The Supreme Court held 6/29/04 that the Federal Tort Claims Act (“FTCA”), which excludes “any claim arising in a foreign country,” 28 U.S.C. § 2680(k), does not authorize a claim against the United States for a false arrest executed in a foreign country just because the arrest was planned in the United States. The Court rejected the so-called “headquarters doctrine,” which allowed FTCA suits for harm alleged to have occurred in a foreign country so long as the harm could be linked to negligent guidance or planning that occurred in the United States. Tort claims are historically regarded as “arising in” the place where the “last act necessary to establish liability occurred,” and there is no evidence that Congress intended “arising in” under the FTCA to have a different meaning.The Court also held that the Alien Tort Statute, 28 U.S.C. § 1350 (“ATS”), is principally jurisdictional, but that “at the time of enactment the jurisdiction enabled federal courts to hear claims in a very limited category defined by the law of nations and recognized at common law.” Thus, although the ATS does not allow “the creation of a new cause of action for torts in violation of international law,” it does encapsulate the “understanding that the common law would provide a recognized cause of action for the modest number of international law violations with a potential for personal liability [in 1789].” “[A]ny claim based on the present-day law of nations [must] rest on a norm of international character accepted by the civilized world and defined with a specificity comparable to the features of the 18th-century paradigms we have recognized.” The Court’s ruling on the scope of the ATS is particularly significant to transnational corporations and domestic businesses with foreign activities. The NAM's press release welcomes this ruling.
The NAM and others urged the Supreme Court 10/6/03 to review this case. Since 1980, foreign plaintiffs have been filing suits in federal courts for conduct involving activities that occur in foreign countries. The NAM and other organizations, as well as the U.S. Government, began to challenge these suits, arguing that U.S. law only provides a forum, and that there must be a separate statute, such as the Torture Victim Protection Act of 1991, that confers substantive rights that a foreign plaintiff can assert here. In addition, we challenged the Ninth Circuit's ruling that the law of nations can be determined from non-binding international declarations, unratified or non-self-executing treaties, and unreliable commentary. The decision of the Ninth Circuit raises serious separation of powers issues, and highlights the foreign policy concerns that underlie the vast majority of these cases. Clarifying these issues is important both in fighting the war on terrorism and in preventing American companies from being uniquely subjected to liability for the acts of agents of foreign governments. Joint brief filed with the National Foreign Trade Council, USA*Engage, the Chamber of Commerce and the U.S. Council for International Business.
On 1/23/04, the NAM filed a brief on the merits calling for strict limits on the ability of foreign nationals to use U.S. federal courts to allege violations of rights in their countries. We argued that the ATS was never intended and does not create a substantive cause of action; rather, it only allows federal courts to hear claims arising under already recognized international standards of conduct. The brief argued that such suits are not allowed unless an international standard of behavior has the assent of the U.S. government, is obligatory and is specific. Allowing these suits to continue also creates serious substantive and procedural conflicts that Congress never intended when it passed the law in 1789. See also United States v. Alvarez-Machain.