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24 Apr 2018

Charity Ryerson, Corporate Accountability Lab (USA)

Supreme Court Rejects Liability for Foreign Corporations in International Human Rights Cases

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...[T]he Supreme Court ruled...that foreign corporations cannot be sued for egregious human rights violations under the Alien Tort Statute (ATS). Here is our...take on the opinion. In short: the majority’s opinion appears to have more to do with market fundamentalism than the administration of justice, and sets a problematic precedent for victims’ access to remedy...[I]t lays the framework to eliminate liability even for domestic companies...While there is a reasonable argument that this case doesn’t have enough connection to the US for US courts to have jurisdiction, the Court made a sweeping ruling based on these limited facts that will harm other plaintiffs bringing cases with much more connection to the US going forward...[T]hey decide...not only do these human rights cases need to “touch and concern” the US, the defendant cannot be a foreign corporation...Kennedy relies primarily on the argument that there is no corporate liability under international law...The next time the ATS comes before the Supreme Court...the defendant will argue powerfully that this opinion forecloses corporate liability altogether, not just for foreign companies.  Kennedy also relies on the separation of powers, arguing that it should be Congress’ role to determine whether corporations are subjects of the ATS...He writes “[A]llowing plaintiffs to sue foreign corporations under the ATS could establish a precedent that discourages American corporations from investing abroad, including in developing economies where the host government might have a history of alleged human rights violations..."

Part of the following timelines

US Supreme Court rules that foreign corporations cannot be sued for human rights abuses under the Alien Tort Statute

Arab Bank lawsuit (re terrorist attacks in Israel)