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Commercial Litigation and Arbitration

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No Corporate Liability under Alien Tort Claims Act

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From Kiobel v. Royal Dutch Petroleum Co., 2010 U.S. App. LEXIS 19382 (2d Cir. Sept. 17, 2010):

Once again we consider a case brought under the Alien Tort Statute ("ATS"), 28 U.S.C. § 1350, a jurisdictional provision unlike any other in American law and of a kind apparently unknown to any other legal system in the world. Passed by the first Congress in 1789, the ATS laid largely dormant for over 170 years. Judge Friendly called it a "legal Lohengrin" — "no one seems to know whence it came."2 Then, in 1980, the statute was given new life, when our Court first recognized in Filartiga v. Pena-Irala that the ATS provides jurisdiction over (1) tort actions, (2) brought by aliens (only), (3) for violations of the law of nations (also called "customary international law") including, as a general matter, war crimes and crimes against humanity--crimes in which the perpetrator can be called "hostis humani generis, an enemy of all mankind."

Since that time, the ATS has given rise to an abundance of litigation in U.S. district courts. For the first fifteen years after Filartiga — that is, from 1980 to the mid-1990s--aliens brought ATS suits in our courts only against notorious foreign individuals; the first ATS case alleging, in effect, that a corporation (or "juridical" person) was an "enemy of all mankind" apparently was brought as recently as 1997. ***

A legal culture long accustomed to imposing liability on corporations may, at first blush, assume that corporations must be subject to tort liability under the ATS, just as corporations are generally liable in tort under our domestic law (what international law calls "municipal law"). But the substantive law that determines our jurisdiction under the ATS is neither the domestic law of the United States nor the domestic law of any other country. By conferring subject matter jurisdiction over a limited number of offenses defined by international law, the ATS requires federal courts to look beyond rules of domestic law — however well-established they may be — to examine the specific and universally accepted rules that the nations of the world treat as binding in their dealings with one another. As Judge Friendly carefully explained, customary international law includes only "those standards, rules or customs (a) affecting the relationship between states or between an individual and a foreign state, and (b) used by those states for their common good and/or in dealings inter se." ***

In short, because customary international law imposes individual liability for a limited number of international crimes — including war crimes, crimes against humanity (such as genocide), and torture — we have held that the ATS provides jurisdiction over claims in tort against individuals who are alleged to have committed such crimes. As we explain in detail below, however, customary international law has steadfastly rejected the notion of corporate liability for international crimes, and no international tribunal has ever held a corporation liable for a violation of the law of nations.

We must conclude, therefore, that insofar as plaintiffs bring claims under the ATS against corporations, plaintiffs fail to allege violations of the law of nations, and plaintiffs' claims fall outside the limited jurisdiction provided by the ATS.

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New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.
New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.

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