Exxon Mobil Corp. v. Saudi Basic Indus. Corp.
United States Supreme Court
544 U.S. 280 (2005)
Two subsidiaries of Exxon Mobil Corporation (plaintiff), Exxon Corp. and Mobil Corp. (the subsidiaries), entered into several joint ventures with Saudi Basic Industries Corporation (SBIC) (defendant) in 1980. Twenty years later, the companies were in dispute about the distribution of royalties. In July 2000, SBIC preemptively filed suit against the subsidiaries in Delaware Superior Court to receive a declaratory judgment stating that the distribution of royalties was proper under the joint venture agreements. Two weeks later, the subsidiaries filed suit against SBIC in United States Federal Court for the District of New Jersey alleging SBIC had overcharged them with respect to sublicenses. The subsidiaries answered SBIC’s suit in state court and filed identical counterclaims to the claims they filed in federal court. After a jury trial, the subsidiaries were awarded a $400 million verdict. Before the trial in state court, SBIC moved to dismiss the federal suit, and the court denied the motion. SBIC filed an interlocutory appeal, which the court did not hear until after the termination of the state action. Eight months after a verdict was rendered in state court, the court of appeals dismissed the subsidiaries’ claims on the basis of the Rooker-Feldman doctrine. The United States Supreme Court granted certiorari to resolve a split in the circuits regarding the application of the Rooker-Feldman doctrine.
Rule of Law
Holding and Reasoning (Ginsburg, J.)
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