Opinion ID: 2745034
Heading Depth: 4
Heading Rank: 4

Heading: Relevant and Irrelevant Considerations

Text: As we have explained above, in order to displace the presumption against extraterritoriality and establish federal subject matter jurisdiction over an ATS claim, the complaint must plead: (1) conduct of the defendant that “touch[ed] and unless Congress clearly states otherwise, see Arbaugh v. Y&H Corp., 546 U.S. 500, 515‐16 (2006), is not applicable in the context of the ATS. 31 No. 10‐5258‐cv concern[ed]” the United States with sufficient force to displace the presumption against extraterritoriality, and (2) that the same conduct, upon preliminary examination, states a claim for a violation of the law of nations or aiding and abetting another’s violation of the law of nations. In evaluating the “relevant” conduct, we are mindful of the Supreme Court’s emphasis on the potential foreign policy implications of the ATS. See Kiobel, 133 S. Ct. at 1664‐65. In all cases applying the presumption against extraterritoriality to statutes, courts must be careful to recall the relevance of this canon—namely, “to protect against unintended clashes between our laws and those of other nations which could result in international discord.” Equal Opportunity Emp’t Comm’n v. Arabian Am. Oil Co. (“ARAMCO”), 499 U.S. 244, 248 (1991); see also Parkcentral Global Hub Ltd. v. Porsche Auto. Holdings SE, 763 F.3d 198, 216 (2d Cir. 2014) (holding a claim brought under § 10(b) of the Securities Exchange Act barred as extraterritorial because “the application of § 10(b) to the defendants would so obviously implicate the incompatibility of U.S. and foreign laws that Congress could not have intended it sub silentio”). This core purpose of the presumption is even more pronounced here: “[T]he danger of unwarranted judicial interference in the conduct of foreign policy is magnified in the context of the ATS, because the question is not what Congress has done but instead what courts may do.” Kiobel, 133 S. Ct. at 1664. Describing the dangers inherent when courts impinge on the role of the executive and legislative branches in 32 No. 10‐5258‐cv managing foreign policy, the Court explained, “[t]hese concerns, which are implicated in any case arising under the ATS, are all the more pressing when the question is whether a cause of action under the ATS reaches conduct within the territory of another sovereign.” Id. at 1665. Thus, as instructed by the Supreme Court, the lower federal courts must proceed with caution when determining whether a particular case alleges conduct that is sufficiently “domestic,” such that the presumption is “displaced” (i.e., does not apply). Furthermore, in identifying the conduct which must form the basis of the violation and the jurisdictional analysis under the ATS, precedents make clear that neither the U.S. citizenship of defendants, nor their presence in the United States, is of relevance for jurisdictional purposes. First, in Kiobel the Court explicitly stated that “mere corporate presence” in the United States would be insufficient to displace the presumption against extraterritoriality. 133 S. Ct. at 1669. And in Balintulo, we described a defendant’s citizenship as “an irrelevant factual distinction,” and expressly rejected plaintiff’s contention that “corporate citizenship [of a defendant] in the United States is enough” to displace the presumption. 727 F.3d at 189‐90. And indeed, in another case in which the Supreme Court assessed the extraterritorial effect of a statute, the fact that the defendant corporations were American did not render defendant’s overseas activities sufficiently domestic. See ARAMCO, 499 U.S. at 247 (holding that Title VII of the Civil Rights Act of 1964 did not apply 33 No. 10‐5258‐cv extraterritorially to a Delaware corporation’s treatment of its U.S. citizen employee in Saudi Arabia). Recently, the Eleventh Circuit reached the same conclusion. In Cardona v. Chiquita Brands Int’l, Inc., the Court of Appeals rejected plaintiffs’ “attempt to anchor ATS jurisdiction in the nature of the defendants as United States corporations.” 760 F.3d at 1189. In discarding this argument, the Court of Appeals quoted the Supreme Court’s directive in Kiobel that “mere corporate presence” does not suffice to displace the presumption, and it identified no significant distinction between corporate presence and citizenship for purposes of analyzing domestic connections. Id. (quoting Kiobel, 133 S. Ct. at 1669). Other courts have considered a defendant’s U.S. citizenship as one germane factor among numerous factors that, when viewed together, sufficiently “touch and concern” the United States so as to confer jurisdiction on the federal courts over a case. In Al Shimari v. CACI Premier Technology Inc., 758 F.3d 516 (4th Cir. 2014), the Fourth Circuit held that ATS claims related to alleged torture of plaintiffs that took place at the Abu Ghraib prison in Iraq, at the hands of interrogators employed by the defendant corporation, sufficiently “touched and concerned” the United States. Id. at 530. The Court of Appeals reached this conclusion based upon the combination of numerous domestic contacts, including: defendant’s status as a U.S. corporation; the U.S. citizenship of defendant’s employees, “upon whose conduct the ATS claims are based”; defendant’s status as a contractor of the U.S. government; and allegations of domestic 34 No. 10‐5258‐cv conduct by defendants in approving, encouraging, and covering up the alleged torture.14 Id. at 530‐31. We disagree with the contention that a defendant’s U.S. citizenship has any relevance to the jurisdictional analysis. The Supreme Court made clear in Kiobel that the full “focus” of the ATS was on conduct. See Balintulo, 727 F.3d at 190‐91 & n.24. Whether a complaint passes jurisdictional muster accordingly depends upon alleged conduct by anyone—U.S. citizen or not—that took place in the United States and aided and abetted a violation of the law of nations. A complaint cannot be “saved” for jurisdictional purposes simply because a U.S. citizen happened to commit the alleged violation; similarly, our jurisdiction over actions taken within the United States is not less clear where they are actions of a foreign Some district courts have similarly considered a defendant’s U.S. citizenship as 14 one pertinent factor among others, including the defendant’s conduct. In Sexual Minorities Uganda v. Lively, 960 F. Supp. 2d 304 (D. Mass. 2013), the court held that the presumption against extraterritoriality was displaced by distinguishing the case from Kiobel in two ways: (1) because “[d]efendant is an American citizen residing within . . . Massachusetts” and (2) because “the tortious acts committed by [d]efendant took place to a substantial degree within the United States,” including “planning and managing a campaign of repression in Uganda from the United States.” Id. at 321‐22. The court likened defendant’s U.S.‐based conduct to “a terrorist designing and manufacturing a bomb in this country,” which he then detonates overseas. Id. at 322. As explained above, we would look only to defendant’s conduct in the United States, but not to his citizenship in determining our jurisdiction. See also Du Daobin v. Cisco Sys., Inc., 2 F. Supp. 3d 717, 728 (D. Md. 2014) (assuming, without deciding, that the presumption against extraterritoriality was displaced in an ATS case because: (1) defendant was an American, rather than foreign, corporation, and (2) “developmental actions relevant to the [alleged law of nations violation] took place predominantly, if not entirely, within the United States,” and “defendant . . . has taken certain actions within the United States with respect to products that might be primarily used for violations of the laws of nations”). 35 No. 10‐5258‐cv national rather than a U.S. citizen.15 Cf. Absolute Activist Value Master Fund Ltd. v. Ficeto, 677 F.3d 60, 69 (2d Cir. 2012) (noting, in a case applying the Supreme Court’s Morrison opinion, that in identifying domestic as opposed to extraterritorial transactions, “[a] purchaser’s citizenship or residency does not affect where a transaction occurs; a foreign resident can make a purchase within the United States, and a United States resident can make a purchase outside the United States”) (internal quotation marks omitted).