On Dec. 1, 2020, the Supreme Court heard oral arguments in Nestlé USA, Inc. v. Doe I (and the companion case Cargill, Inc. v. Doe I) to determine when a U.S. company can be sued for alleged violations of international human rights abroad under the Alien Tort Statute (ATS). This case addresses two questions relating to the ATS: First, does the ATS allow plaintiffs to overcome the traditional bar on extraterritorial application in a case alleging an American corporation aided and abetted slavery and forced labor abroad? And second, does the judiciary have the authority under the ATS to impose liability on a domestic corporation?
The ATS reads, “The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” In Nestlé and Cargill, the plaintiffs are six citizens of Mali who claim they were kidnapped and sold to cocoa plantations along the Ivory Coast as children. The plaintiffs allege that at the plantations they were forced to work long hours without pay and little food and they were subjected to torture and beatings. The plaintiffs contend that Nestlé USA and Cargill, both U.S.-based companies, aided and abetted these human rights abuses by continuing to source cocoa beans from the offending plantations, even though the companies knew of the child slavery and abuse.
The Nestlé case has been ongoing for more than a decade with both Cargill and Nestlé as defendants in the single case, splitting only recently during cert petition. Filed originally in 2005, the case was dismissed in 2010 by Judge Stephen V. Wilson of the U.S. District Court for the Central District of California, who explained that corporations could not be sued under the current understanding of the ATS. However, in 2013, the U.S. Court of Appeals for the Ninth Circuit vacated Wilson’s decision, giving the plaintiffs leave to amend their complaint in light of the ATS-related developments of Kiobel v. Royal Petroleum Co. Again, on remand, Wilson dismissed the plaintiffs’ lawsuit in 2017. At that time, Wilson held the plaintiffs’ claims do not “touch and concern” the United States enough to override the presumption against extraterritorial application of U.S. laws, as required in Kiobel. On appeal, the Ninth Circuit reversed the dismissal. Nestlé and Cargill filed petitions for review by the Supreme Court after being denied an en banc hearing, and the Supreme Court granted cert in July.
In Nestlé’s brief and Cargill’s brief, the defendants argue the plaintiffs’ suit should be dismissed as it does not meet the requirements of the ATS. The defendants argue that under Kiobel, a suit must “touch and concern” the U.S. with “sufficient force to displace the presumption against extraterritoriality.” The defendants claim this forecloses the suit as plaintiffs’ alleged injuries all occurred internationally at the hands of others not directly affiliated with Nestlé or Cargill. They also cite Sosa v. Alvarez-Machain (2004), in which the Supreme Court acknowledged the ATS could provide a cause of action for violations of international law, but the court imposed a strict test. Under the Sosa test, causes of action from the ATS can be recognized only if, first, there is a “specific, universal, and obligatory” international law norm related to the activity and, second, if policy concerns do not negate the recognition of that cause of action. The defendants contend plaintiffs fail both steps of Sosa. Finally, the defendants argue that under the Supreme Court’s reasoning in Jesner v. Arab Bank, PLC (2018), which ruled that foreign corporations could not be subject to suits in U.S. courts under the ATS, domestic corporations should also not be subject to judicially imposed liability.
The plaintiffs, in their response brief, argue that holding the defendants accountable for aiding and abetting slavery along the Ivory Coast is directly in line with the purpose of the ATS. The plaintiffs furthermore do away with the arguments related to Kiobel and Jesner by noting that those cases involved ATS claims with limited connections to U.S. citizens or U.S. territory. “Unlike those cases,” the plaintiffs argue, “this case concerns violations by U.S. citizens from U.S. territory where no foreign state could complain about the United States holding its citizens accountable for such violations.” And finally, the plaintiffs assert aiding and abetting slavery satisfies Sosa step one, and Congress’s creation of corporate liability in the Trafficking Victims Protection Reauthorization Act (TVPRA) rejects any Sosa step two policy arguments against finding liability here. In other words, the plaintiffs argue their claim, of aiding and abetting child slavery, meets the Sosa requirements to be recognized as a cause of action under the ATS. In reply briefings, Nestlé and Cargill reiterate their original arguments and urge the justices to not “open U.S. courts to a broad range of ATS lawsuits.”
If you’d like to listen to the oral argument yourself you can find it here, but if not, here is a summary of the approximately 90-minute session.
Oral Arguments for the Defendants
Neal Katyal, representing Nestlé and Cargill, began by outlining the historical usage of the Alien Tort Statute. He argued that expanding the ATS in the way the plaintiffs seek to do in this case would be contrary to “[h]istory and [the] Court’s cases.” Chief Justice John Roberts followed up, asking why the court should be concerned with the effects on international relations, as the case involves U.S. companies in U.S. courts. Katyal responded by noting that the test, under RJR Nabisco, Inc. v. European Cmty (2016), is not whether international friction will occur with a decision, but whether there is “the potential” for it to occur. Katyal also cited Jesner, referencing the plurality’s concern that the plaintiffs could use corporations as “surrogate defendants to challenge corporate governance.” Roberts pushed back, saying that the concern could be addressed by addressing the standards of aiding and abetting. Katyal agreed that would be a potential solution but argued that if the court were to recognize corporate liability in these situations, it may allow people to “end run around Jesner.”
Justice Clarence Thomas came next. He asked Katyal whether the defendants agreed with “the D.C. Circuit and Fourth Circuit that there is a universal norm on aiding and abetting liability.” Katyal responded that they do not and that if such a norm were recognized, “you’d be left with an extremely broad statute with no congressional analog.” Thomas further questioned Katyal on a universal norm against slavery, to which Katyal contended that the claim hinged not on a norm against child slavery but, rather, on a norm against aiding and abetting child slavery. Katyal said the latter does not exist.
Justice Stephen Breyer brought the conversation back to corporate liability, presenting a hypothetical, based on the Marbois affair of 1784. The Marbois affair involved a French adventurer who assaulted the secretary of the French Legion in Philadelphia. At the time, because of the citizenship of the parties involved and the location of the incident, there was no legal remedy for the assault. This incident led, in part, to the adoption of the ATS. In Breyer’s hypothetical, the president of a corporation decides he wants to hit the French secretary, but instead of doing it himself, he has his corporation pass a resolution to hit the French secretary, and then an agent of the corporation goes out and does so. Breyer then asked Katyal why a corporation should receive a shield from liability under the ATS that an average person would not. Katyal responded that corporations, unlike individuals, receive some protection from liability because there is a separate remedy of going after the individual, and corporate liability comes with additional legal difficulties, such as proving mens rea.
Next was Justice Samuel Alito, who posed another hypothetical involving a corporation that hires agents in Africa to kidnap and enslave children on agricultural plantations to keep prices low on those products. He asked Katyal if that case should be thrown out in U.S. courts. Katyal responded that those facts are far removed from the facts of the present case, but he also said that, under those facts, the victims should have redress through other statutes that are not the ATS. Katyal also noted, “five different mechanisms” that would prevent that type of abuse: foreign law, specific liability under statutes like the Genocide Convention, barring goods from entering the U.S., U.S. liability for an individual acting as a principal and the ability of Congress to pass a specific remedy.
Justice Sonia Sotomayor pointed to the history of the ATS, saying Congress wanted it to cover piracy, including the people who assisted those pirates. She asked Katyal why, given the legislative history, “the ATS would not have seen aiding and abetting as its own form of criminal liability” as he appeared to be arguing. Katyal answered that piracy is a “category unto itself” due to the unique jurisdiction of the seas. Sotomayor pushed back that the location of the crime, on land or sea, should not matter to aiding and abetting. Katyal said piracy is different because there are not multiple sovereigns involved, as there are in the present case.
Up next was Justice Elena Kagan, who asked Katyal if child slavery is a violation of a universal norm; he agreed. Kagan then asked if a former child slave could use the ATS to bring a suit against an individual slaveholder, and Katyal agreed again. Kagan continued, asking if that same former child slave could bring a suit against 10 individual slaveholders, and Katyal acknowledged they could. So what difference does it make if those 10 individual slaveholders form a corporation, Kagan asked. Katyal responded that corporations require a different form of liability, one not present in this case. Kagan pushed back, asking, “What sense does this make?” And Katyal answered, again citing the ability to go after individual wrongdoers and the difficulty of proving mens rea when it comes to corporations. Kagan then pointed to an amicus brief from Oona Hathaway of the Yale Law School Center for Global Legal Challenges that detailed the history of imposing liability on slave ships, which were not individuals. Katyal said that Congress can choose to expand on corporate liability, but that it has not done so in the present situation.
Justice Neil Gorsuch followed up on Kagan’s questioning, asking why the court should exempt corporations from the rationale of the ATS. And Katyal said there is no “specific obligatory norm” under the law of nations to hold corporations accountable for aiding and abetting slavery. Gorsuch pushed further, again asking why, if there was in rem jurisdiction against pirate ships under the ATS, the same concept should not apply to corporate liability. Katyal said that this instance does not rise to the level of a specific universal obligatory norm, as outlined in Jesner.
Justice Brett Kavanaugh next asked why, given the ATS was “once an engine of international human rights protection,” the court should limit its use to suits against individuals. Kavanaugh also pointed to an amicus brief on behalf of former government officials that said the defendants’ position would “gut the statute.” Katyal admonished the claim as “overheated rhetoric,” explaining that the defendants are arguing for the status quo and that another branch of government could change the law if they wanted.
Finally, Justice Amy Coney Barrett began her questioning. She asked Katyal if he thought this case would be better resolved at “Sosa step two.” As previously mentioned, Sosa step two requires courts to consider any policy concerns related to the recognition of a new cause of action. Katyal answered that he thought the evidence bleeds from step one (which concerns whether the alleged activity violates a specific, universal norm) into step two, but that at either step, the defendants should win. Barrett followed up, asking that if this case was resolved by Sosa step two, when there would ever be a chance again for the court to recognize a cause of action, since there is always a separation of powers issue where policy questions may be better left to Congress. Katyal explained that he believes certain crimes could rise to the level of universality required under Sosa. Katyal noted that crimes now considered universal violations of human rights, like genocide, torture and war crimes, were not part of the original Blackstone Three, which were three categories of crimes—violation of safe conducts, infringement of the rights of ambassadors, and piracy—considered to be against the laws of nations as outlined by William Blackstone in “Commentaries on the Laws of England.” Barrett pushed further, asking if there would still be no cause of action for those crimes if the party that sued was a corporation. Katyal answered that, yes, “[i]t wouldn’t be corporate liability.”
In closing, Katyal once again noted that the facts of the present case were not as egregious as the facts presented by the justices in their hypotheticals. He also noted that the court has always proceeded with “great caution” when deciding to create a new cause of action and that if this cause of action was recognized, the defendants fear it would snowball, causing harm to U.S. foreign policy and the doctrine of separation of powers.
Oral Arguments of the United States, as Amicus Curiae
Curtis E. Gannon came next, representing the U.S. government as amicus curiae supporting the defendants. He began his argument by noting the United States condemns child slavery and trafficking but further argued the court should not expand the ATS to encompass plaintiffs’ claims. Gannon said expanding corporate liability should be the duty of Congress, not the judiciary. He also noted that aiding and abetting a crime, the conduct alleged by the plaintiffs, does not overcome the bar against extraterritorial application.
Chief Justice Roberts asked the same question to Gannon as he did Katyal: Why, if there are no objections from foreign countries, can’t U.S. corporations be hauled into U.S. courts? Gannon answered similarly to Katyal, that although there is not an international issue in this case, recognizing this cause of action could open up those issues in the future. The chief justice next asked a clarifying question about what conduct constituted “touch and concern” as those terms are laid out in Kiobel—that is, what conduct would be sufficiently connected to the U.S. to overcome the presumption against extraterritoriality. Gannon said the “touch and concern” aspect is focused more on the conduct in question and not on the citizenship of the parties.
Justice Thomas came next, pressing Gannon on the fact that, in the past, the government had argued the corporate form shouldn’t make a difference in a case. Gannon acknowledged that the government had previously urged the Supreme Court not to categorically eliminate corporate liability under the ATS. But he said here that the government is trying to be consistent with the Supreme Court’s precedents set in Jesner and the court’s usual approach to be cautious with extensions of liability (such as under Bivens). Gannon argued further that it would be unfair to “discriminate on the basis of the defendant’s nationality in the corporate context” since the Supreme Court held in Jesner that foreign corporations could not be sued in the U.S. using the ATS.
Justice Breyer simply asked, “What’s new about suing corporations?” And Gannon answered that, in Jesner and Malesko, the Supreme Court recognized that extending liability to a corporation is, in fact, a serious extension. Breyer pushed back that there are “many [suits]—tens, hundreds perhaps ... brought against corporations under the ATS.” Gannon said many of those suits should now be thrown out under Jesner because they involve foreign corporations. Gannon also outlined other statutes in which Congress considered extraterritorial liability, such as the Trafficking Victims Protection Act, which recognizes corporate liability but is different from the ATS in that it explicitly does so and does not discriminate between domestic or foreign corporations.
Up next, Justice Alito asked Gannon if there are any modern suits under the ATS that involve entirely domestic conduct. Gannon replied that he is not familiar with any, and Alito continued by asking if the defendants’ request to block aiding and abetting liability would have the same effect as holding that a domestic corporation cannot be sued under the ATS at all since corporations will always act through agents. Gannon answered that there will be some activity that could fall under respondeat superior liability and that Congress could always extend civil liability for specific types of extraterritorial conduct.
Justice Sotomayor once again raised her question about the crime of facilitating piracy and why the ATS should not be similarly considered for aiding and abetting slavery. Gannon answered that he was not arguing that aiding and abetting slavery is not against international norms but, rather, that the court should be cautious in extending liability to corporations. Sotomayor admonished Gannon, saying his answer “is more nuanced” than the government’s brief. She then followed up: “I just do not understand why international law would not have seen that as a proper exercise of our power to say that our domestic corporations cannot aid and abet in the United States and be held liable under the ATS.” Gannon briefly answered that the Supreme Court had previously recognized that a congressional acknowledgment of primary civil liability was not a recognition of aiding and abetting liability.
Justice Kagan next asked Gannon why another country would be more offended by the U.S. holding a U.S. corporation liable for aiding and abetting extraterritorial crimes than by leaving a foreign victim without remedy for injuries caused by a U.S. corporation. Gannon said that civil liability under the ATS is not the only way for Congress to hold U.S. citizens responsible for international crimes.
Justice Gorsuch declined to ask questions, so Justice Kavanaugh was up. Kavanaugh noted that Sosa instructs courts to give weight to the executive’s view on how the case could impact foreign policy. He asked Gannon if Gannon believed this case would have such an impact. Gannon said the government was presenting a more general argument about the ATS under Sosa step two, but that if this case was allowed, future cases brought up on similar causes of action could have a bigger impact on foreign affairs.
Justice Barrett ended Gannon’s argument by questioning why aiding and abetting an international crime should not be considered the conduct of interest for the “touch and concern” test. Gannon answered that if the actual tort occurred abroad, then the focus of the conduct should be where the tort was, regardless of whether or not planning or other activities occurred domestically.
In closing, Gannon argued that concerns that “political branches have not moved quickly enough” to resolve issues was not a license for the court to expand liability under the ATS. Gannon also argued that the court should not adopt different rules for domestic versus foreign corporations.
Oral Arguments for the Plaintiffs
Plaintiffs were up next, represented by Paul L. Hoffman. Hoffman opened his argument by stating that the original purpose of the ATS was to provide a federal forum for foreign nationals to bring cases involving violations of the laws of nations. Hoffman also argued that the prohibition on child slavery and forced labor is a universal and obligatory norm, which applies to individuals and corporations. Hoffman distinguished Kiobel and Jesner by pointing out the present case does not assert jurisdiction over a foreign corporation but, instead, focuses on U.S. jurisdiction over a U.S. corporation.
The chief justice was the first to question Hoffman, and he asked why the present case does not raise the same international relations concerns as Jesner or Kiobel if the case will still involve overseas conduct and could potentially bring foreign nationals into U.S. courts. Hoffman answered that this case, like most transnational litigation, will involve nondomestic individuals and evidence, but that no country has objected to the U.S. asserting jurisdiction here. Roberts followed up further, noting that Congress usually addresses, and has addressed in the TVPRA, the type of liability-extension question the plaintiffs are asking the court to resolve here. Hoffman said that yes, the TVPRA provides a solution for similar cases from 2008-forward, but that the current case occurred prior to the TVPRA and so has only the ATS to rely on. Hoffman also said the existence of the TVPRA resolves the Sosa step two problems that the defendants argue.
Justice Thomas came in, asking that since the Torture Victim Protection Act (TVPA) does not allow for aiding and abetting liability, why the court should read that into the ATS, if they are so similar? Hoffman said: “Congress made it very clear when it passed the TVPA that it was complementary to the Alien Tort Statute and was not meant to displace it in any way.” Hoffman also said that it is not clear that the TVPA would not allow aiding and abetting cases to be brought, only that the court in Mohamad v. Palestinian Authority (2012) made clear the TVPA does not allow for corporate liability. Hoffman also said the most analogous statute is not the TVPA, but the TVPRA, which does allow for corporate liability for benefiting from forced labor and slavery in a supply chain. Thomas then asked for clarification on whether there is an international norm against aiding and abetting child slavery in the civil context, or only in the criminal context. Hoffman said that the international community has formulated specific universal and obligatory norms and that the plaintiffs believe aiding and abetting violations of human rights would fall within these norms. Hoffman argued that all circuits that have considered this question have also found aiding and abetting liability in ATS claims but have varied in the standards required.
Justice Breyer followed Thomas and asked Hoffman, assuming there is aiding and abetting liability, what actions would count as aiding and abetting for the purpose of the ATS? Breyer expressed concern that expanding aiding and abetting liability for actions similar to the ones alleged by the plaintiffs “could have very, very significant effects.” Hoffman explained that a court, upon reviewing the facts, should decide, using the international principles of aiding and abetting, whether the defendants have “crossed the line between merely doing business and facilitating” child slavery through their support of a supply chain based on that system. Hoffman also pointed to an amicus brief by Tony’s Chocolonely, a U.S. subsidiary of a Dutch chocolate company that, like the defendants, sources its cocoa from the Ivory Coast. The amicus brief illustrates how similarly situated companies source cocoa beans without facilitating child slave labor.
Next was Justice Alito, who asked Hoffman what the mens rea of the defendants is regarding forced child labor. Alito pointed to the plaintiffs’ brief as saying that the defendants “knew or should have known” the farms they were sourcing cocoa from relied on forced child labor. He then asked if the plaintiffs can only prove the defendants “should have known” about the child slavery and whether that is enough for aiding and abetting liability under U.S. or international law. Hoffman said “should have known” mens rea would not satisfy the international standards for aiding and abetting, but he also argued that the plaintiffs contend the defendants did know what was occurring in their supply chain. Alito pushed back, asking where in the complaint he could find that contention. Hoffman answered that the plaintiffs have “alleged knowledge,” which the U.S. Court of Appeals for the Ninth Circuit said satisfied the knowledge and purpose standard for aiding and abetting allegations. Alito pressed further, asking where specifically the allegation of knowledge is in the complaint. Hoffman answered that the plaintiffs have alleged that the defendants are “intimately involved” in the cocoa farms and send investigators out to the locations who then file reports back at headquarters. Alito did not let Hoffman off easy, saying, “So after 15 years, is it too much to ask that you allege specifically that ... the defendants who are before us here specifically knew that forced child labor was being used on the farms ... ?” Hoffman responded that the Ninth Circuit had given the plaintiffs leave to amend their complaint, and they have more information now than what was outlined in the second complaint.
Justice Sotomayor inquired into what evidence the plaintiffs allege that proves the defendants aided and abetted child slavery, beyond simply sending representatives to investigate cocoa farms. Hoffman said the plaintiffs’ position is that the U.S. corporations, from their domestic headquarters, controlled “every aspect of the supply chain.” Sotomayor asked for clarification on what “control” means, and Hoffman explained he believes the corporations directed activity on the ground in the Ivory Coast, by sending representatives and setting up cooperatives there. Sotomayor pressed further on what detailed acts the plaintiffs believe the defendants engaged in to constitute aiding and abetting. Hoffman answered that there are “exclusive marketing relationships,” that “money is sent from headquarters, equipment is arranged from headquarters, [and] training is arranged for by headquarters.”
Justice Kagan asked Hoffman to explain why, contrary to the government’s position in the case, Jesner did not make it impossible to hold domestic corporations liable under the ATS. Hoffman said that considerations under Sosa step two justified eliminating liability against foreign corporations and that such concerns do not exist for domestic corporations. Kagan further asked Hoffman to expand on what pieces of Jesner (she noted that some parts of Jesner have majority support, while others only have a plurality) are controlling to answer the questions asked in the present case. Hoffman said he does not believe there is a controlling majority in Jesner on how to approach corporate liability for child slavery under the ATS. Hoffman said that, instead, he thinks corporate tort liability was well established and understood to the Founders when the ATS originated and that corporate tort liability was a method the first Congress thought courts could use to “enforce the law of nations.”
Justice Gorsuch’s first question focused on the creation of a new cause of action. He asked Hoffman why the court should infer a new cause of action for aiding and abetting as the plaintiffs request, instead of leaving that job to Congress. Hoffman answered that the Supreme Court in Sosa noted that the authorization given by the first Congress to courts to enforce the laws of nations through common law methods was “still viable.” Hoffman continued, explaining that the only requirement for the continued recognition of causes of actions based on the laws of nations was that there be a specific and universal obligatory norm, which the prohibition on child slavery is. Hoffman also contended that the first Congress passed the ATS to provide a remedy for U.S. citizens injuring foreign citizens, and would not have wanted to restrict that liability in the way the defendants argue.
Justice Kavanaugh focused his first question on the separation of powers, asking if the courts should be the avenue to find a new cause of action, such as the one presented in this case. Pointing to Footnote 20 in Sosa, Kavanaugh said he does not believe corporate liability is a specific universal and obligatory norm as the plaintiffs claim. Hoffman said he believes Sosa’s Footnote 20 was addressing the distinction between norms for private parties and norms that required a connection to state action. Hoffman said he does not think Sosa needed corporate liability to be a specific universal and obligatory norm. Instead, Hoffman said, corporate tort liability is a “general principle of law.” Kavanaugh ran out of time, but he noted that corporate liability is not in statutes like the TVPA, questioning whether it is really a principle of law then.
Justice Barrett brought the questioning of Hoffman to a close. Referencing his answer to Kagan about the purpose of the ATS, Barrett asked what Hoffman sees as the potential foreign policy implications as a result of the court failing to recognize a cause of action in cases like this. Hoffman said, since it is not clear whether there is or is not a forum, the Ivory Coast would not have a reason to protest yet. However, Hoffman made clear that the ATS was designed to provide a forum for foreign nationals to redress harm imposed on them by U.S. citizens. Barrett also noted Katyal’s argument for the defendants that domestic corporations often have relationships through foreign subsidiaries and the like that could implicate the concerns that Jesner ultimately found made foreign corporate liability under the ATS unallowable. Barrett asked if Hoffman believed allowing domestic corporate liability under the ATS would provide a “run around Jesner.” Hoffman responded that Jesner would actually block finding liability for U.S. corporations whose harmful activity was controlled by foreign companies, but he clarified that is not the case with Cargill and does not appear to be the case with Nestlé.
Hoffman closed his argument for the plaintiffs by explaining that their claims satisfy the requirements of Sosa and “fit squarely within the text, history, and purpose of the ATS.” He again noted that child slavery is a fundamental violation of international law and ended by requesting the court to allow the plaintiffs “their day in court.” In rebuttal, Katyal made four points. His first point was that the present case is not about the abhorrence of child slavery but, rather, is about whether the ATS allows corporations to be sued for extraterritorial harms. His second point noted that Congress can fashion specific remedies for human rights abuses, but it did not do so with ATS liability and child slavery. In his third point, Katyal claimed the plaintiffs did not meet Sosa’s burden of proving a universal norm exists. And Katyal’s final point was that Congress sometimes uses corporate liability, though not always. And, regardless, Katyal argued, the Supreme Court “should defer to Congress.”