Academic journal article Suffolk Transnational Law Review

Will the Real ATS Please Stand Up?

Academic journal article Suffolk Transnational Law Review

Will the Real ATS Please Stand Up?

Article excerpt


In many impoverished and remote areas of the world, multinational corporations enter into joint ventures and other commercial arrangements with governments that have poor human rights records. Then, protected by their government partners, the corporations engage in business practices far below the standards expected in the West. Both the multinationals and their host government partners focus solely on maximizing the profits of their joint venture with little concern for the operational effects borne by the local population or environment. The activities of the corporations in the developing world frequently contradict the codes of conduct that they publicly espouse. Host governments lack incentives to enforce any existing regulatory systems that might reduce profits. The host communities lack the power and opportunity to oppose these practices. All too frequently the partner governments are ready to use unrestrained force to suppress criticism and protect the corporate operations in which they have an interest.

Legal developments in the United States, however, provide a framework through which the most egregious human rights violations by multinational corporations may be addressed. For example, in a 1997 case, Doe v. Unocal, (1) the U.S. District Court for the Central District of California determined that under the Alien Tort Claims Act (ATS), a U.S.-based energy company engaged in a joint pipeline project with Burmese government officials could be held accountable for forced labor and other human rights abuses committed while advancing the project. (2)

From the landmark decision in Unocal to present ATS cases against corporate defendants, spokespersons for the business community have warned the litigation would have negative consequences for the competitive position of U.S. business, as well as on the global economy as a whole. The U.S. government frequently joins in the protests against corporate ATS cases, arguing that they impair the government's response to the "war on terror." Some foreign governments also complain about what they consider challenges to their sovereignty. This essay explores the gap between such predictions regarding the effects of the ATS litigation and its demonstrable consequences.


The human rights cases filed against corporate defendants are part of a developing ATS jurisprudence. The ATS is a one- sentence statute enacted as part of the Judiciary Act of 1789 that provides federal court jurisdiction for tort claims brought by aliens for violations of customary international law and treaties. (4) In the late 1970's, in Filartiga v. Pena-Irala (5), lawyers from the Center for Constitutional Rights used the largely-forgotten ATS to sue a former Paraguayan police officer for torturing a Paraguayan citizen to death. In that case, the Second Circuit held that the ATS authorized claims for violation of international human rights. (6) The Filartiga case laid the foundation on which the Unocal decision rests.

Two more legal advances were necessary to support the litigation against corporate defendants involved in human rights violations under the ATS. The defendant in Filartiga was the direct perpetrator of torture. Human rights claims against corporations, however, rarely allege that the corporate defendant engaged directly in the human rights abuses. (7) Because most ATS claims against corporate officials are based on their complicity in the direct human rights violations of a third party, the possibility of vicarious liability under the ATS was a necessary element for the majority of ATS corporate cases. The possibility for vicarious liability under the ATS was recognized in a series of cases against the former dictator of the Philippines, Ferdinand Marcos, and his daughter. (8)

The Second Circuit decision in Kadic v. Karadzic (9) provided the final prepatory step necessary to corporate ATS cases. …

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