A Response to Odette Murray, David Kinley and Chip Pitts by Justine Nolan

[Justine Nolan is a Senior Lecturer in the Faculty of Law, University of New South Wales]

I am in concurrence with the timely article co-authored by Odette Murray, David Kinley and Chip Pitts in the Melbourne Journal of International Law and agree that the death of the Alien Torts Statute (‘ATS’) owes more to exaggerated rumours than legal substance. The article dissects the legal reasoning of the United States Court of Appeals for the Second Circuit in Kiobel v Royal Dutch Petroleum[1] and argues that the majority simply got it wrong principally by conflating ‘the jurisdictional and cause of action aspects of an ATS suit’.

But let’s step back for a moment and recall the history of the ATS. The ATS is a unique piece of
legislation that provides non-US citizens with the right to bring tort actions in US federal courts for breaches of international or treaty law. It was enacted in 1789 but largely lay dormant until the 1980s when plaintiffs started to use it to bring claims against individuals and corporations for alleged
direct or indirect human rights abuses. Beginning with Filartiga v Pena-Irala[2] and continuing through to Doe v Unocal[3] and more recent cases, there has been a general consensus amongst the various circuits of the US courts that both individual and corporate defendants could be held accountable under the ATS for egregious human rights abuses.  However, the decisions of the
last 30 years could not be said to reflect any clear unanimity in reasoning among the various circuit court judges and it is from this background of slight discord that Kiobel has emerged. In Kiobel, the majority (2-1) held that the ATS does not confer jurisdiction upon the federal courts to hear claims against corporations because, in its view, international law has never embraced the concept of corporate liability. The majority view was met with a fierce 87 page dissent from Judge Leval who noted:

The majority opinion deals a substantial blow to international law and its undertaking to protect
fundamental human rights. According to the rule my colleagues have created, one who earns profits by commercial exploitation of abuse of fundamental human rights can successfully shield those profits from victims’ claims for compensation simply by taking the precaution of conducting the heinous operation in the corporate form.[4]

Judge Leval’s dissent in Kiobel is reflected in two more recent decisions, one in the Seventh Circuit (see Judge Posner in Flomo v. Firestone Natural Rubber Co. LLC),[5] and the other in the District of Columbia Circuit (see Judge Rogers in Doe v Exxon).[6] Both of these opinions support corporate liability under the ATS and likewise reflect the reasoning of Murray, Kinley and Pitts that the rumours of the death of corporate liability under the ATS are greatly exaggerated. The courts in Flomo and Exxon also criticise the majority in Kiobel for failing to distinguish between the norm of international law relevant to establishing the requisite conduct and the rules of remedy (determined by US
federal common law). It is this conflation that leads the majority in Kiobel down the proverbial garden path to denying corporate liability under the ATS.

As a number of cases currently before other United States circuits are based on the assumption that corporations may be liable either directly or indirectly under the ATS, it is likely that this issue will not be completely settled until addressed by the Supreme Court.