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Article: The Supreme Court Confronts Controversies Overseas, But Will Congress Have the Final Word?

November 01, 2012
Business Litigation Reports

The proper role of US courts in policing conduct abroad is commanding the Supreme Court’s attention and may soon command that of Congress. Since 1789, the Alien Torts Claims Act (“ATCA”) has long conferred jurisdiction upon federal courts to entertain suits “by an alien” for an alleged tort “committed in violation of the law of nations or a treaty of the United States.” Beginning around 1980, the ATCA became a focal point of controversy as non-US citizens increasingly asserted ATCA claims in federal courts arising from alleged wrongs committed outside the United States. Seldom has the Supreme Court weighed in about that controversy. It is now positioned to do so, however, in what could be a landmark decision.

In February, the Supreme Court heard oral argument in Kiobel v. Royal Dutch Petroleum Co. on the question whether corporations (as opposed to individuals) can be liable under the ATCA for alleged wrongdoing committed in foreign countries against foreign nationals. Arguing on the side of the defendant was Kathleen Sullivan, a name partner at Quinn Emanuel Urquhart & Sullivan, LLP, former Dean of Stanford Law School, and renowned appellate advocate and constitutional scholar. Less than a week after hearing the argument, the Supreme Court issued an extraordinary order setting re-argument for next term. The Supreme Court moved beyond the exposure faced specifically by corporations and asked the parties to address a broader question: “Whether and under what circumstances the [ATCA] allows courts to recognize a cause of action for violations of the laws of nations occurring within the territory of a sovereign other than the United States.” Thus, the Supreme Court will now consider the fundamental question whether US courts should be sitting in judgment of alleged violations of international law committed in other countries.

The Court last ordered re-argument in this fashion three years ago, in Citizens United v. FEC. That case yielded a blockbuster ruling favoring corporations’ first-amendment rights in the face of campaign-finance restrictions. It remains to be seen whether Kiobel will yield a ruling of similar significance.

Looking Around the Corner.   Wherever the Supreme Court comes down, there will be winners and losers.   If the Court limits ATCA lawsuits, supporters of opening up the US legal system to foreign plaintiffs will go to Congress to amend the statute to provide for more expansive jurisdiction.   Opponents will attempt to counter those efforts.   Should the Supreme Court instead permit ATCA lawsuits for foreign torts, opponents of such suits might well ask Congress to limit the law’s application to overseas torts, with corresponding resistance mounted by supporters of expansive jurisdiction.   Either way, the debate is unlikely to end with the Supreme Court’s decision, and Congress may have the final word.