"You know what happened.  General Atomics, a Swiss corporation American controlled, claimed the Moon.  The Federation couldn't just brush them off; that would have been too raw and anyhow the Russians wouldn't have held still.  So the High Court ruled that a corporate person, a mere legal fiction, could not own a planet; therefore the real owners were the flesh-and-blood men who had maintained the occupation - Larkin and associates.  So they recognized them as a sovereign nation and took them into the Federation - with some melon slicing for those on the inside and fat concessions to General Atomics and its daughter corporation, Lunar Enterprises.  This did not entirely suit anybody and the Federation High Court was not all powerful in those days - but it was a compromise everybody could swallow.  It resulted in some tight rules for colonizing planets, all based on the Larkin Decision and intended to avoid bloodshed.  Worked, too - it's a matter of history that World War Three did not result from conflict over space travel and such.  So now the Larkin Decision is solidly a part of our planetary law and applies to Smith."