This working paper, which will not be submitted for publication, has been replaced by two separate articles: (1) Domestic Courts and Global Governance, 84 Tulane Law Review 67 (2009), which presents a substantially revised version of the conceptual and methodological argument; and (2) The Evolving Forum Shopping System, 96 Cornell Law Review (forthcoming), which contains an empirical analysis of forum non conveniens decisionmaking. If citing, please cite these new versions. Please do not cite this older working paper without the author’s permission.]

Domestic courts are global governors. In the United States federal courts alone, thousands of disputes arising out of transnational activity are heard each year. Substantively, the decisions of courts in these cases allocate resources among transnational actors. Jurisdictionally, they allocate governance authority among sovereign states. When domestic courts publish their transnational litigation decisions, they not only directly affect the litigants; they also provide information about how they are likely to decide similar cases in the future, information that can indirectly influence the strategic behavior of transnational actors beyond a particular dispute. Yet the governance of transnational activity by domestic courts - which I refer to as "transnational judicial governance" - has received little scholarly attention, even though legal scholars and political scientists have long appreciated the role of domestic courts in the governance of domestic activity, and are increasingly interested in the role of international courts in the governance of both domestic and international activity. As a result, we have a very limited understanding of how domestic courts behave as global governors, and why they govern the way they do.

In this paper, I propose a governance-oriented approach for analyzing transnational law aimed at improving our understanding of transnational judicial governance. In Part I, I clarify the concept of transnational judicial governance by exploring the global governance implications of judicial decisionmaking in transnational litigation, and I attempt to demonstrate the importance of transnational judicial governance as a distinct object of study. Part II describes the governance-oriented approach, including its focus on transnational law in action and on the broad implications of domestic court decisionmaking for transnational activity, and notes its affinities with legal realism and the New Haven school of international law. Part III illustrates the governance-oriented approach by applying it to the doctrine of forum non conveniens, using an original dataset of over 200 forum non conveniens decisions made by U.S. district court judges to evaluate this example of transnational judicial governance according to the rule-of-law values of predictability and impartiality. Part IV concludes by using Part III's findings to asses whether domestic courts can effectively foster transnational rule of law.