Nestle, Cargill, Child Slave Labor, and the Supreme Court, Explained
By: Elizabeth Rose
Tags: Supreme Court, World, Human Rights Law, Human Rights, United States

Nestle, Cargill, Child Slave Labor, and the Supreme Court, Explained

The Supreme Court heard oral arguments today over whether U.S. corporations can be held liable under the ATS for aiding and abetting forced child slave labor abroad. Elizabeth Rose Follow Dec 2, 2020 · 7 min read

Human rights abuses have long been one of the greatest stains on global order. Despite international and domestic institutions continuing to decry violations of basic human rights and endeavor to promote and ensure human dignity; human rights abuses continue to be under-litigated and under-enforced. The United States is no exception.

Six Africans have fallen victim to such abuse. They have brought a case to the U.S. courts under the Alien Tort Statute (ATS), seeking damages from Nestlé USA and Cargill alleging that as children, they were trafficked from Mali and forced into slave labor on Ivory Coast cocoa farms.

Since 2005, their case has been litigated through the court system and today has finally reached the Supreme Court for review. The Court heard arguments over the centuries-old ATS and whether it provides a vehicle in which the victims can obtain relief.

What is the ATS?

The First Congress enacted the ATS as part of the Judiciary Act in 1789. In full, the cogent statute reads, “[t]he 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.”

At the time of its enactment, only three causes of actions constituted the law of nations: piracy, violations of safe conduct, and offenses against ambassadors.

After enactment, the statute laid virtually dormant for almost two centuries until it was resuscitated in the 1980 landmark Second Circuit case, Filartiga v. Pena-Irala.

In Filártiga, Dr. Joel Filártiga and his daughter, filed a federal court action against Americo Noberto Peña-Irala, Inspector General of the Police in Paraguay for the wrongful death of son and brother, Joelito Filártiga. The Filtárgia’s alleged that Joelito had been kidnapped and tortured as part of a retaliation effort for his father’s political beliefs. The Second Circuit notably decided that the practice of torture was so widely rejected among civilized nations that it qualified as a tort among the law of nations and the Filártiga’s were able to obtain a favorable judgment under the ATS.

Two decades later in 2004, the Supreme Court refined the ATS in Sosa v. Alvarez-Machain, clarifying that the ATS is “purely jurisdictional” and “provides jurisdiction for a ‘modest number of international law violations’ that are derived from federal common law.”

While the Erie doctrine suggests there is no “federal common law”, the Sosa court acknowledged that “international law is a part of our law” and found that “[t]he ATS does not create a cause of action, but that it does recognize a cause of action derived from the [federal] common law, for certain violations of international law”. Such common law causes of actions amounting to violations of international law shall be determined with “specific, universal, and obligatory” precision.

Further directing that the proposed causes of action must be “sufficiently definite in their content and acceptance among civilized nations that they reflect ‘historical paradigms’ that were familiar at the time the ATS was enacted”.

Thus, for purposes of the ATS, courts only possess jurisdiction where, when looking to the federal common law, they can recognize a cause of action defined with precision and universal acceptance.

This created requirement #1 of bringing an ATS claim: state a cause of action that is recognized internationally with “specific, universal, and obligatory” prevision.

In the case of Cargill and Nestle, the prohibition against forced child labor undoubtedly meets this standard and is not at issue in this case.

But stating a recognized cause of action is not enough for an ATS claim.

The claim must also be sufficiently related to the United States to justify it being heard before a U.S. court. In Kiobel v. Royal Dutch Petroleum Co., the United States Supreme Court gave some direction on how to determine whether there is enough of a connection.

The facts of Kiobel, are as horrendous as most other claims brought under the ATS. Nigerian nationals alleged foreign corporations aided and abetted in the beating, raping, killing, and arresting of residents along with destroying and looting property. This case was “foreign cubed”, meaning that foreign plaintiffs brought a case against foreign defendants, for events that occurred on foreign territory.

The court reconciled with the foreign-cubed nature of this case by calling attention to the presumption against extraterritoriality. A longstanding principle in American common law, the presumption against extraterritoriality maintains that where there is a domestic statute in place, it shall be presumed that such statute only applies domestically but for explicit text within the statute stating otherwise.

Statutes that lack an explicit provision giving way to extraterritorial application only function within the bounds of the United States territory. Here, in finding no express provision rebutting the presumption against extraterritoriality, the Court held the ATS could not have been intended to apply outside the borders of the United States or any place abroad where the United States may exercise jurisdiction.

However, the court carefully did not avow all possible claims occurring abroad barred to the ATS’s jurisdiction. Instead, the court strategically left open the possibility for claims to be brought before a United States federal court when “the claims touch and concern the territory of the United States, . . . with sufficient force to displace the presumption against extraterritorial application.”

In Kiobel, all parties and acts involved in the claim lacked an association to the United States. Each Justice agreed that ATS jurisdiction would not be proper in the immediate case. But, as for cases that would properly “touch and concern” the Untied States in order to recognize jurisdiction under the ATS, the Supreme Court left little guidance. The Court held that “mere corporate presence” would not be enough to amount to a weighty touch and concern on the United States to overcome the presumption against extraterritoriality.

Corporations often extend their reach to many countries and there was a fear that expanding jurisdiction to such a level would both implicate untended foreign policy matters and flood the United States courts with civil litigation having little to do with the territory.

Thus, we received requirement #2 for an ATS claim. There must be a showing that the the facts of the case “touch and concern” the United States in some way, with a mere corporate presence in the United States not being enough to satisfy the standard.

Finally, an ATS claim must be brought against the right defendant. It is clear that that individuals can be held liable under the ATS, but it remains an open question whether domestic corporations can be held responsible for their actions under the statute.

The Supreme Court has already determined in Jesner v. Arab Bank, PLC, that foreign corporations may not be defendants in ATS litigation, but did not address the question of domestic corporations, such as Nestle and Cargill.

Therefore, requirement #3 for an ATS claim necessitates that the case be brought against an individual or, maybe, a domestic corporation.

So that leaves the lawyers for Nestlé and Cargill, strangely represented by former Obama-appointed solicitor general Neal Katyal, to argue two things in order to be successful:

(1) That the case is not sufficiently connected to the United States because the domestic corporation, Nestlé and Cargill, cannot be seen as aiding and abetting forced child labor where the plaintiffs cannot point specifically to their connection to the alleged harms, and

(2) That the ATS does not impose liability on domestic corporations.

As to point issue one, the attorneys for the victims argue that the Nestlé and Cargill have maintained an operation along the Ivory Coast for decades and are well aware of the forced slave labor used. But the companies continue to state that they decry the use of slave labor and mere blanket assertions of knowledge on behalf of the company are not specific enough to impute liability.

The Justices today seemed to take interest in the second issue, grappling with the fact that barring liability on domestic corporations could open the doors for mass human rights abuses going unpunished.

Justice Kagan questioned this logic, asking why it would be okay to bring an ATS claim against ten individuals who commit qualifying acts of wrongdoing, but if those ten individuals were to incorporate, they would then be shielded?

Justice Kagan also cited an amicus brief by Oona Hathaway, a professor at Yale Law School which pointed to evidence that showed a “specific, universal, and obligatory” norm for holding corporations liable for slavery, forced labor, and human trafficking.

Justice Alito echoed the absurdity of this logic where corporations can shield themselves from human rights abuses simply by incorporating.

Chief Justice John Roberts, too, voiced concern about not holding domestic corporations liable. Often in ATS cases, there is a concern of exercising the court’s jurisdiction extraterritorially.

However, Roberts noted that here, unlike previous cases, no foreign government has objected to the Court’s authority asking “[a]nd what objection would foreign countries have to ensuring that U.S. corporations follow customary international law?”

However, for all the Court’s skepticism, it seems that Nestlé and Cargill still may come out with a narrow win. While the Court still has to write an opinion which will not be released for another few months where they can still deliberate amongst themselves on the case, the Court seemed hesitant to find a connection between the corporations’ activities and child slave labor without more direct evidence.

The silver lining here is that even if Nestlé and Cargill leave the courtroom without facing liability, the court still seems positioned to leave open the possibility to bring ATS cases against corporations in the future, assuming there is more substantial evidence to directly connect the corporation to the abuse.

As with most human rights cases, it is about little victories. But if the little victories can one day lead the huge reward of accountability, it will be a victory that had been worth fighting for.