In cases where corporations participate in serious human rights abuses, the Alien Tort Statute (ATS) can provide a remedy to the victims of such abuses and can help deter such abuses in the future. The Kiobel case could change that, leaving these victims with no remedy, and leaving corporations free to participate in and profit from human rights abuses.
In 1997, a federal court first allowed an ATS case against a corporation to proceed. Doe v. Unocal, a case brought by EarthRights International and the Center for Constitutional Rights, alleged that the oil company Unocal had hired the brutal Burmese military to provide security for its natural gas pipeline project in Burma (Myanmar), resulting in a wave of abuses against local villagers including rape and other torture, forced labor, and extrajudicial killing. Since then, several other cases have been brought where corporations assist in (and profit from) the commission of gross human rights abuses.
For over a decade, no court ever questioned whether corporations were obligated to follow international human rights law. No one suggested that corporations had any special rights that ordinary human beings do not have. That all changed in 2010, when the Second Circuit Court of Appeals ruled in Kiobel v. Royal Dutch Petroleum that corporations could not be sued for human rights abuses under the ATS. Under this ruling, a company that engages in slave trading could not be sued for it; the company executives and employees might be subject to liability, but the corporate bank accounts would be safe.
The Kiobel ruling came under heavy criticism from scholars, activists, and numerous judges, including judges on the Second Circuit as well as four other federal Courts of Appeals. Its factual basis and legal reasoning has been thoroughly dismantled. The Supreme Court will now decide whether Kiobel stands, and will end all ATS cases against corporations, or whether victims will continue to be able to seek justice against corporate human rights abusers.
Kiobel comes at a time when corporate accountability is on the rise in international law. In 2011, the United Nations Human Rights Council approved Guiding Principles on Business and Human Rights, which set out for the first time a set of guidelines for corporations to respect human rights. The U.N.’s work on business and human rights has repeatedly pointed to the ATS as a model for corporate accountability, and international legal scholars have suggested that more nations adopt similar mechanisms.