Thomas Evans suggests a new target for activist state Attorneys General: the member states of OPEC.
The attorneys general of the various states should sue OPEC as an alien or, pleading alternatively, as a foreign state. (A joint action by the attorneys general is the method the states used to collectively sue tobacco companies, Microsoft and health maintenance organizations.)
The states should contend that Article III of the Constitution outweighs the act of state doctrine. Respect for the sovereignty of a foreign government for acts “done within its own territory” does not, even if very liberally construed, protect decisions reached by a cartel based in Austria that directs 13 nations to sell their product at inflated prices to customers outside their boundaries. If the states won the case, the court could recover substantial damages based on assets and commercial activities of OPEC member nations in the United States.
Such a suit would face substantial obstacles, Evans notes, including separation of powers concerns, but he still thinks it is a good idea, even if only to focus public attention on OPEC’s “illegal” activities.
I am sure some lawyers think litigation is an answer to nearly every problem, but I am not one of them. Assuming OPEC is a sufficiently strong cartel to be a major concern, I think there are better alternative courses than seeking to sue OPEC’s members in federal court. Even assuming a lawsuit could bear fruit (and I doubt it could), I am inclined to think destabilization of OPEC makes more sense than confrontation. Cartels are notoriously difficult to maintain, all the more so when they face external competition. So, why wouldn’t an increase in oil production and development in non-OPEC states undermine OPEC’s influence? Increasing the dynamic and competitive nature of energy markets would seem to make more sense than trying to tie up sovereign oil producing states in litigation.