human rights & business (and a few other things)

Jesner v. Arab Bank : quand l’originalisme américain marche sur la tête

2000px-Seal_of_the_United_States_Supreme_Court_svgCette contribution est la cinquième de la série consacrée à Jesner v Arab Bank sur ce blog. Les autres contributions (en Anglais) sont ici, ici, ici et ici.

C’est avec plaisir que j’accueille Paul Lorentz sur Rights as Usual. Paul est étudiant dans le Master 2 Droits de l’Homme, Sécurité et Développement  à la faculté de droit de l’Université catholique de Lille (France) où j’enseigne un cours “business and human rights” en Anglais. Cette contribution est la sienne.

************************************************

Mardi 24 avril 2018, la Cour Suprême des États-Unis rendait sa très attendue décision Jesner v. Arab Bank, qui a sans nul doute à peine commencé à faire couler l’encre des commentateurs juridiques.

Les faits sont simples : les requérants affirmaient que des officiels de l’Arab Bank, basée en Jordanie, avaient participé au financement de groupes terroristes au Moyen Orient, à tout le moins en permettant l’utilisation de la banque pour transférer les fonds. Ces fonds auraient transité électroniquement, notamment par le biais de la filiale de la banque à New York. Les requérants se sont alors basés sur l’Alien Tort Statute (ATS) pour chercher à engager la responsabilité de la banque jordanienne pour financement du terrorisme, qui a porté par-là atteinte à leurs droits humains (droit à la vie, prohibition des traitements inhumains et dégradants). Si la Cour avait déjà affirmé dans sa décision Kiobel v. Royal Dutch Shell (2013) qu’en l’absence de tout lien avec le territoire des États-Unis, du fait de la présomption d’inapplicabilité extraterritoriale de la législation domestique, les Cours américaines n’avaient pas compétence pour traiter du litige (sauf circonstances exceptionnelles touchant particulièrement le territoire des Etats-Unis), elle avait toutefois soigneusement évité de se prononcer sur la question des corporations étrangères et de leur responsabilité du fait de leurs filiales aux Etats-Unis.

La question qui se posait alors était de savoir si une juridiction américaine avait l’autorité et le pouvoir nécessaire afin d’imposer une responsabilité à une corporation sans que le Congrès n’ait donné d’instructions précises à cet effet.  Pour nier l’existence d’une compétence des Cours domestiques sur des corporations internationales basées à l’étranger, la Cour Suprême a utilisé principalement 3 arguments :

(a)  le manque d’une norme reconnue de responsabilité des personnes privées morales en droit international (faisant ainsi la confusion entre caractère normatif et justiciabilité) ;

(b)  un argument pour le moins douteux sur les possibles conséquences d’un « effet boomerang » sur les investissements américains à l’étranger (affirmant que nier la responsabilité des corporations pouvait en fait, sur le tableau général, aboutir à une amélioration de la situation des droits humains en ôtant des freins au développement) ;

(c) enfin, la partie dont il sera question dans cette contribution, l’intention initiale des rédacteurs.

Classiquement, deux options s’ouvraient à elle pour interpréter l’ATS, entre les conceptions originaliste et téléologique. Sans surprise dans la configuration actuelle de la Cour Suprême américaine, l’interprétation par référence aux intentions initiales du législateur a prévalu. L’objet de ce commentaire n’est pas de discuter des avantages de l’une ou l’autre des méthodes d’interprétation, mais plutôt de critiquer la rigidité avec laquelle la première a été appliquée, risquant d’aboutir très exactement à l’effet inverse de celui qui était recherché.

Dans Jesner, la Cour poursuit en fait le raisonnement qu’elle avait déjà initié dans Sosa v. Alvarez-Machain (2004), en affirmant que l’intention lors de la rédaction de l’ATS en 1789 était de prévenir des incidents diplomatiques. L’idée aurait alors été de s’assurer qu’un recours était ouvert aux potentiels requérants étrangers, afin de garantir l’existence d’un forum permettant la résolution des litiges mettant en jeu les intérêts d’un ressortissant étranger. Si l’interprétation de l’ATS l’amenait en fait à donner compétence aux Cours nationales sur des personnes morales étrangères, à travers leurs filiales aux Etats-Unis, cela pouvait avoir, comme dans la présente affaire, de sérieuses conséquences sur les relations diplomatiques entre les deux États, ce qui serait contraire à l’intention initiale des rédacteurs.

De fait, une décision aux potentielles répercussions diplomatiques importantes n’est pas dénuée de tout caractère politique. C’est l’argument qui a ici prévalu, en affirmant que le mandat d’interprétation conféré au juge ne permet pas de s’éloigner à tel point de l’intention initiale des rédacteurs qu’il aboutisse à un résultat diamétralement opposé à celui initialement recherché. Selon la Cour, il aurait donc fallu une autorisation positive du législateur.

Toutefois, la déduction de l’intention ne s’est pas faite sans quelques approximations significatives. Comme l’a très bien souligné l’opinion dissidente menée par le Juge Sotomayor, le texte (« The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States. ») peut être éclairé sous plusieurs dimensions. Le choix de la majorité s’est ici porté sur une interprétation minimaliste, soutenant en fait que ce qui n’est pas affirmé ne peut pas être déduit. L’objectif affirmé est d’assurer un pouvoir discrétionnaire du juge minimum, qui n’a reçu ni le mandat ni la légitimité nécessaires pour exercer un pouvoir décisionnaire effectif.

Mais en appliquant un contrôle aussi strict, le juge américain est sans doute tombé dans l’excès inverse. Faire le choix de ne lire le texte de l’ATS que dans sa version minimale, est en lui-même politisé. La sélection des faits connexes éclairant la détermination de l’intention originelle a, sinon biaisé, du moins orienté la décision de la Cour. La majorité a ici choisi de ne considérer qu’une série d’évènements historiques qui, s’ils ont mené à la rédaction de l’ATS, n’englobent pas nécessairement l’entièreté des motifs et objectifs qui y ont présidé. La majorité a ici complètement ignoré le choix délibéré des termes « law of nations », concept évolutif depuis sa naissance, ou encore celui de définir un critère pour l’une des parties (le requérant), mais laissant un vide concernant le défendant. Si le législateur avait voulu strictement restreindre les normes applicables, ou la qualité de défendant, il avait alors toute latitude pour le faire.  Même en admettant que l’intention originelle était uniquement de permettre un forum de résolution des litiges internationaux, limiter la portée de l’ATS aux personnes physiques aurait même une tendance à aboutir à un raisonnement assez absurde selon lequel elles seules peuvent causer des tensions diplomatiques.

Ne pas même mentionner ces choix négatifs pour déterminer son intention, c’est tout autant infantiliser le législateur que de l’interpréter avec la plus grande liberté. Pour pouvoir utilement et légitimement se référer à la doctrine originaliste, il aurait fallu que l’intention soit déterminée avec un degré suffisant de certitude, que la Cour n’a pas même évoqué ici. Si l’on souhaite faire une très large part au législateur, alors la cohérence aurait appelé une analyse rigoureuse, un examen approfondi de ses motivations, qui n’ont pas été valablement conduits ici. L’objet n’est pas de critiquer la validité d’une réserve si les conséquences politiques sont importantes, mais de souligner le besoin d’une cohérence dans son application.

De Charybde, la Cour est finalement tombée en Scylla. En cherchant à éviter l’écueil du gouvernement des juges, elle a finalement pris l’eau de l’autre bord. A trop se refuser à interpréter, elle a finalement interprété négativement.


A Long and Winding Road to Corporate Accountability: the Wider Ramifications of Jesner v Arab Bank

2000px-Seal_of_the_United_States_Supreme_Court_svg

This post is the fourth in the Jesner v Arab Bank special series on this blog. Previous posts are here, here and here.

It is a pleasure to welcome Marisa McVey (@MarisaMcV) on Rights as Usual. Marisa is a PhD student at the University of St Andrews. She is focusing on analysing corporate accountability in the reporting and assurance practices of the UN Guiding Principles on Business and Human Rights. More information can be found here. This post is hers.

***************************************

Against the backdrop of the outcry over Cambridge Analytica and Facebook, and other recent business and human rights scandals, there have been increasing calls for greater corporate accountability for human rights, yet binding accountability still seems to be a rarity. Transnational tort litigation has been used to fill this void, but the recent US Supreme Court decision Jesner v Arab Bank more than complicates matters. While the intricacies of Jesner are far better summarised elsewhere, this post wishes to explore the wider implications of closing this particular avenue of corporate accountability. Essentially, does the judgment handed down by the US Supreme Court mean we must look outside the courtroom for corporate accountability?

Fast fashion 

On 24th April 2013, the Rana Plaza factory complex in Bangladesh collapsed, killing over 1,000 people. It gave the general public a glimpse not only of the true cost of ‘fast fashion’, but also the urgent underlying need to hold corporations to account for their conduct. The implications of this disaster echoed around the world, culminating in the Accord on Fire and Building Safety in Bangladesh and the Alliance for Bangladesh Workers Safety, signed by the likes of H&M, GAP and Nordstrom. Audit procedures and corrective action plans within these initiatives sought to prevent any further health and safety hazards. The Accord also provided remediation options, such as international arbitration as an attempt to ensure the brands were accountable to their obligations under the agreement. A fund was also set up to try to compensate victims and their families. The success of these attempts at corporate accountability has been mixed. Brands offer financial help with better safety equipment, yet still apply downward pressure on garment prices; moreover, the compensation fund took two years to reach its $30 million target. Rana Plaza ultimately highlighted two of the most prominent difficulties in the business and human rights endeavour: how do we hold corporations accountable for human rights violations, and how do we provide redress for the harm committed?

Slow justice

Across the globe, and coincidentally on the fifth anniversary of the Rana Plaza disaster, the US Supreme Court handed down its judgment on Jesner. The facts of this case are very different to those of Rana Plaza, but the plaintiffs’ argument exposed the same need to hold corporations to account for their human rights conduct. However, the judgement effectively applies a blanket ban on the ability to hold corporations accountable via foreign direct liability under the Alien Tort Statute (ATS). This antique statute was absolutely not a perfect mechanism for redress for victims of human rights violations by corporations. One could argue that it represented more of a novel legal avenue for scholars of business and human rights, rather than an efficient mechanism for redress for the victims whose lives and livelihoods were destroyed by corporations. In fact, at the time of writing, no plaintiff under the ATS has ever won in the Supreme Court (and with Jesner, it is now unlikely that they ever will).

Yet the ATS became a trendsetter, providing a foundation for the gradual global diffusion of transnational tort cases. One such example was Okpabi v Shell, heard in the UK earlier this year and discussed on this blog here. In the business and human rights field, where voluntary soft-law principles still reign supreme, the ATS and its subsequent case law had offered some (albeit dwindling) hope for legally binding corporate accountability. Corporations are becoming increasingly aware that human rights cannot simply be part of a shiny report on corporate social responsibility (see the Cambridge Analytica/Facebook scandal above). This awareness, however, does not directly translate into action. With foreign direct liability in troubled waters in the UK, and now in the US, there is a need to ensure that corporations are consistently reminded that their human rights responsibilities reach beyond fundraising or building schools in the Global South.

Soft law?  

It’s unlikely that transnational tort cases for human rights will disappear. But, unlike when the ATS first came to the attention of those using creative judicial means to hold corporations to account, there now exists a plethora of non-statutory corporate accountability mechanisms eager to come to the fore. Some, like the Alliance for Bangladesh Workers Safety, are galvanised by (and specific to) a particular industry or human rights issue. Others, like the UN Guiding Principles on Business and Human Rights aim to be preventative, encouraging human rights reporting practices to become central to providing corporate accountability. The OECD Guidelines, with their National Contact Points and specific instance procedure, to an extent provide a stronger form of corporate accountability. However, interpretation of these Guidelines differs from country to country, leaving a highly fragmented body of cases.

These multi-layered, multi-disciplined approaches all have their advantages, yet they are dispersed and incongruent. In some ways, through tort law, foreign direct liability provided an international normative basis for accountability. My guess (and hope) is that Jesner will provide an excellent incentive to ramp up the campaign for a binding international treaty on business and human rights. This would attempt to provide a cohesive basis for corporate accountability, though progress has to date been slow and its exact contents up for debate. Nevertheless, on the fifth anniversary of Rana Plaza, the outcome of Jesner reminds us of the need to provide legal avenues for human rights violations, regardless of who commits them.


Complicity issues and redress for victims in the aftermath of Jesner v Arab Bank

2000px-Seal_of_the_United_States_Supreme_Court_svg

This post is the third in the Jesner v Arab Bank special series on this blog. Previous posts are here and here.

It is a pleasure to welcome a team from the Law School at Queen’s University Belfast on Rights as Usual. The team includes Ciara Hackett, Ciaran O’Kelly, Clare Patton and Luke Moffett. Ciara’s research focuses on CSR and Business and Human Rights.  Ciaran is interested in corporate accountability and the language of corporate reporting. Clare’s research focuses on cause related marketing and CSR. Luke researches on reparations, international criminal law and victims. All are staff in the Law School at QUB. This post is theirs.

*********************************************************

Last week the US Supreme Court issued their decision on Jesner v Arab Bank. This case concerned whether or not corporate defendants could be held liable under the Alien Tort Statute (ATS). The facts of this case involved an allegedly complicit corporate defendant. As a group, we are working together on how complicity is articulated within the business and human rights field. Thus we were especially interested in whether, and if so how, the Court would speak to issues involving complicit corporations. Our research focuses in particular on how the ‘corporate responsibility to respect human rights’ as outlined in the United Nations Guiding Principles on Human Rights does not explicity reference complicity, but how the requirements of due diligence highlights its importance as an object of investigation. Because of the facts of the case, we had hoped that there would be some discussion on complicity in the decision, although we did appreciate that the issue in the case was corporate liability. We certainly had not anticipated the majority (5-4) decision that foreign corporations cannot be defendants in cases brought under the Alien Tort Statute (ATS). Many issues arise from the Jesner decision and some of them are dealt with on this blog here and here. In this blog post, we focus on two aspects: (1) the Court’s narrow view on complicity and its disregard for passive complicity; and (2) the implications of the decision for victims of human rights violations involving corporations.

There is more to complicity than ‘aiding and abetting’

On complicity, the Court seemed particularly misguided, recognising only ‘active’ complicity – and suggesting that this was an issue for Congress to decide. ‘Active’ complicity is also known as ‘aiding and abetting’ and in Kiobel it was used to accuse the corporate defendant of aiding and abetting the Nigerian Government in committing law of nations violations. In Jesner, the majority seemed to say that plaintiffs allege ‘aiding and abetting’ to use corporations as surrogate defendants. Justice Sotomayor (dissenting) recognises that this is misaligned and suggests that there are other forms of ‘aiding and abetting’. However, and perhaps due to the facts of the case, neither she, nor the rest of the Court seem to recognise the idea of ‘passive’ complicity. This is where corporations may be complicit in human rights violations even when they are not the direct result of their own action. For example, in the Ibañez case (translated amicus here), large sums of banks’ loans provided to the Argentine dictatorship were crucial for its abuses of human rights. The banks were not instigating or financing abuse directly, rather, were facilitating an environment under which abuses could happen. Passive complicity, in an era of due diligence and increasingly complex supply chains, is a key area for business and human rights moving forwards. Indeed, the expansion of human rights due diligence in governance processes suggests that corporations, if only through their actions, recognise passive complicity as something for which they might legitimately be called to account. We had hoped that the Court would recognise the existence of a spectrum of complicity, albeit obiter. This would have aligned the Court’s decision with Principle 2 of the UN Global Compact which recognises direct, beneficial and silent complicity. But this was perhaps an optimistic expectation on our behalf.

What about victims?

In short, the Court did not really mention the victims, and certainly not sympathetically.

The judgment is silent on where victims of human rights violations involving corporations might seek redress. Although perhaps beyond the scope of the judgment, this seems cold – especially given the circumstances of the plaintiffs’ claim. Justice Sotomayor in her dissent does make a nod to this. She notes that whereas the market does not price all externalities (including the profit motive for abuses) ‘the law does’. Well, it should. Sotomayor rightly notes that in allowing entities to be protected with rights in the law but with none of the fundamental responsibilities, the Court is undermining the system of accountability that the First Congress endeavoured to impose.  This is something of a counter argument to the majority who suggested that the ATS cannot apply to foreign corporations because it did not apply to corporations in 1789 (see Justice Gorusch in particular). We believe that this view both embeds and further extends Justice Scalia’s renowned textualism yet sits at odds with the consitutional rights developments such as those outlined in Citizen United.

Where alternative routes to recovery are mentioned, they all focus on an active abuse of human rights as opposed to complicity in the face of human rights abuses (typically against employees of corporations as per Justice Kennedy). Justice Kennedy also notes that actions can be taken against individual employees within the corporation for the human rights violations of the corporation. This ignores the literature on collective responsibility and group agency dominating the area at present. It also highlights a further problem. If the Court has such a narrow view of what complicity is, they are failing to recognise the categories of victims that may exist where a corporation has been passively or silently complicit. In so doing, they are creating a hierarchy of victims (whereby a victim of an actively complicit corporation has a more defined route to recovery than a victim of a passively complicit corporation) which we believe is in conflict with the broader conversations on due diligence within business and human rights.

The plurality in Jesner insisted that corporate liability for human rights violations as a cause of action was a matter for Congress not the courts. They cited the failure of the Torture Victim Protection Act (TVPA)  to extend to corporations as a reason why the ATS could not apply to corporations, suggesting that Congress needed to make this decision in the same way as they did in the TVPA. What is frustrating in this claim is that they note that with the ATS, the First Congress ‘provided a federal remedy for a narrow category of international law violations committed by individuals’ but that two centuries on, it is still for Congress to extend this to include corporations. Yet, Congress has failed to do so.  The foreign policy fears, and the claim that extending the ATS to include foreign corporations would have a detrimental impact on American business in developing countries (a particularly strange argument) that infused the majority judgment, seem also to prevail in the legislature.

In categorically closing the idea of foreign corporations being sued under the ATS for human rights violations, 25 years of human rights based claims against foreign corporations have ended. Other routes to remedy at national and international levels remain, and suits against US corporations also remain possible. But this decision has made victims of abuses involving corporations (actively or complicitly) the biggest losers.


Blurring the Line between Criminal and Civil Liability of Corporations in Jesner v Arab Bank

2000px-Seal_of_the_United_States_Supreme_Court_svg
This post is the second in the Jesner v Arab Bank special series on this blog. The first one is here.

It is a pleasure to welcome back Alessandra De Tommaso as a guest poster on ‘Rights as Usual’. Alessandra is a PhD candidate at Middlesex University School of Law in London. She works on the challenges arising from corporate criminal liability under international criminal law. This post is hers.

****************************************************

On 24 April 2018, the U.S. Supreme Court delivered its opinion in the case Jesner v Arab Bank, closing the door to future litigation against foreign corporations under the Alien Tort Statute (ATS). For those who believe in corporate accountability for human rights violations, this decision is a setback. But irrespective of one’s views, the decision is also incorrect. This post focuses on the Court’s misguided use of the practice of international criminal tribunals to exclude the possibility to sue (foreign) corporations under the ATS. It argues that international tribunals’ lack of authority to impose criminal liability on legal entities cannot be used as a reason to foreclose the civil liability of corporations at the domestic level.

The majority’s opinion in Jesner opens with a discussion on whether “the law of nations imposes liability on corporations for human-rights violations”. In reaching the conclusion that there is no international norm of corporate liability, the majority applies the same reasoning adopted by the Court of Appeals for the Second Circuit in its 2010 decision in Kiobel. Since none of the existing international criminal tribunals included corporations in their jurisdiction, the liability of business entities for human rights violations must be excluded under international law. In the words of the majority:

“The international community’s conscious decision to limit the authority of [existing] international tribunals to natural persons counsels against a broad holding that there is a specific, universal, and obligatory norm of corporate liability under currently prevailing international law.” (Kennedy, J., opinion, 15)

Here the Court confuses the lack of a mean of enforcement at the international level with the absence of an international norm (see Dr. Nadia Bernaz’s post here). But leaving aside this misconception, the majority’s reasoning is erroneous from another perspective. The Court does not take into consideration that the international tribunals mentioned in the judgement have the authority to impose criminal liability only. Civil liability is not addressed in the statutes of any of these tribunals; neither was it discussed during the negotiations leading to their adoption. This point was correctly raised by Ambassador David J. Scheffer in his Brief as Amicus Curiae of 26 June 2017. Nonetheless, the Court assumed that the lack of an enforcing mechanism able to impose criminal liability on legal entities at the international level can affect the possibility of imposing civil liability at the domestic level. In doing so, the Court fails to distinguish between criminal liability under international criminal law, on one side, and civil liability under national law, on the other. A distinction that is particularly relevant in the context of corporate liability. Indeed, while corporate criminal liability is still a controversial legal concept and has yet to be recognised under international criminal law, the civil liability of companies is a general principle of law recognised worldwide. Yet the majority refuses to acknowledge such a fundamental distinction.

To conclude, it is incorrect to assume that the exclusion of corporate criminal liability from the statutes of international criminal tribunals forecloses the possibility to hold corporations civilly accountable at the domestic level. The Court’s argument on this point of law is flawed. As correctly observed by Judge Sotomayor in the minority opinion:

“… taken to its natural conclusion, the plurality’s focus on the practice of international criminal tribunals would prove too much. No international tribunal has ever been created and endowed with jurisdiction to hold natural persons civilly (as opposed to criminally) liable, yet the majority and respondent accept that natural persons can be held liable under the ATS.” (Sotomayor, J., dissenting, 9)


Unnecessary, Wrong, and Misguided – the US Supreme Court’s Blanket Ban on All ATS Suits against Foreign Corporations in Jesner v Arab Bank

2000px-Seal_of_the_United_States_Supreme_Court_svg

I  was waiting for it. I discussed it at length with students and colleagues. I envisaged many scenarios, even the worst possible one: the end of all claims against all corporations under the Alien Tort Statute (ATS) (see my previous post here). Yesterday, on  24 April 2018, it finally came: the US Supreme Court’s decision in Jesner v Arab Bank.

The question that was asked was whether the ATS categorically forecloses corporate liability. In a 5-4 decision, the Court issued a blanket ban on all ATS suits against foreign corporations. It said little about the liability of US corporations under the ATS so we can assume it remains a possibility, and that we dodged a bullet on this point. Regardless, this is the end of business and human rights ATS litigation against non-US companies, and a setback for those who seek to strengthen corporate accountability.

After a first read, here are my thoughts. The decision was unnecessary and amounts to, in the words of Justice Sotomayor writing for the dissenting minority, “us[ing] a sledgehammer to crack a nut.” The decision is also wrong, as it conflates the existence of a norm of international law and the possibility of its enforcement at the international level. Finally, the decision is misguided. The Court expresses concerns about the treatment of US corporations abroad if ATS suits against foreign corporations were allowed to continue. This argument attempts to oversimplify what is a complex matter. It is as if the Court aimed to appease those who believe US corporate giants cannot possibly do wrong, but actually have little understanding of how multinational corporations operate.

Ending all claims against foreign corporations was unnecessary

US federal courts have a set of tools at their disposal to address the legitimate concerns the facts of this, and other similar cases, raise. One of those tools is the “touch and concern” test that the US Supreme Court established merely five years ago in Kiobel, and whose raison d’être is now in question. The case could have been dismissed on forum non conveniens grounds or on the basis of nonjusticiability concerns such as the act of state, political question and comity doctrines. Instead of trusting lower court’s determinations on a case by case basis, the Court went for an absolute ban. I simply cannot find a good reason for this approach.

Conflating the existence of a norm of international law with the possibility of its enforcement is wrong

The Court discusses at length the existence of a norm on corporate liability for gross human rights violations under international law. It concludes that such liability is not recognised in international criminal tribunal’s statutes and that it therefore does not exist. Anyone who has taught an introductory international law course will tell you the same story: students often make a similar mistake when they first encounter international law. They mix up the existence of a norm and the possibility of its enforcement. International law is not really law, they assume, because it cannot be enforced in the same way domestic law is. While beginners can be forgiven for this mistake, to see one of the most prestigious judicial institutions in the world fall into that trap is mind-boggling. There is no question that certain norms of international law, particularly in international criminal law, apply to corporations. How they are held liable depends on states and is done precisely through mechanisms such as the ATS. To use this argument to prevent corporate liability at the domestic level is wrong.

The Court’s belief that ATS suits against foreign corporations jeopardize US corporations’ overseas operations is misguided

Towards the end of the judgement, the Court addresses another issue, that of the potential consequences of ATS suits against foreign corporations for US corporations. This, it argues,

“could subject American corporations to an immediate, constant risk of claims seeking to impose massive liability for the alleged conduct of their employees and subsidiaries around the world, all as determined in foreign courts, thereby ‘hinder[ing] global investment in developing economies, where it is most needed.’

In other words, allowing 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, or where judicial systems might lack the safeguards of United States courts. And, in consequence, that often might deter the active corporate investment that contributes to the economic development that so often is an essential foundation for human rights.”

To think that the mere possibility of an ATS lawsuit against foreign corporations could “ discourage” US corporations from investing abroad is misguided. Such lawsuits were possible until yesterday. Have US corporations ever stopped, or even refrained from, investing abroad for that reason? I doubt it. In any event, establishing this would require in-depth research that the Court does not even hint at. This argument is also ridiculous in light of the protections international investment law affords, and of the fact that no ATS lawsuit against a corporation has ever succeeded. The final point about how US corporations contribute to the realisation of human rights is also misguided. Of course it is true in certain circumstances but this is not the point. The point is that when corporations engage in human rights violations it is only right that they are held liable. Having done some good must not prevent liability. By suggesting otherwise, the Court reinforces the dangerous and misconceived idea that human rights standards are an inconvenience for the business world.


« Previous Entries Next Entries »

Powered by WordPress | Designed by Elegant Themes