Is Culture Destiny? — An Empirical Analysis of Foreigners’ Litigation Performance Before the International Trade Commission

Abstract

This study is the first to explore how culture influences a party’s choices and performance in international litigation. It analyzes three aspects of culture in international litigation: cultural barriers to the participation in litigation, cultural risk preferences, and the unique influences that major cultural zones have upon litigation. This study also expands upon the Priest-Klein model of case selection to facilitate analysis. This study uses logistic regression to analyze Section 337 investigations in the U.S. International Trade Commission (“ITC”). Cultural difference, measured by both social values and linguistics, is found to significantly impair every aspect of a foreign party’s performance. Respondents from the Confucian cultural zone are found to be much more likely to settle litigation. This study also finds an unexpected interplay between uncertainty avoidance and cultural heritage: uncertainty avoidance enhances litigation performance only for respondents from the Confucian cultural zone. Other variables such as the economic development level of the home society of a respondent, the time of the investigation, the number of home societies of respondents, and whether the respondent is foreign also lead to statistically significant conclusions. Variables that are not found to have meaningful influences are also presented. The finding of a cultural barrier to a certain extent exonerates U.S. adjudicators whom some prior studies have blamed for xenophobia bias. This article also reviews previous claims of bias on the part of the ITC and finds them unpersuasive. Foreign respondents actually outperform domestic respondents after cultural and other factors are considered. Statistical analysis suggests that the superior outcomes of foreign respondents can be explained by their attraction to weak cases.