United States: Recent Developments In The Extra Territorial Application Of The U.S. Antitrust Laws

I. INTRODUCTION

Many Japanese companies and executives have experienced the nightmare of criminal and civil legal proceedings in the United States arising from allegations that they violated U.S. antitrust law—the Sherman Act1—by participating in a price-fixing conspiracy. This includes, for example, a long-running group of cases in California involving electronics components such as dynamic random-access memory (DRAM), static random-access memory (SRAM), liquid crystal displays (LCD), cathode ray tubes (CRT), optical disc drives (ODD), lithium ion batteries, and capacitors. It also includes the many cases in Michigan involving automobile parts. These, and other cases, have resulted in criminal investigations in which Japanese companies have been compelled to pay fines to the U.S. government, and executives have been forced to serve prison sentences in the United States. In addition, Japanese companies have faced years of civil lawsuits and paid billions of U.S. dollars in settlements and legal fees to resolve private damages actions.

In light of these substantial potential liabilities, it is critical that Japanese companies and executives understand the extent to which the Sherman Act can be applied to conduct that takes place outside the United States, but has effects in the United States. The extraterritorial reach of the Sherman Act is limited by the Foreign Trade Antitrust Improvements Act (FTAIA),2 which Congress passed in 1982. Since then, different appellate courts have applied the FTAIA in different ways. In 2014, long-awaited decisions from three different appellate courts addressed how the FTAIA limits application of the Sherman Act to non-U.S. conduct. Unfortunately, the decisions are not entirely consistent. This article attempts to provide some guidance by providing an overview of the Sherman Act and the FTAIA, giving a brief history of how courts have applied the FTAIA, analyzing the decisions issued in 2014 (one of which was significantly amended in January 2015), and offering some suggestions to reduce the risk of becoming ensnared in legal proceedings in the United States alleging violations of the Sherman Act.

II. THE SHERMAN ACT

Section 1 of the Sherman Act provides that, "[e]very contract, combination . . . , or conspiracy, in restraint of trade or commerce among the several states, or with foreign nations, is declared to be illegal."3 "The Sherman Act was designed to be a comprehensive charter of economic liberty aimed at preserving free and unfettered competition as the rule of trade. . . . . the policy unequivocally laid down by the Act is competition."4 Applied literally, the Sherman Act's language could be construed to prohibit every contract that regulates trade or commerce,5 but the U.S. Supreme Court has made clear that Section 1 is limited to conduct that restricts competition unreasonably.6

The Sherman Act does not treat all agreements that restrain trade in the same manner. Some agreements that restrain trade can also promote competition, so they are subject to the "rule of reason," which considers the procompetitive and anticompetitive effects of the conduct at issue. This is the usual framework for analysis under Section 1 of the Sherman Act.7

However, some agreements are considered to be so harmful to competition and unjustifiable that they are considered per se illegal—that is, the agreements automatically are considered to be a violation of the Sherman Act, with very few defenses available.8 Conduct that falls into this category includes agreements among competitors to fix prices, to limit output or production, to divide markets (for example, by geography or customer), or to fix bids for an opportunity, project or asset.9 These activities are the most serious violations of the Sherman Act, draw the most scrutiny from U.S. enforcement agencies, are most likely to result in criminal prosecution, and pose the greatest risk in private damages actions.10

The penalties for violating the Sherman Act can be severe. A company that is criminally convicted of violating the Sherman Act may be punished by a fine not exceeding $100 million and a person can be fined up to $1 million.11 The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.12 For example, in the LCD price-fixing case AU Optronics was fined $500 million. A person who is convicted also may be punished by imprisonment not exceeding ten years for each count of conviction.13

The primary U.S. enforcement agency for price-fixing violations, especially in cases involving foreign companies, is the Department of Justice (DOJ). Prosecuting companies and individuals that engage in price fixing is among the DOJ's highest priorities. In recent years the DOJ has obtained prison sentences averaging 25 months, and in each of 2012 and 2013 it recovered more than $1 billion in fines in price-fixing investigations.14 Currently, the DOJ's most active cases involve the auto parts industry. As of January 2015, 33 companies—some of them Japanese—had pleaded guilty or agreed to plead guilty and had agreed to pay a total of more than $2.4 billion in fines, and 50 individuals—again, some of them Japanese— have been criminally charged.15

Prosecution by the DOJ is only one area of concern. The other area is private damages actions brought by consumers (or companies) harmed by purchasing price-fixed products. The nature of class action litigation in the United States is well known: an individual consumer (or company) who alleges he purchased a price-fixed product in many cases can bring a lawsuit on behalf of all consumers (or companies) who also bought that product.16 In addition, in the past ten years there has been an increasing trend of companies who purchased price-fixed products to file their own lawsuits.

In lawsuits brought by private parties, damages generally are trebled and each party that engaged in the unlawful conduct is fully liable for all of the damages caused by the conduct, even damages flowing from the sales of co-conspirators.17 For example, assume five companies agree to fix prices for a product and the overall harm to purchasers of the product is $100 million. That amount would be trebled to $300 million, and each company would be potentially liable for the full $300 million regardless of its size. Accordingly, if the smallest of the five companies received only $5 million of the $100 million, it still would be liable for the full $300 million, although it would receive credits toward the $300 million for amounts the other defendants pay in settlements.

Damages in private actions can be staggering. In the liquid crystal display (LCD) price-fixing case, the consumer class action plaintiffs obtained a total settlement of $1.1 billion, and the business class action plaintiffs obtained a settlement of $473 million. Many large companies opted out of those settlements and obtained their own settlements totaling hundreds of millions of dollars.

The possibility of prison sentences and the tremendous potential financial liability for violating the Sherman Act prompt two questions. First, why does the Sherman Act apply to the conduct of companies and executives in Japan? The answer is that the United States seeks to protect its businesses and citizens from violations of the Sherman Act that have effects in the United States regardless of where the conduct took place. Second, are there any limits to the application of the Sherman Act to conduct that takes place outside the United States? The answer to that question is "yes," and it is found in both court decisions and the FTAIA. Direct sales into the United States present the clearest cases for potential liability. But if products arrive in the United States indirectly, to prove a Sherman Act claim a U.S. plaintiff must demonstrate that the non-U.S. conduct had an effect in the United States and that the plaintiff's Sherman Act claim arises from that effect. The problem is that courts have issued inconsistent decisions in interpreting and applying the FTAIA, as explained below.

III. THE APPLICATION OF THE SHERMAN ACT TO NON-U.S. CONDUCT

A. Application of the Sherman Act to Non-U.S. Conduct Prior to the FTAIA

Prior to the FTAIA's enactment in 1982, the application of U.S. antitrust law to non-U.S. conduct was guided by court decisions. The U.S. Supreme Court first addressed the extraterritorial reach of the Sherman Act in 1909 in American Banana Co. v. United Fruit Co., where the alleged anticompetitive conduct took place in Costa Rica.18 The Supreme Court said that it was a "startling proposition" that the Sherman Act would apply to conduct outside the United States.19 The Court declined to find a Sherman Act violation, explaining that "the general and almost universal rule is that the character of an act as lawful or unlawful must be determined wholly by the law of the country where the act is done."20 Two years later, however, the Supreme Court stepped back from this approach of strict territoriality. In United States v. American Tobacco Co., the Court held that a U.S. court had jurisdiction over a Sherman Act claim based on market-division contracts executed in England.21 Subsequent court decisions further eroded American Banana, paving the way for the Second Circuit's decision in United States v. Aluminum Co. of America ("Alcoa").22

In Alcoa, the Second Circuit was the court of last resort because the Supreme Court did not have enough justices who could hear the case. The Second Circuit rejected the strict territorial approach in American Banana and established the "effects test" for determining whether foreign conduct gave rise to a Sherman Act claim in the United States. The U.S. government had brought a civil action against the defendant, a U.S. aluminum manufacturer, which had a Canadian subsidiary that had participated in a cartel with several European companies to limit the supply of aluminum into the United States. The court recognized the need to consider "limitations customarily observed by nations upon the exercise of their powers; limitations which generally correspond to those fixed by the 'Conflict of Laws.'"23 However, the court also stated that "any state may impose liabilities, even upon persons not within its allegiance, for conduct outside its borders that has consequences within its borders . . . ."24 Thus, the agreements "were unlawful, though made abroad, if they were intended to affect imports and did affect them."25 This gave birth to the "effects test," which required that, in order for the Sherman Act to apply to foreign conduct, the conduct must have a direct and intended effect in the United States.

After Alcoa, courts developed different tests for determining the magnitude and type of direct, intended effect necessary to trigger the Sherman Act for conduct outside the United States. For example, the Second Circuit found that a "foreseeable and appreciable" domestic effect was necessary,26 while the Third and Ninth Circuits implemented balancing tests weighing international comity concerns with the degree and significance of harm to U.S. commerce.27

B. The FTAIA

This led the United States to adopt the FTAIA in 1982 to limit the circumstances in which the Sherman Act can be applied to foreign conduct. The language of the statute is very complicated even in English, so lawyers and judges usually use the U.S. Supreme Court's explanation of the statute in its seminal FTAIA decision, F. Hoffman-LaRoche Ltd. v. Empagran, S.A. ("Empagran").28 The Supreme Court explained that the FTAIA limits the reach of the Sherman Act, but first excludes from the FTAIA's coverage conduct involving U.S. import trade or commerce (the "import commerce exclusion").29 In other words, conduct that involves U.S. import trade or commerce (in other words, a non-U.S. company's direct imports into the United States) is subject to the Sherman Act.30 For conduct that does not involve U.S. import trade or commerce, the FTAIA provides that the Sherman Act does not apply unless the conduct satisfies both parts of what is known as the FTAIA's "domestic effects exception": (1) the foreign conduct must have a "direct, substantial and reasonably foreseeable effect" on U.S. domestic or import commerce, and (2) that effect must "give rise to a [Sherman Act] claim."31 Both parts of this test must be satisfied for non-U.S. conduct to be subject to the Sherman Act.

Although the FTAIA's "domestic effects exception" was intended to clarify the extraterritorial application of the Sherman Act, how it could be satisfied remained unclear. In 1992, ten years after the FTAIA was passed, the Supreme Court said that "it is well established by now that the Sherman Act applies to foreign conduct that was meant to and did in fact produce some substantial effect in the United States," but it was "unclear whether the [FTAIA]'s 'direct, substantial, and reasonably foreseeable effect' standard amends existing law or merely codifies it."32 The Court determined that it did not need address the scope of the FTAIA in that case, but it did so twelve years later in Empagran.

Empagran involved a global vitamins price-fixing conspiracy. Plaintiffs were five foreign vitamin distributors outside the United States that purchased vitamins for delivery outside the United States. They asserted Sherman Act claims and the defendants asserted the FTAIA as a defense. The Supreme Court found that the FTAIA's "domestic effects exception" did not apply because the plaintiffs' claims "rest[ed] solely on [an] independent foreign harm."33 To satisfy the FTAIA and bring a Sherman Act claim, the foreign plaintiffs' claims had to be based on an effect felt in the United States. The Court specifically rejected the plaintiff's argument that the second part of the FTAIA's test—the "gives rise to a claim" test—meant that a foreign purchaser could sue in the United States as long as the conduct gave rise to another party's claim in the U.S.34

The Court relied heavily on principles of international comity in its decision, noting that applying U.S. treble damages remedies to foreign conduct would undermine the judicial systems of these nations and encourage forum shopping. This analysis was informed by a brief that Japan's Ministry of Economy, Trade, and Industry ("METI") submitted to assist the Court's consideration of the issues.35 METI argued that permitting foreign purchasers of goods from foreign corporations in foreign markets to bring actions in U.S. courts would interfere with the Government of Japan's ability to regulate its own economy and govern its own society. METI highlighted Japan's existing antitrust legal framework and the bilateral cooperation agreements between the United States and Japan:

[The FTAIA] should not be interpreted to allow foreign purchasers of goods from foreign corporations in foreign markets to bring actions in the United States courts for alleged injuries under United States antitrust laws. ... Giving foreign purchasers the right to damages for purely foreign market transactions undermines the important principles of comity, respect due to a sovereign nation to regulate conduct within its own national territory. Such an interpretation of the FTAIA has international public policy implications which would adversely affect the ability of the government of Japan to regulate its own economy and govern its own society.36

The Supreme Court understood these comity concerns, but did not consider them to preclude application of the FTAIA.37

After the Supreme Court ruled, the case was returned to the lower court to consider the plaintiffs' alternative argument that their injuries were not in fact independent of the conspiracy's U.S. domestic effect. The plaintiffs maintained that the defendants' success in inflating foreign prices necessarily depended on their success in maintaining inflated prices in the United States, due to the global market and the fungible nature of vitamins. While the court considered this argument plausible, it ultimately rejected it, holding that this was not sufficient to satisfy the "gives rise to a claim" test.38

C. Conflicts Among the Courts After Empagran

Although the Supreme Court provided guidance in Empagran, subsequent decisions from the appellate courts were inconsistent in applying both the "import commerce exclusion" and the "domestic effects exception." Some courts applied them strictly, which meant that plaintiffs could not satisfy them and the FTAIA applied to block their Sherman Act claims. Other courts applied them less strictly, which meant that plaintiffs could satisfy them and the FTAIA did not block their Sherman Act claims.

1. Examples of Strict Application of the FTAIA To Block Sherman Act Claims

Some courts construed the FTAIA "domestic effects exception" as a strict and exacting standard, which limited the ways plaintiffs could meet it. For example, in United States v. LSL Biotechnologies, the Ninth Circuit established a strict test for the requirement that an effect on U.S. commerce be "direct": "an effect is 'direct' if it follows as an immediate consequence of the defendant's activity," proceeding "without deviation or interruption."39 Under this standard, a break in the direct chain of causation would block a Sherman Act claim from proceeding. LSL Biotechnologies involved a joint venture between two companies to develop a genetically altered tomato seed that would produce tomatoes with a long shelf life. When the relationship fell apart, the parties entered litigation, eventually resolving their dispute by restricting one company from selling its long shelf-life tomato seeds in North America. The Ninth Circuit found that the restriction on selling seeds in North America did not have a sufficiently direct effect on U.S. commerce.40 The court explained that any effect on U.S. farmers and consumers depended on uncertain intervening events.41 Accordingly, the FTAIA applied and the Sherman Act claim could not go forward.

Similarly, the Eighth Circuit rejected Sherman Act claims based on an alleged global price-fixing cartel in In re Monosodium Glutamate Antitrust Litigation.42 In that case, the foreign purchaser plaintiffs alleged that monosodium glutamate and nucleotides were fungible and marketed on a worldwide basis. The plaintiffs further alleged that the defendant manufacturers necessarily had to fix product prices in the U.S. market in order to sustain inflated prices in foreign markets; otherwise, foreign purchasers would buy the product directly from the U.S. market or from others selling products that they purchased in the United States. The Eighth Circuit rejected the Sherman Act claim because this constituted a "less direct causation standard" than proximate cause, and relied on the principle that comity requires avoiding unreasonable interference with the authority of sovereign nations.43

2. Examples of Less Strict Application of the FTAIA To Allow Sherman Act Claims

However, other U.S. courts were more willing to allow Sherman Act claims based on foreign conduct to proceed. One of the most influential cases is the Third Circuit's 2011 ruling in Animal Science Products Inc. v. China Minmetals Corp., which addressed the "import commerce exclusion" and the "domestic effects exception."44 The plaintiffs were U.S. purchasers of magnesite alleging that Chinese producers engaged in a price-fixing conspiracy that affected U.S. commerce. The Third Circuit held that while the import commerce exclusion must be given a "relatively strict" construction, a defendant need not necessarily function as a physical importer to satisfy it.45 Rather, the inquiry is whether the defendants' alleged anticompetitive behavior was "directed at an import market."46 The court also held that the "domestic effects exception" does not contain a subjective intent requirement, as some had argued.47 Instead, the court ruled that the "direct" and "substantial" effect must have been "foreseeable" to an "objectively reasonable person" in order for the FTAIA not to block a Sherman Act claim.48

The Seventh Circuit also took a more permissive approach and allowed Sherman Act claims to proceed in Minn-Chem, Inc. v. Agrium Inc.49 In Minn-Chem, U.S. purchasers of potash alleged that defendants, who produced potash outside the United States, had conspired to fix the prices of their sales of potash outside the United States and that the inflated prices in those countries raised the price of potash defendants sold in the United States. The court concluded that the allegations satisfied the FTAIA's "domestic effects" test, rejecting the Ninth Circuit's narrower interpretation of "direct effect" in LSL Biotechnologies. The court held that: "the term 'direct' means only that 'a reasonably proximate causal nexus'" exists between the conduct and the injury in the U.S., whether or not the effect is "immediate."50 Based on that standard, the court found that the plaintiff adequately alleged a direct, substantial and reasonably foreseeable effect on U.S. domestic commerce, that the FTAIA did not apply, and that the Sherman Act claim could go forward.51

Part I of this article provided an overview of the U.S. Sherman Act and traced the history of the application of the U.S. antitrust laws to non-U.S. conduct in judicial decisions dating back to 1909, the adoption of the Foreign Trade Antitrust Improvements Act ("FTAIA") in 1982, the U.S. Supreme Court's 2004 decision in F. Hoffman-LaRoche Ltd. v. Empagran, S.A. ("Empagran")52, and conflicting decisions from the courts of appeal that set the stage for important FTAIA decisions in 2014. Antitrust lawyers in the United States have been watching these appellate cases for several years to see whether the courts would reach complete agreement on critical FTAIA issues. They did not, and in two of the cases petitions have been filed asking the U.S. Supreme Court to resolve some of the disputed issues.

D. The Circuit Court Decisions in 2014 Applying the FTAIA

1. The Second Circuit's Decision in Lotes Co v. Hon Hai Precision Industry

In the first decision, Lotes Co., Ltd. v. Hon Hai Precision Industry, Co., Ltd., the Second Circuit (which includes federal courts in New York) adopted the Seventh Circuit's construction of "direct" as requiring a "reasonably proximate causal nexus."53 Lotes was not a straightforward price-fixing case. Rather, Lotes, a Taiwanese corporation, asserted Sherman Act claims alleging that members of a standards-setting organization breached their licensing commitments and precluded Lotes from participating in the U.S. market for USB 3.0 connectors, which resulted in higher prices for U.S. consumers. Defendants asserted that the FTAIA blocked Lotes' claims. For the "direct effect" test, the Second Circuit adopted the Seventh Circuit's Minn-Chem test—a "reasonably proximate causal nexus"—rather than the Ninth Circuit's LSL Biotechnologies test—an "immediate consequence of the defendant's activity."54 The court assumed this test was met. However, the court dismissed Lotes' claims based on its failure to satisfy the "gives rise to a claim" test, because even though Lotes alleged that the defendants' foreign conduct resulted in higher consumer prices in the United States, those prices were not the injury that Lotes allegedly suffered, which was being excluded from the market for USB 3.0 connectors.55

2. The Ninth Circuit's Decision in Hsiung v. United States

Shortly after Lotes was decided, the Ninth Circuit (which includes federal courts in California) issued its decision in Hsiung v. United States, which addressed the "direct effect" test and the FTAIA's "import commerce exclusion."56 Hsiung and his company, AU Optronics Corp., were convicted of participating in the liquid crystal display ("LCD") price-fixing conspiracy. They appealed their convictions, arguing that the FTAIA barred their prosecution because most of the price-fixed LCD panels were sold to third parties outside the United States. The Ninth Circuit reiterated the test it had adopted in LSL Biotechnologies that for an effect to be "direct," it must be the "immediate consequence" of the defendant's conduct.57 The Ninth Circuit acknowledged that the Second Circuit in Lotes had disagreed with its LSL Biotechnologies decision, but said it was "not necessary to address this disagreement because we do not rely on the direct effects exception in affirming the convictions."58 Instead, the court upheld the convictions because some of the price-fixed panels had been imported into the United States from the defendant and therefore fell within the FTAIA's "import commerce exclusion" and therefore the Sherman Act applied.59

The defendants asked the full panel of Ninth Circuit judges to review the decision, but no judge voted to grant review so the petition was denied. At the same time, however, the court amended its original decision to address the "direct effect" test.60 Because the panel issued its amended decision after the Seventh Circuit's final decision in the Motorola Mobility, we discuss it after first describing the Motorola Mobility decisions.

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Footnotes

1 15 U.S.C. § 1 et seq.

2 15 U.S.C. § 6a.

3 15 U.S.C. § 1 et seq.

4 N. Pac. Ry. v. United States, 356 U.S. 1, 4 (1958).

5 Chicago Bd. of Trade v. United States, 246 U.S. 231, 238 (1918).

6 Standard Oil Co. v. United States, 221 U.S. 1, 58 (1911).

7 Texaco, Inc. v. Dagher, 547 U.S. 1, 5 (2006) ("[T]his Court presumptively applies rule of reason analysis").

8 See Broadcast Music, Inc. v. CBS, 441 U.S. 1, 8-9 (1979).

9 See U.S. Dept. of Justice, Price Fixing, Bid Rigging, and Market Allocation Schemes: What They Are and What to Look For (revised Sept. 28, 2005), available at http://www.justice.gov/atr/public/guidelines/211578.pdf.

10 See, e.g., Bill Baer, Assistant Attorney General, Antitrust Division, U.S. Dept. of Justice, Prosecuting Antitrust Crime (Sept. 10, 2014), available at http://www.justice.gov/atr/public/speeches/308499.pdf; see also Scott Hammond, Deputy Assistant Attorney General, Antitrust Division, U.S. Dept. of Justice, The Evolution of Criminal Enforcement Over the Last Two Decades (Feb. 25, 2010), available at http://www.justice.gov/atr/public/speeches/255515.htm.

11 15 U.S.C. §§ 1, 2.

12 18 U.S.C. § 3571(d).

13 Id.

14 Antitrust Division 2014 Criminal Enforcement Update, available at http://www.justice.gov/atr/public/divisionupdate/2014/criminal-program.html.

15 http://www.justice.gov/atr/public/press_releases/2015/311396.htm.

16 Fed. R. Civ. P. 23.

17 15 U.S.C. §§ 15, 15a.

18 213 U.S. 347, 357 (1909).

19 Id. at 355.

20 Id. at 356.

21 221 U.S. 106 (1911).

22 148 F.2d 416 (2d Cir. 1945).

23 Id. at 443.

24 Id.

25 Id. at 444.

26 Nat'l Bank of Canada v. Interbank Card Ass'n, 666 F.2d 6 (2d Cir. 1981).

27 Timberlane Lumber Co. v. Bank of Am., 549 F.2d 597, 613 (9th Cir. 1976); Mannington Mills, Inc. v.

Congoleum Corp., 595 F.2d 1287, 1297-98 (3d Cir. 1979).

28 542 U.S. 155, 161-62 (2004).

29 Id.

30 Id.

31 Id.

32 Hartford Fire Ins. Co. v. California, 509 U.S. 764, 796 & n.23 (1993).

33 Id. at 159.

34 Id. at 173-74.

35 Brief of the Government of Japan as Amicus Curiae in Support of Petitioners, F. Hoffman-La Roche Ltd. v. Empagran, S.A., No. 03-724, 2004WL 226390 (S. Ct. Feb. 3, 2004). METI also joined a brief filed by other countries in the D.C. Circuit court case. Brief of the Federal Republic of Germany, United Kingdom of Great Britain and Northern Ireland, Japan, the Swiss Confederation, and the Kingdom of the Netherlands as Amici Curiae in Support of Defendants-Appellees, Empagran, S.A. et al., v. F. Hoffman-La Roche Ltd., No. 01-7115, 2005 WL 3873712 (D.C. Cir. Mar. 9, 2005).

36 Brief of the Government of Japan as Amicus Curiae, F. Hoffman-La Roche Ltd. v. Empagran, S.A., 2004 WL 226390, at *2.

37 See 542 U.S. at 165-75.

38 Empagran S.A. v. F. Hoffman-LaRoche, Ltd., 417 F.3d 1267, 1271 (D.C. Cir. 2005).

39 379 F.3d 672, 680 (9th Cir. 2004).

40 Id. at 681.

41 Id.

42 477 F.3d 535, 538 (8th Cir. 2007).

43 Id.

44 654 F.3d 462 (3d Cir. 2011).

45 Id. at 470.

46 Id.

47 Id. at 471.

48 Id.

49 683 F.3d 845 (7th Cir. 2012), cert. dismissed, 134 S. Ct. 23 (2013).

50 Id. at 856-57.

51 Id. at 858.

52 542 U.S. 155, 161-62 (2004).

53 753 F.3d 395 (2d Cir. 2014).

54 Id. at 409-13.

55 Id. at 413-15.

56 758 F.3d 1074.

57 Id. at 1094.

58 Id.

59 Id. at 1091-92.

60 United States v. Hsiung, No. 12-10492, 2015 U.S. App. LEXIS 1590 (9th Cir. Jan. 30, 2015).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Emails

From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.