"More trouble ahead for the ATS? SCOTUS grants cert in Nestle case," 2 Jul 2020

The US Supreme Court just granted Nestlé’s cert petition in a case based on forced child labor in Côte d’Ivoire...

Both the alleged facts inJohn Doe I et al v. Nestlé (forced child labor in the supply chains of giant chocolate brands) and the contours of the law under which Plaintiffs are suing (corporate liability for overseas abuses under the ATS) are significant. The cocoa industry notoriously uses child labor, and companies including Defendants Nestlé and Cargill have made ineffective voluntary commitments to address it for nearly twenty years. As for the law, the once-promising ATS, which gives non-US citizens the right to seek justice for violations of international law (including human rights abuse) in US courts, has been gutted over the years. The Supreme Court’s decision to review this case means that corporate accountability under the ATS may see more trouble...

Plaintiffs filed suit under the ATS, the Trafficking Victims Protection Act, and California law, although only the ATS claims have endured. Over the last decade and a half, the case has ping-ponged between federal district court in California and the Ninth Circuit on appeal and remand related to corporate liability under the ATS...

Unsurprisingly, Nestlé’s certpetition filed last September argued that conduct amounting to aiding and abetting should not be enough to overcome the presumption against extraterritoriality under the ATS, meaning that liability would require an actus reus more than a US company’s oversight of a foreign subsidiary. It also argued that unlike natural persons, corporations should not be subject to ATS liability at all...

In May, the Solicitor General’s office (SG) filed an amicus brief on behalf of the Trump administration, arguing that the Court should grant cert and find that 1) domestic corporations are not subject to liability under the ATS; 2) there is no aiding and abetting liability under the ATS; and 3) even if domestic corporations are subject to liability and aiding and abetting liability holds, a US company’s oversight of a foreign subsidiary is too attenuated to constitute aiding and abetting under the ATS as a matter of law..