Goliath, Inc., a United States producer of gem quality sapphires, set up a subsidiary holding company in the Cayman Islands (Junior, Ltd.) to control all of Goliath's non-United States subsidiaries.
Junior then entered into a cartel agreement with producers of sapphires in those countries (other than the US) where sapphires are found. The cartel agreement allocated markets and set prices for all sapphires sold outside of the United States.
The United States government has now brought suit against both Goliath and Junior for violating the US Sherman Antitrust Act. Goliath answers that it was not a party to the cartel agreement and that the agreement does not affect the US market for sapphires. Junior answers that it is not subject to the jurisdiction of the US courts. Are Goliath and Junior correct?© BrainMass Inc. brainmass.com October 9, 2019, 4:18 pm ad1c9bdddf
There are two issues to consider in this problem. One is of civil law and the other of public law.
In terms of civil law, Junior is an offshore company and as such it is not subjected to the jurisdiction of the country of its nationality (in this case US). Legal issues surrounding the affairs of Junior should be ...
Civil law and public law cases are noted.