US Federal Court: Corporations, Foreign or Domestic, Can be Held Liable for Complicity in Genocide

Amazingly, it took a federal court ruling, just last Monday, to make clear that corporations can't get away with murder, including aiding and abetting.

To be sure, American corporations have increasingly been held liable for damages to victims of lung cancer from improper sale and marketing of cigarettes without nicotine warnings, for asbestos abuses, and most recently for sex and age discrimination. But when it comes to awful things done abroad, that's a different story. Courts have generally shied away from even asserting jurisdiction and stayed clear of navigating the shoals of international law to determine liability. To remove some of the judicial inhibitions that have prevented a more vigorous approach to corporate irresponsibility, Judge Allen Schwartz of the Southern District of New York ruled on March 19, 2003 that the Talisman Energy Co. of Canada (with offices in New York) was culpable of having aided and abetted the government of Sudan in its genocidal campaign against its citizens in the South by ethnically cleansing vast swaths of land intended for Talisman's oil drilling (The Presbyterian Church of Sudan v. Talisman Energy Inc. and Republic of the Sudan, 2001). Talisman’s claim that international law had not advanced to the stage where corporations can be held liable for aiding and abetting murder was rejected.

Not content to abide by Judge Schwartz’s ruling (he died unexpectedly shortly thereafter), Talisman Energy called on a distinguished expert in international law to provide a sworn affidavit to the court maintaining that international law gives corporations immunity (e.g., arguing that Flick, Farben and Krupp, the Nazi industrialists, were held liable in their personal capacity and no liability extended to the corporations they led). Moreover, citing as precedent the US Supreme Court ruling of last summer in Sosa v. Alvarez-Machain, et al. (2004) it moved for summary judgment on the pleadings and reversal of Judge Schwartz's ruling.

Last Monday, Judge Denise Cote of the Southern District of New York ruled to affirm Judge Schwartz's ruling, and in the process gave an enormous boost to the movement for greater corporate accountability. Deeming "misguided" Talisman's argument that "corporate liability under international law is not sufficiently accepted in international law", Judge Cote reaffirmed that corporations can be held liable for gross human rights violations as claims brought under the ATS (Alien Tort Statute) related to genocide and crimes against humanity. Talisman's interpretation of what the Supreme Court held in Sosa (finding the US government not liable for the violation of customary international law in the kidnapping and detention of Sosa, a Mexican wrongly assumed to be responsible for the death of an American DEA agent) was deemed a misreading of its intent. Finally, Judge Cote, citing the recent ruling by New York's Federal Court for the Eastern District in In Re Agent Orange Product Liability Litigation [pdf] on March 28, 2005 held that corporate liability extends to secondary liability: aiding and abetting.

In Doe v. Unocal (2002) [pdf] the 9th Circuit Court of Appeals in California left for "another day... the question of whether liability should be imposed [merely] for moral support." In Talisman the court did not have to address the question of mere moral support, as it found that Talisman was charged with having provided actual support for ethnic cleansing through its financial arrangements with the government of Sudan. Judge Cote's ruling thus provides another milestone in the quest for greater accountability by victims of gross corporate irresponsibility.