Federal courts overturn state actions conflicting with national foreign policy.

• Author: Crook, John R.

In recent decisions, the U.S. Court of Appeals for the Ninth Circuit and a federal district court struck down state legislation found to interfere with federal foreign relations interests.

Ninth Circuit Rejects California Law to Extending Statute of Limitations for Armenian Genocide Claims. In August 2009, the Ninth Circuit ruled that a 2003 California statute extending the statute of limitations for claims arising out of insurance policies issued to "Armenian Genocide victims" (1) interfered with the federal government's conduct of foreign relations and was therefore preempted.

The legislation at issue in Movsesian v. Victoria Versicherung (2) defined "Armenian Genocide victim" to mean "any person of Armenian or other ancestry living in the Ottoman Empire during the period of 1915 to 1923, inclusive, who died, was deported, or escaped to avoid persecution during that period." It authorized claims by such victims, their heirs or beneficiaries against "insurers," and extended the statute of limitations for such claims until 2010. "Insurer" was broadly defined as an insurance provider "doing business in the state, or whose contacts in the state satisfy the constitutional requirements for jurisdiction, that sold life, property, liability, health, annuities, dowry, educational, casualty, or any other insurance covering persons or property to persons in Europe or Asia at any time between 1875 and 1923." (3)

The district court denied a defendant insurance company's motion to dismiss, ruling, inter alia, that the legislation was not preempted by conflict with the foreign policy of the national government. (4) The court of appeals reversed, finding that the statute "conflicts with Executive branch foreign policy, and thus, is preempted." (5) Based on the U.S. Supreme Court's 2003 ruling in American Insurance Associates v. Garamendi, (6) the Ninth Circuit saw preemption as involving two elements: whether there was an express federal policy on a matter, and whether the impugned state action conflicted with that policy. (7) On the first element, the court reviewed several cases of vigorous executive branch opposition to proposed congressional resolutions characterizing as genocide the deaths of many thousands of Armenians in the last years of the Ottoman Empire. It found that the executive's actions "clearly establish a presidential foreign policy preference against providing legislative recognition to an 'Armenian Genocide.'" (8) The court found further that articulation of this policy clearly fell within the scope of the president's...