by Brittany Prelogar and Laura Ardito
The Court limited Alien Tort claims for human rights violations on non-U.S. soil. Nigerians alleged Royal Dutch Petroleum and Shell Transport & Trading Company, of Holland and UK respectively, operating a joint-owned Nigerian subsidiary, aided and abetted rights abuses by the local government. A majority found presumption against extraterritorial application of statutes barred these claims as all relevant conduct took place outside the US.
In Kiobel v. Royal Dutch Petroleum Co. [an enhanced version of this opinion is available to lexis.com subscribers], the U.S. Supreme Court significantly limited the viability of Alien Tort Statute (ATS) claims for human rights violations occurring on non-U.S. soil. The Nigerian petitioners had filed ATS claims against Royal Dutch Petroleum Company and Shell Transport and Trading Company, p.l.c., which were incorporated in the Netherlands and United Kingdom respectively, and operated in Nigeria through Shell Petroleum Development Company of Nigeria, Ltd., a jointly-owned local subsidiary. Petitioners filed suit against the companies for aiding and abetting human rights abuses by the Nigerian government. A five-Justice majority held that, under Morrison v. Australia National Bank Ltd. [enhanced version], a presumption against extraterritorial application of statutes barred petitioners' claims in this case, where "all the relevant conduct took place outside the United States." The Court left open the possibility that ATS claims based on overseas conduct may "touch and concern the territory of the United States...with sufficient force" to overcome the presumption against extraterritoriality, but cautioned that "mere corporate presence" in the United States would not suffice. Notably, while the Court originally granted certiorari to consider the availability of corporate ATS liability, the Court did not rule on this issue. ATS Background The ATS was enacted by the First Congress in 1789. It permits foreign plaintiffs to file civil tort actions in US federal courts for violations of the "law of nations or a treaty of the United States." The ATS was rarely used to bring human rights-related claims before 1980, when Paraguayan citizens successfully used the statute in Filartiga v. Pena-Irala [enhanced version] to bring a claim in New York against a Paraguayan police official for torture and murder committed in Paraguay. Since then, plaintiffs have increasingly used the ATS as a vehicle for asserting claims against foreign officials, multinational companies, and other defendants for alleged human rights violations, with cases producing damage awards in some instances exceeding $100 million. The Supreme Court had previously interpreted the ATS in Sosa v. Alvarez-Machain [enhanced version], where it limited ATS claims to a narrow set of violations of international law norms that are "specific, universal, and obligatory." Sosa instructed the lower courts to recognize new federal common law causes of action under the ATS only for violations of international law norms that are accepted universally and "defined with a specificity" that is comparable to the offenses the ATS was designed to redress at the time it was enacted, specifically piracy, violations of safe passage, and assaults on ambassadors. Because the cause of action alleged in Sosa did not meet this standard, the claim was dismissed with no ruling as to whether the extraterritorial nature of the conduct at issue would have been a further bar to the claim. However, the Sosa court appeared to cite approvingly the Second Circuit's decision in Filartiga, which also involved conduct occurring within the territory of a foreign sovereign. In a footnote, the Court in Sosa raised but did not specifically address the issue of corporate liability, which was squarely before the Court for the first time in Kiobel, but which the Court ultimately did not decide.
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Brittany Prelogar (email@example.com) is a partner, and Laura Ardito (firstname.lastname@example.org) is an associate, in the Washington, DC office of Steptoe & Johnson LLP. Each are members of the firm's Business and Human Rights practice, which advises and represents corporations on issues related to Corporate Social Responsibility, Alien Tort Statute compliance, and human rights-related matters. Ms. Prelogar received her J.D. from Harvard Law School. Ms. Ardito received her J.D. from American University Washington College of Law.