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26 Apr 2018

Steve Nickelsburg, Clifford Chance (USA)

U.S. Supreme Court Closes Door to Human Rights Lawsuits against Foreign Corporations under the Alien Tort Statute

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On April 24, 2018, the Supreme Court held in Jesner v. Arab Bank, PLC that foreign corporations may not be sued in U.S. courts for human rights violations under the Alien Tort Statute ("ATS")...The Supreme Court's decision in Jesner effectively puts an end to ATS litigation in U.S. courts against foreign corporations for alleged human rights violations...[H]owever, the volume of ATS litigation had already been reduced dramatically by the Supreme Court's decision in Kiobel that the ATS does not apply extraterritorially.  Thus, plaintiffs already have been pursuing other avenues such as civil lawsuits under the Anti-Terrorism Act, and under common law doctrines...Jesner potentially leaves open the possibility of ATS litigation against foreign corporate officers and employees and U.S. corporations, so some attempts to file new ATS lawsuits may continue...[P]laintiffs are likely to continue to look elsewhere for favorable venues; human rights-related litigation in other jurisdictions is on the increase...There is a clear international focus on promoting transnational accountability for corporate activity with human rights impacts...[H]uman rights-related obligations on corporations have been increasing through other means, including diligence and disclosure obligations under foreign and U.S. federal and state laws...