Issuing the 1st decision was the U.S. Court of Appeals for the 9th Circuit.
In a mid-September decision, the 9th Circuit denied plaintiffs’ appeal from an adverse jury verdict in Bowoto v. Chevron (prior posts here and here). A jury in December 2008 had found Chevron not liable for the death of one protester and injuries to others when security forces, at Chevron’s request, attacked a group of protesters on an oil rig in the Niger Delta. Plaintiffs appealed on a number of grounds, including faulty jury instructions and the judge’s failure to allow a number of claims. (credit for photo above right)
The appeals court decision in Bowoto, from a panel consisting of 9th Circuit Judges Mary M. Schroeder, Jay Bybee (yes, that Bybee, the one who signed off on the torture memos) and District Court Judge Owen Panner, threw out all of plaintiffs’ claims. The opinion for the panel, written by Judge Schroeder (right):
► Held that the summary execution claim is not allowable under the ATS because it is preempted by the Death on the High Seas Act – a somewhat ironic result given that piracy on the high seas was one of the first, and most enduring, types of ATS claims. The court recognized the possibility of piracy claims but nonetheless held that all plaintiffs’ claims for wrongful death and survival had been preempted.
► Also dismissed all the allegations of improper jury instructions.
These rulings are disappointing, but case-specific enough to have limited application elsewhere.
► Not so the court’s ruling that corporations cannot be sued under the Torture Victims Protection Act. The TVPA applies to cases of torture or summary execution committed under color of foreign law. In Bowoto the 9th Circuit undertook to construe the statute's extension of liability to “an individual who…subjects an individual to torture.” The court held that use of the word “individual” rather than “person” to characterize both potential plaintiffs and defendants made clear that Congress meant to exempt corporations from the ambit of the law. Future TVPA cases therefore may sue individual defendants only.
(This ruling is now definitive for cases in the 9th Circuit (comprising Alaska, Arizona, California, Guam, Hawai'i, Idaho, Montana, Nevada, Northern Marianas Island, Oregon, and Washington); it is in conflict with the only other appeals court to consider the issue, the 11th Circuit.)
Issuing the 2d decision was the U.S. Court of Appeals for the 2d Circuit.
The 2d Circuit's late-September decision in Kiobel v. Royal Dutch Petroleum Co. (prior post) compounded the blow dealt by the 9th Circuit in Bowoto.
Kiobel is a companion case to Wiwa v. Shell, both brought by family of Nigerian activists killed for their protest activities against oil drilling in the Niger Delta, allegedly with the complicity and connivance of Shell officials. (photo credit) Wiwa settled in 2009 for $15.5 million, but the panel in Kiobel, led by Judge José Cabranes, decided to request supplemental briefing on the issue of whether corporations could be sued at all under the ATS. In the Kiobel decision, the panel decided that they cannot.
Thus, in the 2d Circuit, which includes New York, corporations have a liability-free zone for depredations abroad.
How could this happen, after a decade of litigation against corporations under the ATS and a number of settlements and jury trials, without the issue ever arising before?
Here’s one chronology:
Back in 2002, there was the Unocal case, involving allegations of forced labor, slavery and other rights violations as part of a pipeline project in Burma. (photo credit) As part of the years of legal skirmishing in that case, a 9th Circuit panel split on the question of whether it was international law or domestic legal doctrines that governed ancillary issues arising under the ATS. (Prior posts here and here.) That is, everyone agreed that the core definition of the “violation of the law of nations” came from international law.
But what about the innumerable other issues, like who can be sued and under what definitions of liability?
► Judge Harry Pregerson held that those questions were governed by international law, and looked to the jurisprudence of the International Criminal Tribunal for the former Yugoslavia to answer the question of how to define “aiding and abetting” for purposes of ATS liability.
► Judge Stephen Reinhardt thought that domestic doctrines of agency, unjust enrichment and tort were more than sufficient and should be used to fill in all the necessary gaps in international law.
At the time, it was not clear to litigators what the implications of this choice could be, since both international and domestic law pointed in the same direction.
Because the panel decision was eventually withdrawn for unrelated reasons, the Unocal case created no precedent. It was up to the 2d Circuit to define the issue.
At first, the 2nd Circuit had as much trouble as the 9th. In Khulumani v. Barclay Int'l Bank Ltd., 504 F.3d 254 (2007), involving allegations of corporate complicity in shoring up the apartheid regime in South Africa, the judges split again. (prior post) (image credit) Judge Robert Katzmann, on the question of aiding and abetting, found that ancillary issues were governed by international law. Rather than look to the ICTY, however, he looked at the Rome Statute of the International Criminal Court, and concluded that aiding and abetting had a “purpose” requirement in international law, one not found in domestic law. Thus, turning to international law had the effect of raising the bar for what plaintiffs needed to prove.
A 2d Circuit panel that included Judge Cabranes agreed with this analysis in a subsequent decision in Presbyterian Church of Sudan v. Talisman Energy, Inc. (October 2009). It dismissed the case on grounds that the plaintiffs could not show that Talisman Energy had the purpose of aiding and abetting the crimes of the Sudanese security forces, even though the oil company knew about the violations and acted despite that knowledge. Plaintiffs’ certiorari petition was set for review by the U.S. Supreme Court at the end of September, but the Court seems not yet to have decided whether to weigh in.
Judge Cabranes’ decision in Kiobel took the reasoning in these earlier cases one step further: if we look for the definition of “aiding and abetting” in international law, then logically we should look for the answer to whether corporations are entities capable of committing actionable violations in international law as well.
Judge Cabranes, predictably, could find few cases in which corporations as such (as opposed to their officers and owners) were held criminally liable for international crimes. He too used the ICC Statute against plaintiffs, using the decision of the Rome Statute drafters not to allow prosecutions of legal persons as evidence of a customary norm excluding corporate liability. (This even though the Rome Statute makes clear that it does not necessarily follow customary law.)
Unfortunately, because of the very nature of international law, it is unlikely to provide answers to lots of questions – including this one – which have always been considered to be issues of domestic law.
As Judge Pierre Leval, concurring in the judgment in Kiobel, put it:
So long as they incorporate (or act in the form of a trust), businesses will now be free to trade in or exploit slaves, employ mercenary armies to do dirty work for despots, perform genocides or operate torture prisons for a despot's political opponents, or engage in piracy – all without civil liability to victims.
Let’s hope this new month of October brings better news on the ATS litigation front.