Minimum contacts

Abstract: This Article begins by surveying the myriad ways that increasing globalization of communication, travel, and trade, and in particular the rise of the Internet, have forced judges and legal scholars to "adapt" traditional rules for legal jurisdiction to the new economic and social environment. For example, if a person posts content online that is legal where posted but illegal in some place where it is viewed, can that person be subject to suit in the far-off location? How should the International Shoe "minimum contacts" test account for online contacts? Is online activity sufficient to make one "present" in a jurisdiction for tax purposes? And on and on. Moreover, beyond the internet context, annual meetings of the world's industrialized countries have become sites for the expression of uncertainty and resentment about the effect of international trade and monetary policy on local labor forces, the environment, and national sovereignty. Similar debates recur in the context of international human rights, where, increasingly, countries are asserting extraterritorial jurisdiction to try those accused of genocide and crimes against humanity in international or foreign domestic courts. Though these issues arise in a variety of doctrinal areas and may involve a wide range of different legal and policy concerns, they all touch on the idea of legal jurisdiction, the circumstances under which a juridical body can assert authority to adjudicate or apply its legal norms to a dispute. And, in each of these cases, the question is complicated by the fact that jurisdiction may be asserted in one physical location over activities or parties located in a different physical location. This period of doctrinal flux affords us an important opportunity to think not only about adapting existing jurisdictional rules, but also about the theoretical basis for those rules. After all, conceptions about legal jurisdiction are more than simply ideas about the appropriate boundaries for state regulation or the efficient allocation of governing authority. Rather, jurisdiction is the locus for debates about community definition, sovereignty, and legitimacy. In addition, the idea of legal jurisdiction both reflects and reinforces social conceptions of space, distance, and identity. I therefore draw on work in political science, anthropology, sociology, critical geography, and cultural studies that forces us to question both whether nation-states should be the only relevant jurisdictional entities and whether strict territorial notions of jurisdiction actually fit people's lived experience of boundaries and community definition. Ultimately, I advance a "cosmopolitan pluralist" conception of jurisdiction, which aims to capture a jurisdictional middle ground between strict territorialism on the one hand and expansive universalism on the other. Such a theoretical model allows the legal definition of jurisdiction to become the rhetorical site for discussions of multiple overlapping and shifting understandings of community, and the recognition of judgments to become the terrain on which alternative conceptions of community vie for persuasive power and legitimacy. I conclude by offering examples of how this conception of jurisdiction is increasingly operating in transnational and international legal practice.

Abstract: Despite the usual presumption for the territorial application of securities laws, U.S. courts have applied domestic antifraud provisions extraterritorially to transactions in other countries, justifying its actions as necessary to protect U.S. investors and the integrity of U.S. markets. The current approaches of U.S. courts, however, have some problematic features. The scope of federal jurisdiction is inconsistent and expansive, and this results in conflicts with other countries and the potential for redundant and unnecessarily costly systems of overlapping regulations. Because courts are not well suited to analyze the various delicate issues related to the application of antifraud rules, this Article affirms the proposition that Congress should grapple with the issue of extraterritoriality and provide the judiciary with clear guidance as to the proper reach of the anti-fraud provisions. Moreover, believing that the current effects and conduct tests of the courts give us practical approaches to decide the reasonable scope of extraterritoriality, this Article makes some recommendations for the scope of extraterritorial subject-matter jurisdiction by suggesting modified and narrowed effects and conduct tests. INTRODUCTION As securities markets have become increasingly globalized in recent years, the growth of transactions in cross-border securities raises an issue of the regulation of transnational securities fraud. Although surging capital across jurisdictional boundaries seems to suggest that national borders are artificial constructs, this circumstance does not comport with regulatory reality. It is an internationally recognized principle that the power to prescribe and enforce securities laws is territorial,1 and most modern securities markets are regulated on a national basis.2 The securities regulations of most countries, in fact, reach only some transactions and not others, and the same may be said of U.S. securities laws.3 Viewed differently, however, securities laws are hardly territorial at all because no country formulates the content of its securities laws without considering the practices of its sister countries and the extraterritorial effects of their laws.4 In regard to the limits of a nation's power to unilaterally regulate conduct that occurs outside of its borders, there is general agreement that laws may have some extraterritorial reach.5 Enforcement of U.S. securities laws against securities fraud produces special problems when persons alleged to have violated the laws are foreign or when securities transactions that are allegedly tainted with fraud are foreign in nature.6 While the U.S. Securities and Exchange Commission (the "SEC" or "Commission") has taken a number of steps to define the scope of disclosure requirements with respect to foreign companies and conduct that occurs primarily abroad,7 the extraterritorial reach of the antifraud provisions remains a matter for the courts to resolve.8 Despite the usual presumption for the territorial application of securities laws,9 U.S. courts have applied domestic antifraud provisions extraterritorially to transactions in other countries, justifying its actions as necessary to protect U.S. investors and the integrity of U.S. markets.10 The current approaches of U.S. courts, however, have some problematic features. The scope of federal jurisdiction is inconsistent and expansive, and this results in conflicts with other countries and the potential for redundant and unnecessarily costly systems of overlapping regulations. Given the possibility of being sued based on the extraterritorial application of U.S. antifraud provisions, participants in cross-border transactions need an identifiable standard to guide their actions. Based on these problematic features of the current extraterritorial subject-matter jurisdiction, this Article reassesses the current approaches of U.S. courts and seeks to determine what U.S. policy should be toward the regulation of cross-border securities fraud. …

Abstract: The Due Process Clause with its focus on a defendant's liberty interest has become the key, if not only, limitation on a court's exercise of personal jurisdiction. This due process jurisdictional limitation is universally assumed to apply with equal force to alien defendants as to domestic defendants. With few exceptions, scholars do not distinguish between the two. Neither do the courts. Countless cases assume that foreigners have all the rights of United States citizens to object to extraterritorial assertions of personal jurisdiction. But is this assumption sound? This Article explores the uncritical assumption that the same due process considerations apply to alien defendants as to domestic defendants in the personal jurisdiction context. It concludes that the current approach to personal jurisdiction over foreign defendants is doctrinally inconsistent with broader notions of American constitutionalism. The inconsistency is particularly stark given recent Fifth Amendment jurisprudence, including that involving Guantanamo Bay detainees. The limits on a court's power to assert extraterritorial personal jurisdiction over alien defendants derive not from the Due Process Clause, as commonly assumed, but from the inherent attributes of sovereignty under international law. The Article concludes by suggesting two frameworks for determining when a court may exercise personal jurisdiction over a nonresident, alien defendant. For theoretical coherence and pragmatic reasons, the Court should untether the personal jurisdiction analysis from the Constitution in international cases. Sovereignty, not due process, limits a U.S. Court's extraterritorial assertion of personal jurisdiction.

Abstract: This article addresses federalism issues raised by the interjurisdictional competition that the internet will present. Within the United States, such on-line activity has already become the target of regulation by the states. Analysis of interstate competition in "law as a product" is appropriate in determining the proper scope of state regulation of on-line activity. Two lines of constitutional cases define the parameters of proper interstate regulatory competition: those dealing with personal jurisdiction, and those dealing with the dormant commerce clause. Inherent in the Supreme Court's Due Process holdings is the principle that interstate diversity in law products is desireable and central to a federal system. The "minimum contacts" test of International Shoe and subsequent cases preserves the individual's right to "vote with his feet" in selecting among the law products offered by the several states. Competition for law as a product can only be maintained if states are prevented from externalizing the costs of their local regulations. The Supreme Court holdings regarding the dormant commerce clause indicate that this constitutional doctrine serves to prevent states from exporting their law products to other jurisdictions by attempting to control wholly extraterritorial activity. Although the Internet may in some cases facilitate externalization of state regulatory costs, centralized regulation by the federal government, rather than overreaching by the states, is the proper solution to such externalities