This past weekend (Labor Day), the wires were abuzz with excitement– in transnational litigation circles, anyway– about a Chinese court’s unprecedented enforcement of a U.S. judgment.
READ THAT SENTENCE AGAIN. Really. I’ll wait.
Yes, folks. A court in the People’s Republic of China was handed a decision from a court in the United States of America, was asked to recognize & enforce it, and responded… um, okay. Yeah, sure. Pay up, defendants.
You would have thought the world turned upside down.
The scoop came from Dr. Jie (Jeanne) Huang, Senior Lecturer in Chinese International Business & Economic Law at the University of New South Wales on Sunday. Transnational litigation nerds like me went berserk. [Update, 6/21/18: A more thorough analysis of the decision can be found here.]
Holy enforcement of judgments, Batman! We’re going to win! FINALLY, THE SUN IS COMING OUT!
Whoa there. Not so fast, says Dan Harris. For the record, Dan is my go-to guy on all things Chinese. If somebody tells me turn left down a street in Beijing and Dan says to go right, I’m going right. Well, his blog yesterday afternoon is a must-read for anybody who, like me, saw a glimmer, a sparkle, that would open the skies and lead to a deep, dark Coppertone tan. It ain’t the bright ray of sunshine that we’re all hoping for. It’s a lot like that seems-to-be-on-all-fours case you find on Westlaw that makes your heart skip a beat… until you Shepardize it and realize it’s so fact-specific that it has no possible bearing on the argument you’re scraping together.
I would paraphrase Dan’s post, or try to distill it down to something soundbytey (yes, I made up that word).* That would not even scratch the surface, so allow me to direct your attention to China Enforces United States Judgment: This Changes Pretty Much Nothing in its entirety. Put another way…
* Soundbytey. Adj. Of or related to a soundbyte, a quip or quote that is easily cited by lazy journalists for simplification and understanding by the masses.
UPDATE: Ted Folkman takes a more optimistic, though cautious, view, in this morning’s Letters Blogatory. Ted sees that glimmer of hope, but also cautions that “it’s probably too soon to change strategies when doing business with Chinese firms or nationals.” He’s certainly right there. An important takeaway from today’s LB post looks at the apparent inapplicability of the Hague Service Convention to the case; perhaps the Chinese are willing to defer to the law of the forum with regard to service.
ANOTHER UPDATE, FIVE YEARS ON: The China Justice Observer observes that there have now been three (three!) U.S. judgments recognized and enforced by Chinese courts, and concludes that it’s a done deal. Bring your judgments to China, the publication seems to exclaim, and you will be made whole! But they conveniently leave out the case numbers and names of the parties. As in the 2017 case I mention above, it seems that China is all too happy to enforce U.S. judgments between Chinese parties, and where the award money doesn’t have to leave China. Public policy looms large over these matters, and the PRC is dead-set against letting cash out of the country. Take it all with a grain of salt.