Archive for May, 2010

The United States government has moved to vigorously enforce the Foreign Corrupt Practices Act over the past several years and this has profound implications for companies working overseas.

The Foreign Corrupt Practices Act, 15 U.S.C. Section 788dd-1(a) (the “Act” or “FCPA”) prohibits “corrupt” offers of any kind of payment to a foreign official when the payment is for obtaining or retaining business.  The Act has exempted “grease” payments, that is, small payments to, for example, expedite paperwork at a port or to speed the clearance of goods shipped.

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For a foreign litigant, filing a complaint in its home country may be cost effective and convenient. In doing so, however, it is critical that the foreign court chosen by the litigant has personal jurisdiction of the defendant. Failure of personal jurisdiction may result in judgments being unenforceable in the United States.  Our due process clause requires at least minimum contacts with the forum state sufficient that the exercise of personal jurisdiction does not offend notions of fair play and substantial justice. The “minimum contacts” test requires a showing either that defendant’s contacts with the forum are “substantial” or “continuous and systematic” (general jurisdiction) or that there is a strong relationship between the quality of the defendant’s activities within the forum and the cause of action (specific jurisdiction). Without personal jurisdiction, all of the upside in choosing one’s own forum is lost along with the ability to enforce the foreign judgment in the United States.

New Jersey’s Foreign Country Money-Judgments Recognition Act applies to any foreign country money-judgment that is “final and conclusive.” Any such judgment is enforceable in the same manner as the judgment of a sister state which is entitled to full faith and credit under the Uniform Enforcement of Foreign Judgments Act, which has been adopted in New Jersey.

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As a general rule, U.S. citizens and U.S. tax “residents” are subject to U.S. federal income tax on their respective worldwide income irrespective of source.  An individual who is neither a U.S. citizen nor resident is generally subject to U.S. income tax only with respect to certain types of U.S. source income that is either FDAP (fixed, determinable, annual or periodical) or ECI (effectively connected with a U.S. trade or business.)

The key determinant of U.S. federal income tax liability is, therefore, residence of the taxpayer.

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You have discovered that a web site contains content that uses original text, artwork, photography or software that you created or commissioned.  You dutifully do some research (including using a “WHOIS” search on the web) to determine who owns the web site, but the site owner has hired a third party (such as Domains By Proxy) to hold the domain name so that the owner’s identity is not publicly available. There is no other identifying information on the web site and it is therefore impossible as a practical matter to figure out who is responsible for copying your creative content.

What can you do?  Fortunately, U.S. copyright law provides a remedy, in the form of the Digital Millennium Copyright Act or “DMCA”, as it’s known.  The DMCA contains provisions, called “take-down” provisions, which provide a quick and easy remedy to copyright owners of content that is infringed (that is, copied) on the web.  Under these provisions, you, as the copyright owner or licensee of copyrighted content, may notify an “Internet Service Provider”, or “ISP”, such as the host of the web site containing the infringing material, of the infringement.  You may couple this notification with a demand for “take-down”, that is, removal, of the infringing material.

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