Blog de Marco Simons

"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." 

In the words of Judge Pierre Leval, who disagreed with his colleagues, that is the result of today's ruling by a panel of the U.S. Court of Appeals for the Second Circuit, which concluded that corporations could not be sued for human rights abuses under the Alien Tort Statute (ATS).  The ATS generally allows suits in federal courts for violations of international law - but, according to the Second Circuit, not if the violation was committed by a corporation.

International investment law doesn't usually get much attention--in comparison to human rights law or international environmental law (or even international trade law), it tends to be fairly dry stuff.  But in recent years multinational corporations have started to use investment law to challenge environmental and human rights regulation and liability.  Treaties such as the North American Free Trade Agreement (NAFTA), the Central American Free Trade Agreement (CAFTA), and various bilateral investment treaties (BITs) give multinational corporations from one member countries various privileges when they invest in another country.  Most significantly, these corporations can take the foreign government to binding international arbitration, where a panel of arbitrators decides whether the government has violated the treaty by expropriating the corporation's property or denying it equal treatment.

In a decision with potentially far-reaching implications, a U.S. court recently rejected the idea that international organizations enjoy absolute immunity from suit in the United States.  The U.S. Court of Appeals for the Third Circuit, one of the appellate courts that sits between the federal trial courts and the Supreme Court, decided in OSS Nokalva, Inc. v. European Space Agency that international organization immunity is subject to the same exceptions as foreign states.  That may sound obscure, but international organizations include institutions such as the World Bank, and some of the immunity exceptions could open up these institutions to significant new levels of accountability.

A bit of background here: In 1945, early in the development of the modern international system, the U.S. enacted the International Organizations Immunities Act (IOIA).  The IOIA was passed, in part, to reassure the United Nations and other new global agencies that it was safe for them to have staff (and often headquarters) in the United States.  The law states that such organizations will have the "same immunity" from suit as foreign states.

But what does that mean?  The traditional practice was that foreign states, like diplomats, had absolute immunity from lawsuits.  The only exception was if the U.S. government told the court not to recognize immunity; because the immunity of foreign states (also known as "foreign sovereign immunity") is designed to protect U.S. foreign policy, the U.S. government can decide that it's not necessary in a particular case.

By 1945, that practice was already changing, in two ways.  First, the U.S. government was more frequently waiving foreign sovereign immunity; second, in cases where the U.S. government said nothing, the courts were developing general rules based on the government's past practice.  Finally, in 1976, Congress decided to enact these rules in a new statute, the Foreign Sovereign Immunities Act (FSIA), which ended the case-by-case evaluation of immunity by the U.S. government.  The FSIA creates a general rule of immunity as well as a series of well-defined exceptions that the courts can apply.

Yesterday a Maryland federal court issued a decision allowing a case alleging torture by a US contractor in Iraq to proceed.  There's a lot of good analysis in the opinion, but I'd like to focus on a particularly strange argument made by the defendants--that foreign residents simply cannot sue in US courts, especially when they are citizens of countries that the United States is at war with.  (Put aside for the moment the suggestion that all Iraqis are "enemies.")  This argument was rightly rejected by the court, which found that the plaintiffs "possess the 'privilege of litigation' in United States courts."  But why was it even raised?

Except in very limited circumstances, no one had ever really questioned that aliens can sue in US courts.  Nearly every transnational case that has been litigated has involved aliens, mostly residing outside the US, suing in US courts.  Last year, however, a federal court in Washington, DC, dismissed a case against Exxon Mobil because, the judge found, there was a "general rule that non-resident aliens lack standing to sue in United States courts."  (The notion of "standing" can be a vexing legal doctrine, but basically it encompasses the idea that the plaintiff is the right person to bring the suit, because the plaintiff has suffered harm and because the law intended to benefit that type of plaintiff.)  There is, of course, no such general rule; nonresident aliens have been suing in US courts for centuries, as the Exxon Mobil plaintiffs pointed out.  So how could the judge get it so wrong?

Supreme Court Follows Administration Recommendation, Declines to Hear Medical Experimentation Case

A few weeks ago, I blogged about the fact that the U.S. government had asked the Supreme Court not to hear an Alien Tort Statute (ATS) case against Pfizer, which accused the drug maker of engaging in nonconsensual medical experimentation in Nigeria.  Yesterday we learned that the Supreme Court had followed this recommendation:

The Supreme Court declined to hear an appeal by Pfizer Inc of a ruling that reinstated U.S. lawsuits by Nigerian families who said the drugmaker tested an experimental antibiotic on their children without getting adequate consent.

The justices, without comment, let stand a ruling by a U.S. appeals court in New York that allowed the lawsuits involving alleged harm caused by the drug, Trovan, to go forward.

This is a victory for human rights.  The Supreme Court's decision not to hear Pfizer's petition means the case will proceed.  The Second Circuit ruled that international law prohibited human experimentation, and that allegations that Pfizer tested experimental drugs on Nigerian children without their parents' consent adequately stated a violation of this prohibition.

While the U.S. courts are not always deferential to the views of the U.S. government--and they should not be, especially where the government's submissions are clearly politically motivated--this is one area where the administration's views are highly influential.  The Supreme Court, which specifically asked for the views of the U.S. government in this case, frequently follows the government's recommendation on whether to take a case or not.  While the Supreme Court often differs from the government's views on how to decide a particular case, the Court hears very few cases every year (about a hundred), and generally agrees with the government on whether a case is significant enough to merit its review.  So far the Supreme Court has declined to hear every corporate ATS case that has come before it.

There have been two significant positive developments for human rights law at the U.S. Supreme Court in the past few days: the high court rejected an accused torturer's argument that he was protected by the Foreign Sovereign Immunities Act, and the U.S. government asked the court to decline to hear a case involving nonconsensual medical experimentation in a Nigerian drug trial.

First, the big news: the Supreme Court's unanimous decision in Yousuf v. Samantar is a tremendous victory for efforts to hold human rights abusers accountable, and in particular for the Center for Justice and Accountability (CJA), the organization that is litigating the case.  CJA represents victims of torture and extrajudicial killing in Somalia who sued Mohamed Ali Samantar, the former Somali Prime Minister and Defense Minister.  They sued under both the Alien Tort Statute and the Torture Victim Protection Act (TVPA).  Despite the fact that the TVPA specifically allows suits in U.S. courts for state-sponsored torture, Samantar argued that, because he had been a foreign official at the time, he was immune from suit under the Foreign Sovereign Immunities Act (FSIA).

The FSIA is a law that defines the immunities of foreign governments in U.S. courts; it's the reason that ERI could not sue the Burmese military regime itself over the Yadana pipeline.  Even though nothing in the law states that foreign officials have immunity, some courts have still found that the FSIA applied to individuals in addition to governments.  But the Supreme Court unanimously rejected this interpretation, finding that the FSIA simply does not apply to individuals.

The decision does not mean that the case is over, however.  The Supreme Court did suggest that "common law" immunity--that is, immunity created not by a specific law, but by the courts themselves--might apply.  So the next battle will be to show the courts that gross violations of human rights should not be entitled to immunity under any interpretation.  This position was argued to the Supreme Court in an amicus brief prepared by Harvard Law School's International Human Rights Clinic, which ERI signed.

When ERI represents victims of earth rights abuses in litigation, our goal is to seek an appropriate remedy for the harms they have suffered, and each case contributes to a general climate of accountability that deters similar abuses in the future.  But litigation often has other benefits, as well; it allows all of the facts to come out, which helps the victims to tell their story and lifts the veil on corporate secrecy.  As former Supreme Court Justice Louis Brandeis famously remarked, "Sunlight is the best disinfectant."  Sometimes the documents that are released through litigation provide insight into aspects of projects that are not even related to the claims in the case, but are important questions of public interest.  ERI's recent initiative on transparency in the oil and gas sector in Burma provides one example of how this has happened.

ERI's case Doe v. Unocal, which proceeded through one phase of trial before reaching a landmark settlement in 2005, challenged abuses arising out of a natural gas pipeline project in Southern Burma.  In many countries, the contracts underlying such a project would be public or subject to freedom of information disclosure.  After all, these are contracts with public entities to develop public resources. For example, BP's recent oil spill in the Gulf of Mexico arises out of a block known as MC252, which was awarded by the U.S. government in 2008 in Lease 206; public information about the lease sale can be found online and shows, among other things, that BP bid over $34 million for the block, with a fixed royalty rate of 18 3/4%.

The 9th Circuit Court of Appeals The Ninth Circuit Court of Appeals has scheduled a hearing in the appeal of Bowoto v. Chevron, ERI's case involving abuses against Nigerian protestors, for June 14, 2010, in San Francisco.  In 1998, ethnic Ilaje villagers held a protest on Chevron's Parabe platform, an offshore oil facility in the Niger Delta.  The Ilajes were protesting the environmental and economic devastation that oil activities had visited upon their communities.  (A detailed account of their grievances is found in The Marginalisation of the Ilajes, which the Ilajes submitted to the local government shortly before their protest.)  A day after acknowledging that the Ilajes were "unarmed" and the situation was "calm," Chevron called in Nigerian military forces to evict the protestors, flying armed soldiers to the platform in Chevron helicopters.  The soldiers shot several protestors, killing two and wounding at least two others, and detained and tortured at least ten others.

In 2008, a jury found that Chevron was not liable for the shootings and torture, but ERI and our co-counsel believe there were several important errors in the trial.  We filed the appeal last year, and in June three judges of the Ninth Circuit will hear our arguments.  In recognition of the importance of the case, the Ninth Circuit has allotted a total of 40 minutes for the argument--twice as long as in most cases.