International Ass’n of Machinists v. OPEC
Citation and Court
649 F.2d 1354 (9th Cir. 1981)
Facts
The International Association of Machinists and Aerospace Workers sued OPEC member states in U.S. federal court, alleging that OPEC’s coordinated oil production limits and price-fixing violated U.S. antitrust law and caused economic injury to Americans through higher fuel costs.
Issue
Whether U.S. courts have jurisdiction over OPEC member states for antitrust claims arising from their collective oil pricing decisions, and whether the act of state doctrine or FSIA bars the suit.
Holding
The case was dismissed; the act of state doctrine bars U.S. courts from adjudicating the validity of OPEC member states’ decisions on oil production and pricing, which are sovereign governmental acts taken within their own territories.
Rule / Doctrine
Decisions by foreign sovereign governments regarding the exploitation of their own natural resources — including setting oil production levels and prices — are quintessential sovereign acts. The act of state doctrine prevents U.S. courts from invalidating such decisions, even when those decisions have anticompetitive effects in the United States.
Significance
IAM v. OPEC established that the act of state doctrine, not just FSIA immunity, shields foreign sovereign resource-management decisions from U.S. antitrust scrutiny. Together with Prewitt Enterprises v. OPEC, it illustrates the near-total insulation of OPEC from U.S. judicial oversight.