I guess we'll tell Japan that they should withdraw and establish the Lytton Commission.
Japan will not withdraw. We'll negotiate with China.
Japan attacks China in Mukden because Japan claims that Chinese soldiers blew up the railroad.
And that can be a French colony... that can be a French colony... Oooo and this one too!
China appeals to the League of Nations, but the League of Nation is unsure of what to do because both China and Japan are members of the League. They offer a weak resolution and establish the Lytton Commission to investigate the claims of both sides.
Japan refuses the League of Nations' resolution and insisted on direct negotiations with China. However, negotiations failed and the Kwantung army expands through Manchuria. Japan then creates the State of Manchukuo as the puppet state of Japan.
France did not take stronger actions against Japanese aggression because it stood to gain from a weak China as a colonial power in Indo-China. Also (like Britain), was suffering from the Great Depression and saw Japan as helping contain communist Russia.
Britain did not take stronger actions because its own interests were not at stake and it did not have the military means to resist Japan. Britain was also partly sympathetic to Japan's actions in Manchuria which it believed that it was "merely an attempt to restore order".
The United States did not interfere with Japanese aggression because it was under the policy of isolationism. It also did not want to jeopardize trade with Japan and its interests were not in danger. Moreover, the United States had to deal with the Great Depression and did not have a credible naval force in the Pacific.