August 12, 2013 Articles

Kiobel: Have We Answered the Question of Corporate Liability After All?

The Supreme Court missed an opportunity to settle the question of whether corporations can be subject to liability under the Alien Tort Statute.

Laura E. Carlisle – August 12, 2013

On April 17, 2013, the U.S. Supreme Court rendered its decision in Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659, 569 U.S. ___ (2013), in a highly anticipated opinion many hoped would settle a split among the federal circuits regarding the recognition of corporate liability under the law of nations and the federal Alien Tort Statute (ATS). The ATS dates back to 1789 but more recently has been invoked to address the role of multinational corporations in human-rights abuses occurring in foreign countries. The Supreme Court, however, did not answer this question of corporate liability, at least not directly.

Kiobel reached the Supreme Court from the Second Circuit Court of Appeals. In September 2010, the Second Circuit affirmed the dismissal of claims brought by former Nigerian residents contending that Dutch, British, and Nigerian oil and gas corporations aided and abetted the local government in committing various human rights abuses in the 1990s in violation of the law of nations. The plaintiffs, since moved to the United States under a grant of political asylum, brought the suit pursuant to the ATS, which creates original jurisdiction in the district courts over any tort action brought by an alien for alleged violations of the law of nations or a treaty of the United States. The Second Circuit rejected the suit outright, ruling that because corporate liability is not a norm of international law, the ATS necessarily does not recognize corporate liability or permit jurisdiction against corporate defendants. The Second Circuit reasoned that international rather than domestic law governs the scope of liability under the ATS and determines who can and cannot be sued under the statute.

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