## Facts

- Filetech S.A.R.L. (Filetech), a French corporation, assembled consumer information and sold marketing lists, largely based on French telephone-subscriber data.
- France Telecom S.A. (France Telecom), a telecommunications entity owned and operated by the French government at the time, provided telephone service throughout France and maintained subscriber databases used to create marketing lists.
- French data-protection law permitted individuals to opt out of computerized processing of their personal data for marketing uses; violations could carry criminal penalties.
- To comply with French law, France Telecom compiled and maintained a list identifying subscribers who had opted out of marketing-related processing.
- France Telecom possessed that opt-out list and refused to provide it (or equivalent “clean” information) to competing list providers such as Filetech.
- Filetech sued France Telecom in France, claiming France Telecom’s control of the opt-out information gave it a monopoly over “safe” marketing lists usable without risking violations of French privacy law; France Telecom responded that French law barred disclosure.
- While the French litigation was still pending, Filetech filed suit in the Southern District of New York (1995), asserting that France Telecom monopolized the marketing-list business in violation of Sherman Act § 2 and that the conduct affected U.S. commerce, including Filetech’s intended U.S. operations.

## Issues

1. Whether the court should dismiss the Sherman Act claims under the doctrine of international comity because parallel French proceedings were pending and the dispute turned on French privacy regulation with potential criminal consequences.
2. Whether the court lacked subject-matter jurisdiction because France Telecom, as an instrumentality of France, was immune under the Foreign Sovereign Immunities Act (FSIA).
3. Whether the Foreign Trade Antitrust Improvements Act (FTAIA) required dismissal because the challenged conduct was largely foreign and the alleged effects on U.S. commerce were insufficient at the pleading stage.

## Decision

- The court dismissed the case on international comity grounds.
- The court rejected France Telecom’s FSIA argument at this stage, concluding the allegations fit within the commercial-activity exception.
- The court declined to dismiss under the FTAIA on the pleadings and resolved the motion on comity instead.

## Legal Principles

- International comity allows a federal court, in its discretion, to abstain from exercising jurisdiction when adjudication would materially interfere with a foreign sovereign’s regulatory choices, especially where closely related proceedings are already pending abroad.
- Comity carries added weight when the dispute is anchored in foreign statutes reflecting public policy (including privacy rules backed by criminal sanctions) and when a U.S. ruling could place a party in conflict with foreign law or disrupt foreign adjudication.
- Under the FSIA, a foreign state and its agencies or instrumentalities are not immune when the action is based upon commercial activity; conduct tied to compiling, marketing, and selling customer-data products can qualify as commercial activity for FSIA purposes.
- The FTAIA generally restricts Sherman Act coverage of foreign conduct unless that conduct has a direct, substantial, and reasonably foreseeable effect on U.S. domestic (or certain import/export) commerce and that effect gives rise to the claim; a court may decide dismissal on comity without definitively resolving FTAIA limitations on a Rule 12 motion.

## Conclusion

Filetech’s Sherman Act § 2 case against France Telecom was dismissed because the dispute centered on France’s subscriber-data privacy regime and a parallel, ongoing French lawsuit addressing the same core controversy, making U.S. adjudication likely to interfere with French sovereign interests; the court nevertheless found FSIA immunity did not bar the suit and did not find the FTAIA required dismissal at the pleading stage.


Filetech S.A.R.L. v. France Telecom, 978 F. Supp. 464 (1997)