Brief Fact Summary. The U.S. (P) claim was based on the fact that funds deposited in a U.S. bank by a Russian corporation that had been nationalized by the Soviet government was due to it.
Synopsis of Rule of Law. The states cannot interfere in the complete powers which the national government has in the conduct of international affairs.
What another country has done in the way of taking over property of its nationals, and especially of its corporations, is not a matter for judicial consideration here.View Full Point of Law
Issue. Does the national government have complete power in the conduct of international affairs?
Held. (Sutherland, J.). Yes. The states cannot interfere in the complete powers which the national government has in the conduct of international affairs. The U.S. (P) recognized the Soviet government coincidentally with the assignment of all claims. The President does not need the consent of the Senate to conduct foreign relations. In respect of foreign relations generally, state lines disappear. Reversed and remanded.
Discussion. The recognition of the Soviet Union and the release of all claims were interdependent and this was noted by the Court. Thus it was purely in the realm of foreign policy to make this agreement. States cannot therefore interfere in the conduct of foreign relations.