This week, the Ninth Circuit Court of Appeals decided John Doe I, et al v. Nestlé, USA, et al. While the holding itself may not have been a game-changer, the court’s thoughtful analysis of the problems with the “myopic focus on profit over human welfare” offered some hope for corporate liability post-Kiobel.

The case was brought by three former child slaves in the Ivory Coast. Aside from 14-hour, 6-day workweeks with only scraps to eat, the children faced regular beatings and torture, and were locked up in tiny spaces. If they tried to leave, they risked, among other things, getting their feet sliced open. The plaintiffs accuse the defendants, Nestle USA, Inc., Archer Daniels Midland Company, Cargill Incorporated Company, and Cargill Cocoa, of aiding and abetting child slavery through their ongoing financial assistance and technological support. The companies “effectively control[ed]” the cocoa from the Ivory Coast, having exclusive buyer-seller relationships with many of these farms, and importing most of the Ivory Coast’s cocoa. The United States District Court for the Central District of California originally dismissed the case in 2010, holding that the defendant corporations could not be sued under the ATS, and that the plaintiffs had not alleged the elements of aiding and abetting. The dismissal was vacated, then that order was withdrawn and replaced with this decision.

While this case was on appeal, the Supreme Court handed down the Kiobel decision. Kiobel marked a change in ATS litigation by introducing a “touch and concern” test to decide whether plaintiffs can sue in a U.S. court for actions committed abroad. They do not clarify the test, but simply say that there is a presumption that statutes are not meant to apply outside of the U.S., and ATS claims must “touch and concern” the U.S. with “sufficient force” to overcome that presumption.

Two recent cases have addressed the touch and concern question, with very different outcomes. In June 2014, the Fourth Circuit held in Al-Shimari v CACI et al., that “touch and concern” under Kiobel is not limited to the tort itself. One month after that, the Eleventh Circuit, in a decision handed down by a visiting judge from the DC Circuit, held exactly the opposite. There, the court appears to state that the torture itself must have occurred on U.S. soil for an ATS claim to be valid. While the Ninth Circuit did not expressly answer the “touch and concern” question, by remanding to allow the plaintiffs to amend their complaint in light of Kiobel due to the fact that part of the conduct is claimed to have been conducted in the U.S., the Ninth Circuit followed CACI’s interpretation that the actions that “touch and concern” go beyond the act of slavery itself.

The court re-iterated an earlier holding that corporations are not immune from liability for human rights abuses, and continued to assert that “it would be contrary to both the categorical nature of the prohibition on slavery and the moral imperative underlying that prohibition to conclude that incorporation leads to legal absolution for acts of enslavement.”

In the most thoughtful, and significant, part of the decision, the court highlighted a number of inferences that indicated purpose to aid and abet slavery. The defendants “sought to accomplish their own goals [of getting the cheapest possible labor] by supporting violations of international law.” They had enough control over the cocoa market in the Ivory Coast to stop child slavery, but instead they facilitated it. In addition, defendants engaged in aggressive lobbying efforts to stop U.S. federal legislation that would have required “slave free” labelling. Although the court declined to decide on which standard applied to the mental element of aiding and abetting, it held that when a corporation directly profits from human rights violations which it has the power to stop, even the highest standard of culpability, that the defendant acted with ‘purpose,’ is met.

Judge Rawlinson, who concurred in part and dissented in part, disagreed with the majority’s conclusion that the defendants’ actions constituted a purpose to aid and abet, stating that “taking advantage of a favorable existing market, while perhaps morally repugnant, does not equate to the specific intent to aid and abet child slave labor.” Fortunately, the majority explicitly disagreed, siding with the very well established understanding that slavery cannot be considered a “favorable existing market.”

While this decision may not have been a total win, it is encouraging to have language in another post-Kiobel opinion that refuses to shield corporations and insists that profits cannot come at the expense of human rights.