Showing posts with label corporate responsibility. Show all posts
Showing posts with label corporate responsibility. Show all posts

Separating natural & environmental disasters

The twin natural disasters that struck Japan this month, earthquake and tsunami, left a trail of devastation in their path. Entire villages were lost. The death toll currently stands at more than 8,000 but is expected to rise much higher (more than 13,000 are missing). (Prior posts here and here.)
Even as survivors struggle for shelter, warmth and food, the natural disasters are being rapidly overshadowed by the unfolding disaster at Japan's Fukushima Daiichi Nuclear Power Station. (right) (photo credit)
The key difference is that the nuclear disaster didn’t have to happen.
The earthquake, the tsunami, and the nuclear meltdown are all wrapped up together right now as one big human tragedy. But it is important not to blur the lines between risks that are inherent to living on planet earth, and risks that we have created for ourselves. Natural disasters like earthquakes, hurricanes or tsunamis are woven into the very fabric of the earth’s geological systems. There is no way to avoid them, though obviously we can take steps to minimize their impacts.
Anger after Hurricane Katrina was not directed at the hurricane for forming and coming ashore, but at the federal, state and local governments for failing to prepare and respond adequately, and at corporate priorities that devastated Louisiana’s (protective) wetlands in order to facilitate shipping. (left) (photo credit) But for those human decisions—to channel the Mississippi in a fashion that prevented soil accretion; to cut channels through the marshes; to underinvest in the poorer parts of New Orleans; to neglect adequate evacuation planning—the natural disaster might never have become a human catastrophe.
Environmental disasters, by contrast, are catastrophes that flow directly from human-created risks.
In Japan, Reactor #3 may already be releasing MOX (mixed oxide), and all six reactors at the site are compromised, with at least three in partial meltdown. One of the most surprising aspects of this disaster has been our collective inability to get accurate information about the quantity of radiation that has been released, and how dangerous it might be. Turns out the radiation detectors were dependent on the same sources of power as the reactor cooling system, making them unavailable just when they matter most. While it may be unclear how much radiation has been released, both the Japanese government and Tokyo Electric have acknowledged that the released radiation is potentially fatal.
How does this disaster fit with industry assurances that nuclear power is safe and clean? It turns out the roots of this crisis date back to a 1973 decision by the Atomic Energy Commission (predecessor agency to the Nuclear Regulatory Commission) that
'the environmental effects of the uranium fuel cycle have been shown to be relatively insignificant.'


In 1978, the U.S. Supreme Court upheld this decision—shutting the door to rigorous assessment of the environmental threats from spent nuclear fuel. At issue in the case, Vermont Yankee v. NRDC, was the AEC’s fuel cycle rule—which had concluded that the environmental effects of spent fuel rods would be so negligible that they could safely be disregarded. At a 1973 hearing on this fuel cycle rule, environmental groups raised the question of what would happen if a disaster caused the water cooling system for a spent rod storage facility to fail. Speaking for the agency, Dr. Frank Pittman responded that it would take a week for the cooling water to boil away, allowing time for “various corrective actions” to be taken. These corrective actions remained conveniently unspecified.
Now we see why.
In the wake of the earthquake and tsunami, all six of the Fukushima Daiichi reactors lost power, and the backup generators failed. Thus these reactors were left in exactly the plight environmental groups predicted in the 1973 hearing. With the risks of catastrophic meltdown looming, Tokyo Electric found itself with neither the time nor the capacity to implement “various corrective actions.”
In desperation, the Japanese military resorted to dropping seawater via helicopter, and Japanese police re-purposed water cannons from riot control to reactor cooling.
These last-ditch measures harken back to BP’s similarly flailing attempts to cap the gushing Macondo well. (right) The BP oil spill, which killed 11 workers and created one of the worst environmental disasters in United States history, flowed from a lethal combination of corporate greed, operational hubris and lax government oversight. (photo credit) I suspect we’ll find the same to be true in Japan. In both disasters, the economic, human and environmental toll is still being tallied, but will be immense.
Japanese regulators will inevitably face the same question American regulators faced after the BP oil spill: Why are we finding out that there is no Plan B only after disaster has struck?
It is foreseeable that a nuclear plant in an earthquake zone might lose power, and that its auxiliary backup generators might fail, just as it was foreseeable that a blowout protector might fail and thus not stem a gushing oil leak. In fact, not only were these disasters foreseeable, they were actually foreseen. It has been three decades since scientists inside the Nuclear Regulatory Commission first warned of design flaws in the Mark I reactors used in Fukushima. And, the scenario unfolding there is precisely the situation that Dr Pittman so blithely dismissed in 1973 -- that of a catastrophic accident causing the kind of containment system used at the Fukushima Daiichi facility to fail, subjecting everything and everyone nearby to dangerously high radiation. Similarly, almost a decade ago the Coast Guard began warning (p. 22-23) that oil companies were not developing adequate clean-up technology to keep pace with their newly acquired deep drilling capacities.
Yet, those warnings fell on deaf ears.
In both situations, regulators charged with protecting the public and the environment willingly accepted industry assurances not only that disaster would not happen, but also that it could be easily managed if it did. The corporations seeking regulatory approval made safety claims they could not back up, and the regulators too readily went along. This corporate equivalent of “don’t worry your pretty head about it” infects virtually every industry—leading to a dearth of worst case scenario planning. The local communities and the environment bear the brunt when things go disastrously awry.
It is the self-inflicted nature of the wounds that makes environmental disasters particularly galling.
► Yes, it was BP that cut corners in drilling the Macondo well.
► Yes, it is Tokyo Power that stored more than 11,000 spent rod assemblies at the Fukushima Daiichi site. (Incidentally, there are 23 boiling water nuclear reactors in the United States that share the same Mark I containment system design as the crippled Japanese reactors.)
► And yes, the corporate actors in charge of those facilities made these choices with an eye toward profit.
► But, to the extent that we demand cheap and reliable energy, we are all complicit.
The line of causation between the glittering lights of the Ginza and the unfolding Fukushima Daiichi disaster is fairly direct, as is the connection between the millions of U.S. automobile owners and the BP oil spill. In a very real sense, our insatiable thirst for more energy to power our growing collection of televisions, air-conditioners and electric toothbrushes is also responsible.
That means that fixing the problem has to proceed on both fronts at once.
► Clearly government agencies need to be re-invigorated and re-inspired. We can no longer allow politicians to dismantle our regulatory agencies under the false pretense that private actors, pursuing private ends will voluntarily safeguard the public interest. We must adequately fund oversight and enforcement of existing safety and environmental laws, and improve them where they are lacking. We must also stop the revolving door that corrupts agency values and leads regulators to confuse industry interests with the interests of their true client—the public. A hollowed out government cannot ensure public safety.
► At the same time, we also need to learn to slake our energy thirst, and thereby remove the political justification (and economic incentive) for these risky gambles.



(Cross-posted at CPRBlog)


Go On! AALS hot topic: "Cutting Edge of Extraterritoriality," featuring 2 IntLawGrrls

(Delighted to welcome back alumna Hannah Buxbaum, who contributes this Go On! guest post respecting the annual meeting of the Association of American Law Schools, which, as Rebecca Bratspies posted, begins today and includes many IntLawGrrls speakers)

Anyone attending the AALS and looking for an international-law related program to attend first thing Friday morning might try “The Cutting Edge of Extraterritoriality” (p. xxxi). This is one of the “Hot Topics” panels on late-breaking developments. The speakers are: yours truly, Hannah Buxbaum (Indiana) (left); another IntLawGrrls alumna, Chimène Keitner (California-Hastings) (middle); and our colleagues Anthony Colangelo (Southern Methodist) and Bill Dodge (California-Hastings).
The panel runs from 8:30 to 10:15 Friday morning in the Yosemite C Room on the ballroom level of the Hilton.
Here's the program description:
How far does (and should) U.S. law reach in regulating conduct or transactions that take place overseas?
This question of the “extraterritorial” application of U.S. law arises in a wide range of contexts, including the regulation of international economic markets, human rights litigation, jurisdiction over terrorist acts abroad, and the availability of constitutional protections in connection with the “war on terror.”
In its June 2010 opinion in Morrison v. National Australia Bank, which limited the application of antifraud provisions under U.S. securities law to transactions taking place in the United States, the Supreme Court articulated an unexpectedly expansive version of the “presumption against extraterritoriality,” a rule of statutory construction. Lower courts have already applied this revamped presumption to other statutes, such as RICO.
And, as IntLawGrrls posted here and here, the U.S. Court of Appeals for the Second Circuit in Kiobel v. Royal Dutch Petroleum Co. recently addressed another issue with far-reaching implications; that is, the respective roles of national and international law in defining the scope of corporate liability under the Alien Tort Statute for human rights violations abroad.
The panelists will use Morrison as the starting point to address shifting understandings of the geographic reach of American law and the role of national law in an increasingly global system.
Hope to see you there!

Kimberley Process & Zimbabwe diamonds

(Thanks to IntLawGrrls for the opportunity to contribute this guest post)

The opening and expansion of global markets has created and exacerbated resource curses, the phenomenon in which natural resource abundance creates governance problems.
Yet international legal scholarship has been slow to recognize the relationship between freer trade and the financing of internal conflicts. My recent article, "Regulating Resource Curses: Institutional Design and Evolution of the Blood Diamond Regime," published earlier this year in the Cardozo Law Review, looks closely at a recent effort to address the global trade in so-called blood diamonds as a potential model for resource curses more generally.
I develop a case study of the Kimberley Process, an international diamond tracking regime (prior IntLawGrrls post), by investigating both the scope of the institution’s regulatory reach as well as the mechanisms by which members promulgate and enforce those regulations. The article focuses on the unique coalition of nongovernmental organizations, corporations, and states, and on the unusual international arrangement upon which they agreed.
Evidence from the evolution of that institution suggests that although designers may indeed seek to maximize their own interests, what determines whether an institution can regulate effectively, and when it may move beyond the designers’ original interests, are legalization elements of that international institution. These include:
► The obligations the regime creates;
► The precision with which those obligations are defined; and
► The possible delegation of interpretive and enforcement efforts.
In accumulating and assessing this evidence, my article contends that while skeptics may correctly identify the Kimberley Process’s initial alignment with state and corporate interests, this lightly legalized regime provides an opportunity for substantial progress on human rights. Although the Kimberley Process might appear as an attempt to whitewash state and corporate abuses, over time, the institution can -- even though it need not necessarily -- evolve to address both the rebel-induced and state-inflicted human rights violations related to the diamond trade.
The article acknowledges 2 factors:
► The importance and potential stickiness of initial design choices; and
► The fact that institutional evolution in favor of issue expansion and greater enforcement is merely feasible rather than inevitable.
Thus, this article demonstrates some of the possibilities and limitations of looking to the Kimberley Process as a model for resource curses, and more generally for other areas in which NGOs seek to align state, corporate, and human rights interests.
Developments which occurred after my article went to press suggest that the Kimberley Process has in fact tried to address state-initiated human rights abuses. In so doing, it is facing some substantial state resistance:
► In 2009, the Kimberley Process sanctioned Zimbabwe for bad behavior in the newly discovered Marange diamond fields. Rather than expel Zimbabwe, members suspended its exports. By November 2009, Zimbabwe agreed to a joint work plan to restore compliance by eliminating smuggling, allowing greater monitoring, and reducing military abuses against civilian miners. Despite these promises, Human Rights Watch reported that as late as September of 2010, soldiers still control large portions of these Zimbabwe fields and continue to violate the human rights of the local miners. (credit for 2006 photo by Tsvangiray Mukwazhi/Associated Press of women and men miners at Marange)
► A November 2010 Kimberley Process meeting failed to reach agreement on whether to lift all export limitations, and thus kept the suspension in place. Zimbabwe’s monitor responded by unilaterally certifying millions of diamonds which are already beginning to make their way to market.
►Many speculate that a December 2010 WikiLeaks posting will influence an ongoing Kimberley Process meeting on the Zimbabwe export question. The 2008 U.S. government cable states:

'In a country filled with corrupt schemes, the diamond business in Zimbawbe is one of the dirtiest.'
► Meanwhile, NGOs such as Global Witness and World Vision have stopped short of calling a boycott, but asked consumers and retailers to act more vigilantly in ensuring that diamonds purchased over the holiday season have not funded violence.
If Zimbabwe continues on its current path of non-compliance, or pulls out of the process entirely, many fear the diamond industry will return to the bad practices of the 1990s, in which widespread human rights abuses were common.
Others suggest, however, that targeted pressure campaigns could convince industry networks to reject working with those that trade in these blood diamonds and persuade individual consumers not to purchase them.
Only time will tell. But this article illuminates the institutional mechanisms that will facilitate success or failure on the Zimbabwe problem.

MAC/Rodarte Juárez debacle: How fashion & makeup bloggers raised corporate & public human rights awareness

(IntLawGrrls is delighted to welcome back alumna M.C. Sungaila, who contributes this guest post)

Less than a month after they took part in a U.N. summit, two U.S. companies tested the limits of social responsibility and were brought to task by fashion and makeup bloggers -- not the United Nations.
About 7,000 businesses from more than 135 countries took part in a June U.N. Global Compact Leaders Summit in New York City. The Global Compact is the world’s largest corporate citizenship initiative. The Compact’s Women’s Empowerment Principles, launched this past International Women’s Day, offer guidance to companies on how to empower women in the workplace, marketplace, and community in accordance with international human rights principles.
Global Compact signatories include major global corporations across a range of industries: Deloitte, PriceWaterhouseCoopers, Bank of America, Cisco, General Electric, Goldman Sachs, Pepsico, Microsoft, Monsanto, and Royal Dutch Shell, for example.
The Global Compact’s Ten Principles in the areas of human rights, labor, the environment, and anti-corruption are derived from U.N. human rights documents. The first principle of the Global Compact is respecting and supporting human rights. The first principle notes that corporate responsibility to respect human rights exists independently of a state’s responsibility to do so and advises that a corporation’s “good works” in one area cannot excuse its infringement of human rights in another. The Compact’s Women’s Empowerment Principles name as priorities promoting equality through community initiatives and advocacy and establishing high-level corporate leadership around gender equality.
But it was the fashion and makeup blogosphere that took two companies, MAC Cosmetics and Rodarte, to task.
► MAC Cosmetics has historically shown profound awareness around social issues. The MAC AIDS Fund, established in 1994, has raised $139 million through the sale of its VIVA GLAM lipstick and lipgloss, from which 100% of sales are donated to fight HIV/AIDS.
► Fashion house Rodarte, founded by California-born sisters Kate and Laura Mulleavy, is a relative newcomer to the fashion scene, prized for its artsy approach.
For Fall 2010, MAC and Rodarte teamed up for a fashion collection and integrated makeup line. According to the Mulleavy sisters, the collection was inspired by their travels across Texas' landscape en route to the art town of Marfa, and the imagined “lines of women workers making their way to factory jobs in the middle of the night” across the border in Juarez, Mexico. (above left; photo credit)
The nail polish, lipstick, and other makeup bore names such as “Juarez,” “Bordertown,” “Factory,” “Ghost Town,” “Sleepwalker,” and “Quinceanera.”
The presentation of the Rodarte clothing collection at the Fall fashion shows – during which the models wore the accompanying MAC makeup line – featured a parade of pale-faced models wearing tattered white lace dresses, looking like ghostly brides. Style.com, commenting on the show, noted that the models could be seen as “the ghosts of the victims of Juarez’s drug wars.” (below right; photo credit)
(I have posted on killings and disappearances of women in Juárez; other IntLawGrrls' posts on the tragedy are here and here.)
MAC and Rodarte sent out press releases for the Fall collection to the fashion and makeup media, including bloggers, in mid-summer. The reaction from beauty bloggers was immediately negative and visceral. MAC and Rodarte appeared to be exploiting, romanticizing – or, perhaps even worse, to be ignorant of – the decades of unsolved killings of hundreds of women and girls in Juarez, many of whom had migrated to the city to work in the factories for minimal wages.
The beauty bloggers decried the collection and called for MAC and Rodarte to take action. As Politics Daily reported:
[B]eauty bloggers who were given advance press kits and samples for the fashion line lashed out at MAC/Rodarte for romanticizing the lives of women fraught with violence and poverty.
Jessica Wakeman of The Frisky called the collection "tasteless" and asked, "What's next, a lipstick called Bergen-Belsen?"
After more than a hundred blogs were found to have objected and called for boycotts, MAC/Rodarte apologizeed and promised to give $100,000 to an appropriate nonprofit. Politics Daily continued:
Newly politicized, beauty and fashion writers began calling for the two companies to donate the entirety of their profits from the collection to women and girls in Juarez.
Within weeks, Rodarte agreed
to turn over its global profits from the sale of the MAC/Rodarte collection to a new initiative that will provide grants to local and international organizations that raise awareness and provide resources for women and girls in Juarez.
But that is not the end of the story. The bloggers’ efforts to raise the companies’ social awareness around the plight of women and girls in Juárez ended in the companies pulling the makeup collection. The companies still pledged to donate all of the projected global profits from the sale of the collection to benefit women and girls in Juárez.
The lessons from this debacle?
► For MAC and Rodarte: that some “due diligence” about the social realities surrounding the inspiration for their collections should be done prior to releasing them, and that social responsibility in one arena does not excuse lack of social awareness in another.
► For individual citizens: that we each have the power to effect change. For those involved in human rights work: that sometimes change and awareness about abuses can come from unexpected, everyday sources.

U.S. Contact Point & corporate accountability

(Many thanks to IntLawGrrls for the opportunity to contribute this guest post.)

Corporate accountability for environmental and human rights abuses abroad is often elusive.
As IntLawGrrls Rebecca Bratspies and Naomi Roht-Arriaza have posted (here and here), recent court rulings now limit the scope of the Alien Tort Claims Act in some jurisdictions, at least temporarily. Non-judicial, ‘soft law’ mechanisms thus have become even more important.
Among the latter accountability mechanisms is the U.S. National Contact Point, or NCP, an office of the Department of State created to take complaints regarding corporate compliance with the Guidelines for Multinational Enterprise issued in 2008 by OECD, the Organization for Economic Co-Operation and Development.
The United States is required to maintain the NCP to resolve disputes about the OECD Guidelines, which cover human rights, environmental, labor, and consumer issues, as well as other topics. Like other countries' NCPs, the U.S. office is tasked not only with assisting to resolve disputes about corporate compliance with the Guidelines, but also with issuing Final Statements about compliance at the end of the process. In the language of international financial institution accountability mechanisms, this gives NCPs both a problem-solving and compliance review function.
To date, the U.S. NCP has never assisted in the resolution of a single case. In contrast, as IntLawGrrl Christiana Ochoa has posted in other countries like the United Kingdom, NCPs have successfully participated in the resolution of major global issues. If transformed, the U.S. NCP could be a valuable tool for communities around the world. Among those communities are clients of my organization, Accountability Counsel, which represents persons harmed by U.S.-headquartered multinational enterprises.
Over the past year, Accountability Counsel has led a coalition of civil society groups to reform the U.S. NCP. Our direct talks spurred the office to published its rules of procedure. As we had anticipated, those rules:
► Fail to meet basic standards for transparency and independence;
► Lack details sufficient to result in a predictable process; and
► Are unlikely to lead to effective results.
The official State Department review is under way, with a new policy governing the U.S. NCP is expected sometime in 2011. In Washington, a public meeting will be held today, November 2, and comments on the U.S. NCP will be accepted at input@state.gov until this Friday, November 5.
Accountability Counsel already has submitted its comments to the State Department regarding suggestions for reform of the U.S. NCP. Based on our work with similar mechanisms at the World Bank Group, the regional development banks, and study of other NCPs, we demonstrated that key elements that are needed to bring this accountability mechanism to the ‘best practice’ level that civil society groups have worked decades to create. Our recommendations focus on:
► Increasing transparency;
► Setting timelines and rules of procedure;
► Providing for review of decisions; and
► Monitoring and enforcement in the event of a finding of non-compliance.
Accountability Counsel is also working on these issues as a member of the State Department’s Advisory Committee on International Economic Policy, which will issue a report with recommendations for reform. Similarly, our group has worked with the United Nations' Special Representative on Business and Human Rights, Professor John Ruggie (prior IntLawGrrls posts), to create a page on the Business and Society Exploring Solutions site for the posting of comments and for debate about the U.S. NCP. The effort is aimed at improving transparency around this review.

A bad September for suits against corporations under the Alien Tort Statute

First there was Citizens United (2010), in which the U.S. Supreme Court gave corporations more ability to influence our politics. Now, one of the few avenues for holding bad corporate actors responsible for overseas violations of basic human rights has been seriously undermined. In a pair of cases from two highly influential federal courts, plaintiffs have lost appeals in cases involving corporate defendants under the Alien Tort Statute (prior posts).
Issuing the 1st decision was the U.S. Court of Appeals for the 9th Circuit.
In a mid-September decision, the 9th Circuit denied plaintiffs’ appeal from an adverse jury verdict in Bowoto v. Chevron (prior posts here and here). A jury in December 2008 had found Chevron not liable for the death of one protester and injuries to others when security forces, at Chevron’s request, attacked a group of protesters on an oil rig in the Niger Delta. Plaintiffs appealed on a number of grounds, including faulty jury instructions and the judge’s failure to allow a number of claims. (credit for photo above right)
The appeals court decision in Bowoto, from a panel consisting of 9th Circuit Judges Mary M. Schroeder, Jay Bybee (yes, that Bybee, the one who signed off on the torture memos) and District Court Judge Owen Panner, threw out all of plaintiffs’ claims. The opinion for the panel, written by Judge Schroeder (right):
► Held that the summary execution claim is not allowable under the ATS because it is preempted by the Death on the High Seas Act – a somewhat ironic result given that piracy on the high seas was one of the first, and most enduring, types of ATS claims. The court recognized the possibility of piracy claims but nonetheless held that all plaintiffs’ claims for wrongful death and survival had been preempted.
► Also dismissed all the allegations of improper jury instructions.
These rulings are disappointing, but case-specific enough to have limited application elsewhere.
► Not so the court’s ruling that corporations cannot be sued under the Torture Victims Protection Act. The TVPA applies to cases of torture or summary execution committed under color of foreign law. In Bowoto the 9th Circuit undertook to construe the statute's extension of liability to “an individual who…subjects an individual to torture.” The court held that use of the word “individual” rather than “person” to characterize both potential plaintiffs and defendants made clear that Congress meant to exempt corporations from the ambit of the law. Future TVPA cases therefore may sue individual defendants only.
(This ruling is now definitive for cases in the 9th Circuit (comprising Alaska, Arizona, California, Guam, Hawai'i, Idaho, Montana, Nevada, Northern Marianas Island, Oregon, and Washington); it is in conflict with the only other appeals court to consider the issue, the 11th Circuit.)
Issuing the 2d decision was the U.S. Court of Appeals for the 2d Circuit.
The 2d Circuit's late-September decision in Kiobel v. Royal Dutch Petroleum Co. (prior post) compounded the blow dealt by the 9th Circuit in Bowoto.
Kiobel is a companion case to Wiwa v. Shell, both brought by family of Nigerian activists killed for their protest activities against oil drilling in the Niger Delta, allegedly with the complicity and connivance of Shell officials. (photo credit) Wiwa settled in 2009 for $15.5 million, but the panel in Kiobel, led by Judge José Cabranes, decided to request supplemental briefing on the issue of whether corporations could be sued at all under the ATS. In the Kiobel decision, the panel decided that they cannot.
Thus, in the 2d Circuit, which includes New York, corporations have a liability-free zone for depredations abroad.
How could this happen, after a decade of litigation against corporations under the ATS and a number of settlements and jury trials, without the issue ever arising before?
Here’s one chronology:
Back in 2002, there was the Unocal case, involving allegations of forced labor, slavery and other rights violations as part of a pipeline project in Burma. (photo credit) As part of the years of legal skirmishing in that case, a 9th Circuit panel split on the question of whether it was international law or domestic legal doctrines that governed ancillary issues arising under the ATS. (Prior posts here and here.) That is, everyone agreed that the core definition of the “violation of the law of nations” came from international law.
But what about the innumerable other issues, like who can be sued and under what definitions of liability?
► Judge Harry Pregerson held that those questions were governed by international law, and looked to the jurisprudence of the International Criminal Tribunal for the former Yugoslavia to answer the question of how to define “aiding and abetting” for purposes of ATS liability.
► Judge Stephen Reinhardt thought that domestic doctrines of agency, unjust enrichment and tort were more than sufficient and should be used to fill in all the necessary gaps in international law.
At the time, it was not clear to litigators what the implications of this choice could be, since both international and domestic law pointed in the same direction.
Because the panel decision was eventually withdrawn for unrelated reasons, the Unocal case created no precedent. It was up to the 2d Circuit to define the issue.
At first, the 2nd Circuit had as much trouble as the 9th. In Khulumani v. Barclay Int'l Bank Ltd., 504 F.3d 254 (2007), involving allegations of corporate complicity in shoring up the apartheid regime in South Africa, the judges split again. (prior post) (image credit) Judge Robert Katzmann, on the question of aiding and abetting, found that ancillary issues were governed by international law. Rather than look to the ICTY, however, he looked at the Rome Statute of the International Criminal Court, and concluded that aiding and abetting had a “purpose” requirement in international law, one not found in domestic law. Thus, turning to international law had the effect of raising the bar for what plaintiffs needed to prove.
A 2d Circuit panel that included Judge Cabranes agreed with this analysis in a subsequent decision in Presbyterian Church of Sudan v. Talisman Energy, Inc. (October 2009). It dismissed the case on grounds that the plaintiffs could not show that Talisman Energy had the purpose of aiding and abetting the crimes of the Sudanese security forces, even though the oil company knew about the violations and acted despite that knowledge. Plaintiffs’ certiorari petition was set for review by the U.S. Supreme Court at the end of September, but the Court seems not yet to have decided whether to weigh in.
Judge Cabranes’ decision in Kiobel took the reasoning in these earlier cases one step further: if we look for the definition of “aiding and abetting” in international law, then logically we should look for the answer to whether corporations are entities capable of committing actionable violations in international law as well.
Judge Cabranes, predictably, could find few cases in which corporations as such (as opposed to their officers and owners) were held criminally liable for international crimes. He too used the ICC Statute against plaintiffs, using the decision of the Rome Statute drafters not to allow prosecutions of legal persons as evidence of a customary norm excluding corporate liability. (This even though the Rome Statute makes clear that it does not necessarily follow customary law.)
Unfortunately, because of the very nature of international law, it is unlikely to provide answers to lots of questions – including this one – which have always been considered to be issues of domestic law.
As Judge Pierre Leval, concurring in the judgment in Kiobel, put it:

So long as they incorporate (or act in the form of a trust), businesses will now be free to trade in or exploit slaves, employ mercenary armies to do dirty work for despots, perform genocides or operate torture prisons for a despot's political opponents, or engage in piracy – all without civil liability to victims.
Let’s hope this new month of October brings better news on the ATS litigation front.

No Alien Tort Liability for Corporations?

A serious, perhaps, mortal blow has been dealt to the Alien Tort Statute by the U.S. Court of Appeals for the Second Circuit. The ATS creates federal jurisdiction over

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.
In its opinion in Kiobel v. Royal Dutch Petroleum Co., however, the Second Circuit dramatically narrowed the scope of the ATS by ruling that it did not apply to "juridical persons," meaning corporations.
Since the groundbreaking judgment in Filártiga v. Peña-Irala (2d Cir. 1980), which was brought by my dearly-missed colleague Rhonda Copelon and the Center for Constitutional Rights, the ATS has offered victims of human rights abuses the prospect of access to U.S. courts.
In Kiobel, the oil company defendants stood accused of aiding and abetting the Nigerian government's campaign of human rights abuses in the Niger Delta, Nigeria's oil-producing region. The litany of human rights violations at issue in the case included allegations of torture, arbitrary detention, and crimes against humanity. Unfortunately, these allegations can no longer be heard in U.S.courts. The Second Circuit ruled on September 17th that corporations cannot be sued under the Alien Tort Statute because they are “juridical” entities rather than natural persons. Should this ruling be adopted throughout the U.S. court system, it would gut the scope of the ATS, making it very likely that corporations participating in human rights abuses will escape any accountability for their conduct.
The Niger Delta is home to 31 million people. (map credit) Since oil exploration began some 50 years ago, the region has suffered an Exxon Valdez-sized oil spill every year. As you can imagine, these spills have devastated the local population. In 2009 Amnesty International reported that the oil industry in the Niger Delta of Nigeria
has brought impoverishment, conflict, human rights abuses and despair to the majority of the people in the oil-producing areas.
Local populations have failed to benefit from the wealth generated by oil production, even as they suffer its environmental consequences. Before being despoiled by oil pollution, the Niger Delta was one of the most important wetlands in the world. BP's oil spill in the Gulf of Mexico (see previous Intlawgrrl posts here, here and here) focused public attention, albeit briefly, on the ongoing environmental devastation in the Niger Delta. (You can hear an interview I did with WBEZ Chicago Public Radio’s Worldview Program on this topic here.)
Just last year, Shell Oil settled an ATS case alleging the company’s complicity in the hanging deaths of nine Ogoni activists, including the world-renown poet Ken Siro Wiwa. Cases alleging similar human rights abuses in oil production have been brought against Talisman Energy for its activities in the Sudan, Unocal for its activities in Burma, and Chevron for its activities in Ecuador. (News on that last suit here.)
Second Circuit Judge José A. Cabranes interpreted international law precedents extremely narrowly in order to concluded that, throughout history,
the principle of individual liability for violations of international law has been limited to natural persons—not ‘juridical' persons such as corporations.
This despite the fact that the Universal Declaration of Human Rights explicitly applies to "every individual and every organ of society." Over the objections of Judge Pierre N. Leval, Judge Cabranes, joined by Judge Dennis Jacobs concluded that that U.S. courts lacked jurisdiction over ATS claims brought against corporate entities.
Given that oil production often takes place in countries without robust judicial systems, this cramped ruling virtually assures that victims will have no avenue of redress.
The United States consumes a quarter of the world’s oil—10% of which comes from Nigeria. That makes the United States the largest purchaser of oil produced in the Niger Delta. Our participation as end-consumers makes us unwitting collaborators to abuse in Nigeria and around the world. We surely have an interest in giving victims of these human rights abuses a forum in which to seek justice.

Another day, another rig blast

Another oil rig exploded in the Gulf of Mexico yesterday (left).
Fortunately, none of the 13 workers on the rig were seriously injured, and the fire was quickly brought under control. There are conflicting reports about leaks, with a mile-long sheen spotted in nearby waters. (credit for Reuters/Lee Celano photo)
While it looks like this particular spill will not turn into a replay of BP's Deepwater Horizon environmental catastrophe, what about next time? How many warnings do we need before getting serious about safety and environmental regulation of offshore drilling?
This latest incident directly contradicts attempts to spin the BP spill as "not so bad" -- attempts that have focused on characterizing the Deepwater Horizon catastrophe as an isolated case of bad judgment. BP has twice pleaded guilty to environmental crimes, one a felony and one amisdemeanor, and has amassed a lengthy record of hefty fines for other violations. Mariner Energy, the owners of the latest oil rig to explode, have been cited for 10 accidents in the Gulf over the last four years, ranging from blowouts to platform fires to pollution spills.
This morning, BP announced that the spill had cost it $8 billion so far. That number sounds suspiciously low to me (though not as patently false as BP's laughably lowball estimates of the quantity of oil gushing from the well into the Gulf had been.) Whatever effective regulation would have cost the industry, it would have been significantly less than $8 billion. And regulation probably could have prevented contamination of our environment with the:
► Hundreds of thousands of gallons of oil that leaked from the well, plus
► Millions of gallons of dispersant that were dumped into the Gulf in response.
Both are fouling th environment and wreaking as-yet-unknown havoc on the Gulf ecosystem, already harmed by disastrous losses in the tourism and fishing industries, and, of course, by the deaths of those 11 workers.

Write On! Vulnerability & the Corporation

(Write On! is an occasional item about notable calls for papers.)

On October 29-30 this year the Feminism and Legal Theory Project and the Vulnerability and the Human Condition Initiative (both based in Emory University in Atlanta, Georgia) will hold a workshop on Vulnerability and the Corporation. The workshop is organised by me, Emory's Martha Fineman (below right), and Anna Grear of Bristol Law School in England. It will take place at Emory from 4pm, Friday, October 29, to approx 5pm Saturday, October 30. Here is the call for papers:
Vulnerability, understood as a universal and constant part of the human condition, is an important paradigm within which to consider and evaluate the ways in which states respond (or fail to respond) to individual, structural and community catastrophes. This workshop will build on the notion of a responsive state and consider the relationship between corporate structures, vulnerability, and state responsiveness. In the first instance, we recognize that increasingly corporations—whether operating on a local, national or transnational basis—act in ways that can either exacerbate or alleviate human vulnerability. Corporations can cause or complicate the inherent vulnerability of their employees and their dependents, as well as exploit the ecology and vulnerability of our natural and created environments. How should the state respond to this powerful potential for benefit or harm that is lodged in a “private” institutional actor? In addition, corporations may themselves be conceptualized as vulnerable entities. The corporation itself has been recognized as a “person” under the US Constitution, entitled to legal rights and protections and as a holder of human rights under the European Convention on Human Rights. How does the concept of corporate personhood differ from that of the natural person in law and what are the implications of those differences for state responsiveness and regulatory policy?

Papers proposed might consider (although are not limited to) questions related to:
► The identification as corporations as rights-bearers and the implications of the disembodiment of rights protection;
► The transfer of power from the state to the corporation and implications for individuals as citizens/consumers/subjects/objects of state-like power;
► The implications of the conceptualisation of corporations as legal persons with standing;
► Regulatory responses to the vulnerabilities produced by corporations including, in particular, questions of worker welfare, protection and environmental justice;
► State, regional and international responses to perceived corporate and market vulnerability and the vulnerabilities that may emerge from such responses;
► Distinctions between human vulnerability and corporate vulnerability and implications of such distinctions for appropriate state responses;
► The potential for the Corporate Social Responsibility and Business and Human Rights movements to enhance theories of appropriate state and corporate responses to vulnerability; and
► Connections and disconnections between experiences of vulnerability by and of the corporation between the Global North and the Global South.
Anyone interested in presenting their work should email an abstract of several paragraphs in length to mfineman@law.emory.edu, anna.grear@uwe.ac.uk, fiona.delondras@ucd.ie, and cdomozi@emory.edu no later than August 15th. Draft papers will be due by October 11th.

'Nuff said

(Taking context-optional note of thought-provoking quotes)

Companies faced with conflicting demands usually have only two choices, 'business as usual' or leaving the country, a choice that may itself have harmful consequences.

-- Molly Beutz Land (right), New York Law School Professor and IntLawGrrls guest/alumna (prior posts), in a most informative ASIL Insight, "Google, China, and Search," which situates the current saga between the web search giant and the mainland giant within the framework of human rights and corporate responsibility. For another take on this issue, see Googling Freedom, a forthcoming article by my California-Davis colleague Anupam Chander.

Human Rights & Business: Beyond Corporate Social Responsibility

(Delighted to welcome back alumna Nadia Bernaz, who contributes this guest post)

With BP making the headlines with the industrial disaster in the Gulf of Mexico (prior IntLawGrrls posts), many have been asking the question of how and whether giant corporations can be made accountable for their actions.
The fact is that a combination common in the Western world -- tighter laws governing pollution and higher standards -- has not worked. Rather, it has often meant that multinational corporations, which no longer have to respect national boundaries, move elsewhere, where standards are lax and land and labour is cheap.
The growing movement for volunteerism among corporate entities based on corporate social responsibility has had some benefit: it has highlighted the social responsibility that companies have when they invest in a given area. (Prior IntLawGrrls posts) However, it has also allowed many corporations to engage in green-washing their image through the display of sophisticated policies printed in expensive brochures.
A new story that has attracted some attention recently concerns the activities of the Vedanta mining concern, one of Britain’s largest companies, who have built an aluminium producing plant in Orissa, in the east of India. Vedanta now wishes to mine bauxite in the region in order to get the plant running at full capacity.
Orissa is one of India’s least developed states, with some of the poorest people in the world, with many indigenous tribes among them. It has been known for a long time that this part of India holds significant deposits of mineral resources, but with India speeding towards accelerated development, these resources have suddenly become crucial to sustaining growth.
Vedanta maintain that their mining activities would bring jobs and increasing wealth to the local population. However, the indigenous Dongria Kondh tribe strongly oppose mining in their sacred mountains, and are concerned about the environmental impact of this activity in the region. An Amnesty International report issued in February supports their view.) The tribal members argue that they do not want to change their ancestral way of life, and have no interest in the type of development Vedanta has promised them. (credit for photo by Parth Sanyal /Reuters, captioned "A tribal woman with her child near the mining site of the alumina refinery in Orissa state")
From an international legal perspective, the Vedanta story raises several important issues:
► The increased power of transnational corporations has made the seeking of accountability for their actions extremely difficult in environments where they may be able to operate freely, and often with the complicity of the government.
► While globalisation itself cannot be regulated, it is clear that new norm creation activities have been taking place in international law, not least with the presence of the World Trade Organisation.
► However, little of the ethos concerning human development and poverty alleviation feeds into these important discussions.
To address these challenges, my home institution, Middlesex University in London, England, has created an MA programme in Human Rights and Business. The course covers areas of law such as international human rights law and the law of the WTO, and explores the relevance of these areas to multinational corporations -- especially those corporations operating in emerging economies. The modules are deliberately human rights law-centred, and go significantly beyond the concept of corporate social responsibility. The programme itself is tailored for busy professionals with significant online content and class contact restricted to two days a month (Friday-Saturday). More information here.

Ballet at Sea? Who does BP think it is kidding?

Much of BP’s s-called “charm offensive” (e.g. attempts to spin the Deepwater Horizon disaster as less than catastrophic) is already well known. The shameless attempts to minimize size of the spill, the ridiculous commercials, the attempts to prevent reporters from informing the public about the horrendous effects the oil is having on wildlife (warning—very upsetting video) and beaches, the dead sperm whale found not far from the spill, not to mention the 11 oil workers who lost their lives, all show a company more focused on minimizing liability exposure than on minimizing the harms that flow (no pun intended) from its actions.
But, even with all that evidence that BP’s crisis management cares more about damage control than on transparency, this “Report from the Gulf” on BP’s website made my jaw drop. I am all for finding the beauty in the everyday, but who do they think they’re kidding??? Oil skimming is dirty, polluted work that puts the health of the clean up workers, whom BP at first didn’t even provide with protective gear, at risk, even as it barely makes a dent in the toxic soup they are spewing into the Gulf.
A few days ago, the Representatives Henry A. Waxman (D-Cal.) and Bart Stupak (D-Mich.), of the House Committee on Energy and Commerce sent BP a fourteen page letter detailing all of the multiple errors and poor choices that combined to create this disaster. Each one involved choosing to minimize costs by increasing risks. I have previously blogged about how the poor deregulatory choices the U.S. made over the last decade enabled BP to be so cavalier with the public good. (here, here and here). But, no amount of thinking about how this crisis occurred, or what lessons to learn from it could prepare me for the unmitigated gall of a company in full CYA mode. Hayward's testimony yesterday was more of the same.
In case you missed it, here is a link to a Rachel Maddow segment where someone read the “report” aloud against a backdrop of what sea skimming actually looks like.

p.s. This is a take that sums up the hypocrisy of BP’s “manage the public” approach to crisis response.

On April 8

On this day in ...
... 1985 (25 years ago today), India sued in the U.S. District Court in Manhattan to recover damages from the Union Carbide Corp., owner of the pesticide plant (left) in Bhopal where a gas leak 3 months earlier, "the worst industrial accident in history, killed about 1,700 people and injured as many as 200,000 more." (photo credit) Sought were not only damages to compensate victims and pay for the costs of emergency relief, but also punitive damages in order, the suit said,
'to deter Union Carbide and any other multinational corporation from the willful, malicious and wanton disregard of the rights and safety of the citizens of those countries in which they do business.'

The litigation eventually moved to India, where, in 1989, the Supreme Court of India approved a $470 million settlement.


(Prior April 8 posts are here, here, and here)

'Nuff said

(Taking context-optional note of thought-provoking quotes)

'[W]hat you are suggesting is that the courts who created corporations as persons, gave birth to corporations as persons, and there could be an argument made that that was the Court's error to start with, ... the fact that the Court imbued a creature of State law with human characteristics.'
-- Sonia Sotomayor (above right), posing the question that appears at page 33 of this transcript of the 1st oral argument in which she participated as an Associate Justice of the U.S. Supreme Court. (Here is audio of the September 9 argument in that campaign spending case, Citizens United v. Federal Election Commission). Jess Bravin plumbed the possible implications of her query in this article in the Wall Street Journal (hat tip to SCOTUSblog); he further observed that "Sotomayor may have found a like mind in Justice Ruth Bader Ginsburg" (below left), who evoked the American Declaration of Independence when she said, even earlier in the argument (transcript p. 4):
'A corporation, after all, is not endowed by its creator with inalienable rights.'
Ways that any rethinking of the legal personality of the corporation might affect subfields of international law -- in particular, the field of corporate responsibility -- deserve pondering.

 
Bloggers Team