Theories of Corporate Liability in the ATS, a Quick List

by Kenneth Anderson

If I were to sit down and sketch out in a single sentence or two the current approaches (“theories” is way too strong for what I mean here) to corporate liability in the ATS, what would they be?  I give it a shot as bullet points below; I welcome any additions, if you were trying to give a short but reasonably comprehensive list of litigation approaches in favor of finding corporate liability.

One thing I (can’t speak for others) took away from the Harvard meeting, as well as discussions with some litigators in the area, is that the question is not settled in US courts.  Sosa left it open in footnote 20, and although I would have described the leading circuit cases as having accepted the idea, I came away from various discussions with a sense that it is more open to a change in direction than I thought – and that, even absent a new Supreme Court ruling on the matter.  My sense after the latest Talisman was that US courts had more or less accepted corporate liability under the ATS, signing on to an accumulation of precedents without signing onto a theory of why.  Reining in ATS liability, insofar as they were inclined to do it, would come either as limits on what substantive acts would count or else, as in the 2nd Circuit’s latest Talisman ruling, as limits on secondary liability.  But I came away from recent discussions with an inchoate sense – not a clear set of reasons – that the corporate liability issue itself was not so settled as I might have thought.

Whether that is so or not, it made me think that having some bullet point list in my head of the main lines of argument in favor of corporate liability was a useful exercise.  Feel free to add any more you like in the comments.  The reason I stress here arguments in favor is that, as someone who thinks it is not the case, it is harder for me to think of the arguments for corporate liability.  The affirmative arguments against corporate liability seem to be mostly variants of saying, the ATS requires as a threshold matter that there be a violation of international law.  Corporations are not things that are capable of violating international law, and there can’t be a violation without a violator upon which law imposes liability; hence no violation of international law and no US action in tort.

The principal way of complicating this as an argument against corporate liability is to say, in addition:  There are two hurdles to finding an international law violation – two axes, if you like.  You have to make the move from individual to corporate liability.  Separate and independently, you have to make the move from criminal law to civil law.  Neither one of these is well founded in international law, and you have to satisfy each in order to show an international law violation.  (Represented as a diagram, the two axes produce four quadrants and it’s fun to frame it that way, but I’ve not managed to figure out how to do graphs like that on WordPress.)  One might disagree with those axes, of course, but they are what I think I see in defense arguments (including my own expert declaration in the Agent Orange case) and defense-side expert statements, at least disaggregating a bit.  There is then a long debate over what to take as constituting “international law” and evidence thereof, but leave that aside.  That said as the basis of anti-corporate liability arguments, what’s the summary list of pro-corporate liability arguments?

  • One. Determine that international law allows for corporate liability “straight up” (Steve Ratner, Jordan Paust, and Ralph Steinhardt, et al. are right; Christopher Greenwood and James Crawford (in their politely skeptical Talisman defense-side affidavits) are wrong).
  • Two.  Find corporate liability but only for a certain “threshold” set of really bad things – the Edwards approach early on in ATS litigation, which I understand to be now overtaken by holdings and newer theories.
  • Three.  Determine that international law allows corporate liability because there is some amount of private liability in international law, and if there is for private individuals, then entity liability can be inferred for private actors (Talisman lower court approach). This approach depends somewhat on a further assumption that if  corporate liability is not affirmatively ruled out, then it is okay for a court to read it in if it finds it reasonable, a little bit like a gap filler argument.
  • Four.  Determine that whether international law allows for corporate liability or not, the fact that US tort law allows for corporate liability is enough for an ATS case.  Once you have the international law violation, the fact of the acts is enough to satisfy the international law prong of the ATS, and then everything else, including who or what is liable, becomes a matter of US domestic civil law (with several variations, looking to federal common law or something else, but leaving aside those complications).  This makes corporate liability the “hinge” that “swings” between the international law prong of the ATS and the US domestic law prong in tort.  The objection is what I already noted above, the “acts” are only a “violation of international law” insofar as they are committed by something or someone legally capable of violating international law.  (This is roughly the approach of Judge Weinstein in Agent Orange; yes, he acknowledged, there is doubt under international law as to whether there is corporate liability, but for purposes of ATS litigation, it doesn’t matter.  It exists under US law and this is US litigation and it would be inconceivable not to have entity liability, as Judge Weinstein bluntly put it.)
  • Four.  Determine that US precedents have already answered the question affirmatively, rightly or wrongly, so enough already, let’s get on with it (approximately Judge Schwartz’s approach in lower Talisman, saying that no one had pointed to any US precedent ruling out corporate liability, so on with things, or the 2nd Circuit’s latest Talisman latest opinion, ‘we here assume corporate liability’, on to aiding and abetting).  (I paraphrase in all these characterizations.)
  • Five.  Inferring corporate liability backwards from aiding and abetting secondary liability.  This is an approach I do not think I have yet seen in the cases – possibly because I missed it or possibly because it seems too far-fetched – is to get to corporate liability from secondary liability.  The usual order is to say, you have to get corporate liability in order to identify something that can aid and abet; it is logically prior.  But you could reverse it, and instead argue that if secondary liability is an accepted premise, then whatever aided and abetted must, by tacit premise, be capable of being liable, hence, liability for corporations.  This is subject to the objection raised above that in order to have a “violation” and not just bad acts, there must be a violator in virtue of being something legally capable of violating – and this presumably would be no less true of aiding and abetting.  But if you accept the idea of inferring to fill a gap in liability, then I suppose you could argue that whatever aids and abets is presumed to be capable of being a violator and hence corporate liability.

If you would propose other lines arguing for corporate liability, feel free to enter them in the comments.  I’m less interested in this post in the counter-arguments to the anti-corporate liability position; I’m trying to get a handle in short form on the affirmative arguments for.  (Plus, I’m in an affirmative, highly positive state of mind! I’m writing off the top of my head, sitting in the bright sunshine outdoors at HLS this morning, hanging out before going back to DC; I could easily have left lots out of this discussion.  LIstening to bass viol suites by Sainte-Colombe.  Drinking super-expensive coffee and eating chocolate.  Yeah, I’m burning out brain cells as I type.  If Cambridge were like this every day, it would be … Palo Alto.  What a beautiful bright fall day here, after a day of rain!)

http://opiniojuris.org/2009/10/25/theories-of-corporate-liability-in-the-ats-a-quick-list/

One Response

  1. Concerning cases here and abroad regarding company and corporate liability, see, e.g., Human Rights Responsibilities of Private Corporations, 35 Vand. J. Transnat’l L. 801 (2002).  Some of the cases are early in U.S. history.

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