January 17, 2012
Authors
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Peter Nestor
Former Director, BSR
The U.S. Supreme Court is poised to decide whether corporations can be held liable for human rights abuses committed overseas in what will certainly be a landmark case.
The plaintiffs argue that corporations should be held liable, just as they are for injuries caused at home. Opponents argue that U.S. law does not apply in these cases, and that corporations are not the right actors to address human rights abuses in corrupt countries. Eight justices could easily split their votes, and the tiebreaker will likely be Justice Anthony Kennedy, who is sympathetic to corporations but is also a staunch supporter of international human rights law.
The U.S. Justice Department recently filed a brief in support of the plaintiffs, along with dozens of other NGOs. A decision that corporations can be liable could trigger a wave of lawsuits against companies operating in locations prone to abuse.
Regardless of the outcome, leading companies are already taking proactive steps to address human rights in their operations. This makes good business sense, and helps to protect companies given an uncertain legal environment.
Oral arguments in Kiobel v. Royal Dutch Shell are set for February 28, and the court will likely issue a decision midyear.
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