CASE ANALYSIS: Asante Technologies, Inc.v.PMC-Sierra,Inc 164F.Supp.2d 1142(2001) United States District Court (N.D.Cal.)

Offer (Asante): the contract “shall be governed by the laws of Plaintiff Defendant Buyer: Asante (California) Seller: PMC (Canada) invoices payment authorized distributor Unique Technologies (California) Offer (Asante): the contract “shall be governed by the laws of the state shown on buyer’s address on this order.” New offer (PMC): the contract “shall be construed according to the laws of Canada.” Acceptance (Asante): specific performance

Leagal issues: Which place had the closest relationship to this contract (The plaintiff contends the United States did)? Whether the CISG is applicable to this case (Plaintiff’s choice of applicable law generally adopts the “law of” the state of California) ? (3)Should this case be remanded back to state court(Whether the federal court had jurisdition over this case)?

Legal Reasoning CISG applies to contracts between parties whose place of business are in different states In this case: Plaintiff’s place of business:California,USA Defendant’s place of business:Canada

Plaintiff’s claim: California is defendant’s place of business. Article 10 of CISG:if a party has more than one place of business,the place of business is that which has the closest relationship to the contract. The court’s decision: Plaintiff’s dealings with Unique do not establish defendant’s place of business in California.

The defendant ‘s two places of business:Canada and the Oregon branch. Canada is the place of business which has the closest relationship to the contract. Decision: the contract in this case is between parties from two different countries :America and Canada.

2、Choice of Law Clause Plaintiff The court Plaintiff argues that the parties can “opt out ” of the CISG by using a choice of law clause The court alleges that the choice of law clauses do not evince a intent to “opt out” of the CISG.

Facts A、The defendant’s confirmation stated that the contract should be explained by the laws of Canada. B、The plaintiff’s choice of applicable law adopts California law. California United State (laws) (treaties)

Canada CISG United State Therefore, the CISG is applicable to this case.

Why does the CISG preempt state law (UCC) ? Federal preemption: the displacing(替代的） effect that federal law will have on a conflicting state law. (联邦优先原则） “This Constitution, and the laws of the United States , and all Treaties, shall be Supreme Law of the land”

Treaties (ratified) === federal law CISG prevails over UCC ?? “ the new law preempts the old law” UCC : 1951 CISG: 1988 Ratification → congressional intent

Why does federal court have jurisdiction over this case? exclusive Federal jurisdiction： cases only can be heard by federal court (专属联邦管辖权） Concurrent Jurisdiction: cases can be heard by federal court & state court (共同管辖权)

Removal： defendant to move a lawsuit filed in state court to the federal court （诉讼转移） 1 、 Body : defendant 2、 Concurrent Jurisdiction 3、out-of –state defendant 4、no “reverse removal”

Decision The federal court had concurrent jurisdiction over this case because the applicable law was the CISG,an international convention ratified by the United States(even though the case could also have been heard in state court.)

Comments 1. The judge can respect the fact and customs Eg:the first judicial opinions about the place of business 2 . The judge’s strict interpretation about the contract. That indicates the judge’s strict attitude towards law.

3. The judge’s legal reasoning skills eg: the second judicial opinion about the choice of law clause. if the clause is an “opt out” CISG( adopt the domestic law) < = CISG so they should adopt the CISG

4. The judge upholds the prestige of international law perform the CISG strictly to promote the international trade according to its fundamental purpose 5.The judge’s abundant legal theory the difference between these legal terms “exclusive federal jurisdiction” “concurrent jurisdiction” and “preemption”

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