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Thread: Can a US Company be sued in another country for advertising illegal items?

  1. #1

    Can a US Company be sued in another country for advertising illegal items?

    http://www.boston.com/business/artic...or_protection/

    And more important, will the US courts allow collection of that judgement?

    Yahoo lawyers ask court for protection

    By David Kravets, Associated Press Writer | March 25, 2005

    SAN FRANCISCO -- Lawyers for Yahoo Inc. asked a federal appeals court Thursday for legal protection for U.S.-based Internet portals whose content is protected by the First Amendment in the United States, but illegal in foreign countries.
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    Some of the judges acknowledged the need for a shield for American companies in such situations, but suggested it was premature in the case of Yahoo, which is challenging a fine levied by a Paris court four years ago for allowing the site's French users to buy and sell Nazi memorabilia, in violation of French law.

    Yahoo asked the 11-judge panel of the San Francisco-based 9th U.S. Circuit Court of Appeals on Thursday to prevent the two French human rights groups that sued from collecting the fine -- now at about $15 million and growing by as much as $15,000 per day.

    But during 70 minutes of arguments, some judges noted that the French groups haven't tried to collect.

    "Where's the beef? Why are we here?" asked Judge Ronald Gould.

    Yahoo attorney Robert Vanderet said the human rights groups might try to collect, and that Yahoo isn't the only Internet portal that needs to know whether U.S. courts would shield American companies from being liable abroad for lawfully protected speech originating in America.

    "Yahoo needs assurances that that order is not enforceable in the United States," Vanderet told the panel.

    Yahoo's French subsidiary, yahoo.fr, complies with France's law, but a French judge ordered Sunnyvale-based Yahoo.com to strip Nazi paraphernalia from the portal's most popular site, yahoo.com. Yahoo did not appeal the French order, and instead sought protection in U.S. courts.

    A San Jose federal judge in 2002 ruled Yahoo, as an American company, was not liable, and the human rights groups appealed. A three-judge 9th Circuit panel overturned the judge, saying he ruled prematurely, since France's Union of Jewish Students and the International Anti-Racism and Anti-Semitism League haven't acted on the French judgment. Yahoo then sought Thursday's rehearing before an 11-judge panel.

    Judge Raymond Fisher speculated that Yahoo's case was premature, but acknowledged the implications for free speech. "They're seeking a remedy that is going to have a major impact in the United States," Fisher said.

    Yahoo says its international subsidiaries comply with local laws, and said it's technologically impossible to censor its U.S. site for users in France.

    Legal experts said if Yahoo can clarify its position in the United States, other U.S-based Internet service providers also will understand their liabilities.

    "Who has a right to exercise legal jurisdiction over content that's on the Web?" asked Jeffrey Pryce, an international lawyer from Washington, D.C. Suppose it was Saudi Arabia or Afghanistan, he asked. "It could get kind of frightening."

    The human rights groups' attorney, E. Randol Schoenberg, said Yahoo has dramatically limited the Nazi material on its American site, and that his clients won't try to collect unless Yahoo reverts "to their old ways."

    The appellate court can rule on the case at any time.
    This sort of thing scares the crap out of me. If the US gives up its sovereignty on this issue, we give up a large chunk of fundamental first amendment law.
    Ineluctable modality of the visible

  2. #2
    This is all going to be settled by the terms of treaties and/or in the WTO, and I honestly have no idea what the "applicable law" between France and the US says on it.

    General rule of doing business in another country - every thing you possess in that country is completely subject to the laws and whims of that country, stuff you possess outside of that country is very difficult for them to get to.

  3. #3
    But the catch here is, the internet doesn't really 'exist' in any specific country. Who should hold dominion over what occurs on it?

    Wastrel da Leezurd.

  4. #4
    Quote Originally Posted by Seriati
    This is all going to be settled by the terms of treaties and/or in the WTO, and I honestly have no idea what the "applicable law" between France and the US says on it.

    General rule of doing business in another country - every thing you possess in that country is completely subject to the laws and whims of that country, stuff you possess outside of that country is very difficult for them to get to.
    That is wrong. A private person is not a signatory to the treaty and a federal treaty cannot take away the private person's Constitutional rights.
    Ineluctable modality of the visible

  5. #5
    Did we or did we not confiscate the assets of certain Iraqis in the States during our spat with Saddam regimes? And I'm not talking about State-run or owned corporations here. You can argue all you like Dmitry but we do it ourselves

  6. #6
    Quote Originally Posted by Dmitry the Wizzy
    That is wrong. A private person is not a signatory to the treaty and a federal treaty cannot take away the private person's Constitutional rights.
    What Constitutional rights? A private citizen of the US has no constitutional rights vis a vis a government that is not the US to the extent they make themselves subject to such government's jurisdictions. The only rights you have in that situation are ones reached via international relations.

    Maybe you misunderstand what I said, or I am misunderstanding what you are saying, but your comment makes no sense as a response to mine.

  7. #7
    This is just dumb. If the physical location of the material in question is in the US, and the people involved are US citizens, then it should obviously fall under the protection of US law. If any country feels that what US sites display is inappropriate, then it is their responsibility to censor those sites on their end of the connection. While I disagree with censorship in principle, China is a good example of this.

    To show the ridiculous nature of this dispute, imagine for a second that instead of French nationals and Nazi memorabilia, it was one of the more fundamental Islamic states that forbids inappropriate attire on women in public and US porn sites. Are we goin to ship off all our wimmins to get stoned to death in the public square because they don't like what we choose to get off to?
    You can never know everything, and part of what you know is always wrong. Perhaps even the most important part. A portion of wisdom lies in knowing that. A portion of courage lies in going on anyways.

  8. #8
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    If yahoo has offices/capital in that country then yes, but then it wouldn't be a international issue as it would be delt with in that country. But from the sounds of it they do not, and france is trying to hammer them because of their content. Which has not broken any of our laws. Just because some french guy can surf to yahoo and break his national law yahoo should be sued? I don't think so. This is scary is the courts allow this to happen.

  9. #9
    Quote Originally Posted by Seriati
    This is all going to be settled by the terms of treaties and/or in the WTO, and I honestly have no idea what the "applicable law" between France and the US says on it.

    General rule of doing business in another country - every thing you possess in that country is completely subject to the laws and whims of that country, stuff you possess outside of that country is very difficult for them to get to.

    EXCEPT its not the same situation here.

    The companies branch that actually is based in France, and provides the French version of Yahoo does COMPLY with the French Law.

    Its the fact that French people dont bother to use their own website and go to the more popular American/English language version of Yahoo which is based in America.....which does comply with American Laws.

    The situation is being looked at improperly here----the proper analogy goes something like this: It is LEGAL for me to buy and sell marijuana in Amsterdam if I have the proper license---however if an American with a legal passport comes to Amsterdam and buys marijuana from me and then takes it back to the States.....is it legal?----The answer is NO---the French people who bought the Nazi Memorabilia should be prosecuted for traveling to a foreign countries domain and "smuggling" illegal goods back into their home country.

    As a side note, isnt Opium legal in some Middle Eastern countries(if its not no big..the point is no non-thirdworld country would call it legal to bring that crap across the border even if you have a friggen receipt for it from the shop you bought it in)

  10. #10
    Oh, I see now. We were talking past each other.

    France is free to take Yahoo's French assets (which includes the entirity of Yahoo-France) subject to French law. This is true whether or not the "violation" they are accused of is a crime under American law, they could do this even if the only "violation" of law was something entirely silly under US standards.

    France can only take Yahoo's American assets under American law.

    In both cases, as countries ruled by the rule of law, the actual law that applies to Yahoo's interactions is going to be treaty law, and rules created by multi-national organizations created by treaties. Absent treaties, it'd be whatever diplomatically the two countries involved could work out. No matter whether the court is a US court, or a French court the same "law" governing the situation should apply. And depending on whether there is some kind of full faith and credit treaty, any decisions may be directly enforceable without an option to challenge in the other country, or may be capable of being fully litigated in parallel.

    All I'm trying to say, is (i) I don't know the specific US-France rules that apply, (ii) any property of Yahoo's in France is subject to French law, and if that allows it to be seized for Yahoo -US's actions, then it can be seized, with only an appeal to diplomacy (or higher treaty law to save it), (iii) France can't change Yahoo's behavior in the US (except by extortion on its French property), and Yahoo's US assets are subject to US law (which may or may not include a treaty allowing France access to them), and (iv) absent direct knowldge of the applicable treaties there is no way to be conclusive on this.

    The more interesting question to me, is what happens if France tries to extend its judgement into other Euro countries. Presumably, French judgments have a much greater impact in European countries under treaty than they would in the US.

  11. #11
    Quote Originally Posted by Seriati
    What Constitutional rights? A private citizen of the US has no constitutional rights vis a vis a government that is not the US to the extent they make themselves subject to such government's jurisdictions. The only rights you have in that situation are ones reached via international relations.

    Maybe you misunderstand what I said, or I am misunderstanding what you are saying, but your comment makes no sense as a response to mine.
    A private person has the first amendment right to advertise items for sale in any part of the world. (assuming they do not violate our laws)
    Ineluctable modality of the visible

  12. #12
    Quote Originally Posted by Dmitry the Wizzy
    A private person has the first amendment right to advertise items for sale in any part of the world. (assuming they do not violate our laws)
    Sure can. And every soveriegn nation has the right to exercise its laws over any of those advertisements that reach within its borders. And only has the power to change things within its borders.

    Those facts can only be changed by treaty law. The Constitution protects their US assets, it's irrelevant to their French ones.

  13. #13
    Quote Originally Posted by Seriati
    Sure can. And every soveriegn nation has the right to exercise its laws over any of those advertisements that reach within its borders. And only has the power to change things within its borders.

    Those facts can only be changed by treaty law. The Constitution protects their US assets, it's irrelevant to their French ones.

    If I am wrong correct me, but I dont think you are understanding that the part of Yahoo that runs Yahoo.fr(the french version of yahoo) complies with french law---the problem here is that the french are using america's yahoo to buy things that are illegal in their own country--wich still sounds like a matter akin to smuggling in my opinion.

  14. #14
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    Quote Originally Posted by Dmitry the Wizzy
    This sort of thing scares the crap out of me. If the US gives up its sovereignty on this issue, we give up a large chunk of fundamental first amendment law.
    Yes, but do we want to turn around and see kiddie porn Web sites protected the same way by other nations?
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  15. #15
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    Quote Originally Posted by Dmitry the Wizzy
    A private person has the first amendment right to advertise items for sale in any part of the world. (assuming they do not violate our laws)
    A private citizen in another country (or extending themselves into another country) has whatever rights that country sees fit to grant them.

  16. #16
    I would have to agree with Lithiun. What is being sold on a US based web site is legal in the US. We have no control over someone from France ordering something from the US that is illegal in their country. That's a customs/legal issue in France that they have to deal with and the person who is ordering the stuff should be prosecuted.

  17. #17
    Ah, but it is often said in other venues that the only way to deal with such matters is to go after the source. So, France is bringing pressure against Yahoo.com through it's ability to levy judgements against yahoo.fr.

    It is actually shady but it is also a common means of coercing an international company to do what you wish them to do. The US certainly has done so elsewhere and I'm sure this is part of why the judges are leery of making a firm ruling on the matter. One country's fixation might be terrorism while the other's is Nazi memorabilia though. Even with France not acting on the judgement, it's a dicey situation in that they certainly seem to be threatening to do so if Yahoo stops playing nice.

  18. #18
    Quote Originally Posted by Lithiun
    If I am wrong correct me, but I dont think you are understanding that the part of Yahoo that runs Yahoo.fr(the french version of yahoo) complies with french law---the problem here is that the french are using america's yahoo to buy things that are illegal in their own country--wich still sounds like a matter akin to smuggling in my opinion.
    No, I definitely get that. I understand very well the distinction between Yahoo-France and Yahoo-US. It doesn't matter much to this argument.

    France is all powerfull inside it's terrority, except as it's agreed otherwise. The US is the same. This matter is going to be decided 100% by the "except as it's agreed otherwise" portion of law that we call treaty law.

  19. #19
    Quote Originally Posted by Ringo Flinthammer
    Yes, but do we want to turn around and see kiddie porn Web sites protected the same way by other nations?
    They already are. It's only an American displaying the image in the US by accessing the server thatis illegal.
    Ineluctable modality of the visible

  20. #20
    Shouldn't the situation be that if you agree to sell to someone in any country, then the seller should be bound by the laws of that country that is being sold to?

    To pick up the Netherlands point, it's legal to buy pot there but isn't it illegal to export it to someone outside that country?

    Tax laws for selling across borders are pretty tight, imported goods have to recieve the same tax levii and domestically sold goods. So why shouldn't imported goods be subject to the other rules of law for the country they're being sold to?

    Another example is arm embargos. Why have an embargo at all and then say that because the arms aren't illegal within the purchsing country it's ok for foreign companies to sell arms to the embargoed country, even if the country of origin placed the embargo.

    Each country has the right to say what it will sell to oither countries.
    Each country should have the right to say what can be sold to it's citizens from other countries.

    If your selling to a country, you should be bound by their laws. Anything else is irresponsible.

    Edited spelling. Gave me a headache too!
    Last edited by Taziir; March 26th, 2005 at 09:31 PM. Reason: Spelling > me

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