International human rights - corporate liability claims not actionable under the Alien Tort Statute - Kiobel v. Royal Dutch Petroleum Co.

Author:Kearney, Colin

The horrific suffering engendered by the early 20th century's economic and political nationalism gave rise to the precept of individual responsibility for gross violations of human rights. (1) In the United States, the Alien Tort Statute (2) (ATS) confers federal subject matter jurisdiction for such violations, granting a cause of action for torts committed in "violation of the law of nations." (3) In Kiobel v. Royal Dutch Petroleum Co., (4) the United States Court of Appeals for the Second Circuit considered whether the ATS confers federal jurisdiction over tort claims against corporations. (5) The court refused to classify corporate liability as a norm of customary international law, and held that tort actions against corporations are not actionable under the ATS. (6)

The plaintiffs are current and former residents of the Ogoni Region of Nigeria. (7) The defendants are multi-national petroleum companies engaged in exploration, production, and distribution of oil. (8) The plaintiffs allege that Royal Dutch and Shell compelled their Nigerian subsidiary, Shell Petroleum Development Company of Nigeria (SPDC), to enlist the aid of Nigerian military forces to brutally crush indigenous resistance to SPDC's oil exploration and production. (9)

The plaintiffs filed a class action suit under the ATS in the U.S. District Court for the Southern District of New York alleging that the defendants aided and abetted, and were complicit in, violations of international law. (10) The defendants filed a motion to dismiss for failure to state a claim upon which relief can be granted. (11) The district court granted and denied the motion in part, and certified the order for interlocutory appeal. (12) On appeal, the Second Circuit held that corporate tort liability was not a "specific, universal, and obligatory" norm of customary international law and dismissed the claim for lack of subject matter jurisdiction. (13) After lying dormant for nearly two hundred years, the ATS was resuscitated by the Second Circuit's opinion in Filartiga v.

Pena-Irala (14) The Filartiga court held that ATS claims were not restricted solely to customary norms recognized by the international community in 1789, but could invoke universal human rights principles that have subsequently ripened. (15) Despite the court's sweeping interpretation, it cautioned against overextending jurisdiction under the ATS. (16)

Notwithstanding the large number of ATS filings post Filartiga, appellate review of ATS issues is rare due to the tendency of parties to settle ATS claims. (17) Eventually, the U.S. Supreme Court had occasion to clarify the ATS' limited applicability as a jurisdictional statute in Sosa v. Alvarez-Machain. (18) In Sosa, the Court restricted ATS jurisdiction to violations of customary norms analogous in stature to those recognized by international law in 1789. (19)

Recent appellate decisions reaffirm the classic principle that in determining what complaints properly allege violations of customary international law, courts should look to "the customs and usages of civilized nations." (20) In determining whether ATS jurisdiction is properly conferred, courts must decide whether the conduct is proscribed by international law and whether liability can be attributed to a specific defendant. (21) In Presbyterian Church of Sudan v. Talisman, the Second Circuit considered whether a Canadian corporation could be held liable for allegedly enabling the Sudanese military to commit crimes against humanity. (22) The court held that because the corporation improved the airstrips to allow its employees to access the concession area, and not to intentionally aid and abet atrocities, the corporation could not be held liable under the ATS. (23) The appellate courts, however, have not expressly decided whether corporate entities can be held liable under otherwise permissible extensions of ATS jurisdiction. (24)

In Kiobel v. Royal Dutch Shell Co., the Second Circuit reaffirmed the ATS' function as a jurisdictional statute only. (25) The

court surveyed various sources of international law to determine whether the plaintiffs' ATS claims alleged violations of customary norms. (26) The court focused on the defendant's corporate identity as a substantive factor in determining whether the plaintiffs' ATS claims alleged violations of customary international law. (27) Finding that no existing norm of customary international law attaches liability to corporate defendants, the Kiobel court affirmed the district court's dismissal of the plaintiffs' claim for lack of subject matter jurisdiction under the ATS. (28)

In his concurring opinion, Judge Leval acknowledged that corporate liability has not yet ripened into a fundamental norm of international law. (29) Additionally, Judge Leval conceded that international law is often primarily concerned with imposing criminal liability on individuals who violate fundamental norms. (30) Judge Leval, however, argued that individual nation-states are free to decide whether egregious conduct, generally prosecuted under international law when perpetrated by individuals, gives rise to civil liability. (31) To support his argument Judge Leval cited seminal ATS decisions, many of which imposed civil liability on individuals for heinous conduct deemed criminal by international law. (32) Judge Leval reasoned that recent ATS jurisprudence recognizes civil liability not because "international law commands civil liability throughout the world," but because international law flatly condemns certain conduct regardless of the perpetrator or cause of action. (33)

The Kiobel court correctly identified controlling case law, meticulously chronicled the history of the ATS, and properly relied upon sources of customary international law. (34) Notwithstanding the tragic circumstances facing...

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