Wednesday, August 8, 2018

Milestones: Haung Tang v. Aetna Life Ins. Co., 523 F.2d 811 (9th Cir. 1975)

Summary:

Plaintiff is a mother of a decedent who was killed by her husband. The husband killed the decedent in San Diego, California, and thereafter fled to Taiwan. There, the husband was tried, convicted and incarcerated for homicide. The decedent had a life insurance policy, for which the husband was the primary beneficiary and the plaintiff mother was the alternate beneficiary. The mother sued to collect the life insurance proceeds; the husband cross-claimed, averring that because he killed his wife while being temporarily insane, he was not precluded from collecting the insurance proceeds. The district court found that the husband was precluded from litigating the insanity argument, because the husband raised the argument in the Taiwanese court and lost.

The Ninth Circuit reversed. The court found that while there may be some occasions in which issue preclusion is permissible with a foreign judgment, plaintiff failed to meet the burden of pleading and proving the identity of issues, because plaintiff provided no foundation for a conclusion that the insanity defense in Taiwan is the same as legal insanity under California law.

Takeaway:

It's an old case, but always a good lesson to remember: because estoppel is such a powerful weapon, it always requires active pleading and establishment.

Tuesday, August 7, 2018

Media Appearance: "South Korea is Going Crazy over a Handful of Refugees" on Foreign Policy

A new column about Korea from me, this time about the liberal democracy in the south dealing with the 500-odd refugees from Yemen:
It is easy to be disappointed at this response coming from a liberal administration, one that was born out of the heroic months-long protests that resulted in the impeachment and removal of the deeply corrupt and authoritarian President Park Geun-hye. Yet polling reveals the dispiriting reason why the Moon administration is at least partially pandering to anti-refugee sentiments: The issue potentially poses the greatest threat to the administration’s stability yet, as it strikes at the foundation of its support, namely young voters, women, and the middle class.

In a recent survey, conducted by Hankook Research, 56 percent of those surveyed opposed admitting the Yemeni refugees, while only 24 percent supported letting them in. But women objected more strongly than men (61 percent to 51 percent), respondents in their 20s (70 percent) and 30s (66 percent) objected the most among all age groups, and middle-income households (62 percent) expressed the strongest objections against admitting the refugees.
South Korea is Going Crazy over a Handful of Refugees [Foreign Policy]

There have been persistent claims that South Korean democracy has been able to survive because of its ethnic homogeneity, closing off a potential major fault line. I used to give no credence to those claims, but the recent turn of events is a score one for those claims.

Friday, August 3, 2018

Case of the Day: China Agritech, Inc. v. Resh, 138 S. Ct. 1800 (2018)

Summary:

The case concerns a class action shareholder litigation against China Agritech, alleging securities fraud. Under the Securities Exchange Act of 1934, the statute of limitations for securities fraud is two years upon discovery of the fact constituting the violation. The statute of limitations began to run when the first class action against China Agritech was filed in 2011. In the following year, the district court denied class certification. Shortly thereafter, a new set of plaintiffs filed another round of class action suit, raising new evidence. The court denied the class certification once again. The plaintiffs in this case then filed a third round of class action in 2014, arguing the statute of limitation had been tolled while the court was considering the class certification. Noting the circuit split on this issue, the Supreme Court granted certiorari.

The Supreme Court unanimously ruled the successive class action suits do not receive the benefit of the tolling provided by Am. Pipe & Constr. Co. v. Utah, 414 U.S. 538 (1974). Justice Ruth Bader Ginsburg's opinion held that, given the "preference for preclusion of untimely successive class actions" appearing on the Federal Rules of Civil Procedure and the Private Securities Litigation Reform Act, the statute of limitations cannot be tolled practically forever as long as the plaintiffs try.

Takeaway:

Eminently sensible result that overruled the Ninth Circuit position, which was bonkers. The fact that the company at issue was a Chinese company can also serve as a broader commentary on where the U.S. economy is today.

Wednesday, August 1, 2018

Case of the Day: Benge v. Williams, 2018 Tex. LEXIS 441 (Tex. May 25, 2018)

Summary:

In a medical malpractice case involving a botched hysterectomy surgery, the plaintiff patient prevailed in the lower courts. In the appeal, the defendant-appellant argued that the plaintiff-appellee's expert witness was not qualified to give testimony because he was not "practicing medicine." The expert was a board certified obstetrician and gynecologist who later also attended and graduated from law school, and began a teaching career in Texas by teaching law at the University of Houston Law Center and medicine at Baylor College of Medicine. In 2011, the expert moved to South Korea to teach law and medicine at Yonsei University, while continuing to collaborate with a Baylor professor.

The court rejected the argument that the expert was not "practicing medicine" because he was not accredited to see patients in South Korea, and also rejected the argument that Yonsei University Medical School was not an accredited institution because the school was not accredited in accordance with U.S. standards.

Takeaway:

It is of course the litigant's prerogative to make this type of hyper technical argument, but the argument needs to pass the laugh test. It is an impossibly heavy lift to claim that a person with a credential like the expert described here, going from teaching at one elite hospital after another, was not "practicing medicine," even though the legal battle may be over a term of art.

Monday, July 30, 2018

Media Appearance: "Cryptocurrency Laws and Regulations in Asia" in Asia Business Law Journal

Vacation is over--time to get back in the saddle! Here is my contribution, together with Michael S. Kim and Daniel S. Lee of Kobre & Kim LLP, giving an overview of cryptocurrency laws of South Korea.
Under the proposed regulatory scheme, digital currency exchanges would be required to register with South Korea’s Financial Intelligence Unit, a sub-organization of the FSC that monitors transactional flows to prevent money laundering or other attempts to evade capital control measures. The exchanges would also need to comply with “Know Your Customer” and anti-money laundering regulations at levels similar to banks. The proposed legislation is currently pending before the National Assembly.
In addition to the FSC’s proposed regulatory scheme, there are several other pending bills regarding digital currency trades and taxation measures. These bills have remained pending due to local elections in South Korea, but given a general lack of resistance toward digital currency regulation, they are expected to pass in the National Assembly soon.
Cryptocurrency Laws and Regulations in Asia: South Korea [Asia Business Law Journal]

Friday, July 13, 2018

Case of the Day: Ogawa v. Kang, 2018 U.S. Dist. LEXIS 88561 (D. Utah May 24, 2018)

Summary:

Plaintiff and defendant were formerly married, with two children. The ex-husband plaintiff is a Japanese national, the ex-wife defendant a South Korean national. While they were married, they lived in Japan until 2012. With the divorce imminent, the ex-wife moved to the United States with the children. The formal divorce was finalized in March 2013. Under the divorce agreement, the ex-husband was to briefly have custody over the children until the end of March 2017, then hand over the children; however, the ex-husband did not do so. In October 2017, the children traveled to South Korea, where the ex-wife met the children and took them to the United States. Plaintiff filed the Hague Child Abduction application in Japan, which reached the District of Utah in which the defendant lived.

The court rejected the application. The court first noted the defendant had the full custodial rights under the divorce agreement, and the plaintiff's right to have some custodial capacity did not include deciding where the children might live. The court also interviewed the children (who were 12 years old,) who expressed the desire to stay with their mother. 

Takeaway:

No matter how many times I read international family law cases--my pet favorite--it will never stop sounding a bit crazy from the perspective of a commercial litigator. This case essentially involves self-help enforcement of a contract and a potential overriding of the contractual terms based on the preferences of 12-year-olds who barely speak any English. I do see the reasons why all of this may be necessary, but the differences are nonetheless quite stark.

Monday, July 9, 2018

Case of the Day: Kasolas v. Yau (In re Fox Ortega Enters.), 2018 Bankr. LEXIS 1415 (Bankr. N.D. Cal. May 11, 2018)

Summary:

Plaintiff is the trustee overseeing the bankruptcy of Premier Cru, a California business that ostensibly procured rare wines at a discount but in reality operated essentially as a Ponzi scheme. Defendant is a former customer in Hong Kong who made online orders from Premier Cru, and is alleged to have received a fraudulent transfer from the debtor's estate. The defendant sought to dismiss based on lack of personal jurisdiction.

The court denied the motion. The court found that the transaction occurred in California with a Californian company, and the fact that the defendant was never physically present in California was of no import. The court further found that "[t]here is a strong federal interest in hearing bankruptcy matters in the bankruptcy court where the bankruptcy case was filed[,]" especially considering "[t]here are 100 such cases with defendants residing all over the United States and the world."

Takeaway:

In the opinion, the court declared: "This is simply not a close case.  . . .  The fact that there is a dearth of case law concerning federal courts exercising personal jurisdiction over non-resident defendants when those defendants were customers who made their purchases online is not vindication for Defendant's argument as he seems to believe." While I believe the court's decision in this case is correct, I am not sure about this strong pronouncement. Probably more correct to say in the peculiar context of bankruptcy (which may be one of the few occasions in which a seller sues a buyer, unlike the much more common scenario of a buyer suing a seller,) simply placing order online is enough to create personal jurisdiction.