“Foreign-cubed” is the name of the latest legal nemesis that keeps lawyers for companies ranging from Toyota to Vivendi up at night.

The term refers to securities class action litigation in which the investors are foreign, the issuers are foreign and the fraudulent conduct took place on foreign soil. And yet, because of some company tie to the United States, large or minuscule, they end up in U.S. courts, where plaintiffs usually can do a lot better than if the suits were filed abroad.

Six years after the moniker was first coined, a foreign-cubed suit has made its way to the U.S. Supreme Court, which will hear the case, Morrison v. National Australia Bank, today. Foreign investors accused Australia’s largest bank of fraud involving a Florida subsidiary, but the bank insists all of the disputed activity took place in Australia. So far, the bank has won.

Foreign companies and countries have flooded the Court with friend of the court briefs, signaling the importance of the case worldwide. Even parties litigating over the Toyota safety meltdown are watching; several securities class actions have been filed in federal courts against the company, which trades on the Tokyo Stock Exchange, based on statements made by Toyota officials in Japan.

The case comes to a Court that has grown increasingly skeptical about U.S. courts exerting extraterritorial jurisdiction. In the 2007 case Microsoft v. AT&T, a 7-1 majority spoke approvingly of the presumption that “United States law governs domestically but does not rule the world.” Three years earlier, in Hoffman-LaRoche v. Empagran, a unanimous Court said extending the reach of American antitrust laws too far into foreign situations would be “an act of legal imperialism.”

via Law.com – Justices to Consider a Border Battle Over Lawsuits.