Case No. 19-416 & 19-453 | 9th Cir.
December 1, 2020
Preview by Emma Liggett, Online Editor
The Alien Tort Statute (“ATS”) gives federal courts jurisdiction over torts committed “in violation of the law of nations.” 28 U.S.C. § 1350 (2018). The First Congress passed the ATS in 1789, originally as a provision of the Judiciary Act, to provide a forum for noncitizens harmed by universal crimes, such as piracy. See Jesner v. Arab Bank, PLC, 138 S. Ct. 1386, 1396–97 (2018). Litigators have since used the ATS for human rights violations. However, the Court has limited its reach in three key cases.
In Sosa v. Alvarez-Machain, the Court held that an ATS claim must meet two criteria to succeed: (1) the violation addressed must be “specific, universal, and obligatory,” and (2) it must be practical, in the court’s judgment, to make the cause accessible to litigants in federal courts. 542 U.S. 692, 732–33 (2004). In Kiobel v. Royal Dutch Petroleum Co., the Court limited the ATS’s grant of jurisdiction for foreign citizens injured by foreign corporations’ misconduct abroad. 569 U.S. 108 (2013). It held that claims under the ATS must “touch and concern” U.S. territory “with sufficient force to displace the presumption against extraterritorial application.” Id. 124–25. Mere corporate presence in the U.S. is not enough. Id. at 125. Most recently, the Court placed a blanket limitation on the ATS in holding that foreign corporations may not be liable absent further action from Congress. Jesner v. Arab Bank, PLC, 138 S. Ct. 1386, 1407 (2018). This begs the question of domestic corporate liability under the ATS.
In Nestlé USA v. Doe (consolidated with Cargill v. Doe), the respondents are six former child slaves trafficked from Mali who, from the ages of twelve to fourteen, were subjected to forced labor and abuse on Ivorian cocoa farms. Brief of Respondents in 19-416 at 3, Nestlé USA, Inc. v. Doe, Nos. 19-416 & 19-453 (U.S. filed Oct. 14, 2020). They worked twelve to fourteen hours for six days a week, ate only scraps of food, and were beaten and whipped as punishment. Id. While the actual perpetrators remain unnamed, claimants allege that Nestlé and Cargill (Petitioners), U.S. corporations in the cocoa bean business, aided and abetted this abuse and thus their claims come under the purview of the ATS. Id. at 4; Brief of Respondents in 19-453 at 4, Nestlé USA v. Doe, Nos. 19-416 & 19-453 (U.S. filed Oct. 14, 2020). The Court will determine (1) whether an aiding and abetting claim against domestic corporations, based on general corporate activity in the U.S., can overcome the extraterritoriality bar, and (2) whether the ATS gives courts authority to impose liability on domestic corporations.
The parties are in agreement that aiding and abetting forced labor and child slavery satisfy the Sosa standard that the violation be of a universal, international norm. See Brief of Respondents in 19-416 at 12–13. However, they disagree about the ATS’s reach and claims that can overcome the extraterritoriality bar. Respondents argue that their claims satisfy Kiobel’s “touch and concern” test, and are not barred, because Petitioners’ conduct took place in the U.S. and constituted the kind of violation the founders intended to address. See id. at 11–12. The petitioners carried out all approved decisions regarding their cocoa supply chains and supervision by executives in the U.S., despite knowing of the use of child slaves. See id. at 4–5. Allowing ATS claims regarding international human rights “violations by U.S. citizens from U.S. territory” is consistent with the history and purpose of the ATS, which was to provide “foreign plaintiffs a remedy for international-law violations when the absence of [one] might provoke foreign nations to hold” the U.S. liable. Id. at 15–16 (quoting Jesner, 138 S. Ct. at 1396).
The petitioners, Nestlé and Cargill, argue that Respondents are impermissibly attempting to apply the ATS extraterritorially. Brief for Petitioner Nestlé USA, Inc. at 14, Nestlé USA v. Doe, Nos. 19-416 & 19-453 (U.S. filed Aug. 31, 2020). The proper inquiry to determine whether a rebuttal to the presumption against extraterritoriality is successful is not Kiobel’s “touch and concern” test, but a “focus” test established in RJR Nabisco, Inc. v. European Community. 136 S. Ct. 2090 (2016); see Brief for Petitioner Nestlé USA, Inc. at 14. This test asks “whether the case involves a domestic application of the statute . . . by looking to the statute’s ‘focus.’” RJR Nabisco, 136 S. Ct. at 2101. Because the conduct relevant to the ATS’s focus—“injury resulting from a tort in violation of the law of nations”—occurred overseas, Respondents’ claims are impermissibly extraterritorial. Brief for Petitioner Nestlé USA, Inc. at 15 (emphasis in original). This is the case even when taking a broader focus, the petitioners argue, because directing and supervising overseas activities from the U.S. are not sufficient to make the ATS’s application domestic. Id. 23–24.
Exempting domestic corporations from ATS liability would undercut the ability of human rights plaintiffs to gain redress for international-law violations perpetuated by profit-driven corporations. Child slavery and forced labor on the Ivory Coast has continued and even increased in recent years despite Nestle’s pledge to stop using it. Brief of Respondents in 19-416 at 6–7. Providing individuals with redress for these crimes seems appropriate, while creating loopholes for domestic corporations signals that they can continue to commit violations so long as they keep an arm’s length from the perpetrators they facilitate.