In an Atlantic Monthly article, The View from There: What living in England, Japan, and China has taught one American about the character of his own country, James Fallows discussed how easy it is to misunderstand other countries and how Americans misunderstand China:
When living in Japan, I heard accounts from many Japanese who had gone to the US for business or study in the 1950s, after the Allied occupation ended. They looked at the factories and the farms and the vastness of America and asked themselves: What were we thinking? How could tiny Japan have imagined challenging the United States? After the Soviet Union fell and the hollowness of its system was exposed, many Americans asked: What were we thinking about “two superpower” competition with the USSR? Its missiles were lethal and its ideology was brutal and dangerous. But a rival to America as an overall model? John F. Kennedy was only one of many to suggest as much, in his 1960 campaign references to the prestige gap as well as missile gap that had opened. Eventually, we all learned there was no comparison at all. I think if more Americans came to China right now and saw how hard so many of its people are struggling just to survive, they too might ask: What are we thinking, in considering China an overall threat? Yes, its factories are formidable, and its weight in the world is huge. But this is still a big, poor, developing nation trying to solve the emergency of the moment. Susan Shirk, of the University of California at San Diego, recently published a very insightful book that calls China a “fragile superpower.” “When I discuss it in America,” she told me, “people always ask, ‘What do you mean, fragile?’” When she discusses it here in China, “they always ask, ‘What do you mean, superpower?’”
I thought of Fallows’s article after speaking last week on China law before the county bar association. My talk had been mistakenly “advertised” as being about “doing business in Asia.” Wanting to disabuse anyone of the notion that I would be providing insights into doing business in all of Asia, I began by making clear what I would and would not be discussing…
It is almost always a waste of time to sue Chinese companies in United States courts. But this seems to be news to many American lawyers.
Just about every month, my firm gets a call from a lawyer somewhere in the United States expecting us to jump at the chance to help enforce a multi-million dollar U.S. court judgment against a Chinese company.
The problem is China does not enforce U.S. court judgments…
I re-watched the movie The Painted Veil (the 2006 version with Naomi Watts and Edward Norton) this weekend. It’s a decent movie with a pretty thin plot, but I love its cinematography and its depiction of 1920s China.
I also love the lessons it teaches for surviving China.
The movie does a good job conveying how China viewed its foreigners back then. That is, China belongs to the Chinese, and they do not particularly want foreigners there — even doctors there to save lives. Foreigners are in China only to the extent that it makes sense to have them there, and they will never be treated the same as Chinese people.
When it comes to modern-day Chinese commercial law enforcement, the perceptions and the treatment of foreigners have not changed all that much…
How often do you stop to think about the ubiquitous “Made in China” label? If you’re a China lawyer, you should think about it almost every day.
To convince recalcitrant clients of the need for product liability protection for the products they are having made in China, I sometimes send them the following deposition questions asked of a U.S. manufacturer whose China-made product had badly injured a child:
At 1:24 a.m. on March 18, 1990, as St. Patrick’s Day festivities wound down in Boston, two men dressed as police officers rang the buzzer at the Isabella Stewart Gardner Museum in Boston’s Fenway neighborhood. Eighty-one minutes later, they vanished, taking eleven paintings and two artifacts with them. None of the stolen works — worth at least $500 million today — has ever been recovered. This week, On Remand looks back at the Gardner heist and another set of stolen paintings that found their way back the rightful owner — landing an attorney in prison in the process….
I figured my first Above the Law post should be something aimed squarely at those who generally read this blog: American lawyers. I also figured I should lead with what I do best and that is scaring the heck out of people.
So I am going to write about four common and egregious mistakes my law firm’s China lawyers often see American domestic lawyers make when representing their clients in doing business with or in China, along with a very brief analysis of what causes American lawyers to make each sort of mistake.
1. Many years ago, a lawyer in the Midwest called us to discuss his client’s desire to form a company in China. This lawyer did not even tell us that his client was in the room. The lawyer asked us the minimum capital the Chinese government would likely require his client put into a Chinese bank to be able to start a business (a WFOE) in China. Based on the nature and size of the business, we estimated $6 to $8 million. The lawyer asked us to confirm that a portion of the required $6 to $8 million could come from factory equipment not cash, and we assured him that it could. At that point, he said, “good,” because his client had already purchased $5 million in equipment and shipped it to China.
We then had to tell him those equipment purchases could not count because they had not been previously designated as going to the WFOE. The lawyer then complained about how his client could not afford to come up with another $5 million and how China was putting form over substance. To which we could say little more than, “yeah”…
* Dewey know who Zachary Warren is? Per this failed firm’s insiders, he seems to be a “man of mystery” who apparently worked in the “bowels of the bureaucracy” that ultimately led to D&L’s demise. [Am Law Daily]
* “You can cross-examine the witness. You can’t cross examine an email.” Defense of the Dewey defendants may be tough when it’s time for trial — and you can bet your ass there’ll be a trial. [New York Law Journal]
* Fear not, friends, because Patton Boggs has found a way to weather the storm. It’s the same way most barely buoyant firms stay afloat: more layoffs. Expect more on this news later today. [National Law Journal]
* Paul Ceglia, the man who claims he owns half of Facebook’s fortunes, can’t toss his criminal charges. Sometimes wheeling and dealing with allegedly faux contracts will land you in the clink. [Bloomberg]
* Because no father wants to see his daughter become “tabloid fodder”: Rachel Canning, the New Jersey schoolgirl who sued her parents, is being “savaged” by the public. Aww, poor little Millennial. [Daily Record]
19 Recordings, the entity that enters into record deals with the recording artists who win American Idol, has sued Sony Music for allegedly stealing millions of dollars after underpaying the company in terms of royalties. The 33-page complaint, available after the jump, opens with a list of American Idol success stories and then documents in detail how Sony Music reportedly stole millions from them.
According to the suit, Sony misclassified streaming music sales to pay 19 Recordings less than what the company was owed. Another claim is that Sony was supposed to obtain approval from 19 Recordings after a certain ceiling cost for advertising was reached, but Sony failed to seek that approval before spending 19 Recordings’ royalties without its consent. The remaining allegations similarly claimed underpayment for royalties, improper passing of expenses on 19 Recordings, not allowing 19 Recordings to audit all of Sony’s books, and claims related to royalties for individual artists.
Interestingly, 19 Recordings filed in federal court. 19 Recordings is the little guy in this action — with the backing of name brand stars — and it seems that the company might fare better in state court. The suit comes just after Season 13 of the show premiered on Fox. The suit seeks $7 million in damages and $3 million in prejudgment interest.
With the snow melting in Sochi, “On Remand” looks back to one of the greatest moments in Olympic history. Tomorrow is the 34th anniversary of the “Miracle on Ice.”
In February 1980, the XIII Olympic Winter Games were underway in Lake Placid, New York. But a little-known group of hockey players had been practicing together for months, skating themselves to exhaustion learning coach Herb Brooks’s new, fast, and grueling style of play. Most of the players on Team USA were barely old enough to order a beer, and hardly any had played hockey professionally. In a few months, several would be playing in the NHL. But on February 22, they were underdogs against a Soviet team that had won the gold in every Olympic contest since 1956 — except for 1960, when the Americans stood atop the podium. A week before the 1980 games started, the Soviets had trounced the Americans, 10-3, in an exhibition game.
“Unless the ice melts” or some team “performs a miracle,” a sports writer quipped, the Soviets would win the gold medal again in 1980. And, for most of the U.S.S.R. versus U.S. game, that prediction appeared accurate. But with 10 minutes left in the game, Mike Eruzione, Team USA’s captain, scored a goal from thirty feet, putting the Americans up 4-3. They never relinquished the lead. As the clock ran out, ABC broadcaster Al Michaels delivered his now iconic play-by-play…
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