HR-6194-119
Ordered to be Reported (Amended) by Voice Vote.
Sponsored by Wesley Hunt (R-TX)
What it does
This bill would bar U.S. federal and state courts from recognizing or enforcing foreign court judgments or arbitration awards against U.S. persons when the underlying claim arose from actions taken to comply with U.S. sanctions or export controls, or when the foreign tribunal based its jurisdiction on those sanctions. It allows defendants to remove such cases to federal court, where they must be dismissed, while preserving exceptions for U.S. government actions, terrorism victims' claims, and disputes where parties had agreed to resolve matters in U.S. courts or arbitration.
Who benefits
U.S. companies and individuals who complied with sanctions (particularly those targeting Russia) and are facing or fear foreign lawsuits or arbitration awards from Russian or other foreign parties seeking compensation for contracts disrupted by sanctions compliance. Banks, exporters, and multinational firms with sanctions-compliance exposure, and the U.S. government's broader sanctions enforcement regime, which benefits from reduced deterrent effect on compliance.
Who is hurt
Foreign parties, including Russian individuals and companies, who obtained or might obtain foreign judgments or arbitral awards against U.S. persons for sanctions-related contract disruptions, as they would lose the ability to enforce those awards in U.S. courts. Foreign courts and arbitral bodies whose rulings would be rendered unenforceable in the U.S. in these circumstances, and possibly U.S. parties with legitimate cross-border contract disputes that get swept into the bill's broader jurisdictional carve-out.
Supporters argue
Supporters argue that Russian courts have increasingly issued judgments against Western companies that complied with U.S. sanctions after 2022, effectively punishing lawful compliance with U.S. foreign policy, and that this bill closes a legal loophole allowing foreign tribunals to weaponize their jurisdiction against U.S. sanctions enforcement. They contend that without this protection, U.S. companies face a choice between violating U.S. sanctions law or paying damages in foreign courts, undermining the government's ability to enforce its own sanctions regime.
Opponents argue
Opponents argue that broadly stripping U.S. courts of authority to enforce foreign judgments could disrupt international commercial arbitration systems that U.S. businesses themselves rely on to resolve disputes fairly, and that the bill's carve-outs are narrow enough that legitimate foreign creditors with valid, unrelated claims could be swept up in the jurisdictional bar. They contend that unilaterally refusing to honor foreign judgments may invite reciprocal treatment of U.S. judgments abroad, harming U.S. companies seeking to enforce awards internationally.
Constitutional context
Congress has broad authority under Article I to regulate foreign commerce and define the jurisdiction of federal courts, and this bill closely tracks that power by limiting a category of civil actions in federal and state courts; no Supreme Court case squarely governs sanctions-related foreign judgment enforcement, so the closest analogous authority is Congress's recognized power to define federal court jurisdiction and preempt state court authority over foreign relations matters, as reflected in cases like American Insurance Association v. Garamendi (2003) on federal foreign-affairs preemption of state law.
Checks and balances
Congress would restrict both federal and state judicial authority to hear a category of cases, while the executive branch's sanctions-enforcement authority is preserved and even reinforced, with courts retaining only the power to dismiss covered claims rather than adjudicate them.
Historical precedent
Congress has previously limited court enforcement of foreign judgments in specific contexts, such as the SPEECH Act of 2010, which barred U.S. courts from enforcing foreign defamation judgments inconsistent with First Amendment protections.