Despite Sen. Majority Leader Mitch McConnell’s negative charisma, he has masterminded the legal coup of the century: refusing to even consider President Obama’s mild-mannered Supreme Court nominee Merrick Garland. Instead, he orchestrated a break with long-standing Senate rules about the filibuster to seat a jurist who was sloppy with his sourcing at best, and a plagiarist at worst.
Moreover, the appointment of Neil Gorsuch is likely to push the Roberts Supreme Court – already dubbed the “Corporate Court” — to a new low in obsequiousness toward corporate litigants.
Gorsuch will get his chance early. Sometime next fall the Supreme Court will hear Jesner v. Arab Bank, where the question is whether corporations can be sued under the Alien Tort Statute.
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Passed in 1789, the Alien Tort Statute gives federal courts jurisdiction to hear suits brought by non-citizens for violations of international law. The modern era of this litigation began in the 1980’s when foreign nationals were allowed to sue a former Paraguayan police official living in the US for alleged human rights abuses.
Soon, multinational corporations were being sued for aiding and abetting human rights violations all over the globe. Corporations fought these cases tooth and nail, generally claiming they couldn’t be sued in US courts or that the Alien Tort Statute didn’t apply to corporations.
The Supreme Court had the chance to rule on whether the Alien Tort Statute applies to corporations in 2013, but despite hearing two rounds of arguments in the case, it ducked the issue. Instead, the court noted that an overseas defendant, Netherlands-based Royal Dutch Shell, was being sued by foreign plaintiffs for activities taken outside the US, which in this case was Nigerians claiming the oil giant committed atrocities in their country. To the Roberts court, this was going too far, because there is a “presumption against extraterritorial application” of US law.
Two years ago, Nestle USA tried to get the Supreme Court to take up issue of corporate liability, but it was denied cert. As I wrote before the Court denied the petition, if Nestle’s argument was successful “it could free every corporation from worrying about suit in American courts for human rights abuses abroad, no matter how heinous.”
How heinous? In the case of Nestle, and co-defendants Archer Daniels Midland and Cargill, it’s using child slave labor to harvest cocoa in the Ivory Coast. The child slaves worked “up to 14 hours a day six days a week, given only scraps of food to eat, and whipped and beaten by overseers. They were locked in small rooms at night and not permitted to leave the plantations, knowing that children who tried to escape would be beaten or tortured,” according to a Ninth Circuit opinion that allowed the suit to proceed. And for those wondering if the defendants knew what was going on, the appellate panel quickly dispatched with that one. “The defendants are well aware of the child slavery problem in the Ivory Coast. They acquired this knowledge firsthand through their numerous visits to Ivorian farms,” the judges wrote.
Yet, last month a federal district court dismissed the case, relying in part on some of the reasoning in the earlier Supreme Court decision. Judge Stephen Wilson, a Reagan appointee, found that the defendants’ alleged conduct in the US were ordinary business practices and did not involve the planning and direction of the child slave labor.
Which brings us to the Arab Bank case Neil Gorsuch will hear this fall. Arab Bank is one of the largest financial institutions in the Middle East, with more than 600 branches on five continents, including New York. The plaintiffs claim that the bank, including its New York branch, acted as a treasurer for terrorists, holding accounts for organizations such as Islamic Jihad. “The Bank has served as the ‘paymaster’ for Hamas and other terrorist organizations, helping them identify and pay the families of suicide bombers and other terrorists,” the plaintiffs told the Supreme Court.
But none of that mattered to the Second Circuit, which dismissed the case. Their first line of analysis was simple. Arab Bank is a corporation and corporations can’t be sued under the Alien Tort Statute. Quoting a prior ruling on the Alien Tort Statute, the Second Circuit panel wrote, “[N]o corporation has ever been subject to any form of liability (whether civil, criminal, or otherwise) under the customary international law of human rights.”
It will be curious, but not surprising, if the Court rules that corporations are immune from the Alien Tort Statute. Such a decision would defy the rationale of Citizens United, which said corporations have the same free speech rights as people, because corporations are nothing more than a collection of individuals. As I described in my book, Corporate Citizen?, the Roberts Court is giving corporations rights without concomitant responsibilities. If corporations are treated as people for the purposes of free speech and religious rights, those rights should come with responsibilities as well. And one responsibility for a human defendant is being held accountable for causing grave harm.
My prediction for Jesner v. Arab Bank is that the newly reconstituted Supreme Court will adopt the corporations’ point of view and insulate them from the Alien Tort Statute. Aided by Gorsuch, the Supreme Court will turn its back on victims of human rights violations. Those who once saw the US as a source of equitable legal norms and a moral high ground for human dignity will have to adjust their beliefs.
Prove me wrong, Justice Gorsuch.