Justices could rule out business liability under 1789 law
WASHINGTON (AP) — The Supreme Court appears ready to rule out lawsuits in U.S. courts against businesses by foreign victims of human rights abuses and extremist attacks.
A case argued Wednesday pitted Israeli victims of attacks in Israel, the West Bank and Gaza in the 1990s and 2000s against Jordan-based Arab Bank. The victims claim that the bank helped finance the attacks.
The issue is whether the foreigners can use an 18th-century law to hold the bank accountable for its role.
The court already has limited the ability of foreign victims to sue under the 1789 Alien Tort Statute.
It appeared from the argument that the five conservative justices could find that corporations cannot be sued at all under that law. Such an outcome would be another blow to a more than 30-year-old strategy by human rights lawyers to use civil suits to pursue individuals who may be responsible for torture and other atrocities, as well as companies with operations in countries with poor records in the area of human rights.
“My understanding is that this sort of relief is fairly unique,” Chief Justice John Roberts said of the efforts to hold businesses liable under the law. Roberts did not seem to be persuaded by lawyer Jeffrey Fisher’s efforts to persuade him otherwise.
Justice Anthony Kennedy said little during the argument, but he did suggest that allowing corporations to be sued under the law might be unfair.
Questions from the liberal justices indicated they would vote for allowing the lawsuit against the bank to proceed.
Referring to an international treaty prohibiting the financing of terrorism, Justice Stephen Breyer said, “If it doesn’t apply to corporations, who does it apply to?”
Paul Clement, representing the bank, told the court that suits against corporate officers and high-ranking officials might be possible, but not against the corporation itself.
The case came to the high court after the 2nd U.S. Circuit Court of Appeals in New York ruled that the bank was immune from such lawsuits. Other federal appeals courts have found that corporations can be sued for damages under the Alien Tort Statute.
Victims in the case allege that the bank, through the involvement of its New York branch, knowingly distributed millions of dollars to finance suicide bombings and make “martyrdom” payments to reward the families of militants who killed civilians.
The bank denies the allegations and argues that allowing the victims’ claims to go forward would interfere with U.S. foreign policy and lead to diplomatic friction.
The Alien Tort Statute, adopted in part to deal with piracy claims, went unused for most of American history until rights lawyers dusted it off beginning in the late 1970s. The Supreme Court cautiously endorsed the use of the law in 2004, but left unanswered precisely who could be held liable and in what circumstances.
In 2013, the justices ruled that people or entities sued under the Alien Tort Statute must have a real connection to the United States. The court declined then to decide whether businesses could be sued.