Wednesday, October 11, 2017

Win the Battle, Lose the War…  Oral Argument Analysis of Jesner v. Arab Bank

by Jena Martin, Professor, West Virginia University College of Law, guest contributor

On Wednesday October 11th, the Supreme Court heard oral arguments in the case of Jesner v. Arab Bank, a case that will decide whether plaintiffs have the right to sue corporations for human rights violations under the Alien Tort Statute (ATS).  The Court heard arguments from the Petitioner, the Respondent and the Solicitor General as a friend of the court.

During the Petitioners’ argument, very little time was actually used discussing the heart of the Court’s purpose for granting cert:  namely whether a corporation, simply by dint of its corporate status, was outside the scope of ATS.  Perhaps this lack of focus was because, as Justice Ginsburg brought up during Petitioner’s time (and which was echoed and expanded upon again by Justice Kagan during her questioning of the Respondent) there seems to be little logical difference between an individual or a corporation for the purposes of tort liability.   As Justice Ginsburg put it succinctly, “what I don’t comprehend is why you would split individual and corporation [in ATS litigation]?” 

Why indeed.

However, if the Solicitor General’s argument is any indication, even if that question gets decided in favor of the Petitioner, the human rights advocates may not be rejoicing. 

Acting as a friend of the court – Assistant Solicitor General Fletcher unequivocally sided with the Petitioners by arguing that there is no distinction between corporations and individuals under the ATS. However, Fletcher also stated that, while “for present purposes, all we’re asking the Court to do … is say there is no categorical bar on corporate liability,” in the future they would “urge the Court to indicate [on remand] that the Second Circuit ought to address [the] very serious extraterritoriality issue.” According to Fletcher, further limiting the reach of the ATS as, he argued, “this court had begun to do in Kiobel” would limit the international friction that he claimed often accompanies these types of cases. 

Of course, the Solicitor General’s suggestion – remanding to the Second Circuit with instructions – would be one way that the Court could further limit the use of the ATS.  However, another way could be to order re-arguments in the case, asking the parties to once again address the issue of extraterritoriality.

Although that would be an unusual step to take, the Court did precisely that the last time the ATS was before it in Kiobel v. Royal Dutch Petroleum (2013). Ironically, the original question before the Court in that case was whether corporations could be sued under the ATS in the same way that individuals can (the precise issue now before it in Jesner).  However, a week after the original arguments in Kiobel, the Court ordered additional arguments on whether the ATS could be used when the violations happened on foreign soil.  As a result of the second round of arguments, the Court subsequently held that so called foreign cubed cases – namely ATS claims that arise on foreign soil and where both the defendant and the plaintiff are foreigners – are outside the ambit of the statute. 

It would seem that the Solicitor General would now have the Court again reopen arguments to further limit the scope of the ATS. Moreover, if the questioning today from the conservative portion of the bench is any indication (Roberts, Alito, and Gorsuch all had questions that either involved: (1) the scope of extraterritoriality; (2) the prospect of foreign entanglement or; (3) the foreign nationality of the defendant)  – the Solicitor General’s office may just get its wish.  If that happens, then the ATS will most likely be made moribund for future victims of human rights abuses – whether the defendant is a corporation or not.

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