U.S. courts continue to shape the legal landscape for foreign companies doing business in the United States. Recent decisions have clarified the scope of personal jurisdiction over foreign defendants, the enforceability of arbitration agreements in cross-border disputes, the standards for enforcing foreign judgments, and the limits of foreign sovereign immunity.

For Turkish companies with U.S. operations, contracts, or business relationships, understanding these developments is essential for assessing litigation risk, structuring dispute resolution provisions, and managing legal exposure in the U.S. market.

The Supreme Court's decisions in Daimler AG v. Bauman (2014) and BNSF Railway Co. v. Tyrrell (2017) significantly narrowed the scope of general personal jurisdiction over foreign corporations. Under these decisions, a foreign corporation is subject to general jurisdiction in a U.S. state only where it is "at home" — typically its state of incorporation or principal place of business.

Lower courts continue to apply and extend the Daimler framework. Several significant decisions in 2025-2026 have:

Rejected "doing business" jurisdiction: Courts have consistently rejected the argument that a foreign company's substantial business activities in a state — even hundreds of millions of dollars in annual sales — establish general jurisdiction. The Daimler standard requires that the state be the corporation's "home," not merely a place where it does significant business.

Narrowed specific jurisdiction: Specific jurisdiction — jurisdiction over claims arising from the defendant's contacts with the forum state — has also been narrowed. Courts have required a closer connection between the defendant's forum contacts and the plaintiff's claims, rejecting jurisdiction based on attenuated or indirect connections.

Practical implication for Turkish companies: Turkish companies that are sued in U.S. courts should carefully analyze whether the court has personal jurisdiction. A motion to dismiss for lack of personal jurisdiction, if successful, can terminate the litigation without reaching the merits. Turkish companies should also consider personal jurisdiction implications when drafting dispute resolution clauses — specifying a particular jurisdiction in a contract generally constitutes consent to that jurisdiction.

The Federal Arbitration Act (FAA) establishes a strong federal policy favoring arbitration. U.S. courts are required to enforce valid arbitration agreements and to stay litigation pending arbitration. The New York Convention — to which the United States is a party — requires enforcement of foreign arbitral awards in U.S. courts.

Delegation clauses: Courts have continued to enforce "delegation clauses" — provisions in arbitration agreements that delegate to the arbitrator (rather than the court) the authority to decide threshold questions of arbitrability, including whether the dispute is covered by the arbitration agreement. Turkish companies should be aware that a broadly drafted delegation clause can significantly limit a court's ability to review the scope of an arbitration agreement.

Class arbitration waivers: The Supreme Court has consistently enforced class arbitration waivers — provisions prohibiting class or collective arbitration. For Turkish companies that include arbitration clauses in their U.S. consumer or employment contracts, class arbitration waivers are an important tool for limiting aggregate liability exposure.

Enforcement of foreign awards: U.S. courts have continued to enforce foreign arbitral awards under the New York Convention, with limited exceptions. Courts have rejected attempts to vacate foreign awards based on alleged procedural irregularities that do not rise to the level of a due process violation.

Practical implication: Turkish companies entering into U.S. commercial contracts should include carefully drafted arbitration clauses that specify the arbitration rules, seat, number of arbitrators, language, and — where appropriate — a delegation clause and class arbitration waiver.

New York courts have continued to enforce liquidated damages clauses — provisions specifying a fixed amount of damages for breach — where the clause represents a reasonable estimate of anticipated damages at the time of contracting, rather than a penalty. Recent decisions have applied this standard to uphold liquidated damages clauses in commercial real estate contracts, construction agreements, and technology licensing agreements.

Practical implication: Liquidated damages clauses in contracts governed by New York law should be drafted to reflect a reasonable estimate of anticipated damages, supported by a brief recital of the basis for the estimate. Clauses that appear punitive — far exceeding any plausible actual damage — are at risk of being struck down.

The COVID-19 pandemic generated significant litigation over Material Adverse Change (MAC) clauses in M&A agreements. Courts have continued to interpret MAC clauses narrowly, requiring that the adverse change be both significant and durationally significant — not merely a short-term disruption. Recent decisions have applied this framework to geopolitical disruptions, supply chain crises, and regulatory changes.

Practical implication: Turkish companies negotiating M&A agreements with U.S. counterparties should carefully define the MAC standard, including specific carve-outs for industry-wide conditions, macroeconomic changes, and regulatory developments.

The Foreign Sovereign Immunities Act (FSIA) provides foreign states and their agencies and instrumentalities with immunity from suit in U.S. courts, subject to specified exceptions. The commercial activity exception — which allows suits based on a foreign state's commercial activities — is the most frequently litigated exception.

State-owned enterprises: Courts have continued to grapple with the status of state-owned enterprises (SOEs) — companies that are majority-owned or controlled by foreign governments. Turkish SOEs operating in the United States should be aware that their sovereign immunity status is not automatic and depends on a fact-specific analysis of their relationship with the Turkish government.

Waiver of immunity: Courts have found implied waivers of sovereign immunity in certain circumstances, including where a foreign state has agreed to arbitration in a commercial contract. Turkish government entities entering into U.S. commercial contracts should carefully review any arbitration or dispute resolution provisions for potential immunity waiver implications.

U.S. courts will enforce foreign judgments under the Uniform Foreign-Country Money Judgments Recognition Act (adopted in most states) if the foreign court had jurisdiction, the judgment was final, and the judgment was not obtained by fraud or in violation of due process. Recent decisions have:

• Enforced Turkish court judgments in U.S. proceedings where the Turkish court had proper jurisdiction and the proceedings satisfied due process standards
• Refused enforcement where the foreign judgment was obtained in proceedings that did not provide adequate notice or opportunity to be heard

Practical implication: Turkish companies seeking to enforce Turkish court judgments in the United States should ensure that the Turkish proceedings satisfied U.S. due process standards. Turkish companies defending against enforcement of foreign judgments in U.S. courts should analyze whether any of the statutory grounds for non-recognition apply.

1. Review personal jurisdiction exposure in existing U.S. contracts — ensure dispute resolution clauses specify jurisdiction carefully
2. Audit arbitration clauses in U.S. commercial contracts for completeness and enforceability
3. Include delegation clauses and class arbitration waivers in arbitration agreements where appropriate
4. Draft MAC clauses with specificity — define the standard and include appropriate carve-outs
5. Assess sovereign immunity status for Turkish SOEs operating in the United States
6. Consult legal counsel before seeking to enforce Turkish court judgments in U.S. proceedings

• U.S. courts have significantly narrowed personal jurisdiction over foreign companies — motions to dismiss for lack of jurisdiction are a viable defense strategy
• Arbitration agreements are strongly enforced in U.S. courts — delegation clauses and class arbitration waivers are important drafting tools
• Liquidated damages clauses must reflect reasonable estimates of anticipated damages — punitive clauses are at risk of being struck down
• MAC clauses are interpreted narrowly — short-term disruptions generally do not constitute material adverse changes
• Turkish SOEs should not assume sovereign immunity — the analysis is fact-specific and depends on the entity's relationship with the Turkish government
• Foreign judgments are enforceable in U.S. courts if the foreign proceedings satisfied due process standards