Opinion ID: 3066204
Heading Depth: 3
Heading Rank: 1

Heading: Corporate Liability under the ATS

Text: The primary focus of international law, although not its exclusive focus, is the conduct of states. Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111, 165 (2d Cir. 2010) (Leval, J., concurring) (“Kiobel I”). Many of its prohibitions therefore only apply to state action, and an important issue in ATS litigation can be determining whether the norm asserted by the plaintiff is applicable to both state actors and private actors. This issue is illustrated by the contrasting decisions of the D.C. Circuit in Tel-Oren v. Libyan Arab Republic and the Second Circuit in Kadic v. Karadzic. In Tel-Oren, Judge Edwards concluded that the plaintiffs’ ATS claim was barred because there was no consensus that international law applied to torture carried out by non-state actors. 726 F.2d 774, 791–95 (D.C. Cir. 1984). In Kadic, by contrast, the Second Circuit held that international law’s prohibition on genocide applies regardless of whether the perpetrator is acting on behalf of a state. 70 F.3d 232, 241–42 (2d Cir. 1995). The Supreme Court’s only allusion to corporate liability occurred in a footnote that referenced these discussions in Tel-Oren and Kadic. Sosa, 542 U.S. at 732 n.20. In the footnote, the Court directed federal courts contemplating the recognition of new ATS claims to consider “whether international law extends the scope of liability for a violation of a given norm to the perpetrator being sued, if the defendant is a private actor such as a corporation or individual.” Id. (emphasis added). The issue of corporate liability has been more thoroughly examined in the circuit courts, which have disagreed about whether and under what circumstances corporations can face liability for ATS claims. Kiobel I, 621 F.3d at 145; Doe v. 16 DOE V. NESTLE USA, INC. Exxon Mobil Corp., 654 F.3d 11, 57 (D.C. Cir. 2011), vacated on other grounds by 527 F. App’x 7 (D.C. Cir. 2013); Sarei v. Rio Tinto, PLC, 671 F.3d 736, 747 (9th Cir. 2011), vacated on other grounds by 133 S. Ct. 1995 (2013); Flomo, 643 F.3d at 1020–21. Here, we reaffirm the corporate liability analysis reached by the en banc panel of our circuit in Sarei v. Rio Tinto. In Sarei, the plaintiffs sought to hold corporate defendants liable for aiding and abetting genocide and war crimes. We first rejected the defendants’ argument that corporations can never be sued under the ATS. Rather than adopting a blanket rule of immunity or liability, the Sarei court held that for each ATS claim asserted by the plaintiffs, a court should look to international law and determine whether corporations are subject to the norms underlying that claim. Id. at 748 (“Sosa expressly frames the relevant international-law inquiry to be the scope of liability of private actors for a violation of the ‘given norm,’ i.e. an international-law inquiry specific to each cause of action asserted.”). Thus, we adopted a norm-bynorm analysis of corporate liability. The Sarei court then conducted corporate liability analyses for the two norms underlying the plaintiffs’ claims, the norm against genocide and the norm against war crimes. Id. at 759–61, 764–65. The en banc panel observed that both norms apply to states, individuals, and groups, and that the applicability of the norms turns on the “specific identity of the victims rather than the identity of the perpetrators.” Id. at 760, 764–65 (emphasis added). Thus, we concluded that the norms were “universal” or applicable to “all actors,” and, consequently, applicable to corporations. Id. at 760, 765. We reasoned that allowing an actor to “avoid liability merely by DOE V. NESTLE USA, INC. 17 incorporating” would be inconsistent with the universal quality of these norms. See id. at 760 (discussing genocide). In Sarei we also explained that a norm could form the basis for an ATS claim against a corporation even in the absence of a decision from an international tribunal enforcing that norm against a corporation. Id. at 761 (“We cannot be bound to find liability only where international fora have imposed liability.”). Contra Kiobel I, 621 F.3d at 131–45. We explained that the absence of decisions finding corporations liable does not imply that corporate liability is a legal impossibility under international law, and also noted that the lack of decisions holding corporations liable could be explained by strategic considerations. Sarei, 671 F.3d at 761 (citing Jonathan A. Bush, The Prehistory of Corporations and Conspiracy in International Criminal Law: What Nuremberg Really Said, 109 Colum. L. Rev. 1094, 1149–68 (2009)). Rejecting an analysis that focuses on past enforcement, Sarei reaffirmed that corporate liability ultimately turns on an analysis of the norm underlying the ATS claim. Id. at 760–61 (“We . . . believe the proper inquiry is not whether there is a specific precedent so holding, but whether international law extends its prohibitions to the perpetrators in question.”). We thus established three principles about corporate ATS liability in Sarei, that we now reaffirm. First, the analysis proceeds norm-by-norm; there is no categorical rule of corporate immunity or liability. Id. at 747–48. Second, corporate liability under an ATS claim does not depend on the existence of international precedent enforcing legal norms against corporations. Id. at 760–61. Third, norms that are “universal and absolute,” or applicable to “all actors,” can provide the basis for an ATS claim against a corporation. Id. at 760. To determine whether a norm is universal, we 18 DOE V. NESTLE USA, INC. consider, among other things, whether it is “limited to states” and whether its application depends on the identity of the perpetrator. Id. at 764–65. We conclude that the prohibition against slavery is universal and may be asserted against the corporate defendants in this case. Private, non-state actors were held liable at Nuremberg for slavery offenses. The Flick Case, 6 Trials of War Criminals (T.W.C.) 1194, 1202. Moreover, the statutes of the International Criminal Tribunals for Rwanda and the former Yugoslavia are broadly phrased to condemn “persons responsible” for enslavement of civilian populations. ICTY Statute Art. 5(c), U.N. S/RES/827 (May 25, 1993); ICTR Statute Art. 3(c), U.N. S/RES/955 (Nov. 8, 1994). The prohibition against slavery applies to state actors and non-state actors alike, and there are no rules exempting acts of enslavement carried out on behalf of a corporation. Indeed, it would be contrary to both the categorical nature of the prohibition on slavery and the moral imperative underlying that prohibition to conclude that incorporation leads to legal absolution for acts of enslavement. Kiobel I, 621 F.3d at 155 (Leval, J., concurring) (“The majority’s interpretation of international law, which accords to corporations a free pass to act in contravention of international law’s norms, conflicts with the humanitarian objectives of that body of law.”). A final point of clarification is in order about the role of domestic and international law. Although international law controls the threshold question of whether an international legal norm provides the basis for an ATS claim against a corporation, there remain several issues about corporate liability which must be governed by domestic law. This division of labor is dictated by international legal principles, DOE V. NESTLE USA, INC. 19 because international law defines norms and determines their scope, but delegates to domestic law the task of determining the civil consequences of any given violation of these norms. Id. at 172 (Leval, J., concurring); Exxon, 654 F.3d at 42–43; Flomo, 643 F.3d at 1020. Thus, when questions endemic to tort litigation or civil liability arise in ATS litigation—such as damages computation, joint and several liability, and proximate causation—these issues must be governed by domestic law. Many questions that surround corporate liability fall into this category, including, most importantly, the issue of when the actions of an individual can be attributed to a corporation for purposes of tort liability. Determining when a corporation can be held liable therefore requires a court to apply customary international law to determine the nature and scope of the norm underlying the plaintiffs’ claim, and domestic tort law to determine whether recovery from the corporation is permissible. Our holding that the norm against slavery is universal and thus may be asserted against the defendants addresses only the international legal issues related to corporate liability in this case. We do not address other domestic law questions related to corporate liability, and leave them to be addressed by the district court in the first instance.