Supreme Court Rules in Favor of Corporations in Human Rights Abuses Case

Back in September, PFAW senior fellow Jamie Raskin wrote a preview of the major cases coming before the Supreme Court this term, one of which, Kiobel v. Royal Dutch Petroleum, deals with the ability of foreign nationals to sue corporations for human rights abuses in American courts. The Supreme Court today issued a sweeping ruling siding with the multinational corporations accused of abuse. Main Justice sums up the facts of the case:

The plaintiffs accuse Royal Dutch, the Shell Transport and Trading Company and their joint Nigerian subsidy of allowing, indeed encouraging, atrocities by the Nigerian military against people who were protesting environmental damage caused by drilling in the Niger Delta in the 1990s. The companies were complicit in beatings, rapes and mass arrests by paying the soldiers, feeding them and allowing them to use oil company property as staging areas for their attacks, the plaintiffs maintain.

At issue was the application of the Alien Tort Statute, enacted in 1789, that gives United States courts jurisdiction over civil actions brought by aliens alleging torts committed in violation of United States treaties or international law. The seldom-used ATS was enacted partly in response to piracy on the high seas. The Nigerian plaintiffs, now legal residents of the United States, tried to use it in a present-day context.

As Jamie Raskin wrote in his Supreme Court preview, the Second Circuit radically twisted legal precedent in this case to rule that individuals could not sue corporations under the Alien Tort Statute:

Jurisdiction to hear the suit was clear. In 2004, the Supreme Court held, in Sosa v. Alvarez-Machain, that the Alien Tort Statute gave federal courts jurisdiction to hear claims about torts committed against aliens that violate well-established international norms like the human rights norms implicated in this case. Yet a bitterly divided Second Circuit panel in Kiobel held for the first time that the statute does not allow courts to hear suits against corporations as opposed to individuals. The Kiobel majority’s ruling on this issue was amazing since the issue was never raised, never briefed, never argued and never decided in any of the proceedings below that took place over the course of nearly a decade. (This rings a bell for close observers of the Citizens United majority, which also pulled a rabbit out of a hat to ask and answer a question never raised below.)

Today, the Roberts Court agreed. The Court unanimously ruled against the Nigerians in Kiobel, but disagreed about how far the ruling should go. Justice Roberts, writing for the conservative majority, wrote a broad ruling in favor of the corporations accused of human rights abuses. The four moderate justices concurred with the majority’s ruling on this particular case, but left the door open for similar cases to be tried in U.S. Courts. Main Justice explains:

Justice Stephen G. Breyer wrote that the defendants’ “minimal and indirect presence in the United States was not enough to give American courts jurisdiction over the case.”  But he stopped short of declaring that similar cases should never end up in American courts if the abuse at issue “adversely affects an important American national interest.” Justices Ruth Bader Ginsburg, Sonia Sotomayor and Elena Kagan agreed with him.

Nicole Flatow at ThinkProgress explains the possible implications of the majority’s ruling:

This decision not only means that Nigerians cannot sue foreign corporations for their conduct abroad. On this particular point, the four-justice Breyer concurrence agreed that this case did not pass muster. Roberts’ sweeping pronouncement against extraterritoriality may also mean that foreign nationals subject to abuse, for example, at the hands of a U.S. corporation that houses its factories in places whose laws shield it from liability, or an American citizen who commits human rights violations abroad against foreigners, also could not be subject to suit in the United States.

The scope of the opinion will not become clear until it is interpreted by courts. Extraterritoriality is a legal concept that asks not just whether conduct took place abroad, but also whether the claims “touch and concern the territory of the United States” such that a plaintiff can overcome the presumption against them. The only hint the court gives is that lawsuits against corporations will face a particularly heavy burden, noting, “Corporations are often present in many countries, and it would reach too far to say that mere corporate presence suffices.”

What is clear is that the presumption is exceedingly difficult to overcome, and that both individuals and corporations have a high chance of skirting liability simply by doing their dirty work elsewhere.

PFAW
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