The Case Against Corporate Aiding and Abetting Liability Under International and Federal Common Law

by Julian Ku

Professors Samuel Estreicher, John McGinnis, Michael Ramsey, Mark Weisburd, Ernest Young and myself, in partnership with the National Association of Manufacturers, filed a brief amicus curiae today in Doe v. Nestle, a Ninth Circuit Alien Tort Statute case. In the wake of the Second Circuit’s decision in Kiobel, but also the DC and Seventh Circuit decisions, the question of whether and how corporations can be liable under the ATS is getting more and more appellate court attention.  Here is our take (short version, DC Circuit and Seventh Circuit were deeply mistaken).

Plaintiffs in this case seek to hold corporate defendants liable under the Alien Tort Statute (ATS), 28 U.S.C. §1350, for aiding and abetting international law violations respecting forced labor and child labor by unidentified farmers in the Ivory Coast. We believe the District Court was correct in dismissing these claims. First, Sosa v. Alvarez-Machain, 542 U.S. 692 (2004), directs that only violations of well-established, specifically defined, and universally agreed-upon international law rules may be recognized under the ATS. In this case, the international legal consensus required by Sosa is absent for at least two essential aspects of the Plaintiffs’ claim. There is no international consensus that aiding and abetting liability may be based on a mens rea of mere knowledge of unlawful activity by others rather than sharing in the purpose of that activity; and there likewise is no consensus that private corporations can be liable for violations of customary international law.

Moreover, even if Plaintiffs could show the necessary international consensus, recognition of an ATS action for the violations alleged here would be an inappropriate expansion of federal common law. Those violations, involving non-U.S. farmers’ infringement of alleged obligations to their own countrymen, are radically different from the violations that were the focus of the ATS at the time of its enactment — conduct that directly affronted, and thereby jeopardized relations with, other nations. Recognition of an ATS action for the entirely different violations at issue here would exceed the sharply limited authority of federal courts to expand implied rights of action, and the equally sharp limits on judicial interference in foreign affairs.

There is one issue here that I think should be interesting to our readers, even those who don’t spend much time thinking about the ATS. It surrounds the question of how to consider international law sources. Plaintiffs in this case (and others) rely heavily on  ICTY and ICTR decisions to support their arguments.  Defendants often point to the Rome Statute of the ICC.  We take the view that none of these sources are definitive on these questions, but the Rome Statute is, on the whole, the better and more authoritative evidence of state practice.  And the Rome Statute reflects states’ unwillingness to adopt looser standards for aiding and abetting and to impose liability on corporations.

6 Responses

  1. At most, the Rome Statute shows that States are free to impose liability on corporations, but they may choose not to do so. The discussions leading to the adoption of the Statute, as well as the post-WWII case-law on corporate liability, shows that international law allows States to impose criminal liability on corporation (or else there would not have been a discussion on the advisability of doing so at Rome).
    Since the US has already chosen to impose criminal liability on corporations (unlike several civil law systems), there is no legal reason why a US court should decline jurisdiction on that basis. Of course, there are policy reasons, to which US courts appear more and more careful these days.

  2. Response…
    Kiobel was in serious error regarding rights and duties of corporations under international law.  Readers should know that Kiobel ignored at least TWENTY U.S. Supreme Court cases to the contrary as well as many other U.S. and foreign judicial decisions recognizing that corporations and companies can have rights and duties under treaty-based and customary international law.  See, e.g. my writing on NonState Actors in the Virginia Journal of International Law (2011), will provide an ssrn click-on next

  3. Response…
    As the Va. J. piece documents, there have also be many actors other than the state —

  4. Response…
    ALSO, it is not correct to state that an aider or abettor or complicitor must be “sharing in the purpose of that activity.”  The complicitor  need only intend to engage in conduct while knowing or being aware that that conduct can or will facilitate the conduct of a direct perpetrator.  Ignorance of the law is no excuse, and not sharing the “purpose” of the direct perpetraror is no excuse.  Those who share the purpose might have JCE or conspiracy responsibility.

  5. That’s quite the fiery language in the abstract of Mr. Paust’s paper…
    I suppose it succeed in that I did actually read it, a task made rather difficult by the truly gigantic footnotes.
    I don’t think most of his examples really help the case at hand, though, since they consist of the US Supreme Court ordering companies to comply with treaties the US is party to, which doesn’t appear to be the case here.
    Ultimately, this is another ill-disguised shake-down lawsuit to which ATS cases are given.

Trackbacks and Pingbacks

  1. […] A group of law professors–in conjunction with the National Association of Manufacturers–recently filed an amicus brief in a Ninth Circuit corporate liability ATS case, Doe v. Nestle. The law professors make the standard arguments that (a) there is no well-established customary international law governing aiding-and-abetting liability; and (b) there is no well-established customary international law providing for corporate liability.  Earlier posts from Susan and me have pretty much beat these topics to death, so there’s no need to rehash all that here […]