BREAKING: Chiquita Liable!! Read More.

The recent decision by the Second Circuit Court of Appeals in Kiobel v. Royal Dutch Petroleum, which ruled that corporations cannot be sued for human rights abuses under the Alien Tort Statute (ATS), was adopted today by an Indiana federal court in the Flomo v. Firestone case, which alleges forced child labor on rubber plantations in Liberia.

Interestingly, while she agreed that corporations cannot be sued under the ATS, the judge in Flomo disagreed with Kiobel in one respect: she said that the court does, in fact, have jurisdiction over an ATS case against a corporation.  This matters, because a court without jurisdiction usually must dismiss a case without deciding any other issues.  In the Flomo decision, the judge stated that she would soon issue a subsequent decision that outlines additional reasons for dismissing the case–something she could not do if the court lacked jurisdiction.

The issue of whether the question of jurisdiction also matters for the Kiobel case itself.  Because Kiobel was at the Second Circuit on an “interlocutory” appeal–an appeal in the middle of a case, before a final judgment–the Second Circuit could consider only a limited set of issues in the case.  Corporate liability was not considered by the district court judge, was not raised by the defendant, and was not briefed by anyone in Kiobel.  So the Second Circuit was only able to decide the issue because they thought it was a jurisdictional issue.  If it wasn’t a question of jurisdiction, the court could not have considered it.

This may be one of the key questions that the Second Circuit faces as it considers whether to re-hear the Kiobel case in front of the full court: Regardless of whether the panel’s decision was correct, was it a matter of jurisdiction?