The 2013 Supreme Court opinion in Kiobel v. Royal Dutch Petroleum radically altered the playing field for plaintiffs using the Alien Tort Statute (ATS) to hold private actors and corporations accountable for human rights violations. The ATS is the federal statute that allows non-U.S. citizens to pursue tort claims in U.S. district court where claims involve violations of international law or a treaty to which the U.S. is party. We present a short round-up of recent, major developments in ATS litigation here.
Kiobel’s “touch and concern” test
In Kiobel, the Supreme Court established a new test for deciding what ATS claims may be actionable. A majority of the Court applied a canon of statutory interpretation known as the presumption against extraterritorial application to the statute and articulated that claims may survive where they “touch and concern” U.S. territory with “sufficient force to displace the presumption against extraterritorial application.” Since then, lower courts have struggled to define the elements of that test and dismissed more claims than they have allowed.
A recent, striking example is Ntsebeza v. Ford Motor Co. On June 20, the Supreme Court rejected plaintiffs’ appeal to reinstate the long-running litigation seeking civil liability for multinational corporations alleged to have aided and abetted South Africa’s apartheid regime. The plaintiffs had asked the Second Circuit to rehear its July 2015 decision dismissing their claims, but the court held that the plaintiffs had not plausibly alleged relevant conduct committed in the U.S. sufficient to rebut Kiobel’s presumption. Specifically, a three-judge panel of the Second Circuit found that due to the fact it was U.S. companies’ subsidiaries in South Africa that had purportedly assisted the ruling regime, the U.S. companies could not themselves be sued under the statute. The Supreme Court’s decision not to grant cert effectively ended that litigation as well as Ntsebeza’s companion case Balintulo v. Ford Motor Co.
Another noteworthy decision is that of the Southern District of Florida on June 1 in In re Chiquita Brands Int’l, Inc. Alien Tort Statute & Shareholder Derivative Litigation. The company had pleaded guilty in 2007 to paying Colombian paramilitaries to suppress labour groups, but the Eleventh Circuit dismissed the ATS claims against the company for lack of a U.S. nexus. The Colombian plaintiffs continue to pursue state law claims in district court. In the meantime, the Florida district court has dismissed ATS claims against various Chiquita executives, finding subject matter jurisdiction lacking on grounds of extraterritoriality though it has permitted claims against some executives under the Torture Victim Protection Act to proceed.
This is not to suggest that no ATS claims survive jurisdictional review. On April 28, in Salim v. Mitchell, the U.S. District Court for the Eastern District of Washington held that a lawsuit filed by the American Civil Liberties Union on behalf of former prisoners of a CIA interrogation program could proceed, having sufficiently alleged acts that satisfied the “touch and concern” requirement. The plaintiffs had relied on Al Shimari v. CACI Premier Technology, a case brought by Iraqi plaintiffs against a U.S. defense contractor for abuses suffered at Abu Ghraib, an analogy that the district court found fitting. In Al Shimari, the Fourth Circuit found legal, contractual and other ties to the U.S. sufficient to satisfy the “touch and concern” requirement but remanded the matter for further factual development so that the district court could determine whether the court lacked subject matter jurisdiction on political question grounds. The district court ultimately decided it did.
Back to Salim, the claims stand a good chance of succeeding – the defendants are U.S. citizens who allegedly designed an enhanced interrogation program for a U.S. agency, and the district court has refused to decline jurisdiction on the basis of Kiobel or the political question doctrine. A jury trial date has been set for June 2017.
Corporate liability and the ATS
One of the key questions left unanswered in Kiobel is whether or not corporate liability is even available under the ATS. The majority opinion seems to imply that it does and all circuits save for the Second Circuit appear to agree. A recent four-part decision by the Second Circuit not to rehear the dismissal of an ATS suit at the district court level based on the Circuit Court’s earlier, controversial holding in Kiobel, however, suggests a fissure may be emerging – one that could eventually require Supreme Court review.
In brief, foreign plaintiffs had sued Jordan-based Arab Bank, PLC under the ATS in 2004 over terrorist attacks committed in Israel, the West Bank and the Gaza Strip in In re Arab Bank PLC Alien Tort Statute Litigation. The plaintiffs sued the bank for allegedly financing and facilitating terrorist activities that took place over a ten-year period from 1995 to 2005. The district court dismissed the claims, and last winter a three-judge panel of the Second Circuit issued a decision affirming the dismissal and reaffirming its earlier holding in Kiobel I (the case appealed to the Supreme Court and resulting in that Court’s 2013 decision) but allowed the plaintiffs to persuade the Second Circuit to overturn circuit law blocking their claims.
At issue is the fact that the Supreme Court had affirmed the Second Circuit’s holding in Kiobel (Kiobel I) on grounds different than those underlying the Second Circuit’s decision (see above). Having recognized its earlier holding as an outlier, the Second Circuit voted against rehearing the Arab Bank decision on May 9. Thus, for now the Second Circuit’s anomalous position that the ATS does not regulate corporate conduct stands. We will continue to monitor developments.