Author: Marco Simons


Jam v. International Finance Corporation: Nine misconceptions from the Supreme Court argument

(Marco Simons is General Counsel at EarthRights International, and counsel for the petitioners in the Jam case. He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

Yesterday, the Supreme Court heard argument in Jam v. International Finance Corporation (IFC), where the question is the degree of immunity that international organizations (IOs) enjoy in U.S. courts. In brief, the International Organizations Immunities Act (IOIA), 22 U.S.C. § 288a, provides that IOs “shall enjoy the same immunity from suit and every form of judicial process as is enjoyed by foreign governments.” It is the meaning of those eighteen words that the Supreme Court will decide. Does that mean the immunity that foreign governments received in 1945, when the IOIA was enacted? Or the immunity that they receive today, with its exceptions for injuries in the United States and commercial activities under the “restrictive theory” of immunity?

I may be biased, but I think the answer is clear; “the same . . . as is enjoyed” means the same as currently enjoyed by foreign governments. There are a lot of approaches to statutory construction at issue in this case – and they all point toward the same result – but I think the easiest way to see this is to look at 42 U.S.C § 1981, one of the key provisions of the Civil Rights Act of 1866 (reenacted in 1870): “That all persons within the jurisdiction of the United States shall have the same right . . . . to make and enforce contracts . . . as is enjoyed by white citizens.”

There is no question that this provision means the same rights as are currently enjoyed by white citizens. This formulation would have been familiar to Congress in 1945, and section 1981 (and its companion section 1982) are the only other places in the U.S. Code that the “same . . . as is enjoyed” formulation appears. The same language has to be interpreted the same way – and thus the IFC and other IOs should receive restrictive immunity, which is what foreign states now receive under the Foreign Sovereign Immunities Act (FSIA) of 1976, and previously received pursuant to State Department policy announced in 1952.

Against this backdrop, the IFC’s counsel – former U.S. Solicitor General Don Verrilli, Jr. – made a number of policy arguments. Most of his arguments were based on misconceptions. But the first misconception came not from the IFC but from the Court, in the form of a question by Justice Breyer.

  1. The purpose of the IOIA was “to get these organizations to locate here”

Justice Breyer was very concerned about whether applying the restrictive theory of immunity would undermine the original purpose of the IOIA – which he identified as follows:  “The purpose of the statute, going back to 1945 and the U.N. and everything, was to get these organizations to locate here.” This is, at most, half right.

First, Congress’s major purpose in enacting the IOIA was clear on the face of the legislative history: “The basic purpose of this title is to confer upon international organizations, and officers and employees thereof, privileges and immunities of a governmental nature.” That was Congress’ overriding purpose, and it should be honored.

Second, it is true that a secondary purpose was to help prepare the ground to allow the United Nations to locate in the United States – but there is no indication that it was intended, as a general measure, to encourage IOs to locate in the United States on an ongoing basis. The Senate Report on the IOIA indicates that it was intended “primarily to meet the requirements” of IOs generally; it named several, only some of which were headquartered in the United States. The law would, however, “also be available to meet the needs of the United Nations Organization, the headquarters of which will in all probability be established in the United States.” Debates in Congress indicate that part of the need to pass the law before the end of 1945 was to meet the needs of the UN as the headquarters issue was resolved.

But helping to resolve the UN headquarters location is very different from generally trying to encourage IOs to locate in the U.S. There is no indication in the legislative history that the U.S. needed to provide extensive immunities to encourage IOs to locate here; instead the law was intended to give IOs appropriate immunities of a governmental nature.

The distinction matters, because there is no danger that any interpretation of the IOIA would threaten any purpose related to the UN. As it happened, the IOIA was not sufficient to satisfy the UN. First a Headquarters Agreement was separately negotiated between the U.S. and the UN. At the time, the U.S. had not adopted the Convention on the Privileges and Immunities of the United Nations (CPIUN), but some of its immunities were incorporated into the Headquarters Agreement. And then the U.S. did ratify CPIUN, giving broad immunity from suit. The IOIA is almost irrelevant to the UN.

In fact, most international organizations established after the IOIA do not have headquarters in the U.S.; the ones that do are either financial institutions that the U.S. dominates (like the IMF and the World Bank Group), organizations founded by the U.S. and only one or two other nations (usually Canada and/or Mexico), or regional inter-American organizations like the Organization of American States (which in any event also negotiated its own separate Headquarters Agreement with the United States). Indeed, other than the UN, no major global organization outside the World Bank Group has sited its headquarters in the U.S. since the enactment of the IOIA; no organization has been relying on the IOIA’s immunity regime for its headquarters decisions.

  1. There was a fixed rule of “virtually absolute immunity”

The IFC argued that, in 1945, the immunities of foreign governments had a “settled meaning of virtually absolute immunity,” which IOs should continue to receive today. This is accurate to a point – the Supreme Court has said that states at the time enjoyed “virtually absolute immunity,” but that this was not a common-law rule; instead it was the consequence of deference to the immunity determinations of the State Department.

So “virtually absolute” immunity could mean no immunity if the State Department chose not to extend immunity in a particular case. And this deference to the political branches means that the 1945-era approach could not be considered a fixed rule, as the IFC argued.

  1. Treaties required the U.S. to grant “virtually absolute immunity”

Next, the IFC argued that “Congress enacted the IOIA . . . to fulfill treaty obligations that committed us to provide virtually absolute immunity.” And later, that “what led to the enactment of the IOIA” was the need “to get these organizations up and going and give them the immunity we promised them.” This is simply false.

Congress enacted the IOIA against the backdrop of three recently-created IOs: the UN, the IMF, and the International Bank for Reconstruction and Development (IBRD, known as the World Bank – though today’s World Bank Group also encompasses four subsequently established institutions, including the IFC). Not one of their founding agreements commits the U.S. to provide “virtually absolute immunity.”

The UN Charter commits the U.S. to grant the UN the “privileges and immunities as are necessary for the fulfilment of its purposes.” No one has suggested why applying the restrictive theory would have frustrated the purposes of the UN, especially in 1945. The UN’s framers could have put absolute immunity into the Charter; they did not.

The IMF’s Articles of Agreement do provide absolute immunity from suit (not “virtually absolute immunity,” a concept that simply does not exist in international law). But that immunity had already been codified into U.S. law, in 22 U.S.C. § 286h; the IOIA was unnecessary for this purpose. As for the IBRD, its Articles of Agreement decidedly do not provide absolute immunity, and arguably do not provide any immunity at all (except for suits from member states).

Thus the U.S. was under no treaty obligations in 1945 to provide “virtually absolute immunity” to any IO.

  1. The UN Charter requires absolute immunity

The IFC then suggested that while the original UN Charter only required “necessary immunities,” the negotiation of CPIUN in 1946 elaborated that “the U.N. should get virtually absolute immunity” – and that not granting such immunity to the UN would put the U.S. “in violation of the commitment we made in the U.N. charter.”

This is wrong in at least two ways.

First, CPIUN again does not provide “virtually absolute immunity”; it provides unqualified, absolute immunity from suit. Again, no treaty reflects the standard that the IFC urges.

Second, and more importantly, the US was not bound by CPIUN until it ratified it. While the purpose of CPIUN was to elaborate on the functional immunity in the UN Charter, not all states agreed with that elaboration. Even today, while there are 193 members of the UN, only 162 have adopted CPIUN. And that adoption was not immediate – 36 countries adopted CPIUN in the 1940s, and adoption continued gradually throughout the 1950s, 1960s, and up through today (the most recent being Saudi Arabia and East Timor in 2015).

The U.S. did not ratify CPIUN until 1970, and until then it was not bound by its interpretation of the UN Charter. It would only have been in violation if the U.S. approach to immunity frustrated the purposes of the UN, and there is no evidence of that.

Indeed, even today, some countries do not accord the UN absolute immunity. As August Reinisch, a leading expert on the subject, notes, “some national courts have tried to limit the Organization’s scope of immunity along the initially envisaged ‘functional’ immunity. In practice, this has also sometimes led to the application of restrictive State immunity principles denying immunity for ‘commercial” activities.’”

  1. The IOIA was enacted to give international organizations “functional” immunity

The IFC argued that – contrary to the language of the IOIA – immunity of IOs should not be the same as immunity of states because “immunity is granted for different reasons. The reason you give an international organization immunity is a functional reason, not a status reason. It’s not about according the appropriate respect to the sovereigns, because international organizations aren’t sovereigns.” But that’s not what Congress thought in 1945.

The Senate Report on the IOIA is replete with indications that Congress intended to do just what the IFC argues against – to tie the immunity of IOs to sovereign immunity as a matter of status. The Senate Report indicates that the IOIA would grant IOs “immunities of a governmental nature,” and that the immunities granted “are those accorded foreign governments under similar circumstances.” Proponents of the IOIA indicated that IOs that are “made up of a number of foreign governments . . . should enjoy the same status as” a foreign embassy.

While Congress’ clear intent was to link IO immunity with foreign sovereign immunity as a matter of status, this still does not disturb any need for functional immunity – as we see next.

  1. Restrictive immunity would impair the functions of international organizations

The IFC suggested throughout that the “restrictive” approach to immunity from suit would conflict with IOs’ needs to function. But it is far from clear why that would be so, other than a generalized argument that subjecting anyone to the possibility of lawsuits makes it impossible for them to function, which is a rejection of much of the U.S. legal system.

The two major categories of exceptions to immunity, under the restrictive theory, are torts within the United States – auto accidents, slip-and-falls, other kinds of negligence in the U.S. – and commercial activities within the United States. The IFC’s argument did not even address the first category. As to the second, it’s not clear why, if every other commercial lender can manage to operate while being subject to suit, the IFC cannot.

Indeed, the only reason for that would be if the IFC’s commercial activities risk harming people in a way that commercial banks would not be willing to do. And if that’s what’s going on, it’s something that needs to be stopped, not protected. Immunity is supposed to protect an IO’s purposes, and the IFC’s purpose is to promote development and end poverty – not harm vulnerable communities. If we think, as a matter of policy, that legal liability impairs sustainable economic development, why don’t we immunize all corporations for all of their actions in developing countries? (In fairness, some might argue for that – but I hope there is no serious debate here.)

  1. The IFC is being sued because its borrower failed to meet its contractual obligations

While the question at issue in the Supreme Court goes far beyond this case, the next misconception peddled by the IFC is about this case in particular, which relates to harms from a power plant project in India. The IFC argued that it is being sued because it tried to put in robust environmental standards into its contract, and the project developer didn’t follow them: “The entity that we loan this money to didn’t live up to the standards and it’s our fault. And so we’re being sued here.”

That is not true at all. The IFC is being sued for its own negligence. The IFC expressly allowed the project developer to deviate from its original plans, which led directly to massive impacts on the local population.

Think of the classic hypothetical where a man walks into a gun dealer and says “I need to buy a gun because I plan to kill my wife.” Now while it’s generally legal to sell guns, you’re abetting a crime if you sell a gun to someone who you know is going to use it to hurt someone. So suppose the gun dealer simply says, “well, first I need you to sign a contract saying you’re not going to hurt anyone with this gun.” The man signs the contract, buys the gun and kills his wife. The gun dealer can make exactly the same argument as the IFC, characterizing the case against it as “the man that we sold this gun to didn’t live up to the standards and it’s our fault. And so we’re being sued here.”

The point is that while including environmental and social standards in a contract is a good thing, it doesn’t get you off the hook if you still know that you’re enabling someone to cause injury. The IFC is not being sued because of its contract; it’s being sued in spite of its contract. The absence of environmental and social standards in the IFC’s contract would not absolve it of liability here. The essential facts – that the IFC knew the project was going to cause harm, specifically approved many of the features of it that do so, and went forward with it anyway – would remain the same.

  1. The IFC takes remedial measures in response to identified problems

Perhaps the argument most divorced from reality was the IFC’s contention that they have an effective internal policing mechanism: “We’ve also got a robust internal accountability mechanism, where if people think something has gone wrong on one of our projects, they can come to us and they can say –they can say, look, there’s a problem here. And they — and we investigate. We take internal remedial measures if we find there’s a problem.”

The mechanism at issue is the Compliance Advisor Ombudsman (CAO). And the CAO does great work. The problem is with the last part of this assertion: that the IFC takes remedial measures if the CAO identifies problems.

If the IFC had done so here, there would never have been a lawsuit. In fact, although the CAO identified numerous problems with the IFC’s behavior on this project, the IFC’s response has been lackluster at best. The CAO’s compliance audit was issued in October 2013 – over five years ago. But the CAO still considers the case to be open, in the “compliance” stage, where the CAO is monitoring IFC’s response to its recommendations. The CAO issued its second monitoring report in February 2017; its bottom line conclusion was that it was “concerned that the actions reported by IFC are not sufficient to address the findings of the audit.”

  1. Absolute immunity for IOs “has been the law for a very long time” and has “worked well”

The IFC closed its argument by suggesting that the absolute immunity rule “this has been the law for a very long time. There is no evidence that it has done anything other than work well.” Neither piece of that is true.

At most, the absolute immunity interpretation has been relied on by international organizations for the past 20 years, since the D.C. Circuit decided Atkinson v. Inter-American Development Bank in 1998. Before that, there was no indication that international organizations would get absolute immunity in U.S. courts.

During the initial years of the IOIA, the State Department treated its immunity not as a fixed rule of absolute immunity, but as a rule of deference to the State Department – just like the rules for foreign states. Thus, just like it did with foreign states, the State Department had a practice of filing “suggestions of immunity” for international organizations; the U.S. confirmed this in its amicus brief. But the U.S. stopped doing so, and in 1977 the State Department indicated that it would be inappropriate to do so after the 1976 passage of the FSIA, precisely because the IOIA “links the two types of immunities.” Again in 1978, the U.S. submitted an amicus brief in the D.C. Circuit arguing that the FSIA’s restrictive approach applies to IOs. The Executive Branch would go on to repeat this interpretation multiple times over the next four decades.

So at least from 1978 to 1998 – a 20-year span – no one had any reason to believe that international organizations had absolute immunity. And during that period, there was no indication that applying the restrictive approach would have any negative consequences.

All this proves is that suits against international organizations, regardless of what degree of immunity is applied, are rare. There was no flood of litigation after the FSIA was enacted and the State Department said it applied to international organizations; there will be no flood of litigation now. There may be a handful of suits – and those suits will encourage more careful behavior on the part of international organizations.

And has immunity worked well? The facts of this case demonstrate that it has not. Immunity distorts market behavior; it creates classic moral hazard problems, where actors take unwarranted risks because they know they cannot be sued. The irony is that if the IFC knew its immunity was not absolute, there would have been no lawsuit here – because the IFC never would have made the decisions that caused the plaintiffs’ injuries.


A further defense of human rights clinics

(Marco Simons is Legal Director of EarthRights International.  He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

Last month, Chicago law professor Eric Posner launched an ill-conceived attack on law school human rights clinics; on my usual blog at EarthRights International (ERI), I wrote a response. (Prof. Posner is the son of Judge Posner, who’s been around these pages a lot recently.) More recently, over at Opinio Juris, Hofstra law professor Julian Ku echoes some of Posner’s argument: sure, he thinks that Posner’s argument “sweeps a bit too broadly,” but he accepts the critique that broad-based human rights clinics “risk becoming a platform for pure political advocacy,” which is “undesirable.”

In Ku’s mind, narrowly-focused clinics such as asylum clinics that may have some international human rights element in them are acceptable, while more broadly-focused clinics – those that employ the range of strategies used by actual human rights lawyers – might be appropriate, depending “on the particular situation of the law school and the goals of its students.”

Despite my earlier response to Posner, there’s more to say here, because Ku’s addition points up further methodological and substantive flaws in the argument. I’m pleased for the opportunity to dig in deeper in this forum.

Methodologically, this is an argument that is both levied by people who are in a poor position to evaluate its merits, and apparently lacking in evidence. Ku, like Posner, is an academic law professor, not primarily a practitioner. He notes that the counter-argument has been advanced by “those who are involved in these clinics” – who would naturally defend their occupation – but ignores my response, as someone who is not involved in a clinical program. (I don’t know if this is deliberate – ERI’s blog is admittedly not that high-profile, but Posner himself did respond to my post on his own blog.)

Since modesty is generally absent in the blogosphere, I’ll posit that I’m in a better position than Ku or Posner to evaluate the usefulness of human rights clinics. Why? Posner’s reply to my critique says that “a clinic experience could be valuable to students if it teaches them (distinctively) legal skills and generates benefits for a client (or is likely to).” The conclusion that human rights clinics perhaps don’t do this seems based entirely on supposition, but my contrary observation is not; it’s based on years of experience and evidence.

I’ve been practicing international human rights law for more than a decade, and I know that my own clinical experience (at the Yale clinic, which Ku singles out) has been quite useful to my career. I learned numerous practical legal skills – from the details of researching international law (which is seldom taught elsewhere in law school, even in international law courses), to techniques for interviewing victims of human rights abuses, to approaches to writing human rights reports founded on international law, to briefs in US courts incorporating international law.

And I also know that at least some of my projects led to benefits for clients. One of the cases I worked on was Doe v. Karadzic, which later led to a $4.5 billion jury verdict in favor of survivors of war crimes in Bosnia. Another major project was a Human Rights Watch report on corporal punishment in Kenyan schools, which was then rampant and highly abusive; two years later the Kenyan government banned the practice, and the ban was enshrined in the constitution in 2010. (Actually eliminating it remains a work in progress.)

My own experience with a single clinic is, naturally, highly anecdotal (though no less so than the critiques). But that’s only the beginning of the evidence I’ve seen of the value of human rights clinics. I’ve employed at least six young lawyers who have come through different human rights clinics, and without exception I can say that they have gained valuable skills. In fact, some of the exercises they have done in their clinics parallel workshops that we conduct for our own staff at ERI. Human rights clinics are a major part of the reason that US-trained lawyers are generally better prepared for the work that we do than their counterparts in other countries, who are rarely taught the practical legal advocacy skills that are essential in this field.

I can also vouch for the practical benefits of the work done by these clinics, because as a practitioner I’ve had the opportunity to partner with clinics at over a dozen different law schools. Obviously many international human rights projects are long-term efforts, so tangible benefits are not always quickly identifiable, but these clinical projects do achieve results in most cases. And it would be a mistake to give students the impression that only legal work that shows immediate benefits to specific clients is worth doing; one of the skills that they learn is the value of contributing to one piece of a long-term strategy.

So I would submit that neither Posner nor Ku is in a particularly good position to evaluate the effectiveness of human rights clinics, and neither of them points to any evidence that human rights clinics don’t serve purposes they recognize as valid. My evidence may be anecdotal, but it’s not insignificant, and I’d rather base my judgments on the evidence available.

Substantively, the part of Posner’s critique that Ku echoes – and that deserves further examination – is the suggestion that human rights clinics engage in activities that are “pretty close to pure political advocacy,” modeled after NGOs “whose lawyers also engage in broad range of non-lawyering political advocacy,” and that it is “undesirable” for law schools to “train[] students in pure political advocacy.” Thus, Ku reasons, law schools should “perhaps demand such clinics ensure that a certain percentage of their work is indeed traditional legal skills training.”

There’s a bit of sleight-of-hand going on here, because the argument starts from the assumption that the kind of advocacy that human rights lawyers do is not lawyering – and of course it’s easy to agree that law schools should be focused on teaching lawyering skills. But Ku makes a definitional error in describing this kind of work as “pure political advocacy”; it could more appropriately be described as “using legal arguments in favor of a policy position.” Framed that way, I’d be surprised if anyone would dispute that this is a proper role for a lawyer, and a valuable skill to teach law students interested in making this work part of their career.

As far as I’m concerned, this should be part of “traditional legal skills training.” Lawyers are hired by clients every day to develop legal arguments in furtherance of policy positions, in every area of the law. Indeed, that’s largely what Ku’s frequent writing partner, John Yoo, famously did as a lawyer for the Bush administration. (And did badly – perhaps if Yoo had a grounding in an international human rights clinic, he would not have so grievously misinterpreted international law to legitimize torture.)

I’m not aware of any human rights clinic that has engaged in “political advocacy” unmoored from legal principles, especially principles of international human rights law. As far as I can tell, that notion – like the suggestion that maybe clinics don’t teach valuable lawyering skills – is entirely lacking in evidence. So Ku’s critique, while softer than Posner’s, rests on the same lack of evidence and the same flawed understanding of human rights practice as somehow not lawyerly in nature.

The real test of a clinic should be whether its graduates are valued for the skills they have learned. Regarding human rights clinics, I can personally testify to this, and I have seen no evidence to the contrary.


Is there a constitutional right to corporate separateness?

(Marco Simons is Legal Director of EarthRights International.  He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

Although it’s gone largely unnoticed amid the blockbuster campaign finance and affirmative action cases, what could be one of the most significant cases of this Supreme Court term will be argued tomorrow – DaimlerChrysler v. Bauman. This happens to be an Alien Tort Statute (ATS) case arising out of Daimler’s alleged participation in targeting labor activists during the Dirty War in Argentina, but the issue in the case is far broader than the ATS. The Supreme Court is considering whether there is personal jurisdiction over Daimler, a German corporation, and Daimler is essentially arguing that it has a constitutional right to be treated separate from its subsidiaries. (One of the few institutions to notice Bauman is the Vanderbilt Law Review, which hosted a roundtable on the case.)

The Ninth Circuit held that the contacts of Daimler’s US subsidiary could be attributed to the parent for personal jurisdiction purposes, because, functionally speaking, they were essentially acting as a single business – the subsidiary was performing acts on behalf of the parent, which the parent would have had to do if the subsidiary did not exist. Daimler argues that this is a violation of due process, because the Constitution requires that it be treated separately from its subsidiary.

My organization, EarthRights International (ERI), submitted an amicus brief on the side of the Bauman plaintiffs, arguing that the Constitution does not enshrine any right to corporate separateness. Indeed, it’s difficult to see how it could – when both Due Process clauses were adopted, it was illegal in all states for one corporation to own another. How can a corporation have a constitutional right to be treated separately from its subsidiaries when subsidiaries did not exist when the constitutional provisions at issue were adopted?

It’s important to note that this case is not about what the “best” rule would be. Due to the interplay of the Federal Rules of Civil Procedure and the California long-arm statute, personal jurisdiction here extends to the limits of constitutional due process, and has not in any way been restricted by Congress. Back in 1925, under a different statutory regime, Justice Brandeis wrote for the Court in Cannon Manufacturing Co. v. Cudahy Packing Co. that a parent corporation’s presence in a state could not be established through the presence of a subsidiary – but he stated that this was due to the absence of statutory authority, not because the Constitution forbids it:

No question of the constitutional powers of the State, or of the federal Government, is directly presented. The claim that jurisdiction exists is not rested upon the provisions of any state statute or upon any local practice dealing with the subject. . . . Congress has not provided that a corporation of one State shall be amenable to suit in the federal court for another State in which the plaintiff resides, whenever it employs a subsidiary corporation as the instrumentality for doing business therein.

This situation has now changed, however, because – in California – Congress has effectively provided that anyone is amenable to suit in federal court whenever the Constitution permits exercise of jurisdiction. And in many other contexts, the Court has already determined that it’s okay to attribute the business of subsidiaries to the parent corporation.

In some ways Bauman is a followup to Kiobel v. Royal Dutch Petroleum, in which the Court decided earlier this year that claims under the ATS could not proceed where the only connection to the United States was the “mere presence” of a foreign multinational corporate defendant. (See ERI’s recent publication about Kiobel, Out of Bounds.) But Bauman has much more far-reaching implications. The Court is faced with the decision of whether to constitutionalize relatively recent innovations in corporate law, and hold that simply because state laws now allow corporations to own other corporations, due process forbids a more functional approach to jurisdictional contacts with the forum.

In other contexts, including tax law, the Court has declined to hold that corporations must be treated separately from their subsidiaries. Changing that in Bauman could have significant implications for a number of areas of the law where corporate separateness is not the rule, and add a new constitutional right that is uniquely available to corporations. Previously, questions of whether to credit separateness between parent and subsidiary corporations have generally been thought of as issues of state law, not the Constitution. After all, corporations can only exist when state law allows them to.

A ruling in favor of Daimler could also have the effect of further incentivizing offshoring of U.S. corporations. A U.S. corporation, headquartered here, is always subject to U.S. jurisdiction for its acts. But if that corporation changes its nationality, and its U.S. operations are now that of a subsidiary, the parent corporation – and, by extension, the rest of the corporation’s global operations – would become insulated from any scrutiny by U.S. courts.

I am most interested to see the approach of the Court’s self-identified originalists to this question. There can be no question that the original intent of the due process clause was not to afford some right to maintain distinctions between parents and subsidiaries, concepts which did not exist at the time. Will the originalists disregard their approach to the Constitution when it comes to protecting the interests of foreign multinational corporations?


After Kiobel, extraterritoriality is not a question of subject matter jurisdiction under the Alien Tort Statute – and neither is corporate liability

(Marco Simons is Legal Director of EarthRights International.  He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

The Supreme Court issued its decision in Kiobel v. Royal Dutch Petroleum a few weeks ago, and it has raised more questions than it has answered. Commentators and scholars have puzzled over what the Court did and what it means – all we really know is that the Court did not expressly rule on whether corporations could be sued for human rights abuses under the Alien Tort Statute (ATS) (the original question certified), and only began to elaborate under what circumstances an ATS suit could be brought for injuries arising in a foreign country (the question certified for reargument).

As to the extraterritoriality question, the Court held that some sort of presumption against extraterritoriality applied to ATS claims. Unlike the usual application of such presumptions, however, the Court did not suggest that this meant that no claims arising in foreign countries could be heard. Instead, the Court’s five-justice majority said that claims needed to be assessed on the basis of the extent to which they “touch and concern” the United States, and that where the only connection to the U.S. is the “mere corporate presence” of a foreign multinational, that is insufficient to allow an ATS claim to proceed.

This raises an interesting question of how this presumption is being applied. As the Supreme Court ruled in Sosa v. Alvarez-Machain, the ATS is a purely jurisdictional statute – claims under the statute come from federal common law. Ordinarily, the presumption against extraterritoriality does not apply to jurisdictional provisions; it only applies to substantive provisions. So Kiobel did not decide that the ATS is not an extraterritorial statute – it decided that the presumption against extraterritoriality applies to claims brought under the ATS. Read More


Sidestepping corporate liability, Supreme Court shifts focus of Kiobel case to extraterritoriality

(Marco Simons is Legal Director of EarthRights International.  He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

Last week I blogged about the Kiobel v. Royal Dutch Petroleum case, in which the Supreme Court was considering whether corporations could be sued for complicity in serious human rights abuses under the Alien Tort Statute (ATS). I noted that some scholars and amici were urging the Supreme Court to decide the case on other grounds; namely, that the ATS was limited to suits against U.S. citizens.

On Monday the Supreme Court issued a rare reargument order in Kiobel, directing the parties to re-brief and argue next Term the question of “[w]hether and under what circumstances” the ATS allows suits for abuses “occurring within the territory of a sovereign other than the United States.”
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Is the Alien Tort Statute Really Limited to Suits Against U.S. Citizens?

(Marco Simons is Legal Director of EarthRights, International.  He is a graduate of Yale Law School, where he received the Robert L. Bernstein Fellowship in International Human Rights.)

The Supreme Court will hear argument in Kiobel v. Royal Dutch Petroleum Tuesday, to determine whether corporations can be sued for serious human rights abuses under the Alien Tort Statute (ATS), 28 USC 1350. But some scholars are urging the court to decide the case on other grounds.

There is a set of conservative legal scholars who intensely dislike the ATS and especially its modern use in international human rights cases. This dislike is somewhat mystifying – what the ATS essentially does is allow cases to be brought in federal court, rather than state court, where they implicate torts against aliens in violation of serious international law violations, such as torture or genocide. Would it really be better to hear cases against Paraguayan torturers or Rwandan genocidaires in state court?

Led by Curtis Bradley, Anthony Bellia, and Bradford Clark, this group of scholars argued strenuously that the ATS did not allow cases under modern human rights law at all. After this position was thoroughly repudiated by the Supreme Court in Sosa v. Alvarez-Machain, they have trotted out new arguments. The latest, from Bellia & Clark, is that the ATS only allows suits by aliens against U.S. citizens; it’s started to get some traction, as four Ninth Circuit judges adopted a version of this argument in their dissent in the Sarei v. Rio Tinto case decided in October.

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