Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-10-56739/USCOURTS-ca9-10-56739-2/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

JOHN DOE I; JOHN DOE II;

JOHN DOE III, individually

and on behalf of proposed

class members; GLOBAL

EXCHANGE,

Plaintiffs-Appellants,

v.

NESTLE USA, INC.; ARCHER

DANIELS MIDLAND

COMPANY; CARGILL

INCORPORATED COMPANY;

CARGILL COCOA,

Defendants-Appellees.

No. 10-56739

D.C. No.

2:05-CV-05133-SVWJTL

ORDER AND

AMENDED ORDER

Filed May 6, 2015

Amended June 10, 2015

Before: Dorothy W. Nelson, Kim McLane Wardlaw,

and Johnnie B. Rawlinson, Circuit Judges.

Order;

Amended Order;

Dissent by Judge Bea

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2 DOE V. NESTLE

SUMMARY*

Alien Tort Statute

The panel denied a petition for panel rehearing and, on

behalf of the court, a petition for rehearing en banc.

Dissenting from the denial of rehearing en banc, Judge

Bea, joined by Judges O’Scannlain, Gould, Tallman, Bybee,

Callahan, M. Smith, and N.R. Smith, wrote that the panel

majority had substituted sympathy for legal analysis in

concluding that the defendant corporations engaged in the

IvoryCoast cocoa trade with the purpose that the plaintiffs be

enslaved, hence aiding and abetting the slavers and plantation

owners. Judge Bea wrote that the panel majority’s conclusion

was wrong, created a split with the Second and Fourth

Circuits, and conflicted with Supreme Court doctrine

interpreting the Alien Tort Statute.

ORDER

The order denying the petition for rehearing/rehearing en

banc, filed on May 6, 2015, is hereby amended at Page 2,

Line 3, to add the sentence:

Judges Graber, Ikuta, Watford, Owens,

and Friedland did not participate in the

deliberations or vote in this case.

SO ORDERED.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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DOE V. NESTLE 3

AMENDED ORDER

Judge Rawlinson voted to grant the petition for rehearing

and petition for rehearing en banc.

Judge Nelson and Judge Wardlaw voted to deny the

petition for panel rehearing. Judge Wardlaw voted to deny

the petition for rehearing en banc and Judge Nelson so

recommended.

The full court was advised of the petition for rehearing en

banc. A judge requested a vote on whether to rehear the

matter en banc. The matter failed to receive a majority of the

votes of the nonrecused active judges in favor of en banc

consideration. Fed. R. App. P. 35.

Judges Graber, Ikuta, Watford, Owens, and Friedland did

not participate in the deliberations or vote in this case.

The petition for panel rehearing and the petition for

rehearing en banc are DENIED.

Judge Bea’s dissent from the denial of rehearing en banc

is filed concurrently with this order.

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4 DOE V. NESTLE

BEA, Circuit Judge, with whom O’SCANNLAIN, GOULD,

TALLMAN, BYBEE, CALLAHAN, M. SMITH, AND N.R.

SMITH, Circuit Judges, join, dissenting from the denial of

rehearing en banc:

Unfortunately, the panel majority here has substituted

sympathy for legal analysis. I quite agree plaintiffs are

deserving of sympathy. They are alleged former child slaves

of Malian descent, dragooned from their homes and forced to

work as slaves on cocoa plantations in the Ivory Coast. But

they do not bring this action against the slavers who

kidnapped them, nor against the plantation owners who

mistreated them. Instead the panel majority concludes that

defendant corporations, who engaged in the Ivory Coast

cocoa trade, did so with the purpose that plaintiffs be

enslaved, hence aiding and abetting the slavers and plantation

owners. By this metric, buyers of Soviet gold had the

purpose of facilitating gulag prison slavery.

How was the cocoa buyers’ purpose shown? By their

purchase of cocoa and their conduct of “commercial

activities [such] as resource development,” conduct one of

our sister circuits has explained does not establish that a

defendant acted with the required purpose.1 The panel

majority’s conclusion is wrong. Even the plaintiffs admit

defendants intended only to maximize profits, not harm

children through slavery.

2

It also creates a circuit split with

the Second and Fourth Circuits.

1 Presbyterian Church of Sudan v. Talisman Energy, Inc., 582 F.3d 244,

264 (2d. Cir. 2009).

 

2

 Doe I v. Nestle USA, Inc., 766 F.3d 1013, 1025 (9th Cir. 2014).

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DOE V. NESTLE 5

But the consequences of the majority’s decision do not

end there—the majority leads us into open conflict with

Supreme Court doctrine interpreting the Alien Tort Statute

(“ATS”). The Court unequivocally requires that federal

judges who are fashioning federal common law torts for

violations of customary international law under the ATS

operate under a “restrained conception” of the extent of such

liability. Sosa v. Alvarez-Machain, 542 U.S. 692, 725–26

(2004). The panel majority flouts that requirement by

permitting a broad expansion of liability under the ATS. The

panel majority allows a single plaintiff’s civil action to effect

an embargo of trade with foreign nations, forcing the

judiciary to trench upon the authority of Congress and the

President. And in the process, the majority creates a second

circuit split by misinterpreting the Supreme Court’s decision

in Kiobel v. Royal Dutch Petroleum, 133 S. Ct. 1659 (2013),

as creating a new test for when the presumption against

extraterritorial application of United States law is rebutted,

rather than incorporating the settled doctrine of Morrison v.

National Australia Bank Ltd., 561 U.S. 247 (2010).

For these reasons, our court should have corrected the

panel’s mistake by granting a hearing en banc, and I

respectfully dissent from the order denying rehearing.

I begin by bringing to mind the basic principles of ATS

litigation. The text of the ATS gives the federal district

courts “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.” 28 U.S.C. § 1350. The Supreme

Court has held that the ATS does not create a substantive tort

action; instead, the statute is purely a grant of jurisdiction. 

Sosa v. Alvarez-Machain, 542 U.S. 692, 724 (2004). ATS

actions thus sound in federal common law. Id. But because

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6 DOE V. NESTLE

there are “good reasons for a restrained conception of the

discretion a federal court should exercise in considering a

new cause of action of this kind,” an ATS claim must “rest on

a norm of international character accepted by the civilized

world and defined with a specificity comparable to the

features of the 18th-century paradigms we have recognized.” 

Id. at 725–26.3 Those “good reasons” include the general

presumption against judge-made law, the paucity of early

cases utilizing the ATS’s jurisdictional grant, the disfavoring

of court-created private rights of action, the risk that ATS

litigation poses to the foreign relations of the United States,

and the absence of an affirmative congressional mandate to

engage in “judicial creativity” by crafting new norms. Id. at

726–28. Indeed, Sosa repeatedly emphasizes the need for

restraint in extending liability to a defendant who is “a private

actor such as a corporation or individual.” Id. at 732 n.20.

As the majority opinion in this case recognizes, the

Supreme Court’s list of requirements for an ATS action is not

exhaustive; instead, the Sosa opinion’s standard “is

suggestive rather than precise, and is perhaps best understood

as the statement of a mood—and the mood is one of caution.”

Doe, 766 F.3d at 1019 (quoting Flomo v. Firestone Natural

Rubber Co., LLC, 643 F.3d 1013, 1016 (7th Cir. 2011)). In

light of its recognition of these principles, the majority’s

errors are all the more curious.

I turn now to the particulars of this case. Plaintiffs,

alleged former child slaves who worked on cocoa plantations

in the Ivory Coast, have sued the defendant chocolate

companies on the theory that by purchasing the chocolate

 

3

 Those paradigms are “violation of safe conducts, infringement of the

rights of ambassadors, and piracy.” Sosa, 542 U.S. at 724.

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DOE V. NESTLE 7

produced by Ivorian plantations, providing technical

assistance4to the plantations, and lobbying Congress for a

voluntary alternative to the mandatory “slave-free” licensing

scheme Congress was considering, the defendants aided and

abetted a violation of customary international law: child

slavery.

I agree with the majority and the plaintiffs that child

slavery is a violation of customary international law. And I

further agree that aiding and abetting a crime is itself a crime,

with its own actus reus and mens rea elements. The parties

in this case dispute what is the correct mens rea standard for

ATS aiding and abetting liability. Defendants claim that a

showing that they acted purposefully to bring about (or

maintain) the use of slavery to produce cocoa is required to

confer liability. Plaintiffs claim that knowledge that slavery

was so employed, together with acts of defendants which

circumstantially benefit the slaver, is enough; specific intent

(purpose) that slavery be facilitated need not be alleged. 

Plaintiffs candidly admit they cannot in good faith allege

defendants acted with the specific intent to promote slavery

and thus harm children.

The panel majority did not accept plaintiffs’ assertion that

knowledge that cocoa growers employed slavery makes out

the mens rea element of aiding and abetting liability. Rather,

they recognized that “two of our sister circuits have

concluded that knowledge is insufficient and that an aiding

and abetting ATS defendant must act with the purpose of

facilitating the criminal act . . . .” Id. at 1023 (citing Aziz v.

Alcolac, Inc., 658 F.3d 388, 399–400 (4th Cir. 2011);

4 The technical assistance is not alleged to have included whips, chains,

or other implements of slavery.

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8 DOE V. NESTLE

Presbyterian Church of Sudan v. Talisman Energy, Inc.,

582 F.3d 244, 259 (2d Cir. 2009)). However, the majority

decided that it need not reach the question whether

knowledge was a sufficient mens rea, because plaintiffs’

allegations met the purpose standard. In particular, though

plaintiffs “conceded that the defendants did not have the

subjective motive to harm children,” and alleged only that

“the defendants’ motive was finding cheap sources of cocoa,”

the majority found that plaintiffs sufficiently alleged

defendants had the purpose of aiding child slavery because of

defendants’ “myopic focus on profit over human welfare.”5

Doe, 766 F.3d at 1025–26. Thus, pursuit of profit over

human welfare, in the majority’s eyes, allows a jury to find

the defendants specifically intended not merely to buy cocoa

cheap, but to promote slavery as a means of buying cheap.6

5 Plaintiffs allege four types of conduct that, taken together, are meant

to show the defendants acted with the purpose of aiding and abetting

slavery. First, the defendants bought the slavers’ cocoa. Second, the

defendants supplied the plantation owners with money, equipment and

training for the cultivation of cocoa, while defendants knew the continued

and expanded profitability of those farmers would facilitate the use of

child slave labor; defendants continue to establish and honor those

agreements today. Third, the defendants lobbied against Congressional

efforts to curb the use of child slaves by, for example, opposing a bill that

would require United States importers to certify and label their products

“slave free.” The companies instead urged and secured the adoption of a

private, voluntary enforcement mechanism for “slave free” certification,

similar to the regime for “fair trade” coffee imports into the U.S. Fourth,

though the corporations have enough market power effectively to control

Ivory Coast’s cocoa markets, and could use that power to stop or limit the

use of child slave labor if they so chose; they have taken no such action.

6 The panel majority does not explain how this pleading could make

plausible a finding of purpose to promote slavery in light ofthe concession

from the plaintiffs that the defendants did not have the purpose of

promoting slavery. See Doe, 766 F.3d at 1025. After all, one would

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DOE V. NESTLE 9

In so reasoning, regardless what the majority contends, it

was most certainly not following Aziz. There, the Fourth

Circuit noted that defendant Alcolac had sold chemicals that

could be used to produce lethal mustard gas with full

knowledge of that possible use, despite having been told that

the chemical in question was subject to U.S. export

restrictions. The chemical was sold to a company defendant

Alcolac knew was a shell company designed to evade those

export restrictions.

Through the shell company, the chemicals eventually

reached Saddam Hussein’s regime in Iraq, which used the

chemicals to create mustard gas it then used to killed

thousands of Kurds. Aziz, 658 F.3d at 390–91. Plaintiffs

alleged, in sum, that Alcolac sold its chemicals “with actual

or constructive knowledge that such quantities [of the

chemicals] would ultimately be used by Iraq in the

manufacture of mustard gas to attack the Kurds.” Id. at 394. 

Nonetheless, the Fourth Circuit held plaintiffs had not

adequately alleged purposeful violation of customary

international law by Alcolac. Id. at 401. That is, the

allegations that Alcolac knew how the chemicals would be

used did not amount to an allegation that Alcolac harbored

specific intent (i.e. purpose) that the Kurds be gassed, and

thereby accomplish a form of genocide.

The contradiction with the majority’s holding is obvious. 

If selling chemicals with the knowledge that the chemicals

will be used to create lethal chemical weapons does not

assume that a panel, having concluded that the plaintiff must show

purpose, would find that a plaintiff who concedes the defendant lacksthat

purpose has briefed himself out of his case. The panel majority’s contrary

decision is unexplained and, I submit, inexplicable.

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10 DOE V. NESTLE

constitute purpose that people be killed, how can purchasing

cocoa with the knowledge that slave labor may have lowered

its sale price constitute purpose that people be enslaved? The

majority replies that “the defendants [in Aziz] had nothing to

gain from the violations of international law.” Doe, 766 F.3d

at 1024. Demonstrably not so—the more Saddam Hussein

used chemical weapons to kill his opponents, the more of

Alcolac’s chemicals he would need and thus the higher the

sales of Alcolac’s products; the higher their sales, of course,

the higher their profit.7

The majority fares no better with its characterization of

the Second Circuit’s decision in Talisman, which should

come as no surprise since the Fourth Circuit’s Aziz opinion

explicitly relied on Talisman. Aziz, 658 F.3d at 398. 

Talisman Energy (“Talisman”), a Canadian oil corporation,

was part of a conglomerate that had a business arrangement

with the Sudanese government whereby Talisman extracted

oil in several regions of Sudan. Talisman and its

conglomerate worked closelywith the Sudanese government:

Talisman upgraded airstrips for the Sudanese government,

who used the airstrips were used to conduct bombing raids on

the ethnic South Sudanese; Talisman considered expanding

its oil-exploration area into South Sudan despite knowing the

government would kill the local inhabitants to give Talisman

the land; Talisman paid royalties to the Sudanese

government, knowing the money would go to the

7 The plaintiffs in Aziz alleged that Alcolac had sold one million pounds

of its chemicals to the shell corporation, on the understanding that the

shell corporation “intended to place further orders in the three to six

million pound range annually.” Aziz, 658 F.3d at 391. It belies economic

reality to suggest that an order of that size provides no benefit to the seller

of goods.

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DOE V. NESTLE 11

continuation of the ethnic genocide8perpetrated by the

government against the South Sudanese people; and, the

conglomerate provided fuel to Sudanese government military

aircraft taking off on bombing missions in pursuit of its

genocidal aims. Talisman, 582 F.3d at 262. Nevertheless,

the Second Circuit held that plaintiffs (Southern Sudanese

victims of the government’s attacks) had not shown Talisman

had aided and abetted the Sudanese government’s genocidal

acts, because “[p]laintiffs d[id] not suggest in their briefs that

Talisman was a partisan in regional, religious, or ethnic

hostilities, or that Talisman acted with the purpose to assist

persecution.” Id. at 263. In distinguishing this case, the

majority makes a point—Talisman was harmed by the

government’s genocidal conduct to the extent that it

ultimately had to abandon its Sudanese venture, while Nestle

continued its cocoa business.9 Doe, 766 F.3d at 1024. But

the Second Circuit also noted that “if ATS liability could be

established by knowledge of those abuses coupled only with

such commercial activities as resource development, the

statute would act as a vehicle for private parties to impose

embargos or international sanctions through civil actions in

United States courts.” Talisman, 582 F.3d at 294.10

8 Genocide is a recognized violation of customary international law. 

Abagninin v. AMVAC Chemical Corp., 545 F.3d 733, 739 (9thCir. 2008).

9 Of course, Talisman also benefitted from its relationship with the

military; like any oil company doing business in a region prone to

violence, it had to “rely on the military for defense.” Talisman, 582 F.3d

at 262.

10 An embargo by chocolate manufacturers on Ivory Coast chocolate

farmers is precisely the predictable economic effect plaintiffs’ successful

action would have. Indeed, failure to effect an embargo by refusing to

deal with the plantation owners is precisely the misuse of economic power

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12 DOE V. NESTLE

By contrast, defendants here are alleged to have been

aware that slaverywas occurring on the cocoa plantations, but

not to have done anything to assist directly in the enslavement

of plaintiffs. Indeed, the plaintiffs in this case do not even

allege that defendants could not have procured similar prices

from the Ivorian plantations absent their use of slave

labor—by technological innovations or the exercise of

monopsony power, for instance.11 By contrast, Talisman was

required to acquiesce in the Sudanese government’s misdeeds

if it wanted to make a profit. It bears emphasis that Alcolac

and Talisman undoubtedly knew that their actions were

contributing to great evils: the use of poison gas in Alcolac’s

case, and genocide in Talisman’s. Nonetheless, the Second

and Fourth Circuit’s decisions absolved these companies of

ATS aiding and abetting liability, because plaintiffs’

allegations did not make it plausible that defendants

specifically intended Kurd or Southern Sudanese killings.

which the majority finds sufficient to make plausible the conclusion that

defendants acted with the purpose to promote slavery. Doe, 766 F.3d at

1025.

11 Nor can the panel majority rely for its answer on the plaintiffs’

allegations that the corporations trained farmers and lobbiedCongress. As

to farmer training, the complaint alleges that two of the named defendants

are attempting to change farming and labor practices in the Ivory Coast in

an effort to reduce the use of child labor; the complaint contains no

allegation that the third defendant has engaged in any farmer training at

all. The panel majority cannot be inferring pro-slavery purpose fromantislavery activity. As for the lobbying, plaintiffs themselves allege that the

corporations’ lobbying efforts had the intent of ensuring child labor free

chocolate; the plaintiffs then allege that the defendants’ lobbying had the

effect of allowing child slavery to continue. That the corporations’

lobbying is alleged to have backfired does not mean that the backfire was

intended.

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DOE V. NESTLE 13

Thus, the panel majority’s claim to have adopted the

Second and Fourth Circuit’s analysis is simply incorrect. It

has not done so, and has thus created a circuit split on the

proper mens rea element for aiding and abetting liability

under customary international law.

Moreover, the majority is on the wrong side of the circuit

split it creates. Sosa requires that the federal courts accept as

proper bases of a claim for relief only those violations of

customary international law that have “definite content and

acceptance among civilized nations.” Thus, if there is

conflict as to the proper scope of ATS liability, the narrower

reading should be chosen, as no consensus can be said to exist

on the broader one. Sosa, 542 U.S. at 732. As the majority

opinion recognizes, “the Rome Statute rejects a knowledge

standard and requires the heightened mens rea of purpose,

suggesting that a knowledge standard lacks the universal

acceptance that Sosa demands.”12 Doe, 766 F.3d at 1024. 

The conflict between the Rome Statute’s rejection of

knowledge and the panel majority’s effective acceptance of

knowledge is sufficient to eliminate the required consensus. 

In its assessment of our sister circuits and its reading of

Supreme Court precedent, therefore, the panel majority is

well off the mark.

12 The Rome Statute, 37 I.L.M. 999 (1998), is the treaty that establishes

the International Criminal Court. The United States has signed but not

ratified the treaty. In 2002, Under Secretary of State John Bolton sent a

letter to then-UN Secretary General Kofi Annan which stated that the

United States did not intend to become a party to the treaty and suspended

the United States’s signature. See Press Statement of Richard Boucher,

United States Department of State, May 6, 2002, available at

http://2001-2009.state.gov/r/pa/prs/ps/2002/9968.htm.

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I turn next to the question of extraterritoriality—an

important one in this case, since all the acts of enslavement

and maintenance of slavery are alleged to have occurred

outside United States borders. While this case was pending

before the panel, the Supreme Court announced its decision

in Kiobel v. Royal Dutch Petroleum, 133 S. Ct. 1659 (2013). 

The Supreme Court held in Kiobel that the presumption

against extraterritoriality applies to claims brought under the

ATS; as usual, that presumption is rebuttable.13

Id. at 1669. 

To be viable, ATS claims must “touch and concern the

territory of the United States” with “sufficient force to

displace the presumption against extraterritorial application.”

Id. (citing Morrison v. National Australia Bank, 561 U.S.

247, 264–273 (2010)).

The plaintiffs claim Kiobel’s “touch and concern”

language announces a new test to determine when the

presumption against extraterritoriality is rebutted, while

defendants argue Kiobel simply adopts the test announced in

Morrison. Morrison’s text adopted a “focus” test, whereby

courts must ask whether the defendants engaged in the

conduct that is the focus of the statute at issue. Morrison,

561 U.S. at 266–67.14 The panel majority adopted plaintiffs’

13 This is the presumption that “when a statute gives no clear indication

of an extraterritorial application, it has none.” Kiobel, 133 S. Ct. at 1664

(brackets omitted) (quoting Morrison v. National Australia Bank Ltd.,

561 U.S. 247, 255 (2010)). That is, American statutes—the 1934

Securities Exchange Act or the 1797 Alien Tort Statute—do not apply to

actions taken beyond our shores unless Congress tells us to the contrary.

14 In Morrison, an Australian bank had purchased a Florida mortgageservicing company, and listed the mortgage-servicing company’s assets

on its annual reports. It proudly touted the success of the mortgageservicing company’s business and gave it a high valuation. A few years

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DOE V. NESTLE 15

view and held that “Morrison may be informative precedent

for discerning the content of the touch and concern standard,

but the opinion in Kiobel II did not incorporate Morrison’s

focus test.” Doe, 766 F.3d at 1028. Respectfully, the

majority is quite wrong.

First, the Supreme Court’s opinion in Kiobel counsels

against the majority’s analysis. As the Supreme Court’s

majority opinion states, though Morrison dealt with acts of

Congress, “the principles underlying the [Morrison] canon of

interpretation [which counsel against the Exchange Act’s

extraterritorial application] similarly constrain courts

considering causes of action that may be brought under the

ATS.” Kiobel, 133 S. Ct. at 1664. Moreover, the Court’s

explanation of the “touch and concern” language is

later, however, the bank wrote down the value of the mortgage-servicing

company’s assets, causing the bank’s share price to drop. Id. at 251–53.

The plaintiffs, Australian shareholders in the bank, brought suit for

violation of SEC Rule 10b-5, which states that it is unlawful “to use or

employ, in connection with the purchase or sale of any security registered

on a national securities exchange or any security not so registered, . . . any

manipulative or deceptive device or contrivance in contravention of such

rules and regulations as the [Securities and Exchange] Commission may

prescribe.” Id. at 262 (ellipses and brackets in original). The district court

dismissed for lack of jurisdiction because the conduct occurred abroad,

and the SecondCircuit affirmed. The Supreme Court reclassified the issue

as merits-based rather than jurisdictional, and affirmed. In light of the

presumption against the extraterritorial applicability of federal law, the

Court held that “the focus of the Exchange Act is not upon the place

where the deception originated, but upon purchases and sales ofsecurities

in the United States.” Id. at 266–67. Because the statute intended only to

regulate domestic transactions and protect prospective parties to domestic

transactions alone, the plaintiffs’ claims, which arose out of deception

occurring inAustralia, betweenAustralian buyers and sellers of Australian

bank shares, were dismissed for failure to state a claim for relief.

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16 DOE V. NESTLE

encompassed in one citation to Morrison. Id. at 1669.15 The

meaning is clear: the Supreme Court stated that the Morrison

presumption against extraterritorial application of American

statutes is to be applied to ATS cases. And, since the

15 Kiobel cites to pages 2883–88 of Morrison. In those pages, the

Supreme Court explained why the Australian share fraud claims in

Morrison did not have sufficient “contact with the territory of the United

States.” Morrison, 561 U.S. at 2884. The Court first noted that the

principal purpose of the 1934 Securities and Exchange Act was to protect

transactions on domestic exchanges, as Congress could not regulate

foreign exchanges. Second, as to securities traded on foreign exchanges,

the Securities Exchange Act was exclusively focused on domestic

purchases and sales; here, the transaction had not occurred in the United

States. Id. Furthermore, there was no contemporary statutory context

suggesting that Congress’s “comprehensive regulation of securities

trading” was meant to encompass foreign transactions on securities not

registered in the United States. Id. at 2885. Indeed, the strong risk of

incompatibility with foreign law counseled against application of the

Securities and Exchange Act to such transactions. Id. The Court further

noted, in rejecting the test proposed by the Solicitor General (“SG”), the

fact that the SG’s test (which asked if “significant and material conduct”

had happened in the United States) would open the floodgates of class

action litigation for lawyers representing victims of foreign securities

fraud. Id. at 2886. Finally, the Court explained that the consistency of the

SG’s proposed test with international law meant only that adoption of the

SG’s test would not violate international law, not that it was required by

international law, and that the SEC’s interpretation was not entitled to

deference because it was based on cases which the Supreme Court had

disapproved.

Thus, a court applying the Morrison test in the ATS context should

focus on the location of the alleged violation of customary international

law, statutory indicia that Congress intended U.S. courts to regulate the

particular conduct at issue, the risk of an increase in future litigation, and

the existence of a well-founded interpretation of applicable law to which

the court should defer. All of these considerations point to the conclusion

that plaintiffs’ claims here lack sufficient contact with the territory of the

United States.

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DOE V. NESTLE 17

presumptions are the same, it follows that the very same

evidence is needed to rebut either presumption. Moreover,

the Kiobel opinion cannot have imparted any additional

meaning to the “touch and concern” test; the Kiobel majority

did not apply the test or provide any further guideposts as to

its possible meaning. Against this evidence, the panel

majority points to the mere use of different language, as well

as some language in the concurrences of Justices Kennedy

and Alito in Kiobel, to claim a new but undefined test was

created by the Court. Doe, 766 F.3d at 1028. This is too thin

a reed on which to support such an expansive argument.

Second, the two circuits to consider this issue agree that

Kiobel simply directs application of the Morrison test; the

panel majority’s contrary conclusion thus creates another

circuit split. In Baloco v. Drummond Co., Inc., 767 F.3d

1229 (11th Cir. 2014), the Eleventh Circuit noted that “[t]he

Court in Kiobel looked to Morrison v. National Australia

Bank Ltd., 561 U.S. 247 (2010), for a discussion of when

claims that ‘touch and concern the territory of the United

States’ do so ‘with sufficient force to displace the

presumption against extraterritorial application.’”16Id. at

16 Baloco was a Colombian national and the child of a union leader who

worked for Drummond Ltd. at Drummond’s coal mining operation in

Colombia. Drummond is a closely-held corporation with its principal

place of business in Alabama. The union leader was murdered, Baloco

alleged, by paramilitary members of the AUC, an organization affiliated

with Colombia’s military which provided security for Drummond’s coal

mining operation and was engaged in a guerrilla war with FARC. Baloco

brought suit under the ATS, Trafficking Victims Protection Act, and

Colombia’s wrongful death statute. The district court granted

Drummond’s motion to dismiss Baloco’s ATS claims for lack of subject

matter jurisdiction under 12(b)(1). The Eleventh Circuit affirmed. The

court adopted the presumption that the ATS statute did not touch murders

occurring outside the United States, and applied the Kiobel “touch and

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1236–37 (quoting Kiobel, 133 S. Ct. At 1669). Similarly, in

Mastafa v. Chevron Corp., 770 F.3d 170, 182–86 (2d Cir.

2014), the Second Circuit applied the Morrison “focus” test

in a post-Kiobel ATS case to determine if the presumption

against extraterritoriality had been rebutted.17

concern the territory of the United States” standard to see if the

presumption was rebutted. The court explained that “[t]he [Supreme]

Court in Kiobel looked to Morrison for a discussion of when claims that

‘touch and concern the territory ofthe United States’ do so ‘with sufficient

force to displace the presumption against extraterritorial application.” 

Baloco, 767 F.3d at 1236–37 (quoting Kiobel, 133 S. Ct. at 1669). 

Examining the allegations ofBaloco’s complaint, Baloco’s “claims are not

focused within the United States” because the killings occurred in

Colombia in the context of a guerrilla war in Colombia. Baloco, 767 F.3d

at 1237–38.

17 Mastafa was an Iraqi woman who was the victim of torture by agents

of Saddam Hussein’s regime in Iraq. She brought suit against Chevron,

alleging that it paid kickbacks and other unlawful payments to the regime

which enabled the regime to survive and torture her. The district court

granted Chevron’s 12(b)(1) motion to dismiss for lack of subject matter

jurisdiction, and the SecondCircuit affirmed. The court explained that the

Supreme Court’s decision in Kiobel “significantly clarified the

jurisdictional grant of the ATS with respect to extraterritoriality.” 

Mastafa, 770 F.3d at 181–82. The court noted that inKiobel, the Supreme

Court had not explained how this presumption could be displaced; “[t]o

determine howto undertake the extraterritoriality analysis where plaintiffs

allege some ‘connections’ to the United States, we first look to the Court’s

opinion in Morrison.” Id. at 183. The circuit interpreted the Morrison

methodology as requiring that the conduct which touched and concerned

the territory of the United States be the conduct which gave rise to ATS

liability. The circuit then concluded that the only conduct alleged in the

complaint which touched and concerned the United States (maintenance

of escrow accounts and arrangement of payments in New York bank

accounts) did not constitute a violation of customary international law. 

Thus, the district court correctly concluded that it lacked subject matter

jurisdiction. Applied here, the only conduct of defendants which touched

and concerned the U.S. were (1) sales of cocoa products in the US and

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DOE V. NESTLE 19

The panel majority’s analysis thus puts our court on one

side of yet another circuit split; yet again, the majority has

taken the minority, incorrect side.18

Finally, I note that this case squarely presents the question

whether ATS liability should extend to corporations.19 Our

court’s earlier affirmative answer to this question in the panel

was vacated by the Supreme Court, making this a question of

first impression in this circuit. Sarei v. Rio Tinto PLC,

671 F.3d 736, 748 (9th Cir. 2011) (en banc), vacated by

(2) lobbying efforts in the Congress. Neither sales nor lobbying are even

colorable violations of customary international law.

18 There is one other court to have opined on this issue: the Fourth

Circuit, in Al Shimari v. CACI Premier Technology, Inc., 758 F.3d 516

(4th Cir. 2014). The paragraphs in which the Fourth Circuit decided that

the Morrison presumption against extraterritorial applicationwas rebutted

do not cite the “focus” test; of course, those paragraphs also do not cite the

“touch and concern” test. Id. at 528–29. However one interprets the

Fourth Circuit opinion, it does not affirmatively hold that “the opinion in

Kiobel II did not incorporate Morrison’s focus test.” Doe, 766 F.3d at

1028. The majority opinion in this case is the first to come to that

conclusion. And the panel majority is the first to hold that Kiobel

necessitates remand of the case to decide whether the presumption against

extraterritoriality has been vacated, a conclusion the FourthCircuit did not

reach.

19 A circuit split exists on whether the ATS’s grant of jurisdiction

extends to claims against corporations. Compare, e.g., Flomo v. Firestone

Natural Rubber Co., LLC, 643 F.3d 1013, 1021 (7th Cir. 2011)

(“[C]orporate liability is possible under the Alien Tort Statute . . . .”) with

Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111, 148–49 (2d. Cir.

2011) (“[C]orporate liability has not attained a discernable, much less

universal, acceptance among nations of the world in their relations inter

se, and it cannot, as a result, form the basis of a suit under the ATS.”).

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133 S. Ct. 1995 (2013).20 The panel majority chose to

“reaffirm the corporate liability analysis” of Sarei. Doe, 766

F.3d at 1021. Here again, the majority has erred.

The Sarei analysis, as the majority adopts it today, comes

in three parts. First, the analysis of customary international

law is norm-by-norm, as “there is no categorical rule of

corporate immunity or liability” in ATS cases. Id. Second,

corporate liability can be imposed in the absence of

“international precedent enforcing legal norms against

corporations.”

21

Id. Third, norms that are “‘universal and

 

20 Sarei was vacated in light of the Supreme Court’s decision in Kiobel

and the opinion was not reinstated on remand. Sarei v. Rio Tinto,

722 F.3d 1109 (9th Cir. 2013) (en banc). Instead, “a majority of the en

banc court” voted to affirm the district court’s judgment of dismissal with

prejudice without any further explanation. Thus, the original Sarei en

banc opinion has no precedential effect.

21 In the Sarei en banc court’s words, “[t]hat an international tribunal has

not yet held a corporation criminally liable does not mean that an

international tribunal could not or would not hold a corporation criminally

liable under customary international law.” Sarei, 671 F.3d at 761. Of

course, as the Sarei opinion did notstate, that an international tribunal has

not yet held a corporation criminally liable does not mean that an

international tribunal would hold a corporation criminally liable, either. 

And as the Second Circuit noted in Kiobel, the Sarei panel’s factual

premise was incorrect: the refusal to extend liability to corporations like

IG Farben, which aided and abetted Nazi war crimes, was “not a matter

of happenstance or oversight,” but a careful decision reflecting the central

moral principle of holding men, not “abstract entities,” accountable for

evil actions. Kiobel, 621 F.3d at 134–35.

Moreover, as I discuss below, Sarei’s willingness to rush ahead of

international tribunals’ declarations of law is inconsistent with the

Supreme Court’s cautious mood in Sosa.

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DOE V. NESTLE 21

absolute,’ or applicable to ‘all actors,’ can provide the basis

for an ATS claim against a corporation.” Id.

There are many problems with this approach. Our court

was wrong enough in Sarei to join those circuits which held

that corporate liability could exist under the ATS. But even

amongst those circuits that erroneously conclude that

corporate liability can exist under the ATS, the Sarei

approach resuscitated by the panel majority distinguishes

itself as particularly erroneous, in two ways.

First, the Court has explained that a norm cannot give rise

to ATS liability unless it is “specific, universal, and

obligatory.” Sosa v. Alvarez-Machain, 542 U.S. 692, 733

(2004) (quoting In re Estate of Marcos Human Rights

Litigation, 25 F.3d 1467, 1475 (9th Cir. 1994)). Well and

good. In this case, the panel majority finds that the norm

against slavery is sufficiently specific, universal, and

obligatory to give rise to ATS liability. Doe, 766 F.3d at

1022. I agree. The majority then says that because of the

“categorical nature of the prohibition on slavery and the

moral imperative underlying that prohibition,” corporations

must be liable for aiding and abetting slavery. Doe, 766 F.3d

at 1022. But this is circular reasoning: by the panel’s

reasoning, any norm “categorical” enough to give rise to an

ATS claim based on customary international law necessarily

gives rise to corporate liability for violation of that norm. 

And worse yet, the majority’s reasoning contradicts the

Supreme Court’s teaching in Sosa that there must be a

meaningful inquiry—not a mere labeling of norms as

‘categorical’—as to whether the particular international norm

at issue, which is assumed to confer liability under the ATS

generally, would allow for corporate liability in particular. 

Sosa, 542 U.S. at 732 n.20.

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Second, the Sarei opinion rested its analysis on common

sense inference about “congressional intent when the ATS

was enacted.” Sarei, 671 F.3d at 761. Because Congress

could not have anticipated the “array of international

institutions that impose liability on states and non-state actors

alike in modern times,” the Sarei panel refused to be bound

“to find liability only where international fora have imposed

liability.” Id. But this approach is forestalled by Sosa’s

reminder that federal courts have “no congressional mandate

to seek out and define new and debatable violations of the

law of nations.” Sosa, 542 U.S. at 728. In light of the

cautious mood expressed by Sosa, therefore, a desire to “get

ahead” of international law cannot be followed.

In sum, the majority’s error violates the Supreme Court’s

commands and opens our doors to an expansive vision of

corporate liability.

22

We do the law a disservice when we allow our

sympathies, no matter how well-founded, to run our decisions

afoul of the Supreme Court’s unequivocal commands. 

Because this court has done such a disservice by refusing to

take this case en banc, I respectfully dissent.

22 More expansive, even, than the Sarei decision that the Court vacated. 

In the Sarei en banc opinion, we first noted that there was an international

norm against war crimes, then noted international law cases which

recognized aiding and abetting liability for war crimes. Sarei, 671 F.3d

at 763–66. By contrast, the panel majority here finds an international

norm against slavery and a general international law principle of aiding

and abetting liability—without finding such liability applied to

slavery—and finds those two sufficient to give rise to liability. Thus, the

panel imposes liability for aiding and abetting slavery without citing a

single case in which an international tribunal recognized the applicability

of this form of liability for this particular norm.

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