Sheron Korpus Comments on Second Circuit Vitamin C Antitrust Comity Ruling

On September 20, 2016, the Second Circuit vacated a $147 million district court judgment against Chinese companies Hebei Welcome Pharmaceutical Co. Ltd. and North China Pharmaceutical Group Corp. for violating U.S. antitrust law by participating in an illegal cartel to fix the price and limit the supply of vitamin C for export. In its appeal, the Ministry of Commerce of the People's Republic of China (MOFCOM), a Chinese agency tasked with regulating antitrust law, argued that the companies were required to comply with the price-fixing regime under Chinese law and should not be penalized under U.S. law. The Second Circuit agreed with MOFCOM, ruling that the U.S. courts are bound to grant deference to a foreign government’s interpretation of its own laws, and that the lower court abused its discretion by asserting its jurisdiction in the case.

Kasowitz partner Sheron Korpus was quoted on the case in Law360’s “2nd Circ. Vitamin C Ruling A Landmark For Comity,” noting that “[n]otwithstanding that the case proceeded all the way to trial and verdict, the court’s decision was a reversal of the motion to dismiss, thereby rendering moot over 10 years of litigation that followed.”

The case is Animal Science Products Inc. et al. v. HeBei Welcome Pharmaceuticals Co. Ltd. et al.

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