Human rights abuses, corporate liability and extraterritorial application of the Alien Tort Statute

Esther Kiobel, Individually and on behalf of her late husband Dr. Barinem Kiobel, et al, Petitioners. v. Royal Dutch Petroleum Co. et al., 569 US (2013) (17 April 2013)

Summary

The United States Supreme Court has found that the Alien Tort Statute, used for decades by survivors of human rights abuses to seek redress, has no application to violations committed in other countries unless there is a strong connection with the US. The Court expanded the presumption against extraterritorial application to limit the scope of the Statute. The Justices of the Court agreed that mere presence of a corporation in the US would not of itself demonstrate a strong enough link to bring alleged extraterritorial human rights violations within the Statute’s ambit. However, the Court declined to address the broader question of corporate liability under the Alien Tort Statute.

Facts

The applicants, Mrs Kiobel and others, are Nigerian nationals that resided in the Ogoni region of Nigeria during the 1990s. The applicants stated that during the early 1990s residents of the area protested against oil exploration conducted by Shell Petroleum Development Company (SPDC), a subsidiary of the respondent holding companies Royal Dutch Petroleum Co and Shell Transport and Trading Company p.l.c. The applicants alleged the respondents compelled SPDC to aid and abet the Nigerian government in violently suppressing peaceful demonstrations.

History of proceedings

Following unrest in Nigeria, the applicants moved to the US where they were granted political asylum and became legal residents. The applicants filed a class action suit in the District Court under the Alien Tort Statute requesting relief under customary international law. The Alien Tort Statute allows foreign citizens to bring law suits in Federal Courts for some violations of the law of nations. The District Court dismissed some of the claims but denied the respondents' motion to dismiss claims for aiding and abetting crimes against humanity, torture and cruel treatment, and arbitrary arrest and detention. These claims were certified for interlocutory appeal in the Court of Appeals for the Second Circuit. The Second Circuit dismissed the remainder of the complaint in its entirety, noting the law of nations does not recognise corporate liability. The Supreme Court then granted certiorari to consider that question but ordered new briefing and argument on the related question of whether and under what circumstances the Alien Tort Statute allows courts to recognise a cause of action for violations of the law of nations occurring in a foreign sovereign.

Decision

The court unanimously dismissed the applicants' claim, although the reasoning used to reach this conclusion differed.

The opinion of the Court was delivered by Chief Justice Roberts, joined by Justices Scalia, Kennedy, Thomas and Alito. Chief Justice Roberts recalled the presumption against extraterritorial application, outlined in Morrison v. National Australia Bank Ltd., 561 US (2010), requiring a clear indication from Congress that a statute should apply to foreign sovereigns. The presumption, which intends to prevent interference in foreign policy, had previously applied on the basis of "merits questions". The Alien Tort Statute, in contrast, is "strictly jurisdictional" (Sosa v. Alvarez-Machain, 542 US 692,732). However, the Court was of the opinion that the presumption should nonetheless apply to avoid the alternative, which might amount to judicial interference in foreign policy.

Chief Justice Roberts further reasoned that nothing within the text of the Alien Tort Statute rebutted the presumption. At the time of drafting, three key offences under the law of nations were identified: (a) violation of safe conducts, (b) infringements of the rights of ambassadors, and (c) piracy. The first two had domestic application only, and the third did not consider conduct that occurred on the soil of a foreign sovereign but rather conduct happening at sea, outside the scope of any jurisdiction. His Honour noted that as all conduct occurred outside the US and the claims did not touch the interests of the nation with "sufficient force to displace the presumption" the claim must fail. His Honour added that "a mere corporate presence" within the US would not be a sufficient force as corporations were necessarily present in multiple jurisdictions.

Justice Kennedy wrote an additional paragraph, agreeing with the majority, but noting further exploration of extraterritorial application might be needed in the future. Justice Alito also provided a concurring written judgment, joined by Justice Thomas, in which he declared the Alien Tort Statute only applied to violations of international law as it stood at the time of drafting in 1789.

Justice Breyer, joined by Justices Ginsburg, Sotomayor and Kagan, provided a second significant judgment. His Honour disagreed that the presumption had not been rebutted. His Honour noted that while piracy occurred at sea it necessarily took place aboard a ship and should be deemed to occur in the territory of the ships’ flag state. Justice Breyer turned to principles of foreign relations law to find jurisdiction for the Alien Tort Statute where a defendant's conduct would substantially and adversely affect an important national interest of the US, particularly the longstanding duty to not provide safe harbour for an enemy of mankind. However, His Honour found that the mere corporate presence of the defendants within the US failed to vindicate a distinct national interest, particularly as the claim was not that the respondents themselves had engaged in the activities of torture, genocide and so on, but had merely helped others to do so. This meant that there could be no claim of provision of safe harbour to an enemy of mankind and that the claim was too remote.

Commentary

Kiobel demonstrates the reluctance of the US Supreme Court to involve itself in conduct that has occurred in foreign jurisdictions unless a sufficient American interest is involved. The decision also significantly confines the scope of a statute that has previously been a critical avenue for holding human rights violators to account.

However, the judgment fails to fully answer the question for which the Supreme Court granted leave – whether a corporation may be liable under the Alien Tort Statute. The impact of this is that while many current claims under the Alien Tort Statute will now have to fail, until further judicial direction is given, corporations might still be liable under the statute should their conduct sufficiently affect an American interest.

Ella Dalrymple, Pro Bono Graduate – Sydney, DLA Piper Australia