Corporations, human rights violations, and the U.S. Supreme Court

 On October 1, 2012, the U.S. Supreme Court heard oral arguments for Kiobel v. Royal Dutch Petroleum, a case that concerns the legal treatment of corporations accused of committing human rights violations overseas.

 

Kiobel is a class action brought by current and former residents of Nigeria, in the Ogoni region, against Royal Dutch Petroleum for alleged conduct in Nigeria in the 1990s. Starting in the late 1950s, Shell Petroleum Development Company of Nigeria, which now falls under the umbrella of Royal Dutch Petroleum, entered Nigeria’s Ogoni region to explore its oil-producing potential. A local group, known as the Movement for Survival of Ogoni People, began to protest these activities out of concern for their impact on the environment. Esther Kiobel (the widow of one of the protestors) and the other plaintiffs allege that, from 1993 to 1994, Royal Dutch Petroleum responded to these actions by working with Nigerian military forces that assaulted, raped, and murdered some of the protestors.[1]

 

Kiobel’s claim was made under the Alien Tort Statute, a U.S. law enacted in 1789.[2] The statute allows U.S. courts to hear lawsuits over alleged overseas “violation[s] of the law of nations,” also known as customary international law. For a U.S. court to have jurisdiction over a case, the alleged perpetrators must conduct business or otherwise have a presence in the United States. At the time it was passed, the Alien Tort Statute was likely envisioned as a legal tool to address piracy and crimes committed against ambassadors.[3] In 2010, the U.S. Court of Appeals for the 2nd Circuit held that only individuals—not corporations—could be held liable through a claim brought under the Alien Tort Statute. The appellate court explained that, because corporate liability is not a universally accepted concept within customary international law, the Alien Tort Statute could not be employed as a tool to hold corporations liable for international human rights violations. The court noted, however, that individuals could be found liable for such violations under the Alien Tort Statute.[4]

           

The U.S. Supreme Court originally heard oral arguments for Kiobel in February 2012, with a focus on whether corporations could be sued for alleged overseas human rights violations under the Alien Tort Statute.[5] One month later the Court requested additional oral arguments, which were held in October 2012. This time, the Court specified that the arguments should focus on whether the Alien Tort Statute allows U.S. courts to have jurisdiction over cases that concern activities that occurred outside of the United States.

 

Interestingly, the last time that the Supreme Court requested additional oral arguments was in 2009, for the Citizens United v. Federal Election Commission case, which the Court decided in 2010.[6] That case concerned the desire of the non-profit corporation Citizens United to promote its movie, Hillary: The Movie—which offered an unflattering portrait of Hillary Clinton—throughout the presidential primaries in 2008. Lower courts had determined that Citizens United could not use television advertisements to promote the film, as this would have violated laws that determined how corporations could engage in political speech.[7]

 

The U.S. Supreme Court overturned these lower court decisions and, with its Citizens United opinion, expanded the ability of corporations to use their own monies for political speech (i.e., advertisements for or against candidates in advance of an election).[8] The decision received significant attention from the media, as it dramatically altered the role that corporations could play in the political process. As evidenced by the recent presidential and congressional election cycles, corporations now have a more prominent voice in U.S. elections compared to the role that they played before the increased financial freedom granted by Citizens United.

 

While the Kiobel case raises very different types of legal concerns than those addressed by Citizens United, it has similarly captured the attention of the business community and other stakeholders due to its implications for corporations. For example, the U.S. Chamber of Commerce filed an amicus brief, also known as a friend-of-the-court brief, in support of Royal Dutch Petroleum. The Chamber of Commerce has summarized its position as follows:

 

“[E]fforts to expand civil liability under the 1789 Alien Tort Statute (ATS) would interfere with U.S. foreign relations, and would have severe economic consequences not just on the domestic economy—by discouraging investment by foreign companies reluctant to be exposed to American-style litigation—but also on developing and post-conflict countries, particularly those where the U.S. government has enlisted the aid of American businesses to ‘constructively engage’ them through commerce.”[9]

 

Groups such as the Center for Constitutional Rights have filed amicus briefs in support of the Kiobel and the other plaintiffs, arguing that “a general principle of law exists supporting corporate liability and that this principle supports a finding that corporations can be held liable under the ATS.”[10] An amicus brief submitted by Ambassador David J. Scheffer echoes this point. In his brief, he writes: “The Circuit Court majority’s judgment abandoning corporate liability under the Alien Tort Statute . . . stands in stark contrast to the growing number of nations that have embraced corporate liability for atrocity crimes.”[11]

 

As these arguments suggest, stakeholders believe that the Court’s decision will have a major impact on the global business community and international human rights. The case gives the Court an opportunity to again consider whether corporations should, under the law, be treated in the same way as actual people. In Citizens United, the Court expanded corporations’ political speech rights, bringing them more in line with those enjoyed by actual people. In the appellate court’s treatment of Kiobel, the Second Circuit found that the Alien Tort Statute could apply to actual people but not to corporations. In the coming months, the U.S. Supreme Court will decide whether this distinction will be upheld, with important implications for both corporations and individuals in the U.S. and overseas.

 

Sarah O. Rodman is a doctoral student in Health Policy and Management and a pre-doctoral fellow at the Center for a Livable Future at the Johns Hopkins Bloomberg School of Public Health.

 

 

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