This article will be useful for public international law professionals and commercial arbitrators.
Withers partnered with Stanford Law School (“SLS”) to file an amici curiae brief in support of Respondents in Nestlé v. Doe, a case in which the United States Supreme Court examined aiding-and-abetting liability of US companies and parent companies in relation to breaches of human rights that occurred outside the United States.
On June 17, 2021, the United States Supreme Court issued an opinion in Nestlé USA, Inc. v. John Doe I, et al. & Cargill, Inc. v. John Doe I, et al., Nos. 19-146 & 19-453. The case was brought by six Malians (“Respondents”) who were alleged victims of child slavery and human trafficking at cocoa farms in the Ivory Coast, against cocoa companies Nestlé USA, Inc. and Cargill, Inc. (“Petitioners”) that allegedly “aided and abetted” Respondents’ child slavery and human trafficking by buying cocoa beans from, and providing technical and financial resources to, farms in the Ivory Coast that used child labor. Respondents’ claims were based on the Alien Tort Statute (“ATS”), a 1789 law that gives federal district courts original jurisdiction over “any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” 28 U.S.C. § 1350.
Withers in the amici curiae brief argued that aiding and abetting liability has been well-established in international law since the enactment of the ATS in the eighteenth century and through the present day. Withers’ November 25, 2020 update regarding the amici curiae brief can be found here. The full amici curiae brief can be found here.
By a vote of 8-1, in an opinion authored by Justice Clarence Thomas, the Supreme Court ruled that Respondents’ ATS lawsuit against the cocoa companies cannot go forward because it is based on alleged conduct that occurred overseas. Nestlé USA, Inc. v. Doe, 141 S. Ct. 1931, 1933 (2021). Based on the presumption against “extraterritoriality” in statutory construction, which stands for the proposition that congressional statues only apply to conduct in the United States absent a clear indication otherwise, the Supreme Court ruled that Respondents’ lawsuit could go forward only if alleged conduct that is relevant to the ATS occurred in the United States. Id. Because the Supreme Court held that Respondents’ complaint against Petitioners contained only general allegations about corporate decision-making in the United States, and did not contain more allegations regarding Petitioners’ conduct in the United States that would violate the ATS, the Supreme Court ruled that allowing Respondents’ ATS claims to proceed would violate the presumption against extraterritoriality. Nestlé, 141 S. Ct. at 1937. Accordingly, the Supreme Court reversed the previous decision of the Court of Appeals for the Ninth Circuit that had permitted Respondents’ lawsuit to proceed, and remanded the case to the Ninth Circuit for further review consistent with the Supreme Court’s ruling. Nestlé, 141 S. Ct. at 1940.
Although the Supreme Court reached a consensus regarding the presumption against extraterritoriality as it applied to Respondents’ ATS claims, the justices did not reach a consensus on a number of other ATS issues raised in the case, including the issues raised in Withers’ amicus brief. Nestlé, 141 S. Ct. at 1933. In a different section of his opinion, Justice Thomas opined that Respondents’ ATS lawsuit should be dismissed because Respondents’ aiding and abetting claims against Petitioners are not viable causes of action under the original meaning of the ATS. Nestlé, 141 S. Ct. at 1937. However, because only Justices Neil Gorsuch and Brett Kavanaugh joined this portion of Justice Thomas’ opinion, it is not binding on United States courts going forward. In a dissenting opinion, Justice Sonia Sotomayor, joined by Justices Stephen Breyer and Elena Kagan, criticized this narrow view of the scope of the ATS and affirmed the view that the ATS empowers federal courts to enforce international law violations. Nestlé, 141 S. Ct. at 1947. Justice Sotomayor’s more fulsome view of the scope of the ATS comports with the legal analysis set forth in Withers’ amici curiae brief.
The Supreme Court did not reach a consensus on any of the issues in the lawsuit besides extraterritoriality. Nor did the Court decide the second question on which it granted certiorari — whether domestic corporations can be sued under the ATS at all (although Justices Sotomayor, Kagan, Breyer, Gorsuch, and Alito expressed support for the notion that there is no basis for US corporate immunity under the ATS). As a result, the viability of ATS claims based on international law violations (including against domestic corporations) is still an open question, and the arguments raised in Withers’ amici curiae brief are still unresolved as a matter of Supreme Court jurisprudence. Although Justice Thomas’ majority opinion made clear that plaintiffs seeking to bring ATS claims must allege substantial conduct within the United States to avoid dismissal of their claims, it remains unclear what types of international law violations will be considered actionable under the ATS going forward.
The consolidated cases are Nestlé USA, Inc. v. Doe I, et al. (Docket number 19-146) and Cargill, Inc. v. Doe I, et al. (Docket number 19-453). The Supreme Court opinion can be found here.
The Withers team is led by partner Emma Lindsay and includes senior associates Jovana Crncevic, Camilla Gambarini and Joseph Gallo, and paralegal Lalindra Sanichar.