The Penal and Revenue Rules, State Law, and Federal Preemption

30 Pages Posted: 8 Feb 2014 Last revised: 28 May 2014

William S. Dodge

University of California, Davis - School of Law

Date Written: May 19, 2014

Abstract

Under two longstanding rules, U.S. courts will not enforce the penal and revenue laws of foreign nations, nor the judgments of foreign courts based upon such laws. Both the penal and revenue rules are rules of common law. But are they rules of state common law or federal common law? Some federal courts have held that the revenue rule is federal common law and preempts inconsistent state law. This essay argues, to the contrary, that the penal and revenue rules — like other rules concerning the conflict of laws and the enforcement of foreign judgments — are rules of state law. Building on Justice Harlan’s concurrence in Zschernig v. Miller, I offer a narrower theory of preemption based on clear federal policies expressed in U.S. treaties. Under this theory, States would be precluded from enforcing foreign tax claims, for example, but could recognize foreign convictions as bars to subsequent prosecutions for the same offense, as some state double-jeopardy statutes have done.

Keywords: judgments, conflicts, revenue rule, federal common law, foreign affairs, preemption

Suggested Citation

Dodge, William S., The Penal and Revenue Rules, State Law, and Federal Preemption (May 19, 2014). UC Hastings Research Paper No. 86. Available at SSRN: https://ssrn.com/abstract=2392019 or http://dx.doi.org/10.2139/ssrn.2392019

William S. Dodge (Contact Author)

University of California, Davis - School of Law ( email )

Martin Luther King, Jr. Hall
Davis, CA CA 95616-5201
United States

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