Reason Was that Iranian Law Limited Calculation of Amount In Accordance With Official Tariff Ceiling.
Although not from California, this case is important in highlighting how the choice of law can really drive the result in a particular matter, including on appeal.
In McKesson Corp. v. Islamic Republic of Iran, No. 01-7041 (D.C. Cir. June 3, 2014), Iran appealed a $13.4 million fee award to McKesson Corp. under a U.S. fee-shifting calculation after a “baroque procedural history” of some years following a $29.3 million judgment in McKesson’s favor for expropriating its interests in a dairy after the 1979 Iranian Revolution.
Iran did well to appeal on the choice of law issue. The D.C. Circuit reduced the fee award down to $29,516. (Yes, this is no typo.) Both sides agreed that Iranian law applied to fee entitlement, which did exist, but McKesson tried to run away from the reality that Iranian law had an “official tariff” rule that capped the calculation of fees at much, much lower levels than the district judge’s award using American lodestar/multiplier analysis. Because McKesson could not meet its burden of showing the official tariff did not apply, the fee award had to be reduced to the tariff “cap.” Ouch!
Diminished. “Shamus O’Brien”, Irish Wolfhound, and “Cortez”, Mexican Chihuahua. Seventh Annual Dog Show of the Washington Kennel Club. 1920. Library of Congress.
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