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1 Dec 2014

Sif Thorgeirsson, Manager, Corporate Legal Accountability Project, Business & Human Rights Resource Centre

Closing the courtroom door: Where can victims of human rights abuse by business find justice?

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When a company takes your land without compensation, pollutes your water, or brings in private militia to guard an oil well who start to rape and abuse the women of a local community, you should have the right to ensure it stops, and to get your livelihood restored.  It should not matter whether you are rich or poor or in what country you live.  Yet many victims of business-related human rights abuse have no access to judicial remedy in their home country.  Up to now, a select few have worked with lawyers to take the cases to the courts in the country where the company is headquartered (often USA or Europe).  But now, they face a steady loss of venues internationally where they can bring their claims.  The majority of cases of abuse we see at Business & Human Rights Resource Centre occur in weak governance zones, which often do not have an independent judiciary, and sometimes lack fully functioning courts at all.  Therefore these victims frequently do not have access to enforceable remedies in their home country.  Some then seek legal remedy elsewhere, e.g., where the company is headquartered.  Of the 108 legal cases the Resource Centre has profiled, the majority (54%) are related to extraterritorial claims – that is, claims of abuse occurring outside the country of the court hearing the case.  Unfortunately, in many companies’ home countries, getting an extraterritorial claim into court can be difficult and in some key countries, these claims are being drastically narrowed. 

A turning point in extraterritorial human rights claims was the US Supreme Court’s decision in Kiobel v. Shell in 2013.  For many years prior to this, the US Alien Tort Claims Act had provided a unique gateway for victims to seek justice – it allowed victims from around the world to bring cases to US courts and have a judgement passed.  In the Kiobel lawsuit, the plaintiffs alleged that Shell was complicit in torture, extrajudicial killings and other abuses of Ogoni people in the Niger Delta.  The Supreme Court’s 2013 decision in Kiobel restricted the scope of ATCA for abuses outside the United States, holding that there is a presumption against extraterritorial application of US law.  The Court ruled that the facts must “touch and concern” the United States with “sufficient force” to overcome this presumption against extraterritoriality.  The effect has been a near-freeze on victims seeking justice through this vital avenue.  At the time of the Kiobel decision, there were at least 19 corporate Alien Tort cases pending in US courts.  Since then, only one new Alien Tort case has been filed against a company in US court. 

Lower courts have dismissed a majority of the ATCA cases that were pending at the time of the Kiobel decision, using this narrower standard on extraterritoriality, although the full contours of extraterritorial jurisdiction in US courts following Kiobel are still evolving.  Cases dismissed include those against Occidental Petroleum (alleging complicity in a 1998 bombing attack in Colombia), Cisco (over supplying spyware to the Chinese Government), Drummond (alleging complicity in killing a Colombian labour leader), companies associated with the South African Apartheid government (over their alleged role in that government’s abuses), Chiquita (over its role in abuses by Colombian paramilitaries), Rio Tinto (alleging complicity in abuses during an armed conflict in Bougainville, Papua New Guinea) and Daimler (over its alleged role in abuses by the Argentinian military dictatorship).  But not all US courts have taken such a strict line against ATCA cases since Kiobel.  Some have permitted the plaintiffs to amend their complaints in order to show their cases’ ties to the United States, or have simply allowed cases to move forward.  These include lawsuits against military contractors accused of participating in torture at Abu Ghraib, ExxonMobil regarding abuses by security personnel in Aceh in Indonesia, and Nestlé and others over forced child labour at cocoa suppliers in Côte d’Ivoire.

Since the Kiobel decision, victims of business-related human rights abuse can therefore no longer rely on ATCA as a viable option to access US courts to seek to hold companies accountable.  In our work on business and human rights lawsuits around the world, we have seen that victims are increasingly looking elsewhere. 

Victims have also long sought legal remedies against companies in English courts.  However, in 2012 new legislation passed affecting the way in which plaintiffs’ lawyers could fund their work – the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO).  Given the costly nature of transnational litigation, this change presents challenges for victims’ advocates, although as with Kiobel, just what the change means in practice is not yet clear.  Chris Esdaile, a solicitor with the leading human rights law firm Leigh Day & Co. in London, recently reflected on the on-going need for legal accountability and legal services since the passage of LASPO, saying: “It is too soon to see the full impact of LASPO 2012. There is no doubt that the landscape has changed, and it remains to be seen how that change plays out in the long-term. However, in the meantime, the demand for our services remains high and we continue to issue new cases. Gauging any negative impact is made even more difficult because we remain one of the very few, if not the only UK firm doing this work post-LASPO.”  The official commentary to the UN Guiding Principles on Business and Human Rights identifies difficulty in securing legal representation as a key barrier to accessing remedies.

While the scope for remedy from US and English courts is narrowing, other national courts are emerging as potential venues for extraterritorial claims.  For example, in the last three years there have been three cases filed in Canadian courts addressing extraterritorial business-related human rights abuse.  This is a slight but significant increase over the previous rate: only four such cases had been filed over the preceding 15 years.  Just last week a group of Eritrean refugees filed a claim in Vancouver court against the mining firm Nevsun Resources, alleging they had been subjected to forced labour at an Eritrean mine owned by the company.  The other two Canadian cases filed recently deal with alleged abuses at mines in Guatemala.  In addition to Canada, in the last several years key extraterritorial cases that could set precedents have been filed in France, Switzerland and Germany.

It will never be easy for victims of abuse to bring their extraterritorial claims to court.  US courts in particular, and possibly also English courts, may become untenable as options for victims of abuse to seek justice.  It is, however, encouraging to see the potential for courts in other countries where companies are based to adjudicate human rights claims.  Concerted action is needed by governments and others to reverse the trend toward closing of avenues to justice, in order to fulfill victims’ rights to access effective remedies.