Ralls Corp v CFIUS

Ralls Corp v CFIUS, 758 F.3d 296 (D.C. Cir. 2014), is the leading precedent on due-process limits of U.S. national-security investment restrictions. The case entered the drone debate in May 2026 when Autel Robotics cited it in its FCC reply, arguing that the Covered List designation rests on classified evidence Autel has never been allowed to examine — the same constitutional flaw the D.C. Circuit condemned a decade earlier.

The case arose after Ralls Corporation, owned by two Chinese nationals affiliated with Sany Group, acquired four Oregon wind-farm projects in 2012. CFIUS reviewed the acquisition and President Obama ordered divestiture on national-security grounds, providing no access to the underlying evidence. The D.C. Circuit reversed, holding that an affected party must be informed of the action taken against it, given access to the unclassified portions of the evidence relied upon, and afforded an opportunity to rebut. Property interests vested before CFIUS review are constitutionally protected; they cannot be stripped without minimum procedural safeguards.

The ruling's reach beyond Chinese wind farms became clear in the Autel and DJI proceedings. Any U.S. regulatory body that restricts a Chinese-linked company's access to the market using classified or undisclosed evidence faces a Fifth Amendment challenge grounded in Ralls. As national-security regulators expand Covered List designations deeper into consumer technology, Ralls is the fulcrum on which each challenge turns.