International groups have long been using a 1789 tort to sue corporations for acts on foreign soil. An upcoming Supreme Court case might put an end to that.
This past October, a 15-year legal battle between Royal Dutch Petroleum and a Nigerian political movement finally went before the Supreme Court -- of the United States, that is. On October 17, the Court decided to hear a lawsuit filed by Esther Kiobel, whose husband, Dr. Barinem Kiobel, was one of nine activists from the Movement for the Survival of the Ogoni People hanged by Sana Abacha's military government on November 10, 1995. Kiobel alleges Shell was partly responsible for her husband's death, and for other human rights violations committed in the oil-rich Ogoniland region.
Esther Kiobel's lawsuit against Shell is hardly a standard Supreme Court case. After all, Kiobel v. Dutch Royal Petroleum involves a foreign national suing an Anglo-Dutch oil company, and the violations were allegedly committed by a foreign government on foreign soil. But the case landed in U.S. court because of a much-debated, sentence-long statute in the Judiciary Act of 1789, a law whose meaning and scope is still hotly contested.
The Alien Tort Statute states, "The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States." In other words, U.S. courts have jurisdiction over cases involving American citizens' alleged violations of "the law of nations," or international law.
The question the Supreme Court will ponder in the Kiobel case is whether American corporations can be held liable under international law -- in this case, a multinational company with a major American presence. Royal Dutch Petroleum is headquartered in The Hague and has its registered office in London. But its U.S. subsidiary, Shell Oil, accounts for 15 percent of its gas and oil business.
The U.S. court system is an imperfect recourse for human rights advocates, but if the Supreme Court affirms the ability to sue multinational corporations, it could become an important one. "U.S. courts are not particularly fabulous with international law," says Kayleen Hartman, a post-graduate fellow at Georgetown University Law School's Human Rights Institute, "but it's important to have a remedy in U.S. courts because every company is here."
On September 17, 2010, the Second Circuit court stunned legal observers by determining that the ATS does not allow individuals to sue corporations. The two-to-one decision, which held that the "law of nations" doesn't include corporate liability, broke with 15 years of case precedent and four other circuit-level federal courts. Maria LaHood of the Center for Constitutional Rights, which submitted an Amicus brief on behalf of Kiobel, disagrees with the court's decision. "You look to general principles of law of nations, and corporations can be held liable," she says. "Nobody even thought this was an open question until the [Second Circuit's] Kiobel decision came down."
Human rights activists have already used the Alien Tort Statute to sue corporations. For instance, in 2004, the non-profit group Earths Rights International successfully sued the energy company Unocal for its alleged cooperation with the Burmese military junta. That same year, the Supreme Court affirmed that human rights violations could be the subject of ATS suits, though only if they were the kinds of very serious abuses banned under "customary international law." In Sosa v. Alvarez-Machain, a partial win for human rights advocates, the Court decreed that rigidly defined crimes like genocide or torture could be the subject of an ATS suit. Less-established legal concepts, such as environmental degradation or violence against women, could not.
If the Supreme Court sides against Kiobel, the scope of the Alien Tort Statute could severely narrow. Paul Hoffman, who is the lead attorney for Kiobel and also argued Sosa v. Alvarez-Machain, says limiting the application of ATS would reinforce the corporations' sense of impunity. "What's at stake is the very important principle that if there's a corporation involved in very serious human rights violations, are we going to shut the courthouse door on the victims trying to get accountability for those violations?" Hoffman, who is a member of Amnesty International's International Executive Committee, adds, "If [the Supreme Court justices] affirm the Second Circuit decision that these cases can't be brought at all, then if there's another IG Farben in today's world, they would get a pass," referring to the German producer of Zyklon B gas used in Nazi concentration camps.
Another possible consequence of the case, according to LaHood, is that if the court decides against Kiobel, it will curtail the accepted principle that international law can and does have a role in U.S. court. As long ago as 1900, in the landmark Paquete Habana v. United States decision, the Supreme Court determined that customary international law is relevant to the U.S. legal system. "It's no different for the court to determine and interpret international law than any other type of law," LaHood says.