The supreme court of Brazil, known as the Supreme Federal Court (STF), recently ratified the ruling of an American court regarding a legal dispute between an American and Brazilian company.
The Case
The matter at issue involves a decision by a New York court that ordered copyright distributor Latin Stock Brazil Produces to pay $362,740 USD to American company Shutterstock, which provides videos, images, and music. In order for the judgment to be enforceable in Brazil, however, the country’s judiciary had to ratify the New York Court’s decision.
Brazil’s Superior Court of Justice (STJ) accepted use of service of process by process of mail — a landmark ruling — the method by which was previously agreed to by the litigants in a clause in the contract between the parties. The parties further agreed in their contract that in the event of litigation, the matter would be resolved by a New York court where service of process can be perfected by mail. The STJ ratified the New York Court’s ruling as the agreement and acknowledgment receipt of mail was attached to the lawsuit.
The Ruling
The STF recently confirmed that a foreign court’s decision could be ratified without requiring a Brazilian company to be served with process in the legal dispute by letter rogatory. A letter rogatory is a formal request from a court to a foreign court for judicial assistant — typically asking the foreign court permission before performing a judicial act without which the foreign court’s sanction would result in a violation of that country’s sovereignty. The STF upheld a ruling of a lower Brazilian court, the Superior Court of Justice (STJ), that released an American company from the obligation of serving the Brazilian company through letters rogatory. According to an article published by Mondaq, between January 2015 and September 2020 the STJ granted nearly 90% of requests to ratify a foreign ruling. The STF held that the STJ’s judgment granting Shutterstock’s request was well-founded and also supported by the infra-constitutional law. Public policy also supported the decision as it provided greater legal certainty to foreign investors who wish to execute agreements with Brazilian companies — business relationships that can attract foreign capital to the country.
The Effects
After the STF endorsement of service of process by mail, numerous foreign companies now have the option of possibly establishing another method of process of service aside from letters rogatory, making international service both faster and cheaper. It is expected that companies with international agreements will include a similar clause in their contracts.
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