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The 11th U.S. Circuit Court of Appeals has reversed a district court’s ruling that barred a Costa Rican distributor from taking legal action against a multinational company outside the United States, an issue involving foreign anti-suit injunctions that has caused a split in the circuit courts. The Nov. 21 ruling allows Lantech, a Costa Rican corporation, to pursue legal action in Costa Rica against Canonlat, Canon Inc.’s Latin American operation. Canon v. Lantech, No. 07-13571 (11th Cir.). [See related article.] Canonlat was Lantech’s distributor of photocopiers and related materials before the two companies terminated their relationship as a result of delinquent payments. Legal action followed in courts in Costa Rica and Florida, raising the issue of whether American courts can bar proceedings in foreign courts. In July, a Florida judge issued an anti-suit foreign injunction in a summary judgment, stopping Lantech from taking legal action in Costa Rica. The latest ruling vacates that injunction. The appeals court said the district court erred in issuing the injunction because � �while acknowledging the two legal actions are similar � Canonlat did not demonstrate that resolving the matter in the Florida district court would dispose of Lantech’s claim in Costa Rica. “That the district court regarded the ‘dispositive’ requirement as merely an ‘additional factor’ in some courts, and not as a prerequisite, is therefore legal error that constitutes an abuse of discretion,” the appeals court stated. Traci Rollins, a partner in the West Palm Beach, Fla., office of Squire, Sanders & Dempsey who represented Lantech, said the case has been in the courts longer than expected, but that the right ruling has been issued. “I think the decision articulates in black and white exactly what is necessary as a threshold requirement for obtaining an anti-suit foreign injunction,” she said. “This case did not meet the test of similarity of actions.” Michael Diaz Jr., managing partner of Miami’s Diaz, Reus, Rolff & Targ, who represented Canonlat, was not immediately available for comment. The 2d, 3d, 6th and the D.C. circuit courts of appeals have issued decisions making anti-suit injunctions more difficult, while the 5th, 7th and 9th circuit courts have taken a more liberal approach. The 1st circuit has applied a mixed approach.

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