How to Sue a Foreign Company: Jurisdiction, Service, and Collection

To sue a foreign company in the United States, you first confirm your contract does not force the dispute into arbitration, then file in a U.S. court that has personal jurisdiction over the company, serve the lawsuit under the international rules that apply to the country where the company is based, and plan from the start for how you will collect if you win. Knowing how to sue a foreign company means treating jurisdiction and collection as the two hard problems and everything else as procedure around them. Getting a step wrong can cost months and thousands of dollars in translation, filing, and legal fees you cannot recover.

Read Your Contract for an Arbitration Clause

Before you hire a lawyer to draft a complaint, read anything you signed with the foreign company. Many international commercial agreements contain a mandatory arbitration clause requiring disputes to go to a private arbitrator rather than a court. If yours does, filing a lawsuit is likely wasted effort. The company will move to compel arbitration, and U.S. courts are required to enforce those clauses.

The United States enforces the New York Convention through Chapter 2 of the Federal Arbitration Act. It covers any commercial arbitration agreement where at least one party is not a U.S. citizen or the transaction has a meaningful connection to a foreign country.¹ When the company moves to compel, the court must stay the case until arbitration finishes. Courts resolve close calls in favor of arbitration, so a broadly worded clause will almost certainly take your dispute out of court.

If the clause is silent on where arbitration happens, federal district courts have jurisdiction over proceedings to compel arbitration under the Convention regardless of the amount in dispute.¹ If there is no arbitration clause, or the clause is narrow enough that your claim falls outside it, you can go to court.

Choose Between Federal and State Court

Federal courts hear cases between U.S. citizens and foreign parties under diversity jurisdiction, but only when the amount in dispute exceeds $75,000.² Below that, you generally file in state court.

For a corporation, citizenship for jurisdictional purposes is both the country of incorporation and the country of its principal place of business.² A company incorporated in Germany with headquarters in Munich and no U.S. incorporation is a foreign party for diversity purposes.

Federal court also gives you more venue flexibility. A defendant that is not a U.S. resident can be sued in any federal judicial district.³ You can file wherever personal jurisdiction exists, without the venue constraints that limit suits against domestic defendants.

Establish Personal Jurisdiction

A U.S. court cannot hear your case unless it has personal jurisdiction over the foreign company. The standard is the “minimum contacts” test: the company must have purposefully directed activities toward the state where you file.⁴

Jurisdiction comes in two forms. General jurisdiction exists when a company’s ties to a state are so continuous and systematic that it is essentially “at home” there. For a corporation, that typically means only the state of incorporation or the state of its principal place of business.⁵ The Supreme Court has made clear that simply doing a lot of business in a state is not enough. A Japanese manufacturer that sells millions of dollars of products across the United States is probably not “at home” in any particular state.

Specific jurisdiction is the more common route. It applies when your lawsuit arises from the company’s activities in the state where you file. A foreign company that sold you a defective product through a U.S. distributor, ran a targeted ad campaign in your state, or negotiated a contract with you there has likely created enough contacts.⁴ The question is whether the company deliberately reached into your state in a way that connects to your claim.

Websites and E-Commerce

When the only connection is a website, courts look at how interactive it is. A site that merely posts information available to anyone worldwide is unlikely to create jurisdiction anywhere. A site that takes orders from customers in your state, processes payments, and ships products there creates stronger grounds. The more a company targets your specific market through local pricing, shipping options, or language, the stronger the case that it purposefully directed activity toward your state.

Foreign Parents and U.S. Subsidiaries

Many foreign companies operate here through a U.S. subsidiary that is a separate legal entity. You generally cannot sue the foreign parent based only on the subsidiary’s presence. If the parent’s control over the subsidiary is so pervasive that the subsidiary has no real independence, courts may treat it as an “alter ego” of the parent and subject the parent to jurisdiction wherever the subsidiary operates. Courts set a high bar, and factors vary by state. If the subsidiary runs as a genuine independent business, the corporate separation will hold.

Anticipate the Defenses That End Cases Early

Forum Non Conveniens

Even after you establish jurisdiction, a foreign company can ask the court to dismiss the case on the ground that the United States is a seriously inconvenient place to try it. The company will argue that the witnesses, evidence, and events sit abroad, and that a foreign court is the more practical venue.

Courts weigh where the evidence and witnesses are, the cost of bringing them here, whether the foreign court can adequately handle the case, and the local interest in resolving the dispute. Your choice of a U.S. forum gets some deference, but if the balance tips strongly the other way, the court can dismiss. That is not a loss on the merits; you would have to refile in the foreign country.

Foreign Sovereign Immunity

If the company is owned or controlled by a foreign government, sovereign immunity can block your case. Foreign states and their instrumentalities are generally immune from suit in the United States. The main exception is commercial activity: a foreign state loses immunity when the suit is based on commercial activity it carried on here, on acts here connected to commercial activity elsewhere, or on activity abroad that has a direct effect in the United States.⁶

In practice, a state-owned airline, bank, or oil company operating commercially here can be sued; a foreign government agency performing a purely governmental function cannot. If you suspect government ties, research the ownership structure before filing.

Serve the Company Under Rule 4(f)

Filing a complaint starts the lawsuit, but the foreign company has no obligation to respond until it has been formally served. For foreign defendants, service is governed by Federal Rule of Civil Procedure 4(f), which sets a hierarchy of methods.

The first option is any internationally agreed means reasonably calculated to give notice, such as the Hague Service Convention. If no international agreement applies, or if it allows alternatives, the rule permits service by the foreign country’s own procedures, through a letter of request to the foreign court, or by personal delivery or signed-receipt mail unless the foreign country’s law prohibits it. As a last resort, a court can order any method not prohibited by international agreement.

The Hague Service Convention

For countries that are parties to the Hague Service Convention, its procedures typically take priority. You send your documents to a designated Central Authority in the foreign country, which arranges service under its own domestic procedures.⁷ No special authentication of documents is required.

The Central Authority can require that all documents be translated into the country’s official language.⁷ Professional translation of a complaint and supporting papers can run from hundreds to several thousand dollars depending on length and language. The Convention also sets a minimum waiting period of six months from transmission before a court may enter a default judgment, so plan on at least that long.

Services performed by the Central Authority are generally free under Article 12, though you may be billed for expenses of the judicial officer who carries out service or for any special method you request.⁸

Service by Mail

Some countries allow service by registered mail under Article 10(a), but many have formally objected. If the country has filed an objection, service by mail is void. The U.S. Department of State advises checking whether a country has objected before using postal channels.⁹ Getting service wrong is not just a delay. You may have to start the process over, adding months and thousands of dollars in translation and filing costs.

Get Evidence From Abroad

American discovery is broad, but that breadth does not travel well. When you need documents or testimony from a foreign company’s offices abroad, you will run into obstacles that do not exist in domestic litigation.

The main tool is the Hague Evidence Convention. You submit a formal “letter of request” through the foreign country’s Central Authority, specifying the evidence sought, the people to be examined, and the questions to be asked. The request must be in or translated into the receiving country’s language, though member states must also accept requests in English or French.¹⁰ The foreign authority can refuse only on narrow grounds, such as national security or sovereignty.

A harder problem is that several countries, France and Germany among the most notable, have blocking statutes that make it a criminal offense for their companies to comply with American discovery requests. Companies there may genuinely face conflicting legal obligations. When that happens, U.S. courts balance the importance of the evidence against the foreign restrictions, and the result is unpredictable. Expect international discovery to take longer and produce less than it would against a domestic defendant.

Collect the Judgment

Winning is only half the problem. A judgment is worthless if you cannot collect on it, so build your collection strategy around where the company’s assets actually sit.

U.S. Assets First

If the company holds assets in the United States, such as bank accounts, real property, inventory, or accounts receivable, enforce the judgment here. After the judgment is final, you request a writ of execution directing law enforcement to seize and sell non-exempt property. For assets held by a third party like a bank, you pursue a garnishment order.¹¹ This is the fastest and simplest path to payment, which is why identifying U.S. assets early in the case matters so much.

Enforcing Abroad

If the company has no meaningful U.S. assets, you have to get a foreign court to recognize and enforce your American judgment. No international treaty obligates foreign countries to honor U.S. judgments, so enforcement depends on the law of the country where you want to collect.

Many countries will consider enforcement under the principle of comity, a practice of mutual respect between legal systems. The foreign court will typically examine whether the U.S. court had proper jurisdiction, whether the defendant received adequate notice, and whether the proceedings met basic standards of fairness. Enforcement abroad usually requires hiring a local attorney, translating the judgment and supporting documents, and initiating a separate proceeding there. Some countries are more receptive than others, and a few resist enforcement altogether. Researching the target country’s track record before you file the original lawsuit can save you from winning a judgment you can never collect.

1
Office of the Law Revision Counsel. 9 USC Ch 2 – Convention on the Recognition and Enforcement of Foreign Arbitral Awards
2
Office of the Law Revision Counsel. 28 US Code 1332 – Diversity of Citizenship, Amount in Controversy, Costs
3
Office of the Law Revision Counsel. 28 US Code 1391 – Venue Generally
4
LII / Legal Information Institute. Minimum Contacts
5
Justia US Supreme Court. Daimler AG v Bauman, 571 US 117 (2014)
6
Office of the Law Revision Counsel. 28 US Code 1605 – General Exceptions to the Jurisdictional Immunity of a Foreign State
7
HCCH. 14 – Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters
8
U.S. Department of Justice. OIJA Guidance on Service Abroad in US Litigation
9
U.S. Department of State. Service of Process
10
HCCH. 20 – Convention of 18 March 1970 on the Taking of Evidence Abroad in Civil or Commercial Matters
11
Legal Information Institute. Writ of Execution