As if Ford and GM Didn’t Have Enough Problems, U.S. Court Refuses to Dismiss South Africa Lawsuit

A big case from the U.S. District Court here in New York came down this week, and I was spending my time reading blog posts on Harold Koh.  Where are my priorities?  In an important test of the scope of the Alien Tort Statute’s application to multinational corporations, Judge Shira Scheindlin has finally ruled on the defendant corporations’ motion to dismiss, and allowed most of the lawsuits to continue against a number of key companies, Ford and GM included.

It’s a long opinion, so you can cheat and read the Law.com summary here. Readers of this blog will no doubt focus on Judge Scheindlin’s review of the elements for aiding and abetting liability, which is at the core of most of these case against corporations.  Kevin Heller will be happy to learn that Judge Scheindlin has rejected the stricter ICC standard requiring assistance for the “purpose” of committing the criminal activity in favor of a looser assistance with the “knowledge” of criminal activity standard.  She then applies this standard and narrows the lawsuits somewhat, but not nearly as much as the corporate defendants would like since she applied the looser knowledge standard. (She had the freedom to pick, because the Second Circuit panel above basically split three ways on this question).

I don’t know what happens next here.  There could be another appeal, which would start this process all over again.  From GM’s perspective, why not keep appealing? They are likely to be in bankruptcy by the time this case even gets to summary judgment…