vitamin C manufacturers that was overturned by the Second Circuit on comity grounds. In re Vitamin C Antitrust Litigation, 837 F.3d 175 (2d Cir. 2016). The Second Circuit held that the court was “bound to defer” to a foreign government’s legal statement, as a matter of international comity, whenever the foreign government appears before the court.
The case occasioned amicus briefs from the Chinese Ministry of Commerce (MOFCOM) in the lower courts, citing its interpretation of one of its own regulations, and asserting that the defendants here, Chinese Vitamin C exporters, were compelled by Chinese law to fix prices, thus “insulating” them from price-fixing liability. At the Supreme Court, a group of distinguished Chinese administrative law professors supported that view in an amicus brief and urged affirmance. Several equally distinguished American scholars of Chinese law filed counter briefs suggesting that MOFCOM lacked the authority to interpret statutes or even their own rules.
In the blogpost, I guessed that the Court would avoid getting in the middle of that argument, and that “Given the Solicitor General’s argument that the court of appeals erred by treating the Ministry’s amicus brief as conclusive, . . .it is likely that the Supreme Court will agree with that and remand for a less deferential review.”
The Court did just that in its unanimous decision today (June 14). In a brief 12-page opinion, written by Justice Ginsburg, the Court vacated the Second Circuit’s opinion and remanded it for “renewed consideration” without giving conclusive weight to the Chinese government’s views. Basing the decision in part on Federal Rule of Civil Procedure 44.1, the Court held that federal courts “should accord respectful consideration to a foreign government’s submission, but the court is not bound to accord conclusive effect to the foreign government’s statements.”
In the key passage on page 9, the Court said:
Given the world’s many and diverse legal systems, and the range of circumstances in which a foreign government’s views may be presented, no single formula or rule will fit all cases in which a foreign government describes its own law. Relevant considerations include the statement’s clarity, thoroughness, and support; its context and purpose; the transparency of the foreign legal system; the role and authority of the entity or official offering the statement; and the statement’s consistency with the foreign government’s past positions.
That sounds a lot like Skidmore deference, or as Justice Scalia might have said, “the ol’ totality of the circumstances test.” U.S. v. Mead Corp, 533 U.S. 218, 241, (Scalia, J. dissenting). But it is consistent with the views of the majority of circuits that have passed on this question and with international treaties concerning foreign judgments. Moreover, in terms of reciprocity concerns, the Court said that the United States itself “historically, has not argued that foreign courts are bound to accept its characterizations or precluded from considering other relevant sources.”
Jeffrey S. Lubbers is Professor of Practice in Administrative Law at American University’s Washington College of Law.