Bush vs. Alien Torts

Unocal argues that California courts do not have the jurisdiction to hear the case, and that the laws of Burma (an oppressive dictatorship) or Bermuda (a lovely tax haven) law should apply to the case. Superior Court Judge Victoria Gerrard Chaney, however, rejected the idea of applying Myanmar’s law, pointing out that “there is no effective rule of law” under a military dictatorship. Chaney also ruled out Unocal‘s idea of using Bermuda law:

“She ruled that California law should apply because the state would be harmed more than Bermuda if its laws were not applied.”

The case was brought under the Alien Tort Claims Act of 1789, which allows federal courts to hear “any civil action by an alien for a tort only, committed in violation of the law of nations,” — which has been interpreted to mean that aliens can sue in US courts for gross abuses of human rights. The law is unsettling multinationals that do business with unscrupulous regimes around the world. Other companies such as Chevron, Shell, and Talisman Energy have cases pending against them for complicity with human rights abuses in developing countries.

The alarmed companies seek a reinterpretation of the law, even though to date not a single dollar has been awarded in any ATCA claim against a multinational. The corporations worry that scores of lawsuits will put a drain on profits. Katrin Dauenhauer of IPS News reports that the International Institute of Economics (IIE) is predicting that the sky will fall if the ATCA is not tamed. The IIE foresees :

“‘…the disruption of over 300,000 jobs in the United States and two million jobs elsewhere, the loss of more than 300 billion dollars in global trade and investment, and a 70-billion-dollar drop in world economic output if Congress does not pass new legislation to clarify and limit the scope of the centuries-old law.'”

These numbers are based on a “nightmare scenario” that posits that almost every major company that has done business with China would be taken to court under ATCA for complicity in Beijing’s human rights abuses. The nightmare ignores the reality that most ATCA claims are dismissed.

Big business wants ATCA changed. Harold Hongju Koh, a law professor at Yale, says, “The corporate hysteria about the ATCA is really something to see. We’re talking about a litigation trend that has led to zero cents in damages, and based on this they want the statute repealed?” Human rights activists see the corporate angst as part and parcel of Bush’s attack on the ATCA, as Dauenhauer writes:

“The administration of President George W. Bush recently has come to the defense of some of the companies sued under the statute, arguing that the lawsuits interfere with foreign policy and that the law has been ‘commandeered’ to allow cases being heard that had ‘no connection whatsoever with the United States.’

In what human rights groups see as a frontal assault on the law, the State Department wrote a submission on behalf of Unocal to dismiss a suit against the California-based oil giant, saying the action stretches the law beyond anything its authors would have recognized and undermines the ‘war on terrorism.'”

The logic gets convoluted: a California-based company shouldn’t address allegations that it knowingly aided and abetted a military junta’s brutality — because it undermines the war on terror? (Is Burma an ally in the war on terror? Does terror exclude forced relocation, forced labor, rape, and torture?) But the primary problem, as Professor Koh explains in an essay, is that in the tricky arena of international human rights, the administration is going after an important legal tool and missing the bigger picture. Koh recommends an international treaty establishing what conduct constitutes “aiding and abetting” human rights violations. But in the Unocal case, the Bush administration hasn’t demonstrated that kind of commitment to the cause:

“Like the Clinton Administration, [the Bush administration] could have supported the plaintiffs; it could have supported the defendants on case-specific grounds; or it could have declared neutrality (as it did in the Supreme Court’s recent Texas sodomy case).

Instead the Administration chose a fourth, radical option, urging a position that would wipe out nearly twenty-five years of appellate precedent. The Department dramatically changed its interpretation of the two-hundred year-old statute, now insisting that victims of gross abuse cannot sue under the ATCA, even if they could prove that defendants shared responsibility for the abuses, because the claimed abuses occur outside of the United States and a ruling against the corporation would endanger American interests in the war on terror.

…

The United States and British Governments are already developing common standards to clarify when a corporation illegally aids and abets official human rights abuse and work is proceeding on an international convention under OECD auspices. […] If this Administration cares as much about advancing human rights as it professes, it should put its efforts into developing such standards and encouraging responsible companies to meet them, not attacking a venerable law that has been used to call terrorists and genuine corporate abusers to account. ”

Incidentally, Koh points out, the administration’s position would preclude suits against Al Qaeda and other terrorist groups.

Human rights advocates are hoping the ATCA survives the assault by corporations and the Bush administration. In the long run, the IIE laments that “the influx of lawsuits will ultimately affect the way corporations are doing business.” For those in favor of human rights, in the long run, that could be a good thing.