Jonathan Poling Comments on Appeals Court Ruling Against CFIUS

Jonathan Poling, a partner in Akin Gump’s international trade practice, is quoted in FDI Magazine on a recent case involving Sanay Group, a Chinese manufacturer of construction machinery, and the Committee on Foreign Investment in the United States (CFIUS).

CFIUS had ordered Ralls to sell property in Oregon consisting of four wind farms located in or near U.S. Navy restricted airspace because it raised national security concerns. Pres. Obama upheld the CFIUS decision and, while his ruling is not subject to review, Ralls still appealed, first unsuccessfully to a federal district court in Washington and then to the U.S. Court of Appeals, claiming it was denied due process. The appeals court said Sanay had a constitutional right to see and rebut the unclassified evidence relied on by CFIUS in ordering Ralls to sell the property that raised national security concerns.

Poling, a former Justice Department representative on CFIUS, says that while the court agreed with the company, its ruling only applies to “unclassified” information. Since much of CFIUS’s work is classified, he predicts “this ruling will make CFIUS all the more reluctant to generate unclassified information in its analysis.”