Human rights lawyers look for silver lining in Kiobel black cloud

By Alison Frankel
April 17, 2013

When the U.S. Chamber of Commerce rushes out a statement hailing a decision by the U.S. Supreme Court, you can be sure that opinion is a defeat for plaintiffs’ lawyers. So it is with the court’s long-awaited ruling Wednesday in Kiobel v. Royal Dutch Petroleum. All nine justices agreed with Shell’s counsel at Quinn Emanuel Urquhart & Sullivan that claims by a group of Nigerian nationals suing under the Alien Tort Statute for Shell’s alleged abetting of state-sponsored torture and murder in their country should be dismissed, though they split on precisely why. The majority, in an opinion written by Chief Justice John Roberts, held that the presumption against extraterritoriality, most recently articulated by the court in Morrison v. National Australia Bank, applies to the Alien Tort Statute even though the ATS, unlike laws regulating conduct, is strictly a jurisdictional statute. Roberts’ opinion rejected (among other things) arguments that because the ATS was enacted to address piracy on the high seas, it extends to atrocities committed on foreign soil.

Corporations like Shell, which are based outside of the United States, can now rest assured that they cannot be sued under the ATS by non-U.S. nationals who claim to have suffered harm from the corporation’s activities abroad – an outcome greeted warmly by pro-business interests. But in a call with reporters on Wednesday afternoon, human rights lawyers tried to look on the bright side, pointing to indications throughout the court’s majority opinion and three concurrences that all is not lost for victims who want their day in a U.S. courtroom.

Those indications begin with Roberts’ concluding words in the majority holding. Yes, he said, the presumption must be against extraterritorial application of the ATS, but that presumption is not inviolable when there’s a strong connection between the United States and the allegations asserted. “Where the claims touch and concern the territory of the United States, they must do so with sufficient force to displace the presumption against extraterritorial application,” Roberts wrote.

In concurring opinions, Justices Samuel Alito and Anthony Kennedy, both of whom joined the majority opinion, both took care to note the narrow reach of the court’s holding. Alito, who opined along with Justice Clarence Thomas that ATS cases should be barred unless they involve domestic conduct that allegedly violates the norms of international law, said that the majority opinion “obviously leaves much unanswered, and perhaps there is wisdom in the court’s preference for this narrow approach.” Kennedy’s one-page concurrence says more explicitly that the ATS might still be a tool for human rights victims: “Other cases may arise with allegations of serious violations of international law principles protecting persons, cases covered neither by the (Torture Victims Protection Act) nor by the reasoning and holding of today’s case,” he wrote. “In those disputes the proper implementation of the presumption against extraterritorial application may require some further elaboration and explanation.”

Paul Hoffman of Schonbrun DeSimone Seplow Harris & Hoffman, who argued at the Supreme Court on behalf of the Nigerians suing Shell and represents plaintiffs in several other ATS cases, told reporters that the ruling “does not foreclose the possibility” that Justice Stephen Breyer‘s concurrence, which was joined by the other three justices on the court’s left wing, “could become the majority in other cases.” In the concurrence, Breyer disputed the majority’s presumption against the extraterritoriality of the ATS, though he agreed that the Nigerians’ case does not belong in U.S. courts. He laid out a different standard for ATS litigation: “I would find jurisdiction under this statute where (1) the alleged tort occurs on American soil, (2) the defendant is an American national, or (3) the defendant’s conduct substantially and adversely affects an important American national interest, and that includes a distinct interest in preventing the United States from becoming a safe harbor … for a torturer or other common enemy of mankind.” (For what it’s worth, Breyer agreed with Hoffman that the ATS’s anti-pirate roots argue for extraterritorial application.)

Hoffman, Marco Simons of EarthRights International and international law expert Ralph Steinhardt all said that federal trial and appellate courts will now have to entertain briefing on how Kiobel affects the ATS cases before them. The cases most likely to survive, according to Hoffman and Simons, are those against U.S. corporations – though the Supreme Court said that corporate citizenship alone is not enough to overcome the presumption against extraterritoriality – or cases involving atrocities on U.S. soil, such as the Sept. 11 attacks. “No one really knows where courts will draw the line,” said Hoffman. Simons noted that as a consequence of the majority opinion, multinational corporations based outside of the United States are now protected from claims that can still be brought against U.S.-based corporations. Simons also said that human rights victims can turn to state courts rather than federal court, as many have done in the last several years.

“This decision is going to generate more litigation than it resolves,” said Steinhardt. “There’s a strong ray of hope” that plaintiffs can still litigate some ATS claims in U.S. courts.

For a reality check, I called former Bush Administration State Department legal adviser John Bellinger of Arnold & Porter, whose amicus brief (co-authored with Paul Clement of Bancroft) helped refocus the Supreme Court’s attention in Kiobel from corporate liability under the ATS to extraterritoriality. Bellinger and Clement submitted a second brief when Kiobel returned to the Supreme Court for reargument, arguing against extraterritoriality on behalf of seven U.S. corporations. Bellinger agreed with the human rights lawyers that we’re going to see plaintiffs testing the scope of the Kiobel bar in lower courts and that there could be some circumstances in which ATS suits survive. ATS claims against a defendant now living in the United States might, for example, displace the presumption against extraterritoriality, Bellinger said. So might a case against a U.S. corporation accused of actively planning overseas misconduct from its domestic headquarters.

But those cases will be rarities, Bellinger predicted. “This ruling means that the U.S. is no longer going to have its courts open to be the arbiter of human rights around the world,” he said. “The door to ATS claims is no longer ajar. It’s closed, but unlocked.”

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