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Supreme Court Weighs Corporate Liability in Human Rights Cases

February 28, 2012 at 12:00 AM EDT
The Supreme Court heard arguments Tuesday, weighing whether victims of abuses overseas should have the right to use U.S. courts to prove companies should pay for alleged involvement in human rights atrocities. Gwen Ifill and The National Law Journal's Marcia Coyle discuss the potential liability implications for corporations.
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GWEN IFILL: At the U.S. Supreme Court today, justices heard arguments on a pair of international human rights cases. At issue is whether corporations and groups can be sued in American courts for alleged involvement in abuses overseas. The justices’ decision could have big implications for corporate liability around the globe.

Marcia Coyle of The National Law Journal was in the courtroom for the arguments, and she joins us to explain.

Now, we’re talking two court — two cases today with percolated up to the court, one of a two-century-old statute and one of a two-decade-old statute.

MARCIA COYLE, The National Law Journal: Exactly, two separate arguments, two different federal laws, but sharing a common question of whether you can get corporate liability when corporations commit or are complicit in human rights violations.

GWEN IFILL: Now, that’s an interesting distinction you just made, commit or are complicit in.

MARCIA COYLE: Yes.

GWEN IFILL: Are we talking about American corporations which themselves violated people’s human rights, or they stood by while the countries with which they did business did it?

MARCIA COYLE: Either they actually were perpetrators or they aided and abetted, say, in one of the cases we heard today, the Nigerian military.

The case — the first case involves the alien tort statute, which you pointed out is old. It was enacted in 1789. And the suit that was brought to the court was brought by a group of Nigerians who either themselves were tortured or had family members who were tortured and killed when they were peacefully protesting oil drilling in a particular region of Nigeria.

They brought their suit against three oil companies. And a lower court found that there was no corporate liability in international law, and so their suit could not go forward. This is a complicated area, Gwen, but the arguments today boil down to this.

On the Nigerian family side, their lawyer argues that international law, you look to international law to determine what actions, what kind of conduct violates the law of nations. But international law leads to each nation’s own domestic law. Who can be held liable?

The family’s lawyer and the United States here, the deputy solicitor general of the United States argued that, under U.S. domestic law, torts like this, actions for injuries, damages for these injuries, has always held that corporations are potentially liable parties.

GWEN IFILL: And that was the case in the second case as well, which involved torture?

MARCIA COYLE: That was in the first case.

And I should add that there was another argument. . .

GWEN IFILL: Right.

MARCIA COYLE: . . . and a very vigorous argument by the oil company’s attorney, Kathleen Sullivan, that you look to international law to answer both questions. And the justices seemed more incline to follow that argument than the argument of the United States and the families.

In the second case, the Torture Victim Protection Act, that gives an action to citizens in the United States, as well as noncitizens, for damages against an individual — and that word individual is very important here — who tortures or kills under the color of law of a foreign nation.

This argument focused on the meaning of the word individual. The claim here was brought by the family of a man who was a nationalized citizen. He was visiting the West Bank with his son when he was arrested by Palestinian Liberation Organization, the Palestinian Authority. He was — there was evidence he was tortured and then he was killed.

And so they brought an action under this law for damages. So the question was, you know, can you hold corporations or an organization like the Palestinian Authority liable, when the law speaks to individual? And, again, the justices were skeptical that you could do that.

GWEN IFILL: That’s what — I was curious.

MARCIA COYLE: Yes.

GWEN IFILL: Were they listening? Were they receptive?

MARCIA COYLE: They gave the lawyer for the family here a very hard time.

As Justice Scalia said, individual isn’t a strange word. It’s not an odd word. It’s used all the time. And it means individual. But the lawyer for Asid Mohamad, who is the plaintiff in this case, he said that in every tort regime in United States law, Congress has always provided for corporate or organizational liability, and this law is a tort law.

He also argued that there was no good reason not to hold — there was no good reason to exempt corporations from here. The whole purpose of this law is compensation, deterrence and accountability.

GWEN IFILL: Now, to a non-legal mind, listening to this argument about corporations’ liability vs. individual liability sounds a lot — it sounds like it tracks a lot with other arguments we have heard from the court about whether corporations are liable, whether speech — I’m thinking of Citizens United and political spending cases.

Is there any similarity in this case?

MARCIA COYLE: Well, there are civil rights and human rights organizations who feel there is something of a parallel here. They’re saying, well, the Supreme Court, in particular in the Citizens United decision, gave corporations the same rights as human beings when it comes to. . .

GWEN IFILL: Individuals and individuals.

MARCIA COYLE: . . . campaign spending, right.

GWEN IFILL: Right.

MARCIA COYLE: And now they’re saying, will this Supreme Court recognize that corporations, just like human beings, individuals, have responsibilities, as well as rights? And the responsibility here is not to violate human rights.

A lot of organizations, after Citizens United, accused the Roberts court here of being pro-corporate. And they’re looking at this case to see if they can say that again about the Roberts court, if it should find that corporations cannot be held liable for human rights violations.

GWEN IFILL: Marcia Coyle, The National Law Journal, thank you so much.

MARCIA COYLE: My pleasure, Gwen.