SUPREME COURT:

Justices weigh human rights claims against Shell

Supreme Court justices today appeared inclined to limit the ability of human rights lawyers to sue corporations in U.S. courts for alleged acts that take place overseas.

It's not clear how and to what extent the court would achieve that goal, with several justices offering different theories on how a 1789 law called the Alien Tort Statute can be used as a tool to fight human rights abuses around the world.

Oil companies and other extractive industries, which are often defendants in such suits, are deeply interested in the outcome.

The case before the court, Kiobel v. Royal Dutch Petroleum, involves Nigerian plaintiffs who sued Royal Dutch Shell PLC over alleged human rights violations in Nigeria.

Cases involving Exxon Mobil Corp. and mining giant Rio Tinto PLC are among those that would likely be affected if the court ruled in favor of Shell.

The Shell case arose from crackdowns by the Nigerian government in the 1990s on activists in the Ogoni region who have for years protested about the environmental impact of Shell's operations.

The Ogoni plaintiffs say Shell and its related companies aided and abetted the Nigerian government in committing various human rights abuses.

Today's argument is the second time this year the high court has considered the case. In February, the court heard arguments on a different question: whether a corporation can be held liable under the Alien Tort Statute (Greenwire, Feb. 28).

But just a few days later, the court took the unusual step of ordering reargument, asking the parties to argue "whether and under what circumstances the Alien Tort Statute ... allows courts to recognize a cause of action for violations of the law of nations occurring within the territory of a sovereign other than the United States."

In the meantime, various entities, including the U.S. and U.K. governments and the European Commission, have all offered the court possible ways of deciding what types of cases should be allowed to proceed in U.S. courts.

During today's argument, it appeared that the nine justices may have difficulty deciding on which option to take.

Justice Anthony Kennedy, the court's regular swing vote, seemed to be interested most in barring cases, like Kiobel, in which there is little, if any, connection with the United States.

Likewise, Justice Antonin Scalia voiced concerns about the possibility of U.S. corporations' being sued in overseas courts for violations in the United States.

Justices Ruth Bader Ginsburg and Sonia Sotomayor both raised the possibility of requiring plaintiffs to first make sure they cannot sue in other courts -- for example, a court in the country where the alleged violation took place -- before they can sue in U.S. courts.

Sotomayor noted with approval the recommendations made by the European Commission along those lines.

"It seems like a simple set of rules," she said.

Yes another option would be to take into account the views of the State Department in considering possible foreign policy implications, an approach Justice Stephen Breyer seemed to favor.

"That would get rid of this problem," he said.

The lawyers for both sides were put on the defensive at certain points. Paul Hoffman, of Venice, Calif.-based Schonbrun DeSimone Seplow Harris & Hoffman, who represents the plaintiffs, seemed to accept that the court wanted to place some limitations on the application of the Alien Tort Statute.

He conceded, for example, that the notion of requiring plaintiffs to try to sue in other courts first could be viewed as an "additional safeguard."

Shell attorney Kathleen Sullivan, of Quinn Emanuel Urquhart & Sullivan, initially seemed to be arguing for a broad ruling against any overseas application of the law, but she then backed off somewhat under questioning from the justices.

One of Sullivan's backup arguments is that the Alien Tort Statute could apply in certain circumstances, but not in cases, like Kiobel, in which the defendant is foreign and the conduct took place overseas.

Solicitor General Donald Verrilli, presenting the views of the Obama administration, didn't get an easy ride, either.

Scalia asked why the court should defer to his argument -- that cases like Kiobel should be barred, but others shouldn't -- when previous administrations have taken positions more sympathetic to defendants.

Verrilli was forced to offer a defense of his role, in which he has to consider the views not just of the State Department but other arms of the federal government.

Scalia wondered why the Obama administration's arguments deserve any more deference than those of prior administrations.

"Because they are persuasive, your honor," Verrilli said.