Alien Tort Claims Act: Holding Corporations Accountable for Human Rights Violations in the Global Economy

Human Rights Dialogue

Human Rights Dialogue Spring 2003

Carnegie Council on Ethics and International Affairs

By Terry Collingsworth, International Labor Rights Fund

Since its inception in 1986, the International Labor Rights Fund (ILRF) has been working to develop mechanisms to secure labor rights in the global economy. Since “labor rights” are a subset of human rights, the ILRF initially used traditional human rights tools, such as documenting severe and extremely abusive practices including child labor, forced labor and violence against trade union leaders, and by promoting research and policy advocacy. Because multinational corporations have played a crucial role in shaping the architecture of the global economy, and because they alone have the capacity to reshape it and alleviate its most abusive practices, much of the ILRF’s efforts have focused on holding them to account for their actions.

Although our use of traditional human rights tools enabled us to make some progress, we were frustrated by the lack of means for effectively enforcing human rights standards in the global economy. Since there were no mechanisms in international law that would allow us to enforce these rights, we began to explore the possibility of finding remedies in the domestic legal system. The answer came to us when we were working to address the use of forced labor in Burma by the Unocal Corporation, a U.S. based oil company, and Total (now ElfTotalFina), the French oil giant, in the construction of a natural gas pipeline. We began the experiment of using the Alien Tort Claims Act (ATCA) to initiate human rights cases against the most egregious violators of human rights in the MNC community. The ATCA, a US federal statute that dates back to 1789, provides that “[t]he district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.”

The use of ACTA was revived in the 1970s in cases seeking to hold former dictators and torturers accountable after they had obtained refuge in the United States. During that period, the ATCA was found by several courts to provide a viable cause of action to address human rights violations. The seminal case was Filartiga v. Pena-Irala, 630 F. 2d 876 (2d Cir. 1980), where the Second Circuit Court of Appeals held that an alien could sue in U.S. federal court for a “tort” that violates the “law of nations,” and that torture was a clear violation of the law of nations. Since that ruling, the ATCA has been used routinely to reach direct perpetrators of human rights abuses. Interpreting the statute in a new way, the ILRF took the next step and, based on the rulings in the Nuremberg Tribunals, applied the ATCA to MNCs that are complicit in human rights violations committed in the course of commercial activities.

Our organization is currently involved in five different lawsuits based on the ATCA, which have enabled us to become a leading force in using this federal law to hold corporations accountable for their actions abroad. In our case against Unocal, for example, we have been able to argue for the “Nuremberg Principle,” which was used during the trials of business leaders who had profited from slave labor provided by the Nazis. This principle holds that private firms that were not directly involved but knowingly benefiting from slave labor can be held accountable for human rights violations. In another case, we have charged Coca Cola with the murder and terrorism of trade unionists in Colombia. Coca Cola has argued that it cannot be held liable in a US federal court for occurrences in Colombia, adding that that it does not own, and therefore does not control, the bottling plants in Colombia. We hope that this case will develop a standard under which a multinational company cannot profit from human rights violations while limiting liability to a local entity that is a mere facilitator for the parent company’s operations.

In these two cases, as well as other cases that we have initiated against Del Monte, Exxon Mobil, and Drummond Coal, we hope to establish the ATCA as one of the most effective tools yet in the effort to halt extreme abuses against workers. Yet, despite our success thus far, there are many limitations to using litigation to target MNCs. Litigation is time consuming, expensive, and often politicized. For example, the Unocal case is now approaching its eighth anniversary, the plaintiffs have been left in legal limbo all of this time, and the ILRF has struggled to raise funds to confront Unocal’s seemingly unlimited legal war chest. Furthermore, since the law relies on a narrowly defined “law of nations” standard, it is limited in its ability to address other crucial human rights concerns related to wages, sweatshop labor, and health and safety standards. In addition, because it is a US federal law, the ATCA can be used only against corporations that are based in the United States and fall under US jurisdiction. It is not appropriate, then, to shift to an exclusive reliance on ATCA litigation.

We view litigation as a piece that had long been missing from prior campaigns. We defined the ideal campaign as having three components: an ATCA case based on solid evidence that an MNC was participating in established human rights violations for profit in order to provide a viable and concrete case; the presence of an “on the ground” entity in the country where the violations occurred that would be able to build on any political momentum created by a global campaign and sustain it independent of the case; and a credible campaign to educate consumers and citizens in the market countries to apply direct pressure on the target MNC to change its practices.

Our current campaigns will hopefully provide a successful model of this cooperation. Although the ACTA cases have perhaps served as the catalyst for cooperative, strategic action, it is unlikely that litigation alone will bring major change. What is needed is an organization that will remain vigilant to ensure that the situation does not deteriorate, or that the resolution of a lawsuit serves only to address the concerns of the small group of claimants. Moreover, since MNCs obviously have the ability to hire scores of lawyers and drag litigation out for years, grassroots campaigns are necessary to ensure that the companies become aware that a drawn out legal battle will be costly in other ways even if the litigation itself ultimately fails. Consumers want to know that a company they support is not complict in human rights violations, and that the company has done all it reasonably can to prevent such abuses from occurring. In the present state of evolution of the global economy, few companies can actually meet that standard, but we are well on the way to developing a process to make each of them accountable, one by one if necessary.

While using this approach, the ILRF is simultaneously working to push for the adoption of a universal social clause that can help protect workers’ rights. We have developed a model provision for human rights to be added to trade agreements and are working with other human rights groups to build support for this effort. At this point, MNCs are aggressively complaining about being subject to ATCA suits, but they offer nothing more than “voluntary” codes of conduct as the alternative. Hopefully, a few visible victories in the ATCA cases will provide the incentive for the business community to proceed with a good faith discussion for an alternative that creates binding, globally applicable protections for workers, much like those that MNCs have designed to protect their own property rights in the global economy.