An American court blocks human-rights suits against businesses
Oct 7th 2010
WHEN lawyers for a group of Burmese villagers used an obscure American law in 1996 to sue Unocal, an oil company, for using forced labour and other abuses while constructing a pipeline in Myanmar, human-rights campaigners saw a new way of attacking companies (as opposed to their executives in person) for misdeeds abroad. A flurry of headline-grabbing suits followed. Nine Nigerians, including relatives of Ken Saro-Wiwa, a playwright, accused Shell of complicity in human-rights abuses. Vietnamese villagers sued Dow Chemical and others for injuries caused by the Agent Orange herbicide.
This avenue was abruptly closed recently when the second circuit Court of Appeals in New York ruled on September 17th that corporations could not be held liable under the Alien Tort Claims Act for breaches of international law abroad. Businesses had long argued this, but no American court had ruled clearly on the issue before. Both companies and their accusers reckoned that the courts treated the principle of liability as a given.
The decision, if upheld, will bring new clarity and an end to such lawsuits. But until all avenues of appeal are exhausted, the precedent will not be firmly set. The Supreme Court declined on October 4th to rule immediately on the specific question of whether corporations could be held liable under international law. It had been asked to do so by Talisman Energy of Canada, which won a case brought by Sudanese plaintiffs who accused it of conspiring with their government to commit genocide.
Read the full article here.
If this decision is upheld, it will be a blow to efforts to hold corporations accountable for profiting from slavery, forced labor, and child labor. I find the ruling particularly ironic, given that the Supreme Court recently rule that the government cannot restrict an individual's free speech rights for being incorporated; like Judge Pierre Leval who wrote the dissent for this New York case, I wonder why individuals are exempt from civil liability for slave trading if they are incorporated. As The Economist points out, regardless of the US' decision, other countries may continue to hold corporations accountable. However, if the US wishes to address the root causes of slavery and other human rights abuses, it must also hold corporations accountable.