Doe v. Exxon Mobil Corp. - 573 F. Supp. 2d 16 (D.D.C. 2008)

Rule:

Under District of Columbia law, respondeat superior is simply another way to say that a master is liable for the acts of its servants. There are two requirements to establish liability: (1) a master-servant relationship; and (2) the tortious conduct must occur while the servant is acting within the scope of his or her employment. These are both questions generally to be decided by a finder of fact. 

Facts:

Eleven Indonesian villagers allege that Exxon Mobil Corporation, two of its U.S. affiliates (Mobil Corporation and ExxonMobil Oil Corporation), and its Indonesian subsidiary, ExxonMobil Oil Indonesia (EMOI), are liable for killings and torture committed by military security forces protecting and paid for by EMOI. There is evidence that these security forces committed the alleged atrocities; that EMOI paid for the security, which was provided "as may be requested by [EMOI]" under a contract; that EMOI had the right to influence the forces' "deployment logistics" and "to influence the security plan and the development strategy;" and that EMOI "assisted in the management of security affairs . . . on behalf of" the Indonesian government entity that provided these forces. Additionally, there is evidence that EMOI alone was not "equipped to handle all the issues that were cropping up" with security and therefore "went up the chain and request[ed] additional corporate kinds of support" from Exxon Mobil Corporation--which enforced "uncompromising controls" over EMOI's security. The oil entities all sought summary judgment.

Issue:

Were Exxon, as the parent corporation, and EMOI liable for killings and torture committed by military security forces protecting and paid for by EMOI?

Answer:

Yes.

Conclusion:

Applying District of Columbia law, the court held that EMOI was potentially vicariously liable under a theory of respondeat superior because it controlled the military forces' daily activities, paid them directly, and assigned its own civilian security personnel to work alongside them. Because the military forces were engaged to perform armed security for EMOI, unauthorized acts of violence were foreseeable and fell within the forces' scope of employment. Because EMOI knew of actual human rights abuses by the military forces, it was potentially liable for negligent hiring, retention, and supervision. As a parent corporation, Exxon was liable for the acts of the subsidiary, its agent. However, insufficient evidence of agency existed between the subsidiary and the oil company's two American affiliates to hold the affiliates liable. A nationalized Indonesian oil company was not a required party under Fed. R. Civ. P. 19(a)(1).