On April 3, 2017, the U.S. Supreme Court agreed to hear Jesner v. Arab Bank, in order to decide the question of whether corporations may be sued for violations of international law under the U.S. Alien Tort Statute (ATS). This is the same question that the Court originally agreed to hear in Kiobel v. Royal Dutch Petroleum, but ultimately sidestepped when it decided that case on a different basis.
The Arab Bank cases arise from five separate lawsuits filed between 2004 and 2010 in the U.S. District Court for the Eastern District of New York asserting claims on behalf of victims, and the family members of victims of terrorist attacks that took place in Israel, the West Bank, and the Gaza Strip between January 1995 and July 2005. The plaintiffs allege that the Bank purposefully financed terrorism by providing financial services to foreign terrorist organizations that committed the suicide bombings and other terrorist attacks that caused plaintiffs’ injuries. The plaintiffs allege that the Bank also knowingly and purposefully distributed millions of dollars to terrorists and the families of terrorists, and that Arab Bank thus financed terrorism in violation of international law and that it aided and abetted crimes against humanity and genocide. The trial court dismissed ATS claims under the Second Circuit’s decision in Kiobel, finding that corporations could not be sued.
ERI originally filed an amicus brief when the Arab Bank cases were heard by the Second Circuit Court of Appeals in 2014. On behalf of a coalition of human rights and labor organizations, ERI’s brief argued that corporations are not immune from suit under the ATS. The Second Circuit decision in Kiobel wrongly relied on the fact that corporations cannot be brought before any international tribunal to conclude that corporations are not subject to international law. The ATS is a domestic remedy for violations of international law, and international law has always primarily been enforced through domestic mechanisms. It is thus essential that federal courts look to domestic law to determine questions of how, and against whom, international law is enforced. Recognizing the right to sue corporations vindicates the text, history, and purpose of the ATS and international law. It makes no sense to limit the enforcement of international law to the few areas in which international tribunals have been created.
Nonetheless, the Second Circuit issued a decision reaffirming that its decision in Kiobel remains binding, setting the stage for a petition to the Supreme Court. The Supreme Court accepted that petition, and we expect the case to be heard in the fall of 2017.
ERI’s amicus brief to the Supreme Court similarly argues that corporate immunity from ATS claims makes no sense, especially in light of the fact that ATS claims are federal common law claims and federal common law universally allows corporations to be sued. ERI’s brief also argues that, under federal common law, the standard for aiding and abetting liability under the ATS should be knowing, substantial assistance.
The Second Circuit decision is available here: http://www.scotusblog.com/wp-content/uploads/2016/10/16-499-op-below-2d-cir.pdf