for the uranium and there was an escalation clause to meet future increases in general cost of living but this did not cover changes in the basic market price of uranium.
This
Following a large and unexpected increase in the price of uranium after 1973, Westinghouse found themselves in serious difficulties and on 8 September 1975 they gave notice that their uranium supply contracts had become "commercially impracticable" blaming the large oil price rise in 1973 and the "actions of foreign uranium producing countries and companies that have significantly curtailed international uranium supplies" as the cause, (at that time Westinghouse only had 15 million lbs of uranium available to meet a demand of 81 million lbs). led to Westinghouse being sued by the public power utilities. The total amount of compensation claimed would have cost Westinghouse in the region of $2 billion. Westinghouse, in their turn have taken this figure as the basis for a treble damage antitrust claim against 29 uranium producing companies, including RTZ and several of its subsidiaries; since defendants in antitrust proceedings are liable jointly and severally, the theoretical exposure is $6 billion. Nine of the foreign defend- ants, including RTZ, did not accept that the Chicago court has jurisdiction and consequently decided not to appear. Earlier this year the judge found against the defaulting defendants on the question of liability and announced his intention of holding a hearing on damages; this decision is currently been appealed. The trial involving the appearing defendants, where the merits of the case will be fully argued, is not scheduled to take place until 1981.
(In March 1976 the US Department of Justice began an investi- gation of the uranium producing industry in so far as that industry's activities may have affected the domestic or foreign commerce of the USA. In June 1976 a Grand Jury was empanelled in aid of that investigation and several subpoenas to various US companies were issued. Subsequently, the US Department of Justice intervened in Westinghouse's attempt to obtain inform- ation from RTZ by conferring immunity on the UK witnesses and thereby removing their privilege under the Fifth Amendment. In the event, the case went to the House of Lords and RTZ's privilege rights were upheld. The Grand Jury finished its work in May 1978 without handing down any indictments.)
8
Some Other Jurisdictional Problems
The situation has been further exasperated by US attempts in other areas to extend their jurisdictional reach. A few examples of this are when:-
a)
b)
the US claims that companies controlled 25% or more, directly or indirectly by American shareholders are subject to American law, even if they do no business in the USA.
the US attempts to regulate the activities of UK subsidiaries of US companies such as in the US Depart- ment of Commerce's rules relating to trade with the Middle East.