Sorry for the Inconvenience: Can Anti-Trust Actions Be Dismissed Using Forum Non Conveniens?

Photo by Sasun Bughdaryan on Unsplash

Margot Tierney, Associate Member, University of Cincinnati Law Review

I. Introduction

The effects of globalization can be felt in nearly all aspects of life and in almost every profession, including the legal field. One area of the law where globalization plays a prominent role is in the doctrine of “forum non conveniens,” a legal doctrine which allows courts to dismiss cases on the grounds that another court can better deliberate the case.[1] International corporations often attempt to bring anti-trust actions in the United States due to the U.S.’s favorable anti-trust laws; however, many times these cases are dismissed on the basis of forum non conveniens.[2] This phenomenon of foreign corporations seeking arbitration in American courts coupled with different reading of anti-trust laws’ venue provisions has led to a federal circuit split on whether a court can dismiss an anti-trust action on forum non conveniens grounds.

The Fifth Circuit first held in 1982, and continues to hold, that a court cannot dismiss an anti-trust case on forum non conveniens grounds, while the First, Second, and Sixth Circuits hold that a court can dismiss an anti-trust action based on forum non conveniens.[3] The approach adopted by the First, Second and Sixth Circuits is the more persuasive method for analyzing this issue because it promotes judicial efficiency, encourages fair and accurate arbitration, and fights against forum shopping. Therefore, the Fifth Circuit, the remaining undecided circuits, as well as the Supreme Court should adopt the majority split’s approach to better ensure fairness and justice within the judicial system.

II. Background

A. Forum Non Conveniens

In order for a case to be heard by a specific court or within a specific jurisdiction, certain criteria must be satisfied. There are three components of a jurisdictional question that need to be met for a court to have jurisdiction over a case: (1) whether there is personal jurisdiction; (2) whether there is proper subject matter jurisdiction; and (3) whether there is jurisdiction to render the particular judgment sought.[4] However, while a plaintiff is deemed the “master of his complaint”[5] and, thus, is given great discretion to bring their case in any venue where these jurisdictional requirements are met, they are still not guaranteed that the case will be heard before that court.[6]

Forum Non Conveniens (FNC), or “unfitting forum,” is a doctrine which can be invoked either by the defendant or the court itself to move a case outside of the original jurisdiction.[7] Derived originally from Scottish common law,[8] FNC was first recognized by the U.S. Supreme Court in 1933.[9] Under this doctrine, a court may use its discretion to dismiss a case over which it has proper jurisdiction because another court or jurisdiction is in a better position to hear and deliberate the case.[10] In deciding whether to dismiss a case on FNC grounds, a court must weigh a plaintiff’s interest in having the case heard in their choice of proper jurisdiction versus any inconvenience the defendant would face in deliberating the case in that forum. Thus, FNC is often brought by the defendant as a counter to a plaintiff’s attempt to “forum shop,” or to choose a court in which the plaintiff believes he or she will have a successful outcome.[11]

Additionally, the Supreme Court held in Piper Aircraft Co. v. Reyno that a plaintiff may not overcome a defendant’s motion to dismiss a case on FNC grounds by simply making a showing to the court that the laws to be applied in the alternative forum are less favorable towards the plaintiff.[12] Both public factors, such as limiting the court’s docket and the availability of a jury, and private factors, such as access to proper evidence and availability of witnesses, are contemplated in an FNC deliberation.[13] However, this doctrine is flexible and it may take into account numerous other considerations related to fairness and convenience in determining whether or not a court will hear the case.[14] Given the flexibility in weighing different factors for the parties, there is a fair amount of deference allotted to the court in deciding whether or not to accept a motion for FNC and dismiss a case on those grounds.[15]

B. The Sherman Act and Antitrust Laws

In 1890 Congress instituted the Sherman Antitrust Act in an effort to “preserve free and unfettered competition as the rule of trade.”[16] Since then, Congress has passed numerous anti-trust laws such as the Federal Trade Commission Act and the Clayton Act, which work in tandem with the Sherman Antitrust Act to encourage competition in the business world and to discourage monopolistic behavior of businesses.[17] The Sherman Antitrust Act forbids “every contract, combination, or conspiracy in restraint of trade,” as well as “monopolization, attempted monopolization, or conspiracy or combination to monopolize.”[18] However, this does not mean that every attempt by a business to restrict trade is prohibited; only unreasonable attempts to restrain trade and the free market are illegal.[19] The Federal Trade Commission Act, on the other hand, focuses on unfair competition and forbids “unfair methods of competitions” and “unfair or deceptive acts or practices.”[20] Finally, the Clayton Act addresses practices and issues that the Sherman Act does not specifically address, including mergers and acquisitions of similar companies which may result in the creation of a monopoly.[21] The Clayton Act also monitors dealings between merchants to ensure that these dealings are fair and non-discriminatory.[22] These acts contain special venue provisions which give plaintiffs broad discretion in choosing where to bring their anti-trust claims. These claims can essentially be brought in any jurisdiction where the effects of the anti-competitive actions can be felt.[23]

C. Circuit Split: Can an Anti-Trust Action Be Dismissed on FNC Grounds?

Because the Supreme Court has yet to address the question of whether a court can dismiss an anti-trust case on forum non conveniens grounds, federal circuit courts have been left to decide the issue for themselves. At the end of 2021, the Sixth Circuit Court of Appeals joined the First and Second circuits in saying that an anti-trust action can be dismissed on FNC grounds, while the Fifth Circuit currently stands alone in holding that an anti-trust action cannot be dismissed on FNC grounds.

i. Precedent: Anti-Trust Actions Cannot Be Dismissed on FNC Grounds

The first time a federal circuit court heard and ruled on the question of whether anti-trust action can be dismissed on FNC grounds occurred in the Fifth Circuit with the 1982 case, Industrial Investment Development Corp. v. Mitsui & Co.[24] In this case, Industrial Investment Development Corporation, an American company with two Hong Kong subsidiaries, sued Mitsui and Company, a Japanese company, and its American subsidiary.[25] The plaintiff alleged that the defendant conspired to keep the plaintiff and its subsidiaries out of the business of harvesting trees and exporting lumber to the United States as well as other countries.[26] The Fifth Circuit held that the dismissal on FNC grounds was not appropriate for two reasons. First, the court read the venue provision of the Clayton Act to preclude a federal court from dismissing an anti-trust action on FNC grounds.[27] This court read the venue provision of the Clayton act broadly and reasoned that the provision (1) was put in place for the plaintiffs’ convenience, so dismissing on FNC grounds would diminish the benefit that the venue provision was supposed to provide to a plaintiff; and (2) did not permit FNC claims because they would ultimately lead to a longer litigation process and would be difficult to apply in anti-trust cases.[28]

Second, citing the principle of international law that no country shall execute the penal laws of another,[29] the court here found that the protections provided by foreign courts could reach beyond what was intended by American anti-trust laws.[30] Thus, the Fifth Circuit held it was improper to apply FNC to anti-trust actions because allowing a foreign venue to deliberate the action could potentially lead to a finding of anticompetitive violations beyond the scope of anti-trust acts.[31] Therefore, relying on the venue provision of the Clayton Act and on the notion that foreign venues may not properly deliberate anti-trust actions based in American law, the Fifth Circuit held that anti-trust actions cannot be dismissed on FNC grounds.[32]

ii. Precedent: Anti-Trust Actions Can Be Dismissed on FNC Grounds

Nine years after the Fifth Circuit’s decision in Industrial Investment, the First Circuit was presented with a case raising the same question.[33] However, the First Circuit found that a defendant was not automatically barred from bringing an FNC claim simply because the underlying action is an anti-trust claim.[34] In Howe v. Goldcorp Investment, Ltd., the plaintiff, Reginald Howe, was a shareholder of Goldcorp.[35] He sued Goldcorp’s officers, all of whom were Canadian, for violating securities statutes with regard to failing to disclose their intentions, plans, and objective to take over two other Canadian companies.[36] The defendants moved to dismiss the case on FNC grounds, and the First Circuit found this dismissal to be proper.[37] Unlike the Fifth Circuit, the First Circuit read the special venue provision in the Securities Act of 1934 to not prohibit an FNC dismissal because it states a case may be heard in any jurisdiction where a securities violation may have occurred.[38] Since many of the activities in question were performed in Canada by the Canadian directors of a Canadian company, and since most of the relevant evidence and witnesses were located in Canada, it would have been more appropriate for a Canadian court to hear this case.[39] Thus, the First Circuit granted the defendants FNC motion and held that anti-trust actions may be dismissed on FNC grounds if a foreign venue is deemed more proper.[40]

Then in 1998, the Second Circuit Court of Appeals heard the case Capital Currency Exchange v. National Westminster Bank PLC and joined the First Circuit in the circuit split.[41] In this case, a Dutch company, with a New York based affiliate, sued two British Banks along with their officers and directors under the Sherman Act, contending that the British Banks were conspiring to deny it proper banking services.[42] However, in weighing the considerations of both the defendants and the plaintiffs, the Second Circuit upheld the dismissal on FNC grounds.[43] Similar to the First Circuit’s approach, the Second Circuit weighed public and private considerations.[44] While the court found most of the considered elements to be neutral toward both an American forum and British forum, the court ultimately held that England would be the more appropriate forum.[45] The court recognized that essentially all of the crucial witnesses for  proving the plaintiffs’ claims were located in England and that these witnesses were “not subject to the compulsory process in the United States.”[46] Therefore, the Second Circuit held that this factor was sufficient to dismiss the anti-trust case on FNC grounds.[47]

Finally, the Sixth Circuit joined this side of the circuit split at the end of 2021 in Prevent USA Corp. v. Volkswagen AG.[48] In this case, two European companies, both with American subsidiaries, that work closely with one another mutually alleged anti-trust violations by the other.[49] Using its American subsidiaries, Prevent USA brought a case against Volkswagen USA in federal court claiming it violated the Sherman Act.[50] Volkswagen then moved to dismiss the case on FNC grounds, claiming that the case should resume in Germany.[51] The Sixth Circuit held that FNC dismissal was proper since the factors favoring dismissal outweighed those which would favor the case remaining in the United States.[52] The court noted that the American courts would not have proper access to witnesses and evidence needed to properly deliberate the case, and the court also determined that Germany would be a better forum than the United States because German jurisdictions and laws would cover more anti-trust actions than the American courts.[53] Therefore, the Sixth Circuit held that an anti-trust case can be dismissed on FNC grounds, following the footsteps of the First and the Second circuits.[54]

III. Discussion

While both sides of the circuit split make convincing arguments, the proposition that anti-trust actions can be dismissed on FNC grounds is more appealing and can be better applied in a modern legal environment. By allowing FNC claims in anti-trust cases, various aims of the American legal system are satisfied: efficiency, fairness and justice, and fighting forum shopping.

A. Efficiency

One of the foremost concerns of the American judicial system is the desire for efficiency.[55] Various mechanisms have been implemented in order to achieve judicial efficiency, and FNC is one of such doctrines that aids the courts in achieving this goal.[56] The courts often find themselves in a position where they have more cases on their dockets than they are capable of hearing. When a case is dismissed on FNC grounds and removed to another court, or another country entirely, the courts, as well as the parties involved, do not have to spend an overwhelming amount time and judicial resources acquiring witnesses, evidence, etc. from another jurisdiction.[57] Rather than spending time and resources on hearing the case, the court can focus its attention on more pressing matters relevant to its jurisdiction. Although time and resources still need to be dedicated to these close-to-home cases, these cases can be heard more quickly due to the closeness of relevant witnesses and evidence. Therefore, allowing FNC claims to be heard in anti-trust actions leads to efficiency in the judicial system.

B. Ability to Fairly and Justly Arbitrate

As exemplified by precedent, many of these anti-trust cases have been brought in American courts by non-American corporations.[58] The activity that gives rise to these cases typically takes place outside of the United States which may lead to a myriad of issues. The witnesses to the events and the evidence are often located in a foreign jurisdiction; retrieving these witnesses and evidence may be increasingly difficult or almost impossible in some cases. Additionally, even if the witnesses and evidence were to be exported to the United States, there may be difficulty in translating documents from the native language to English. There may be difficulty in understanding the testimony and statements given by foreign witnesses due to language barriers. Further, questions about foreign business practices and customs often come into play when deliberating a case with events that took place in a foreign country. When American courts are put in a position where they must apply American laws to foreign businesses and their practices, this may lead to complications and, potentially, an unjust outcome. Thus, when a court can dismiss an anti-trust case on FNC grounds to a jurisdiction that has the proper tools to better understand the evidence, the witnesses, and the laws, the court should do so.

C. A Way to Fight Forum Shopping

Forum shopping occurs when multiple courts have jurisdiction over a plaintiff’s claim, so the plaintiff can pick which jurisdiction he or she believes would view his or her claims in the best light.[59] This practice is often viewed as controversial and even unethical in certain situations. Foreign plaintiffs, as seen in the described cases, often bring anti-trust suits in the United States to avail themselves to America’s advantageous anti-trust laws.[60] American anti-trust laws often lead to more favorable outcomes for plaintiffs claiming the defendants’ business practices are unfair.[61] If unable to dismiss the case on FNC grounds, these defendants would be required to fight a case in the United States when the dispute in question is more closely linked to another nation that could be thousands of miles away. This would require the defendant to spend an excessive amount time, money, and other resources in order to defend itself in a venue that is inappropriate. In the case of defendants who simply do not have a surplus of time, money, and resources, having to litigate a full case in the United States might not be a plausible option for them. This could lead to a default being issued against them if they were unable to get the case dismissed on FNC grounds. In contrast, if an anti-trust case can be dismissed on FNC grounds, then the defendant would in theory only have to expend the effort of appearing internationally in the early stages of litigation, before international witnesses, or other costly complications enter the process. However, by allowing anti-trust cases to be dismissed on FNC grounds, the potential injustices that accompany forum shopping can be avoided.

IV. Conclusion

The Supreme Court has yet to issue a ruling on the question of whether an anti-trust case can be dismissed on forum non conveniens grounds. The majority of federal circuit courts hold that such cases can be dismissed by using the doctrine of FNC. This approach is more favorable to foreign defendants as well as to the American judicial system as a whole. It values the efficiency of the American judicial system by allowing cases to be removed to a different and more appropriate venue; it values fairness but often delegating the case to the jurisdiction where the cause of action occurred as well as where the evidence and witnesses are likely located; and it values the defendant’s ability to have a fair hearing. Therefore, the approach adopted by the majority split better fosters fairness and justice and should be adopted by the Supreme Court should the question be presented to it.  


[1] Edward L. Barrett, Jr., The Doctrine of Forum Non-Conveniens, 35 Calif. L. Rev. 380, 386-87 (1947).

[2] Donald Earl Childress III, Escaping Federal Law in Transactional Cases: The Brave New World of Transactional Litigation, 93 N.C. L. Rev. 995 (2015).

[3] Industrial Inv. Dev. Corp. v. Mitsui & Co. 671 F.2d 876 (5th Cir. 1982); Howe v. Goldcorp Invest., Ltd. 946 F.2d 944 (1st Cir. 1991); Capital Currency Exch. v. National Westminster Bank PLC, 155 F.3d 603 (2nd Cir. 1998); Prevent USA Corp. v. Volkswagen AG, No. 21-1379, 2021 U.S. App. LEXIS 33234, at *2 (6th Cir. Nov. 8, 2021).

[4] Susan Gilles & Angela Upchurch, Finding a “Home” for Unincorporated Entities Post-Daimler AG v. Bauman, 20 Nev. L. J. 693, 696 (2020). 

[5] Caterpillar v. Williams, 482 U.S. 386 (1987).

[6] See Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 507 (1947).

[7] Barrett, supra note 1, at 388.

[8] Paxton Blair, The Doctrine of Forum Non Conveniens in Anglo-American Law, 29 Col. Law Rev. 1, 20 (1929).

[9] Rogers v. Guar. Tr. Co., 288 U.S. 123, 151 (1933) (Cardozo, J. dissenting).

[10] Gilbert, 330 U.S. at 507.

[11] Christopher A. Whytock, The Evolving Forum Shopping System, 96 Cornell L. Rev. 481, 485 (2011).

[12] Piper Aircraft Co. v. Reyno, 454 U.S. 235, 260 (1981).

[13] Gilbert, 330 U.S. at 508-09.

[14] Piper Aircraft, 454 U.S. at 259.

[15] Id. at 257.

[16] Fed. Trade Comm’n., The Antitrust Laws, https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/antitrust-laws (last visited Feb. 2, 20220).

[17] Id.

[18]  The Sherman Antitrust Act, 15 U.S.C. §§ 1-7.

[19] Id.

[20] Federal Trade Commission Act, 15 U.S.C. §§ 41-58.

[21] The Clayton Act, 15 U.S.C. §§ 12-27.

[22] Fed. Trade Comm’n, supra note 16.

[23] See e.g., 15 U.S.C. § 22 (“any suit, action, proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found.”).

[24] Mitsui & Co. 671 F.2d at 891.

[25] Id. at 881.

[26] Id.

[27] Id. at 890.

[28] Id.

[29] The Antelope, 23 U.S. 66, 123 (1825).

[30] Mitsui & Co., 671 F.2d at 891.

[31] Id.

[32] Id.

[33] Howe, 946 F.2d at 955.

[34] Id.

[35] Id. at 945.

[36] Id.

[37] Id. at 955.

[38] Id. at 948.

[39] Id. at 951.

[40] Id. at 953.

[41] Capital Currency Exch., 155 F.3d at 612.

[42] Id. at 605.

[43] Id. at 606.

[44] Id. at 611.

[45] Id. at 611-12.

[46] Id. at 611.

[47] Id. at 612.

[48] Prevent USA Corp. v. Volkswagen AG, No. 21-1379, 2021 U.S. App. LEXIS 33234, at *2 (6th Cir. Nov. 8, 2021).

[49] Id.

[50] Id. at 4.

[51] Id.

[52] Id. at 5-7.

[53] Id. at 6.

[54] Id. at 23-24.

[55] Fed. R. Civ. P 1.

[56] Blair, supra note 8, at 20-30.

[57] Gary B. Born & Peter B. Rutledge, International Civil Litigation in United States Courts 369-70 (6th ed. 2018).

[58] Childress III, supra note 2.

[59] Whytock, supra note 11, at 485.

[60] Thomas Köster & H. Harrison Wheeler, Appellate Courts Split on the Interpretation of the Foreign Trade Antitrust Improvements Act: Should the Floodgates be Opened?, 14 Ind. Int’l & Comp. L. Rev. 717, 717-18 (2004).

[61] Id.