How Litigation Imports Foreign Regulation

68 Pages Posted: 18 Feb 2021

Date Written: February 8, 2021

Abstract

Foreign regulators exert a powerful and deeply underestimated influence on American complex litigation. From the French Ministry of Health and the U.K.’s National Health Services, to the Japanese Fair Trade Commission and the European Commission, foreign agencies have shaped some of the most important cases in the last two decades. The intersections between American litigation and foreign regulation range from plaintiff discovery requests of documents produced by or to foreign regulators, to coattail class actions against multinationals triggered by enforcement penalties abroad, all the way to foreign agency letters submitted to U.S. courts expressing an interest in a case. Indeed, dozens upon dozens of the most important multidistrict cases in the country—covering over 100,000 claims—have been heavily influenced by the existence of foreign regulatory documents or enforcement actions. In this manner, litigation is importing foreign regulatory zeal to the United States. Yet few American legal actors know that foreign regulation affects domestic cases and even judges are unsure whether this practice is appropriate.

This Article presents a systematic study of the new relationship between foreign regulation and American litigation. The cross-border spread of litigation ideas sits at the center of broader debates about complex litigation, the regulatory role of multidistrict litigation, the recent trend of litigation isolationism, and the expanding role of discovery. The Article argues that litigation can import and domesticate foreign regulations, allowing private litigants to audit the work of captured domestic agencies. For instance, litigators can measure the work of the FDA against health regulators in France, or the work of the SEC against financial regulators in Germany. Litigation can also push U.S. law to match foreign regulation, promoting a rough harmonization across borders, coherence, and convergence. While the litigation-led use of foreign regulation promises a wealth of benefits for U.S. law, it has not been sufficiently recognized, nudged forward, or appreciated. The Article thus seeks to provide a solid theoretical footing for the incorporation of foreign regulations, and argues that an understanding of litigation-led globalization clarifies scholarly debates in a variety of literatures. After this analysis, the Article also argues that courts should invite American regulators to help them decide whether to welcome or reject this foreign influence.

Suggested Citation

Zambrano, Diego, How Litigation Imports Foreign Regulation (February 8, 2021). Virginia Law Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3782113

Diego Zambrano (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States

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