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Shadow Amendments, Corporate Exceptionalism, and the Supreme Court

Professor William Aceves

Should U.S. corporations be held responsible when they are complicit in the use of child slave labor? While the answer may seem obvious, the Supreme Court is now considering this question. If it follows prior case law, it may rule in favor of corporate immunity, writes California Western Professor William Aceves in an op-ed recently published on Just Security.

In Doe v. Nestlé USA, Inc., the plaintiffs are victims of child slave labor who were forced to work at cocoa plantations in the Ivory Coast. They allege the two defendants, U.S. corporations Nestlé USA, Inc. and Cargill, Inc., are complicit in their mistreatment, and that federal courts have jurisdiction over their claims. The plaintiffs allege U.S. jurisdiction under the Alien Tort Statute (ATS), which allows foreign victims of international torts to bring claims in U.S. courts. The defendants are seeking dismissal of these claims, arguing that corporations cannot be subject to jurisdiction under the ATS.

Surprisingly, the Court’s ATS jurisprudence may support these corporations. In four other ATS cases, the Court adopted a series of “shadow amendments” to the statute, which make it very difficult for victims to bring these cases. These judicial revisions—which Aceves refers to as “shadow amendments”—alter the text of the statute with new conditions. Professor Aceves argues these shadow amendments reflect a strand of judicial activism that favors corporate defendants.

In Nestlé, Professor Aceves drafted an amicus brief to the Supreme Court on behalf of several foreign lawyers, arguing that the assertion of ATS jurisdiction, in this case, is consistent with international law and the practice of foreign countries. The brief argued that many countries assert jurisdiction over domestic corporations for harmful conduct committed abroad.

The Supreme Court heard the case on December 1, 2020. During oral argument, Justice Kagan addressed the brief Professor Aceves submitted to the Court. While questioning the Deputy Solicitor General who was arguing on behalf of the U.S. government, which had intervened in the case, Justice Kagan referenced the brief, noting “many of the countries around the world with the strongest rule of law systems do hold their own corporations civilly liable for the kinds of actions at issue here.” She asked the Deputy Solicitor General whether this foreign practice should inform the Court’s decision.

The case is now under submission, with a decision expected this Spring.

If the Court rules in favor of corporate immunity, it will have adopted yet another shadow amendment to the ATS. According to Professor Aceves, these shadow amendments reflect the activism of a Court that is skeptical of both human rights litigation and corporate accountability. He argues the Court should defer to the will of Congress, which drafted the ATS, instead of redrafting the statute to fit its preferred views. Even if the Court disagrees with the ATS, Aceves suggests the Court would do well to heed its own advice: those who disagree with federal legislation should look to Congress and not the courts for relief.

Read Professor Aceves’ complete Just Security op-ed here.