Welcome to the second edition of our newsletter featuring US disputes-related legal developments affecting Asia Pacific interests.  For more informaiton, please contact Thomas Riley or Allison Alcasabas of the New York office.

International Arbitration / International Litigation

January

  • Airline passenger plaintiffs asked the U.S. Court of Appeals for the Ninth Circuit to approve a US$39.5 million settlement with several Asia-based airlines arising out of a multidistrict litigation relating to alleged price-fixing. The plaintiffs urged the Ninth Circuit to dismiss the claims of a lone dissenter, who argued that the settlement inappropriately treated all class members the same, even though the class members' claims had vastly different litigation value.  
  • Tang Energy Group Ltd. asked a Texas federal court to confirm a US$70 million international arbitral award against the U.S. arm of the Aviation Industry Corp. of China (AICC), in a dispute involving a joint wind energy investment. In the arbitration, Tang successfully argued that AICC had competed with the joint venture entity in breach of the joint venture agreement.  
  • The U.S. Attorney's Office for the Eastern District of Pennsylvania charged five people, including two Chinese national scientists, with conspiracy to steal data relating to an in-development cancer drug from a GlaxoSmithKline research facility, with intent to sell that data in China.  
  • In Iowa federal court, a Chinese business owner pleaded guilty to conspiracy to steal intellectual property and trade secrets from U.S.-based seed manufacturers, DuPont Pioneer and Monsanto Co., for the benefit of his own China-based seed company.  
  • The U.S. Court of Appeals for the Second Circuit dismissed an investor fraud suit brought against a Chinese subsidiary of Ernst & Young, which alleged that the auditor's fraud was responsible for a Beijing oil driller's failed initial public offering. The Court held that the auditor's assessment of the company, while flawed, did not meet the threshold for proving fraudulent intent.

February

  • A California federal court dismissed a consumer class action brought against Iams Co. and its parent company, Mars Inc., on the basis that the companies were not required, under California's Consumer Legal Remedies Act and Unfair Competition Law, to disclose the nature of their labor practices on food product labels. The proposed class action had alleged that Iams and Mars did not disclose that they allegedly used forced labor in Thailand to catch fish used in Iams' cat food products.  
  • The U.S. Court of Appeals for the Federal Circuit affirmed a US$3 million award requiring a Taiwan-based maker of computer parts and its American counterpart to pay damages for infringing a patent relating to predictive snooping technology.  
  • PTC Inc., a Massachusetts-based software company, agreed to pay US$14.5 million in fines and US$13.6 million in disgorgement of profits, plus interest, to settle a claim brought by the US Government alleging that two of PTC's Chinese subsidiaries had bribed Chinese officials with vacations in the United States in order to win contracts with Chinese state-owned entities, in violation of the Foreign Corrupt Practices Act.  
  • In response to a claim brought by the United Steelworkers Union, the U.S. Department of Commerce agreed to investigate the importation of Chinese tires into the United States. The Union argued that illegally subsidized Chinese tires had been sold in the United States at unfairly low prices.  
  • The U.S. Court of Appeals for the Second Circuit reversed the dismissal of a Korean technology firm's fraud claim against a global bank. The appellate court found that the global bank could be sued in New York, even though the deals in question had been made through its Korean entity, finding that the pleadings sufficiently alleged an agency theory of fraud.

March

  • The family members of passengers on board the Malaysia Airlines Flight MH370, which disappeared while en route to China in March 2014, have sued Boeing Co. in Illinois state court. The claimants contended that defects in the Boeing 777 jetliner led to the crash.  
  • The U.S. District Court for the Second Circuit declined to revive an investor class action against a Chinese oil and gas company, alleging that the company concealed a widespread corruption scheme.  
  • A Chinese national who owns a Chinese aviation company pleaded guilty in California federal court to trying to hack into computers belonging to Boeing Co. and other U.S. companies in an attempt to steal military data and send it to China.  
  • A California federal jury ordered Enplas Display Device Corp. to pay over US$4 million in a patent infringement suit brought by Seoul Semiconductor Co. Ltd. The patents concerned the backlighting of LCD television displays. The jury found that the patents were valid and that Enplas willfully induced infringement of them. 

U.S. Regulation

  • The U.S. Food and Drug Administration released final rules for implementing the Food Safety Modernization Act to help produce farmers and food importers prevent food safety problems before they occur. Among other things, the final rules include science-based minimum standards for the safe growing, harvesting, packing and holding of fruits and vegetables for human consumption; requirements for food importers to verify that food imported into the U.S. is produced in a manner that meets applicable U.S. safety standards; and a voluntary program for the accreditation of third-party certification bodies, which conduct food-safety audits and issue certifications for foreign facilities and the foods they produce for humans and animals.  
  • Congress repealed the country-of-origin labeling rule ("COOL") for beef and pork products. This rule had previously required packaging to identify the country or countries where the meat animal was born, raised, and slaughtered. The decision to repeal COOL was a response to the World Trade Organization's recent ruling that such labels discriminated against meat raised and slaughtered outside of the United States.  
  • The Consumer Product Safety Commission introduced a "regulatory robot," a web-based tool to help manufacturers and small businesses to identify the various rules and regulations that may apply to their products. Users enter information about a particular product (e.g., the product type, the age grade for the product, and whether it contains any hazardous substances) and the robot will briefly outline the rules and regulations that may apply to that product.