Government Procurement and Divestment
In the 1980s, numerous state and local governments enacted government procurement bans on companies doing business in South Africa. In 1996, the state of Massachusetts enacted a similar ban on companies doing business in Burma. Three months later the Congress passed a law imposing a set of mandatory and conditional sanctions on Burma, followed in 1997 by President Clinton's Executive Order implementing the statute and banning new U.S. investment in Burma. The NFTC filed a lawsuit challenging the constitutionality of the Massachusetts Burma law. In 2000, the Supreme Court, in Crosby v. NFTC, unanimously overturned the Massachusetts law on the grounds that it conflicted with the Supremacy Clause, finding that the Federal law preempted the state law.
In 2005, Illinois enacted sanctions on Sudan prohibiting state funds from being deposited in banks that could not demonstrate that they had no links to Sudan and prohibiting Illinois public pension funds from holding investments in companies with business ties to Sudan. The NFTC filed a lawsuit, and in 2007, Federal District Court in NFTC v. Giannoulias overturned the Sudan sanctions law because it conflicted with the Foreign Commerce Clause, interfering "with the Federal government's authority to over foreign affairs and commerce with foreign countries."
In 2010, Congress passed the Comprehensive Iran Sanctions, Accountability and Divestment Act (CISADA), which intended to authorize state divestment legislation targeting the Iranian energy sector: "It is the sense of Congress that the United States should support the decision of any state or local government that for moral, prudential or reputational reasons divests from, or prohibits the investment of assets of the state or local government in…the energy sector of Iran."
Subsequently, numerous bills have been introduced in state legislatures requiring divestment from a list of "scrutinized companies" doing business in a target country. In September 2010, California enacted an Iran divestment law that conforms to CISADA and in June 2011, Florida enacted a similar law. Other pending state divestment legislation targets Iran, Syria and Cuba.
USA*Engage Amicus Briefs on Sanctions by U.S. States
Faculty Senate of Florida International University v. State of Florida – The NFTC submitted an amicus brief to the Eleventh Circuit in October 2010 in support of a petition for a rehearing en banc and a request for the views of the U.S. Solicitor General to review a panel's ruling upholding sanctions enacted by the state of Florida, as being in conflict with the Supreme Court ruling in Crosby v. NFTC. USA*Engage, the NFTC, the U.S. Chamber of Commerce, and the Emergency Committee for American Trade filed an amicus brief in April 2011with the Supreme Court supporting a petition for certiorari in the case.