Supreme Court decides Yegiazaryan v. Smagin
June 22, 2023
The Supreme Court just released its opinion in Yegiazaryan v. Smagin.
For prior coverage on TLB by Bill Dodge see here, here, here, and here.
The issue in the case was whether the plaintiff adequately plead a domestic injury under RICO. The foreign plaintiff alleged that the defendants worked together illegally to frustrate his collection on a California judgment to enforce an arbitral award issued in London. The Court found the allegations of domestic injury sufficient, reasoning that:
courts should look to the circumstances surrounding the alleged injury to assess whether it arose in the United States. In this suit, that means looking to the nature of the alleged injury, the racketeering activity that directly caused it, and the injurious aims and effects of that activity.
The Court adopted this “context specific” test and rejected more bright-line approaches to the question of domestic injury that would have focused on the plaintiff’s residence or the location of disputed property. Three justices dissented (Alito, Thomas, and Gorsuch) arguing that “[t]his analysis offers virtually no guidance to lower courts, and it risks sowing confusion in our extraterritoriality precedents.” They would not have held for the defendants, however, but instead would have dismissed the writ as improvidently granted, noting that the U.S. government and foreign states had not provided any input on the potential effects of a decision in the case.
A very interesting case that adds to the Court’s growing number of recent opinions on extraterritoriality!
More coverage soon on TLB.