Supreme Court Weighs If Firms Can Be Sued Over Human Rights Abuses Abroad

By | March 6, 2012

The U.S. Supreme Court said on Monday it would hear arguments next term on whether an 18th century U.S. law can be used to sue multinational corporations or others in American courts for alleged human rights abuses committed abroad.

The justices said in a brief order they would consider during rearguments in the case whether the 1789 U.S. law at issue, the Alien Tort Statute, extended to conduct that occurred within a foreign nation.

The Supreme Court heard arguments last week on a narrower issue in the case of whether corporations can be sued in the United States under the law. A number of justices appeared ready to rule that only individuals, not corporations, can be held liable under the law.

But several justices during the arguments raised the broader issue of whether U.S. courts even have jurisdiction to hear such lawsuits for alleged genocide, war crimes and other abuses abroad. That will be the focus of next term’s arguments.

The case involved a lawsuit by 12 Nigerians who alleged that Royal Dutch Shell Plc helped the Nigerian government crack down on oil exploration protests between 1992 and 1995 through torture, executions and crimes against humanity.

The case has been closely watched by corporations concerned about long and costly litigation in the United States and by human rights advocates who say businesses can be held accountable in U.S. courts for their alleged role in foreign abuses that violate international law.

The justices directed the parties in the case to file briefs addressing “whether and under what circumstances” the Alien Tort Statute allowed U.S. courts to recognize international law violations that occur outside the United States.

The justices ordered that the briefs be submitted in May and in June.

A Supreme Court official said the new arguments in the case would take place in the upcoming term that begins in October. A decision is likely early next year.

The British, Dutch and German governments supported Shell, as did various multinational corporations and the U.S. Chamber of Commerce business lobby, while the Obama administration and human rights groups backed the Nigerian plaintiffs.

The 1789 law had been largely dormant for nearly two centuries, but has been used in the past 20 years by foreign victims to sue corporations and others for alleged abuses overseas.

In the past two decades, more than 120 lawsuits have been filed in U.S. courts against 59 corporations for alleged wrongful acts in 60 foreign countries.

Many of the lawsuits have been unsuccessful, though there have been a handful of settlements, lawyers in the case said. Many of the cases, having dragged on for years, are still pending.

The Supreme Court case is Esther Kiobel v. Royal Dutch Petroleum Co., No. 10-1491.

Topics Lawsuits USA

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