Many European businesses are failing to effectively implement corporate governance codes which is heightening the risk of a serious corporate scandal on the scale of that involving Enron, new research claims.

A poll of Europe's 500 largest publicity listed firms found just 56 percent had the necessary policies in place to protect against ethic and compliance failures, with only 9 percent expecting budgets aimed at addressing the issue to increase.

The worrying figures were despite three-quarters of respondents predicting greater pressure from stakeholders for improved ethics and compliance programs.

The report by Integrity Interactive and the Association of Corporate Counsel (ACC) also found that although 99 percent of companies had a code of conduct or value and principles statement prescribing what staff can or cannot do, only half ensured that all employees were made to read it.

In addition, a quarter of companies confessed to sending their code to selected employees even though 72 percent believed that the entire workforce should be privy to it.

Frederick J. Krebs, ACC president, said: "Companies in the U.S. have spent the last several years ratcheting up their efforts on ethics and compliance but many of their European counterparts still have more work to do.

"For any ethics and compliance program to be effective and successful, it is vital that adequate steps are taken to ensure that all employees understand the policies in place. It is not good enough to have codes of practice buried on an Intranet site where employees have to proactively seek them out.

"Therefore training on codes and policies and the evaluation of levels of understanding of these, play a significant role in protecting a business against scandal and without it many could be heading for trouble."

TomorrowNow allegedly pretending to be Oracle customers and illegally hacking into its secure support Web site for users of Oracle's PeopleSoft and JD Edwards applications. SAP then allegedly copied content from the site and used it to offer Oracle customers cut-rate support services in the hopes of eventually migrating them over to SAP's rival applications.

So far, SAP has yet to respond publicly to the accusations, perhaps suggesting that a countersuit could be in the offing. As for Oracle, the vendor hasn't made any additional comment beyond the lawsuit itself.

"If we decide to trust a company, we'd hope it to be justified," said an IT manager at a French company that uses JD Edwards applications and sources its support for that software from TomorrowNow. "When we choose a supplier, we don't necessarily investigate them first," he added. The manager agreed to speak on the condition of anonymity for himself and his company.

While products, services and price are primary factors in procurement decisions, a vendor's ethics and business practices are also extremely important, according to John Matelski, chief security officer and deputy chief information officer for the city of Orlando and a JD Edwards user. He's also the former president of the Quest International Users Group, which focuses on the needs of PeopleSoft and JD Edwards applications customers that Oracle acquired through the January 2005 purchase of PeopleSoft.

"As a public-sector entity, which is directly accountable to its citizens and constituents, I would be concerned about our relationship with any vendor that is proven to conduct business in an unethical manner," Matelski wrote in an e-mail response for comment. He would prefer to do business with companies that can be trusted, and do not have a track record of inappropriate business practices.

"Due to the nature of the relationships that we develop, software vendors and consultants would be held to a higher standard, because they would typically have a greater level of access to our systems and data during implementation and support engagements," Matelski wrote. "The security and privacy of our data is key, and if an organization is known to have illegally obtained data before, I would need to be much more careful when evaluating whether to establish or continue a relationship with them."

David Mitchell, software practice leader at analyst Ovum drew a comparison between the potential damage of the lawsuit with fallout of the corporate spy scandal that hit Hewlett-Packard Co. last year. Despite leading to the resignations of several executives including its chairman, HP weathered the storm well and customers stayed loyal to the company.

"With HP, Hurd responded positively, he apologized," Mitchell said. "It was about the approach they took when something inappropriate had happened. If HP had not responded so positively I think they would have seen more negative consequences."

Should Oracle's charges against SAP be proven, "they need to embrace it and reassure people how it's come about," he added. If there was some wrongdoing, Mitchell, the former senior director for market development at Oracle UK, believes it'll turn out to be the work of one bad apple. "SAP ethically and culturally is a very correct organization, this isn't rotten DNA," he said. "If this turns out to be true, then it will be an individual, I think, who has acted inappropriately."

As for Oracle, the vendor needs to act to avoid any negative publicity from the suit given that it named many customers whose identities were allegedly purloined by SAP and suggested that SAP customers unknowingly might be using services that contain Oracle's intellectual property. "It could be good for Oracle to say, 'We have no beef with the customer, our beef is with SAP,'" Mitchell said. "Or it could be perceived as Oracle picking on the customer."

Andreas Chatziantoniou, a software consultant specializing in Oracle products with Accenture Technology Services in the Netherlands, wondered about another potential negative hit on Oracle.

"From the reputation side, I believe that this can backfire," he wrote in an e-mail. "Oracle has a reputation for dumpster diving in order to get information about competitors," alluding to an incident in 2000 when Oracle defended the actions of detectives it hired to investigate two research groups that supported Microsoft Corp. during its antitrust trial.

The lawsuit might be Oracle's way to gain some extra publicity, following the release earlier this week of the vendor's third-quarter financial results, according to Chatziantoniou. Perhaps a case of "read between the lines: our results could have been much better when SAP would play by the rules," he suggested.

The lawsuit alone won't deter customers from buying SAP's applications, but the noise around the legal action might give both SAP and Oracle users the sense that the firms are distracted and not fully focused on customers' needs, he added.

Now isn't the time for either Oracle or SAP to lose focus, given the competitive threat they face.

Last week, Microsoft, which has tended to focus more on the small to midsize business market with its Dynamics applications, vowed to compete more aggressively in the enterprise market against Oracle and SAP.

Another issue that should give vendors pause is that customers have long memories when it comes to scandals, Chatziantoniou wrote. "Even years later, people (the decision makers) remember the 'bad publicity,'" he added. What might suit the vendors' customers and partners is an out-of-court settlement, he concluded.

"So far such a situation has never happened to me in my business life, but if it did I would consider the fact very heavily when doing business with such a company," Manfred Reif, a managing director at HSH Nordbank, a credit investment bank in Luxembourg, wrote in an e-mail response to comment on the lawsuit. "Nevertheless, first of all being suspicious and 'listening' to your gut feeling should be one's daily duty," he added.

Another factor to bear in mind is the number of customers Oracle and SAP share, Seth Ravin, CEO and president of Rimini Street ., pointed out. He's a co-founder of TomorrowNow, selling his share of the company to SAP in early 2005 and establishing Rimini Street as a rival supplier of third-party maintenance and support.

While Oracle and SAP compete bitterly in the applications market, plenty of SAP users run their software on Oracle's database and middleware. It's in both vendors' interest to resolve the current dispute rapidly.

"So far, we've only heard one side of the argument," Ravin said, with SAP yet to comment.

Given how closely Oracle and SAP watch each other, he finds it hard to believe that the alleged actions by TomorrowNow were deliberate. "I strongly doubt it," he said, adding that such behavior wouldn't be in anyone's best interests and would likely be quickly discovered. Oracle appears to require users of its customer support database to be "self-policing," he said, in other words, they have access to more content than their specific needs warrant, which may have led to some confusion about what was OK for SAP to access and what wasn't.

Reed ruled that the American Civil Liberties Union's (ACLU) arguments against COPA, "true, reliable and credible and I accept those facts" and determined COPA violated the First Amendment's right to free speech.

Reed said that Attorney General Alberto Gonzales failed to "meet his burden of showing that COPA is the "least restrictive, most effective" alternative in achieving the "compelling [public] interest."

The ACLU filed a suit for permanent injunction relief against enforcing the law a week after Congress passed the measure in 1998. The organization argued that COPA overreached lawmakers' good intentions to protect children from "sexually explicit" material available online. Under COPA, children are defined as anyone under 17-years of age.

As written by Congress and signed by then President Bill Clinton, any commercial Web site operator that made "sexually explicit" material available to minors was, under COPA, subject to criminal and civil sanctions even if the online material was otherwise acknowledged as free speech for adults but deemed "harmful to minors."

COPA provided a safe harbor for Web site owners if they required the use of a credit card or other identification method used to verify age or, significantly, "any other reasonable measures that are feasible under available technology."

The ACLU immediately contended that Internet filtering technology was more feasible than any age verification methods, mitigating, the ACLU claimed, the impact on otherwise protected free speech. By the time the Bush administration inherited the political hot potato, it steadfastly maintained that filtering technology does not work and the threat of jail time and steep fines were the most effective defenses against making sexually explicit material available to minors.

Reed wrote that the ACLU's clients "post content on their Web sites including…resources on sexual health, safer sex, and sexual education; visual art and poetry; resources for gays and lesbians; online magazines and articles; music; and books and information about books that are being offered for sale." No matter Congress' valid interests to protect children, Reed ruled, such free speech restrictions on content stifled legal online free speech.

"I may not turn a blind eye to the law in order to attempt to satisfy my urge to protect this nation's youth by upholding a flawed statute, especially when a more effective and less restrictive alternative is readily available." Reed wrote.

As the case bounced all the way up from the district court to the Supreme Court and back down again, the Bush administration insisted filtering technology is not an effective tool for parents to censor adult content for their children. The ACLU argued otherwise. As the case dragged on for almost a decade, the Department of Justice (DoJ) eventually subpoenaed Google, Yahoo, MSN and AOL for proof child protection filters were ineffective tools against sites with sexually explicit material.

While Google successfully fought the subpoenas, the other search engines turned over evidence that convinced Roberts that "filtering products block both Web pages originating from within the United States and Web pages originating from outside the United States."

That determination, Roberts ruled, sank the DoJ's defense of COPA.

Roberts said that, in addition to their content-filtering features, filters can provide parents with a report indicating which Web sites a child visited, which sites were blocked, the number of e-mails and instant messages a child sent and to whom a child sent e-mail or instant messages.

Roberts further ruled that Internet-filtering technologies offer "money-back guarantees or free trial periods, so that parents can simply download a filtering product for free over the Internet and then use it for a set time period to see if it is something that they want to continue using."

"Based upon the testimony of [ACLU witnesses], which I accept, I find that filters generally block about 95 percent of sexually explicit material," Roberts ruled. He also determined that two separate reports commissioned by Congress, "have confirmed that content filters can be effective at preventing minors from accessing harmful materials online."

The Bush administration has the right to appeal the decision, but the DoJ had not responded to Roberts' decision by press time.

"We think some people may have skipped over it on the form – even with the software, in some instances – just completing the return as they did last year. We've been surprised by that," Everson said.

For this year only, most taxpayers can claim a refund of $30 to $60. The amount depends on the size of your family, for taxes the IRS mistakenly collected on long-distance phone services. So far, 30 percent of tax filers are failing to claim the refund, and half of the taxpayers paid preparers to complete their return, Forbes reported.

On the other hand, the IRS received huge telephone refund claims, allegedly fraudulent, for around $10,000 early in the filing season. "That's a lot of phone usage. Even my teenage kids can't generate that much phone usage," Everson joked. A subsequent crackdown on fraud appears to be effective, he said.

Other challenges for the IRS included extensions of tax breaks that did not become final until the end of December. The agency had to hussle to implement the changes in time for filing deadlines, and incorporate the changes into software programs.

A new direct-deposit service was also difficult: Filers can split their refund and have it sent electronically to different financial institutions. Everson said about 55,000 people took advantage of the service, that’s of 74 million returns processed so far, but he expects it to become more popular.

In most countries, lawyers are not required to hold an LL.M. degree, and many do not choose to obtain one. An LL.M. degree by itself generally does not qualify graduates to practice law. In most cases, LL.M. students must first obtain a professional degree in law, e.g. the Bachelor of Laws (LL.B.) in the United Kingdom or the Juris Doctor (J.D.) in the United States, and pass a bar exam or the equivalent exam in other countries, such as the Zweites Staatsexamen in Germany. While the general curriculum of the LL.B. and J.D. is designed to give students the basic skills and knowledge to become lawyers, law students wishing to specialize in a particular area can continue their studies with an LL.M. program. Some universities also consider students for their LL.M. program who hold degrees in other related areas, or have expertise in a specific area of law.

Graduation requirements for an LL.M. program vary depending on the respective university guidelines. Some programs are research-oriented and require students to write a thesis, while others only offer a number of classes that students must take to complete the course of study. Many LL.M. programs combine both coursework and research. Part-time programs are also available for professionals wishing to complete their LL.M. while working full-time.

Prospective students should be aware that there is no universal definition for the term LL.M. It is used in different ways by institutions around the world. Particularly in the United States and Germany, LL.M. programs are often designed to teach foreign lawyers the basic legal principles of the host country. In this regard, the LL.M. can help lawyers seeking to relocate and practice in another country, or expand their area of practice to multinational issues. The completion of an LL.M. program, however, does not automatically qualify foreign students to take the bar exam in their host country. In the U.S., for example, some states allow foreign lawyers to seek admission to the bar upon completion of an LL.M., while in other states, a J.D. is required.

LL.M. is an abbreviation of the Latin Legum Magister, which means Master of Laws. In Latin, the plural form of a word is abbreviated by repeating the letter. Hence, "LL." is short for "laws." Legum is the possessive plural form of the Latin word lex, which means "specific laws", as opposed to the more general concept embodied in the word jus, from which the word juris and the modern English word "justice" are derived.

The media recently has been writing the obituary of the tort lawyers. "The power of the plaintiffs bar is on the wane," argued the American Lawyer; a cover story in Business Week promised to reveal "How Business Trounced the Trial Lawyers." With apologies to Mark Twain, the reports of the trial lawyers' demise are greatly exaggerated.

While asbestos and tobacco litigation bonanzas are winding down, America's most aggressive contingency-fee law firms still have in place a fee structure in search of an investment strategy. And so, faced with shrinking domestic opportunities, these firms have gone global.

Consider one class-action lawsuit, in which a plaintiffs firm sued Deutsche Bank on behalf of an African tribe which suffered atrocities committed by imperial Germany in the 19th century. Or another, consolidating 10 complaints filed around the country on behalf of all South Africans injured by the former apartheid regime from 1948 to the present.

One of the South African complaints was on behalf of a class including 32,000 plaintiffs; the class in another was estimated to encompass "millions of individuals." The defendants, almost 100 multinational corporations that did business in South Africa after 1948, were alleged to be liable for injuries on the theory that they had aided and abetted the apartheid regime. Purported damages in just one of the consolidated actions total $400 billion.

The law used to lodge these massive foreign class actions in the U.S. is the Alien Tort Statute (ATS). This obscure piece of legislation adopted in 1789 gave federal district courts jurisdiction in civil cases brought by an alien for a tort committed in violation of the law of nations, or of a U.S. treaty. The law was passed primarily to assure a hearing for cases involving offenses against foreign ambassadors, violations of safe conduct and piracy.

The ATS was virtually dormant for two centuries. Then relatives of a Paraguayan citizen who had been kidnapped and tortured to death by a Paraguayan police official—on Paraguayan soil—brought a civil suit against the police official. Plaintiffs and defendants happened to be in the U.S., the police official illegally. In 1980 a U.S. court of appeals allowed the suit to go forward under the ATS, on the grounds that the police official violated international law, including various U.N provisions. From that acorn a mighty oak has grown.

Even by American standards the size of recent ATS class actions is extraordinary. Cases involving wholly foreign events routinely consist of tens or hundreds of thousands of "John Doe" plaintiffs who reside in remote locations as distant as Sudan and Pakistan. The size of the class of defendants has also grown to 500 or more deep-pocketed individuals or companies.

The fact that these lawsuits appear in U.S. courts at all defies common sense. Imagine our justifiable indignation if courts in Japan, France or Russia determined they had jurisdiction over alleged wrongdoing by Americans, in America, against other Americans. It takes a thoroughly arrogant view of the world—call it legal imperialism—to presume that our courts should be the arbiter of problems everywhere, whether or not the problem had anything whatsoever to do with the U.S.

Nevertheless, our tort lawyers presume just that, demanding that our court system sit in judgment over alleged conduct occurring completely within the borders of other sovereign nations, regardless of the effect this may have on U.S. foreign relations. Huge ATS cases have been filed against classes of unnamed defendants in Saudi Arabia, the United Arab Emirates, Qatar and other countries in the Middle East where vital, and delicate, U.S. national security interests are at stake.

Of course, it ultimately will be impractical for U.S. courts to police these monster ATS class actions if they are allowed to proliferate; they dwarf in size the asbestos cases that currently plague the U.S. courts. Congress could have amended the ATS to limit the damage, and in 2005, Democratic Sen. Dianne Feinstein proposed to do so, without success.

Fortunately, the Supreme Court weighed in. In Sosa v. Alvarez-Machain, a Mexican doctor suspected to have participated in the torture and murder of a U.S. DEA agent was apprehended in Mexico by Jose Sosa, a Mexican national hired by U.S. law enforcement. Mr. Sosa brought the Mexican doctor to the U.S., where he was arrested. The doctor sued Mr. Sosa for unlawful detention. In 2004, the Supreme Court dismissed the action and imposed a "high bar" against innovative ATS lawsuits. As a result of Sosa, several ATS suits have been rejected because of the potential for interference with U.S. foreign policy.

In one case, the D.C. circuit dismissed an ATS case seeking reparations from Japan for crimes committed during World War II because the suit interfered with state-to-state negotiations and threatened to "disrupt Japan's delicate relations with China and Korea, thereby creating serious implications for stability in the region."

In another, a federal court dismissed a case brought after the Israeli Defense Forces used heavy equipment to demolish buildings in the Palestinian territory. Plaintiffs sought damages from the manufacturer, Caterpillar, along with an order to stop supplying products to the Israeli armed forces. The court noted that the plaintiffs improperly sought to challenge the acts of an existing government in a region "where diplomacy is delicate and U.S. interests are great."

Trial lawyers nevertheless continue to test the outer limits of ATS liability, "high bar" or not, by filing an array of increasingly ambitious ATS class actions. In one pending case, Wal-Mart has been sued on behalf of residents of China, Bangladesh, Indonesia, Swaziland and Nicaragua. Plaintiffs seek to hold the company vicariously liable for the labor policies of its overseas suppliers. The improvement of labor policies in other countries is certainly a worthy goal. But it is the province of the executive branch and Congress under the foreign affairs and treaty-making powers, not that of attorneys looking for contingency fees.

The corporations named in the South African case—including IBM, General Motors, Ford, Xerox, Coca-Cola and Citigroup—were legally doing business in South Africa pursuant to the official U.S. policy of "constructive engagement" that sought to encourage positive changes in South Africa through economic investment. Recognizing this, the federal court in the Southern District of New York dismissed all 10 of the cases.

That dismissal, along with the dismissals of several other ATS cases, is now pending on appeal before the Second and Ninth Circuits. As these and other ATS cases ripen for appellate review, the era of post-Sosa ATS jurisprudence is entering a critical phase.

The executive branch has promoted strict conformance with Sosa: Both the Clinton and Bush administrations have filed progressively stronger "Statement of Interest" briefs urging that federal courts dismiss ATS cases that could interfere with U.S. foreign policy.

Still, leading class-action law firms such as Motley Rice, Milberg Weiss and Cohen Milstein have launched exploratory ATS cases to test the waters, trying to maneuver around sovereign immunity, which prevents lawsuits against foreign governments. Instead, the plaintiffs lawyers claim that U.S. corporations doing business abroad are vicariously liable for the purely overseas acts of foreign governments, or other actors, in jurisdictions where the U.S. companies do business. And pressured by the massive exposure involved in ATS class actions, defendants in some early cases have opted to settle rather than undertake the risks of litigation.

These plaintiffs firms are flush with cash, experts in the business of creating cases, and undeterred by setbacks. In fact, contingency-fee lawyers take each rejection as a lesson in which tactics work and which do not. They know that if they can weather dismissal motions in a single case, they can proliferate a succession of copycat ATS class actions.

Once they do, you can be sure that a torrent of global ATS class actions will follow—to the detriment of the U.S. court system, foreign policy and U.S. standing around the world.

The media recently has been writing the obituary of the tort lawyers. "The power of the plaintiffs bar is on the wane," argued the American Lawyer; a cover story in Business Week promised to reveal "How Business Trounced the Trial Lawyers." With apologies to Mark Twain, the reports of the trial lawyers' demise are greatly exaggerated.

While asbestos and tobacco litigation bonanzas are winding down, America's most aggressive contingency-fee law firms still have in place a fee structure in search of an investment strategy. And so, faced with shrinking domestic opportunities, these firms have gone global.

Consider one class-action lawsuit, in which a plaintiffs firm sued Deutsche Bank on behalf of an African tribe which suffered atrocities committed by imperial Germany in the 19th century. Or another, consolidating 10 complaints filed around the country on behalf of all South Africans injured by the former apartheid regime from 1948 to the present.

One of the South African complaints was on behalf of a class including 32,000 plaintiffs; the class in another was estimated to encompass "millions of individuals." The defendants, almost 100 multinational corporations that did business in South Africa after 1948, were alleged to be liable for injuries on the theory that they had aided and abetted the apartheid regime. Purported damages in just one of the consolidated actions total $400 billion.

The law used to lodge these massive foreign class actions in the U.S. is the Alien Tort Statute (ATS). This obscure piece of legislation adopted in 1789 gave federal district courts jurisdiction in civil cases brought by an alien for a tort committed in violation of the law of nations, or of a U.S. treaty. The law was passed primarily to assure a hearing for cases involving offenses against foreign ambassadors, violations of safe conduct and piracy.

The ATS was virtually dormant for two centuries. Then relatives of a Paraguayan citizen who had been kidnapped and tortured to death by a Paraguayan police official—on Paraguayan soil—brought a civil suit against the police official. Plaintiffs and defendants happened to be in the U.S., the police official illegally. In 1980 a U.S. court of appeals allowed the suit to go forward under the ATS, on the grounds that the police official violated international law, including various U.N provisions. From that acorn a mighty oak has grown.

Even by American standards the size of recent ATS class actions is extraordinary. Cases involving wholly foreign events routinely consist of tens or hundreds of thousands of "John Doe" plaintiffs who reside in remote locations as distant as Sudan and Pakistan. The size of the class of defendants has also grown to 500 or more deep-pocketed individuals or companies.

The fact that these lawsuits appear in U.S. courts at all defies common sense. Imagine our justifiable indignation if courts in Japan, France or Russia determined they had jurisdiction over alleged wrongdoing by Americans, in America, against other Americans. It takes a thoroughly arrogant view of the world—call it legal imperialism—to presume that our courts should be the arbiter of problems everywhere, whether or not the problem had anything whatsoever to do with the U.S.

Nevertheless, our tort lawyers presume just that, demanding that our court system sit in judgment over alleged conduct occurring completely within the borders of other sovereign nations, regardless of the effect this may have on U.S. foreign relations. Huge ATS cases have been filed against classes of unnamed defendants in Saudi Arabia, the United Arab Emirates, Qatar and other countries in the Middle East where vital, and delicate, U.S. national security interests are at stake.

Of course, it ultimately will be impractical for U.S. courts to police these monster ATS class actions if they are allowed to proliferate; they dwarf in size the asbestos cases that currently plague the U.S. courts. Congress could have amended the ATS to limit the damage, and in 2005, Democratic Sen. Dianne Feinstein proposed to do so, without success.

Fortunately, the Supreme Court weighed in. In Sosa v. Alvarez-Machain, a Mexican doctor suspected to have participated in the torture and murder of a U.S. DEA agent was apprehended in Mexico by Jose Sosa, a Mexican national hired by U.S. law enforcement. Mr. Sosa brought the Mexican doctor to the U.S., where he was arrested. The doctor sued Mr. Sosa for unlawful detention. In 2004, the Supreme Court dismissed the action and imposed a "high bar" against innovative ATS lawsuits. As a result of Sosa, several ATS suits have been rejected because of the potential for interference with U.S. foreign policy.

In one case, the D.C. circuit dismissed an ATS case seeking reparations from Japan for crimes committed during World War II because the suit interfered with state-to-state negotiations and threatened to "disrupt Japan's delicate relations with China and Korea, thereby creating serious implications for stability in the region."

In another, a federal court dismissed a case brought after the Israeli Defense Forces used heavy equipment to demolish buildings in the Palestinian territory. Plaintiffs sought damages from the manufacturer, Caterpillar, along with an order to stop supplying products to the Israeli armed forces. The court noted that the plaintiffs improperly sought to challenge the acts of an existing government in a region "where diplomacy is delicate and U.S. interests are great."

Trial lawyers nevertheless continue to test the outer limits of ATS liability, "high bar" or not, by filing an array of increasingly ambitious ATS class actions. In one pending case, Wal-Mart has been sued on behalf of residents of China, Bangladesh, Indonesia, Swaziland and Nicaragua. Plaintiffs seek to hold the company vicariously liable for the labor policies of its overseas suppliers. The improvement of labor policies in other countries is certainly a worthy goal. But it is the province of the executive branch and Congress under the foreign affairs and treaty-making powers, not that of attorneys looking for contingency fees.

The corporations named in the South African case—including IBM, General Motors, Ford, Xerox, Coca-Cola and Citigroup—were legally doing business in South Africa pursuant to the official U.S. policy of "constructive engagement" that sought to encourage positive changes in South Africa through economic investment. Recognizing this, the federal court in the Southern District of New York dismissed all 10 of the cases.

That dismissal, along with the dismissals of several other ATS cases, is now pending on appeal before the Second and Ninth Circuits. As these and other ATS cases ripen for appellate review, the era of post-Sosa ATS jurisprudence is entering a critical phase.

The executive branch has promoted strict conformance with Sosa: Both the Clinton and Bush administrations have filed progressively stronger "Statement of Interest" briefs urging that federal courts dismiss ATS cases that could interfere with U.S. foreign policy.

Still, leading class-action law firms such as Motley Rice, Milberg Weiss and Cohen Milstein have launched exploratory ATS cases to test the waters, trying to maneuver around sovereign immunity, which prevents lawsuits against foreign governments. Instead, the plaintiffs lawyers claim that U.S. corporations doing business abroad are vicariously liable for the purely overseas acts of foreign governments, or other actors, in jurisdictions where the U.S. companies do business. And pressured by the massive exposure involved in ATS class actions, defendants in some early cases have opted to settle rather than undertake the risks of litigation.

These plaintiffs firms are flush with cash, experts in the business of creating cases, and undeterred by setbacks. In fact, contingency-fee lawyers take each rejection as a lesson in which tactics work and which do not. They know that if they can weather dismissal motions in a single case, they can proliferate a succession of copycat ATS class actions.

Once they do, you can be sure that a torrent of global ATS class actions will follow -to the detriment of the U.S. court system, foreign policy and U.S. standing around the world.