“We Are Above the Law” — World Bank Asks Supreme Court for Absolute Immunity

Home / Blog / “We Are Above the Law” — World Bank Asks Supreme Court for Absolute Immunity

When Donald Trump boasts about being above the law, he is speaking to a broader, more dangerous trend. Among America’s corporate class, immunity from the law—both from civil lawsuits and criminal prosecution—is the golden ticket to unchecked power and profit.

The quest for immunity is alive and well in America, especially among those whose core business practices threaten human rights and the environment. The fossil fuel industry is attempting to get immunity from lawsuits involving its role in causing the climate change crisis, as part of the “Americans for Carbon Dividends” initiative.

Gun manufacturers have already won immunity from lawsuits arising out of mass shootings and other gun-related deaths. While the gun manufacturers are not the ones pulling the trigger in these tragedies, some have willingly profited from putting their products into the hands of those who do.

Similarly, several corporations are using “SLAPP” lawsuits as a clever way to evade liability. SLAPPs (Strategic Lawsuits Against Public Participation) are frivolous lawsuits intended to silence the free speech rights of activists and journalists. In many of these cases, the SLAPP filer’s true goal is not to win a judgment in the lawsuit but to overwhelm its critics’ resources and force them into a binding settlement that prevents them from exposing or speaking out about corporate wrongdoing.

In each of these examples, the goal is the same. Rather than clean up their acts, these corporations and powerful actors try to position themselves outside the law, so they can continue acting with impunity.

At EarthRights International, we believe the courts play an essential role in holding the powerful to account. Absolute immunity threatens one of the basic tenets of democracy—that no one, and I mean no one, is above the law.

Last week, we brought this issue to the Supreme Court. On October 31, the Court heard oral arguments in Jam v. International Finance Corporation (IFC). As the private sector lending arm of the World Bank Group, the IFC has status as an international organization, although some of its activities resemble the work of a commercial bank or multinational corporation more than a humanitarian organization.

From its offices in Washington, D.C., the IFC sometimes finances high risk, mega-development projects around the world, like oil pipelines, dams, and power plants. These projects have, at times, imposed severe health, safety, and human rights impacts on surrounding communities.

The vast majority of the IFC’s projects never receive complaints from affected communities. In 2015, for example, its internal complaints mechanism received complaints on less than 2% of its projects. But failures do happen: the Jam case arises out of a disastrous coal-fired power plant in India that never should have been built.

As a result of the project, the communities face a dire situation: they have lost all access to clean drinking water and are forced to breathe air filled with toxic coal dust. Numerous families have lost their traditional livelihoods after the power plant wiped out their fishing grounds. At first, the communities turned to the IFC and its business partners for remedies. When the IFC refused to help, the communities had no choice but to bring a lawsuit in U.S. federal court. My organization, EarthRights International, represents the communities.

In court, the IFC asked for the case to be dismissed, claiming to have “absolute immunity” from all lawsuits in U.S. courts. This is the question that is now before the Supreme Court.

The Supreme Court case has rattled the walls of the World Bank Group: this was a wholly preventable disaster. During the planning of the project, the IFC ignored warnings from its own staff about the tremendous, unmitigated risks. After the project became operational, the IFC disregarded the findings of harm by its own internal complaints mechanism.

The IFC did not expect to face any consequences for this reckless, destructive behavior. That is what immunity does—it gives people and organizations a free pass to do whatever they want, regardless of who it harms. Until now, no one has challenged them in a court of law.

As David Hunter, Professor of Law at American University, explained, “Nothing changes at the Bank unless they hear the voices of the communities affected on the ground. Today, they heard their voices in the highest court in the land.”

The moral of this lawsuit is simple—rules matter! Every parent knows that their kids are more likely to follow the rules if there’s a punishment for breaking them. And if there are no consequences for breaking the rules, they’re more likely to be broken. That’s certainly how it was in my house—I got home by my midnight curfew every weekend because I knew I’d be grounded if I was late. The same principle applies to international bankers: if the IFC knows that it can violate the law with impunity, then what’s stopping it?

In a healthy democracy, everyone—no matter how powerful—needs to follow the rules or face consequences. This is what the “rule of law” means. In the Jam case, the Supreme Court has an opportunity to draw this bright line, at a time when our country so desperately needs to hear this message. If international organizations can operate above the law in America, others will soon follow—corporations will start asking, why should we be subject to legal accountability for the projects we engage in when an institution like the IFC is not?

Regardless of what happens in this case, we will continue to work with our clients and their communities in India to seek justice for the harms caused by this IFC-led coal plant. After this week’s hearing, I walked out of the court with Dr. Bharat Patel, one of our clients who heads a fishworkers’ rights group in India. He traversed the globe to witness this historic event, in the hope that, as he explained, “This struggle could set a precedent that could potentially prevent damage in other places around the world.” That’s what justice is, and that’s what this case is about.

 


 

The U.S. Supreme Court heard oral arguments in Budha Ismail Jam v. International Finance Corporation on October 31, 2018, where they considered the question of immunity of international organizations from U.S. law. For more information on this case and the underlying legal issues, please read our preview of the case and our press release.

More Blog Posts

December 10, 2018

Plan it Right: National Action Plan of Thailand on Business and Human Rights Shall be Inclusive to CSOs Voices
Read More

November 27, 2018

2019 EarthRights School Application
Read More

November 19, 2018

Congress Should Investigate the Oil Industry’s Role in Causing the Climate Crisis
Read More