The “Crucial” Choice of Law Question in Kiobel

by Julian Ku

Here is the second round of my exchange with Professor David Weissbrodt over at Pointoflaw. I begin by citing the following exchange during Kiobel’s oral argument yesterday.  

SULLIVAN: …The crucial question that is at the threshold is which law determines whether corporations are liable.
 
JUSTICE BREYER: I think you are right on that point….

- From the Kiobel v. Royal Dutch Shell, Oral Argument Transcript, February 28, 2012 at 32.

This exchange between Kathleen Sullivan, the attorney for respondents Royal Dutch Shell in Kiobel, and Justice Breyer highlights the importance of the “choice of law” question to this case. The “choice of law” question is whether international law or domestic law governs the question of corporate liability.

The importance of the “choice of law” question might seem surprising. After all one might expect that a leading international human rights lawyer like Kiobel’s attorney, Paul Hoffman, and a leading scholar of international human rights law like Professor David Weissbrodt, would invoke international law to justify holding corporations accountable for humanitarian atrocities. Yet both (along with the Obama Justice Department) are insisting the question of corporate liability is a matter for domestic and not international law.

The reasons for this insistence, as I argued in my prior post, is that the international law precedents for holding corporations liable for violations of customary international law are embarrassingly thin. They are so thin that the Petitioners barely mentioned them, and that the Obama Justice Department didn’t even invoke them. They are so thin that Professor Weissbrodt, who spearheaded the important U.N. effort to develop norms governing the behavior of transnational corporations, does not make this argument either.

Justice Breyer’s comment therefore suggests that if international law governs the question of corporate liability, the plaintiffs will lose. And that the only way plaintiffs will prevail is if they convince a majority of the Court (meaning Justice Kennedy), that the question of corporate liability is really a question of remedies, and that is a matter left to the domestic common law of the U.S.

On this “crucial” point, I still find the Petitioner’s argument lacking.

Read the rest of my post here and Prof. Weissbrodt’s post here.

http://opiniojuris.org/2012/02/29/the-crucial-choice-of-law-question-in-kiobel/

9 Responses

  1. Response…
    No, there are foreign and U.S. cases that already recognize that corporations and companies can have rights and duties under international law.  If the foreign cases are thin, they do exist.  see, e.g., http://ssrn.com/abstract=1548112 for foreign cases.
    I agree that the focus should be on international law; and there are already 20 Supreme Court cases that have recognized corporate and company rights and duties under international law.  see, e.g., http://ssrn.com/abstract=1701992 at pages 978 & n.2, 986-89.

  2. Julian,

    I’m not sure I find your argument that the applicability of international law norms depends on the identity of the defendant persuasive.  As evidence for your argument you invoke the fact that “international law claims against sovereign states [are] usually barred due solely to the identity of the defendant.”

    But here I think you’re confusing immunity doctrines with whether the underlying norm applies in the first instance.  In other words, the question in international law isn’t whether torture or genocide or any other grave human rights abuse applies to sovereign actors in the first instance, but whether some other doctrine – in this case, sovereign immunity doctrine – affirmatively bars application to certain classes of defendants in some contexts.  Likewise, I don’t think you’d want to assert that constitutional obligations don’t apply to government officials just because certain immunity doctrines protect government officials from lawsuits in many cases.

    If I’m right about the mistake in your reasoning, I think it’s fatal to at least this aspect of your argument, unless you can identify a source of international or domestic law that affirmatively bars these types of claims from proceeding against corporations.

  3. What is not prohibited may be permitted – SS Lotus.
    Best,
    Ben

  4. International law giveth (a cause of action); international law taketh away (the suiability of entities).

  5. Re: Eugene’s point, I agree that it’s plausible in theory that international law bars suits against entities like corporations, but what I’m disputing is Julian’s suggestion that foreign sovereign immunity shows how claims do not attach to certain categories of defendants in the first instance.  Isn’t the better view of how immunity theories operate that the claims do attach, but that certain categories of defendants may nonetheless be immune from suit?  If so, then the burden is on the defendant to locate a relevant immunity theory (one that applies to corporations, in this case), not on the plaintiff to show that the cause of action attaches to specific categories of defendants.

  6. If there are a number of states that in their domestic law do see such liability for corporations why did the argument not go toward a “general principles of law” recognized by civilized nations view.  I know the debate about this being raised to the international plane or not but it seems that the debate is a non-liquet kind of argument on one side and a domestic law on the other when it could have been a third way.
    Best,
    Ben

  7. Response…
    Ben: I believe that some such foci (including the fact that corporations can have rights and duties under international law, general principles of law, etc.) were hijacked by those who wanted to focus on, of all things, “common law,” even though the ATCA (ATS) expressly focuses on international law.
    Raha: that is a good point and it was recognized in the district court in Presbyterian Church of Sudan v. Talisman Energy, Inc., 244 F. Supp.2d 289 (S.D.N.Y. 2003), a great case.

  8. That 2003 district court ruling was rather soundly reversed, if memory serves.
    http://caselaw.findlaw.com/us-2nd-circuit/1499003.html

  9. Response…
    M. Gross: but read why and note the implicit acceptance of corp. liability but a lack of proof of complicity under a faulty standard (faulty b/c there is no need for substantial support, etc.).

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