Alien Tort Statute -- 2013



Kiobel v. Royal Dutch Petroleum Co.   (U.S. Supreme Court)

Corporate liability under Alien Tort Statute

On April 17, 2013, the Supreme Court issued a ruling that dramatically constrains efforts to expand the application of a 1789 statute, the Alien Tort Statute, beyond our borders. The law merely provides a forum in federal courts in the United States for allegations involving violations of the "law of nations," but often such cases involve foreign plaintiffs alleging acts occurring outside of the United States. This suit was brought by 12 Nigerian nationals claiming human rights violations by three oil companies.

The Court ruled that the presumption against extraterritoriality applies to suits under the Alien Tort Statute. That presumption means that a statute does not apply to activities occuring outside of the United States unless it says it does. The presumption helps prevent conflicts between our laws and those of other nations. The Court found it particularly important to apply in this context because ATS law is determined by the courts, not by Congress.

The NAM filed an amicus brief urging exactly what the Court concluded. Many foreign governments have protested the extraterritorial application of U.S. law by means of the ATS. We argued that properly applying the law of the place where the act occurred avoids the conflict that would otherwise result from applying U.S. law to conduct occurring in other countries, and promotes international harmony.

In addition, we countered an argument by the plaintiffs that relied on the "transitory torts" doctrine, i.e., that purports to allow lawsuits against a person regardless of where the injury occurs, as long as personal jurisdiction is satisfied. Our brief explained that transitory tort cases apply the law of the country where the challenged act occurred, rather than -- as the plaintiffs wanted -- the law of the United States, or international law as interpreted by U.S. courts. Such interpretations are complicated and lead to conflicting results, not only on the precise content of the law but also on jurisdictional issues. The Court rejected the plaintiffs' transitory torts argument.

This is a very important victory for American manufacturers, many of whom have been sued under the ATS for alleged activities that occur entirely in other countries. The NAM has filed amicus briefs in many of these cases to provide guidance on issues such as (1) whether the law of nations recognizes claims for aiding and abetting liability, (2) whether activities encouraged by U.S. foreign policy can lead to liability, and (3) whether the law of nations imposes liability on corporations as well as individuals.

When it was originally argued before the Supreme Court, this case involved whether the ATS applies to corporations, or only to individuals. The Second Circuit ruled that individual corporate executives can be sued, but not corporations. No corporation has ever been subject to any form of liability under the customary international law of human rights. The NAM filed an amicus brief supporting the view that there is no specific and universal view that corporations are subject to liability for the claims in this case, as is required in determining whether the law of nations has been breached. But we spent most of our brief supporting an alternative ground for dismissing this case -- that aiding and abetting liability under international law requires that the defendant acted with a purpose to facilitate the violations, not something less like mere knowledge of the conduct. That "purpose to facilitate" was not alleged by the plaintiffs. The purpose requirement is found in nearly every leading source for determining the content of customary international law, from the Rome Statute of the International Criminal Court, to a United Nations statute and study, to case law from the International Military Tribunal at Nuremberg, to opinions of foreign international-law experts. Moreover, courts should approach any expansion of ATS liability very cautiously to avoid intruding into matters of foreign relations and to respect the ability of foreign judicial systems to address matters like this that arise abroad.

After the first round of arguments in 2012, the Court sought briefing on the extraterritoriality issue and decided the case on that basis. Thus, in a future ATS case that does not have extraterritoriality problems, there still remain open questions about whether the law applies to corporations and whether they can be sued for aiding-and-abetting liability.


Related Documents:
NAM supplemental brief  (August 8, 2012)
NAM brief  (February 3, 2012)