Sina Finance: Harvard Notes: The Trinity U.S. Project Litigation is Justified

Source: Sina Finance Text/Sina Finance Boston Staff Writer Feng Xuming

The Trinity Group's lawsuit against Obama in a U.S. court, although extremely difficult, is justified and should be fought on the basis of reason. At the same time, as *5,656 crab eaters, regardless of Sany's victory or defeat this time, this incident has a very positive significance for Chinese enterprises that "go global" - they must take the initiative to familiarize themselves with and learn to use the judicial system of the host country, eliminate misunderstandings, and claim rights.

The picture shows Xiang Wenbo, vice chairman and president of Sany Heavy Industry (picture from: Sina Finance)

Ralls then filed a lawsuit in the U.S. District Court for the District of Columbia, citing CFIUS and President Barack Obama as co-defendants.

Wu Jialiang, deputy general manager of Sany Group and CEO of Ralls, said that the incident caused direct economic losses of up to $20 million to Sany Group. During the 18th National Congress of the Communist Party of China, Liang Wengen, chairman of Sany Heavy Industry, who was attending the meeting in Beijing, once again told reporters that Sany had been treated unfairly in the United States, and the purpose of the prosecution was "to seek justice, and second, to wash away the injustice."

　Although the lawsuit is difficult to win, it is justifiable

As Wu Jialiang said, it is really forced to sue the head of state in an unfamiliar country, and the difficulties and resistance of litigation are very great.

However, the author believes that from the perspective of legal theory and litigation technology, Sany's lawsuit is justified and should be fought on the basis of reason. There are at least three reasons for this:

First, although in the area of national security, the U.S. judicial system gives the executive branch more leeway — under CFIUS rules, the president's decision on this matter is not subject to judicial review; But that doesn't preclude the court system from adjudicating on the president's power to review the matter.

Second, CFIUS and Obama's ruling against Sany is indeed unfair, because Danish wind power companies have operated there without interference on national security grounds.

Third, under the relevant law, if Sany had chosen to "greenfield investment" (i.e., build a factory directly in Oregon) instead of merging with other companies, then CFIUS would not have the authority to conduct an investigation, let alone submit it to the president* for a final ruling. How absurd, why is it that mergers and acquisitions are a matter of national security, while greenfield investments can? This paradox makes it necessary for the U.S. judicial system to re-examine its own legislation in the field of foreign investment.

Something more important than winning a lawsuit

At the same time, we need to realize that Obama's move in the Trinity lawsuit is more important in terms of attitude and long-term significance than the outcome of the lawsuit itself.

In recent years, the scale of Chinese investment in the United States has been growing, and the unfair treatment of Chinese companies has become more and more frequent. Sany's experience is by no means an isolated case, and companies such as CNOOC, Huawei, and ZTE have all experienced similar experiences. Although there are political, economic, cultural and other factors, freezing three feet is not a day's cold, but only by standing up confidently and redressing grievances can we eliminate the fog and misinterpretation, and then win fair treatment.

Furthermore, learning to use the host country's own judicial procedures to resolve disputes is the only way for Chinese enterprises to "go global" and truly become world-class multinational enterprises. Liang Wengen said, "We believe in the laws of the United States." This phrase is understood by many as PR language in the face of the media. But if you think about it from another angle, it should be the mentality of a mature multinational enterprise - to fully study the legal system of the host country, and be good at using judicial means to fight for rights and win reputation, especially when investing and operating in developed markets such as Europe and the United States.