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I.
Introduction
On April 17, 2013, the Supreme Court handed down its
decision in Kiobel v. Royal Dutch
Petroleum Co., 133 S. Ct. 1659, 185 L. Ed. 2d 671 (U.S. 2013), finding that
the federal court did not have subject matter jurisdiction over the matter, as the
Alien Tort Statute (the “ATS”) under which the human rights claims were brought
possesses a presumption against extraterritoriality, and all of the relevant events
in the case occurred in Nigeria. Some
have opined that the Court’s decision is the “last breath” of the Alien Tort
Statute. This article will summarize the
various opinions in Kiobel,
subsequent developments, and then address whether litigation under the ATS is
or is not now futile.
II.
The Alien Tort Statute
The first Congress of the United States, sitting in
Philadelphia, passed the Judiciary Act of 1789 which contained, in section 9, a
single sentence that constitutes the ATS.
That single sentence reads as follows: “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.”
28 U.S.C § 1350 (2011).
For decades and decades thereafter, there was
virtually no litigation under this statute.
Then, thirty three years ago, the Second Circuit issued an opinion in Filartiga v. Pena-Irala, 630 F.2d 876
(2d Cir. 1980), which breathed life
into the somnambulant statute.
Thereafter, a spate of ATS cases were filed, most of them involving
torture or genocide committed overseas, with the claims being filed in federal
district courts by aliens who had sought refuge in the United States from a
nation-state allegedly engaged in violations of customary international
law.
In 2004, in Sosa
v. Alvarez-Machain, the Supreme Court addressed the statute, holding that
such claims could not proceed if the customary law norm under which the claim
was brought had “less definite content and acceptance among civilized nations
than the historical paradigms familiar when [the ATS] was enacted.” 542 U.S. 692, 732 (U.S. 2004).
III.
The Kiobel
Litigation
Between 1992 and 1995, several Nigerian nationals
granted asylum in the United States sued, among other defendants, a Dutch
corporation, Royal Dutch Petroleum, alleging that it had aided and abetted
violations by the Nigerian government of customary international law, to wit,
torture of individuals protesting environmental damage by the oil companies in
the Niger River delta. Kiobel v.
Royal Dutch Petroleum Co., 621 F.3d 111, 117 (2d Cir. 2010). Eventually, the Kiobel litigation resulted in a Second
Circuit opinion, holding that, under customary international law, a corporation
may not be sued for violations of international norms. Id. at 145. Thereafter, the Supreme Court granted certiorari to
review that question. 132 S. Ct. 472 (U.S. 2011).
IV.
Kiobel I
After extensive briefing, including 37 amicus briefs, the
Court heard oral argument on the corporate responsibility issue in the
2011-2012 term. See Kiobel v. Royal Dutch
Petroleum, SCOTUSBlog, http://www.scotusblog.com/case-files/cases/kiobel-v-royal-dutch-petroleum/ (last visited July 23,
2013). A week after oral argument, the Court issued an order directing that the
parties brief whether the statute could be applied extraterritorially to
conduct occurring exclusively outside the United States. Id.; 132 S. Ct. 1738 (U.S. 2012). The Court set the case for reargument during the October
2012 term. 132 S. Ct. at 1738.
V.
Kiobel II
Again, after extensive briefing, including some
seventy amicus briefs, and after oral argument, the Court issued a unanimous
holding that the federal district court lacked subject matter jurisdiction over
the controversy. Kiobel, 133 S. Ct. at 1663. The Chief Justice issued an
opinion for five Justices (Scalia, Thomas, Kennedy, and Alito joined) in which he
stated that while the presumption against the extraterritorial application of
the statute had not been overcome in this case, that the presumption could be
overcome if the facts sufficiently “touch[ed] and concern[ed] the territory of
the United States”. Id. at 1669. Justices Thomas and Alito filed a
concurrence in which they questioned whether the Chief Justice’s “touch and
concern” standard satisfied the “definiteness and acceptance among civilized
nations” requirement articulated in Sosa. Id. at 1670 (Alito, J.,
concurring).
Justices Breyer, Ginsburg, Kagan, and Sotomayor issued
a concurring opinion in which the articulated at least three circumstances
under which conduct occurring outside the United States might still be
actionable in federal court: “(1) the alleged tort occurs on American soil, (2)
the defendant is an American national, or (3) the defendant’s conduct
substantially and adversely affects an important American national interest,
and that includes a distinct interest in preventing the United States from
becoming a safe harbor (free of civil as well as criminal liability) for a
torturer or other common enemy of mankind.” Id. at
1671 (Breyer, J., concurring).
Justice Kennedy also issued a one-paragraph
concurrence, in which he praised the majority for its cautious approach in
declining to answer the myriad questions arising out of the application of the
ATS. Id. at 1669 (Kennedy, J.,
concurring). Indeed, the Kiobel
opinion leaves unanswered many important questions in international human
rights litigation, and raises new ones, including: What is the significance of
the Court’s use of the phrase “displace the presumption,” rather than the usual
“rebut the presumption?” Is corporate liability permitted under the ATS? If so,
does the presumption against extraterritoriality apply even if the corporation
operates in, is domiciled in, and is headquartered in the U.S.?
VI.
Commentary
a.
The “Touch and Concern” Framework
In the wake of Kiobel,
several commentators and bloggers have opined that Kiobel represents the demise of ATS litigation involving conduct
occurring outside the United States. See,
e.g., Phil Berkowitz et al., The
Final Breaths of the Alien Tort Statute, Littler Mendelson P.C., Apr. 19,
2013, http://www.littler.com/publication-press/publication/final-breaths-alien-tort-statute
(last visited July 23, 2013); James E. Berger & Charlene Sun, International
Litigation Update: Developments Concerning the Alien Tort Statute and Personal
Jurisdiction King & Spalding Client Alert, May 16, 2013, http://www.kslaw.com/imageserver/KSPublic/library/publication/ca051613.pdf
(last visited July 23, 2013). Their principal argument has been that the majority’s strong
presumption against extraterritoriality means that ATS plaintiffs,
traditionally foreign nationals bringing cases against U.S. corporations for
human rights violations overseas, face a nearly insurmountable hurdle in
establishing that the entity that allegedly caused their injuries sufficiently touches
and concerns the territory of the United States. Kiobel demonstrates that it is insufficient to merely show that a
corporation, such as Shell, has some operations in the United States. These
commentators believe that many ATS plaintiffs will be unable to show sufficient
contacts with the U.S. in post-Kiobel litigation,
and their claims will accordingly fail.
Other commentators believe that Kiobel does not represent the “final breath” of that ATS. Chief
Justice Roberts’ touch and concern language, according to one commentator, “has
provided fodder for another decade or more of litigation and created more
business for litigators, [as] [c]ompanies and victims’ advocates will battle
over when claims touch and concern the U.S. with sufficient force.” Katie
Redford, Door Still Open for Human Rights
Claims After Kiobel, SCOTUSBlog (Apr. 17, 2013 6:48 p.m.), http://www.scotusblog.com/2013/04/commentary-door-still-open-for-human-rights-claims-after-kiobel/ (last visited July 23,
2013). Another scholar explained that ATS suits like Doe v. Exxon – brought by fifteen Indonesian villagers tortured by
Indonesian soldiers allegedly hired by Exxon – could possibly survive under
this post-Kiobel framework, as Exxon
has extensive operations in the United States, employs tens of thousands of
Americans, is headquartered in the U.S., and sends many thousands of barrels of
oil from Indonesia to the U.S. every year. Oona Hathaway, The Door Remains Open to “Foreign Squared” Cases, SCOTUSBlog (Apr.
18, 2013 4:27 p.m.), http://www.scotusblog.com/?p=162617 (last visited July 23,
2013).
b.
DaimlerChrysler Corp. v. Bauman
In fact, the question of whether ATS claims
sufficiently “touch and concern the territory of the United States” could be further
articulated next term, when the Supreme Court hears DaimlerChrysler Corp. v. Bauman. See 133 S.Ct. 1995, 185 L. Ed. 2d 865 (U.S., 2013). In Bauman, twenty-two Argentinian nationals
sued Daimler in California federal court for human rights violations allegedly
undertaken by the company’s Argentinian subsidiary in collaboration with the
government during Argentina’s “Dirty War” in the 1970s and 80s. See Bauman
v. DaimlerChrysler AG, No. 04-00194, 2007 U.S. Dist. LEXIS 13116 (N.D. Cal.
Feb. 12, 2007). In 2011,
the Ninth Circuit held that Daimler had sufficient contacts with the state to
justify the exercise of personal jurisdiction. See Bauman v. DaimlerChrysler Corp., 644 F.3d 909, 911 (9th Cir.
2011). Applying a two-pronged agency theory, the court reasoned that MBUSA,
Daimler’s U.S. subsidiary, was Daimler’s agent because MBUSA was distributing
vehicles in California, a “critical aspect” of Daimler business, and because
Daimler controlled “nearly all aspects” of MBUSA’s operations. Id. at 922-24.
Although the case primarily concerns the standard for
establishing personal jurisdiction, some have noted that the Bauman case could
provide an opportunity for the Court to either cite Kiobel in dismissing the case, or expand upon its reasoning in Kiobel by requiring a certain level of
contact between the U.S. and the corporate defendant. John Bellinger, Reflections on Kiobel, Lawfare (Apr. 22,
2013 8:52 p.m.), http://www.lawfareblog.com/2013/04/reflections-on-kiobel/ (last visited July 23,
2013); Xander Meise Bay, The ATS’s Second
Act: The Supreme Court Looks to Address the Unanswered Questions of Kiobel,
Corporate Responsibility and the Law, (Apr. 23, 2013), http://www.csrandthelaw.com/2013/04/the-atss-second-act-the-supreme-court-looks-to-address-the-unanswered-questions-of-kiobel/ (last visited July 23,
2013).
c.
The Future of Non-ATS Human Rights Litigation
Regarding the future of non-ATS human rights cases, one
commentator remarked that, “[w]hen U.S. federal courthouse doors close, other
doors open for the litigation of transnational cases.” Donald Childress, An ATS Answer with Many Questions (and the
Possibility of a Brave New World of Transnational Litigation), SCOTUSBlog
(Apr. 18, 2013 5:03 p.m.), http://www.scotusblog.com/?p=162624 (last visited July 23,
2013). Some human rights cases now precluded by the Kiobel decision could move to foreign courts, while others may move
to U.S. state courts. Suing U.S. corporations in courts in the nations where
the violations took place could prove ineffective, however, as the judiciaries
of countries such as Nigeria lack the safeguards, objectivity, and robust
enforcement capabilities that U.S. courts possess.
As for state courts, assuming plaintiffs can
effectively “plead around” removal to federal court, where Kiobel and forum non
conveniens defenses could prove insurmountable, they may be able to bring
cases under state law in state courts. Donald E. Childress III, The Alien Tort Statute, Federalism, and the
Next Wave of International Law Litigation, 100 Geo. L.J. 709, 741 (2012), available at http://ssrn.com/abstract=1815413 (last visited July 23,
2013). As Rich Samp noted, “States are largely free to craft their tort
law without interference from the federal government, so plaintiffs’ lawyers
barred from raising overseas human rights claims in federal court under the ATS
may well decide to file their lawsuits in state courts instead.” Rich Samp, Supreme Court Observation: Kiobel v.
Royal Dutch Petroleum & the Future of
Alien Tort Litigation, Forbes (Apr. 18, 2013 10:51 a.m.), http://www.forbes.com/sites/wlf/2013/04/18/supreme-court-observations-kiobel-v-royal-dutch-petroleum-the-future-of-alien-tort-litigation/
(last visited July 23, 2013). Although there are few, if any, current examples
of this state law-state court approach, such cases will undoubtedly arise in
the next few years.
VII.
Conclusion
In short, Kiobel
unquestionably limited the possibilities for plaintiffs’ lawyers seeking to
bring international human rights claims against American corporations. But Kiobel did not close down all avenues
of potential litigation, and we can anticipate that creative lawyers will
construct ways to pursue such cases in both federal and state courts, as well
as in hospitable fora overseas, in the near future.
Left lingering, meanwhile, is the question of what
Congress will do with the now-limited extraterritorial application of the ATS. In
his concurrence, Justice Kennedy noted that Congress eased the judiciary’s task
when, in 1991, it expressly defined the extraterritorial application of the
Torture Victims Protection Act. Kiobel, 133 S. Ct. at 1669. Surely
Congress can do the same here. Human rights advocates and multinational
corporations will no doubt be advocating for and against such a change in the
coming months.
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