Part of law says you can’t do anything to him because he’s head of state, others might say he’s a prisoner of war

US v. Alcoa (1945) (p. 338)

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  US has been more aggressive than most countries in applying its law extraterritorially
  
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  Much of this law developed with respect to US antitrust law
  
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  To a large degree, the US created antitrust law, although it has since been followed in many other countries
  
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  Early on in history of Sherman Antitrust Act, questions arose over how big the reach of the statute was to apply to conduct taking place outside US
  
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  American Banana case: USSC examines a statute, asks whether the statute reaches conduct outside of US, purely as a domestic law matter (not looking at it from perspective of int’l law)
  
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  US courts have said Congress has the power to regulate conduct abroad, but this doesn’t ask whether this is limited by int’l law.
  
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  When courts ask whether Congress intended to regulate worldwide or intended to limit the reach of the regulation to the US, it is treated as matter of statutory interpretation
  
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  As general matter, Congress is presumed to have legislated within territory of US, unless there are other indications to the contrary suggesting Congress intended a wider scope
  
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  Everything above is all domestic US law, not int’l law
  
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  Sherman Act: every contract in restraint of trade shall be prohibited
  
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  Issue: did Congress mean every contract in US, or in the world?
  
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  Charming Betsy doctrine: when court engages in interpreting a statute, and there are 2 possible interpretations, 1 of which is consistent with int’l law and 1 that is not, prefer the interpretation that is consistent
  
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  Through CB we have a backdoor limit on jx
  
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    If Congress passes law saying “No right hand turns on red,” this could mean not in the US, or not anywhere in the world
    
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    If the “anywhere in the world” interpretation is prohibited under int’l law, then we should go with the “only in the US” interpretation
    
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    Again, this is only US domestic law, not int’l law
    

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  American Banana case
  
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    Holmes decision accords with the French position in Lotus: acts can only be determined lawful or unlawful by the country where the act takes place
    

US v. Aluminum Co. of America (Alcoa) (1945), p. 338

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  This case reverses American Banana
  
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  The 2^nd Circuit is doing the reversal because too many SC justices had stock holdings in Alcoa, and SC couldn’t get a quorum to decide the case; therefore we treat the case as a USSC case, equal with American Banana
  
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  Canadian company was one of co-D’s in action against aluminum cartel
  
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  Cartel: we will continue to engage in contracts that restrain trade, but we’ll just do them outside US based on American Banana decision
  
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  This shows why the Banana decision was untenable: to get around US law, companies could just restrain trade abroad
  
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  Court: we will reinterpret Sherman Act to reach conduct taking place outside US
  
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    2 caveats: Sherman Act applies extraterritorially, but only for acts that were intended to affect US market, and did affect US market
    

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  Alcoa effects test
  
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    Agreements intend to have effects in the US
    
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    Agreements do have substantial effects in the US
    

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  Not all countries have the same attitudes about anti-competition law; might think cartels are a good thing
  
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  The act may be legal where it’s taken, and in fact encouraged by the gov where the act takes place
  
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  But here, the US is asserting as a matter of its own domestic law jx to prescribe
  
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  2^nd circuit creates the effects test; not included in Sherman Act
  

Primary Bases of Prescriptive Jx

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  Territoriality
  
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  Effects
  
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    Does Helms-Burton meet the effects test?
    
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    How does comity limit the effects test?
    

Book 339L Alcoa effecs test quickly gained wide acceptance in US courts and US gov’t agencies and courts oftend applied federal antitrust alws to conduct taking place partially or wholly outside the US.

-estraterritorial assertion of US law gave rise to considerable friction between US and other states.

- these tension arose in part out of disagreemtnst over appropriate ssubstantive content of antitrust law and in part out of a belief by other states that foreign law rather than US law ought to regulate activity occurring in foreign territory

- these complaints prompted judicial efforts to refine the test: Timberlane is an influential attempt at doing so.

Timberlane is a US partnership that imported lumber into US from Central America and sought to establish operations in Honduras. Bank of America financed the Honduran lumber industry. Honduran lumber co financed by the bank went bankrupt and its assets passed to the company’s creidorts who sold the assets to Timberlane. After timberlane began operations in Hondurance, the bank allegedly conspired with Honduran lumber companies to drive Timberlane out of business to enable other companies financed y the bank to continue to monopolize the Honduran lumber market. Ninth circuit district court dismissed the complaint for ack of subject matter jx and on “act of state” grounds. On appeal, 9^th circuit discussed the extraterritorial reach of US antitrust law:

Timberlane Lumber Co. v. Bank of America (1976), p. 340

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  Introduces a comity test into whether the US should appropriately extend its antitrust laws
  
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  Comity: takes into account interest of the other state, which tends to be the territorial state or state of nationality of one of the D’s
  
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  Opinion commanded a lot of excitement because the 9^th Circuit seemed like a concerned int’l citizen, seen as opinion sensitive to necessity of int’l operation; was thought to be the newest approach in the area
  
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  However, Hartford Fire kills off the Timberlane approach, gives robust assertion to US ability to exercise jx without looking at competing interests of other states