February 23, 2012

The writer is a partner with Arnold & Porter LLP and an adjunct senior fellow in international and national security law at the Council on Foreign Relations. He served as the State Department’s legal adviser from 2005 to 2009.

On Tuesday, the Supreme Court will hear arguments in Kiobel v. Royal Dutch Petroleum, which will decide whether corporations may be sued in U.S. courts for violations of international law under a peculiar 223-year-old federal law, the Alien Tort Statute.

The Obama administration argues that corporations should be subject to lawsuits under the Alien Tort Statute for alleged human rights violations in other countries. But foreign governments contend that allowing U.S. courts to judge actions with no connection to the United States violates international law. To avoid this conflict and the diplomatic friction the Alien Tort Statute was intended to prevent, the Supreme Court should limit the law’s extraterritorial reach.

First enacted as part of the Judiciary Act of 1789, the Alien Tort Statute (ATS) authorizes U.S. federal courts to hear civil lawsuits by “aliens” for acts that violate the “law of nations.” The law was apparently intended by its 18th-century drafters to allow ambassadors and other foreign nationals to sue in federal courts for assaults or other offenses committed in violation of international law — acts that might cause diplomatic friction for the new American republic if left unaddressed by state courts.

The law was virtually forgotten for its first 200 years — until 1980, when human rights lawyers used it to sue a Paraguayan official over the torture of a Paraguayan citizen. As reinvented, the ATS has become the fountainhead for human rights lawsuits against foreign government officials for actions in their own countries.

In the 1990s, plaintiffs’ lawyers began to use the ATS to sue multinational corporations for violations of international law. More than 120 lawsuits have been filed in federal courts against 59 corporations for alleged wrongful acts in 60 foreign countries.

Multinational corporations in almost every industry have been sued, including Coca-Cola (accused of aiding murders by Colombian paramilitary groups), ExxonMobil (accused of aiding human rights abuses by the Indonesian military), General Motors (accused of aiding South Africa’s apartheid government) and Yahoo (accused of sharing subscriber data with the Chinese government). Almost all of these suits have been over “aiding and abetting” abuses by foreign governments, rather than over direct offenses.

Few ATS lawsuits have resulted in judgments, but most cases have dragged on for years, and some companies have settled rather than submit to protracted and reputation-damaging litigation.

The Kiobel case was filed against Shell Oil by Ni­ger­ian villagers who accused the company of aiding human rights abuses by Nigeria’s military. In 2010, an appellate court in New York ruled that corporations may not be held liable under the Alien Tort Statute, citing the grounds that international law binds only nations and individuals.

In a brief to the Supreme Court, the Obama administration urges the justices to reverse the lower-court decision. The administration’s goal of promoting accountability for serious human rights abuses committed by foreign governments is laudable, but its position here reflects a desire to change existing international law, rather than adhere to it.

International law does not allow courts of one country to exercise jurisdiction in civil cases over offenses in other countries. For this reason, foreign governments, including many close U.S. allies, have filed more than 20 protests with the State Department and federal courts in Alien Tort Statute suits over the past decade. The British, Dutch and German governments — all strong advocates of human rights — have filed briefs in the Kiobel case, arguing that applying the ATS to acts that take place in other countries and have no connection to the United States is a violation of international law. (I submitted a brief on behalf of several corporations in support of Shell, describing the objections filed by foreign governments in other cases.)

Ironically, the modern application of the Alien Tort Statute has caused the very diplomatic tensions it was enacted to prevent.

Moreover, the Obama administration should be concerned about reciprocity: It would certainly object if foreign governments were to encourage lawsuits in their courts against U.S. companies for perceived violations of international law, such as against the manufacturers of drone aircraft.

In 1992, Congress passed the Torture Victim Protection Act, a narrowly tailored law that authorizes civil suits against foreign government officials for acts of torture or murder committed in their countries, but the suits are subject to numerous procedural limitations. Even this narrow statute is unprecedented in international law and risks reciprocal lawsuits against U.S. officials. But this law was specifically intended by Congress to apply to acts in other countries. The Supreme Court should not interpret the Alien Tort Statute, which was enacted for a different purpose, to allow U.S. courts to sit in judgment over acts that take place in foreign countries, without a clear congressional mandate.