The US Supreme Court on Thursday reversed a ruling that allowed several individuals to sue food corporations Nestlé USA and Cargill over child slavery claims, limiting corporate liability under the Alien Tort Statute.
The case which the Supreme Court decided was Nestlé USA, Inc. v. Doe I, consolidated with Cargill, Inc. v. Doe I. In these cases, the unnamed plaintiffs alleged that Nestlé and Cargill were complicit in the use of child slave labor on cocoa farms in the Ivory Coast. Although Nestlé and Cargill did not own the farms, they provided substantial resources to the farms, including training, tools, and cash. In exchange for this, the two companies had the exclusive right to purchase cocoa from the farms. The Supreme Court found that Nestlé and Cargill were not liable for human rights abuses on the farm in an 8-1 decision.
The unnamed plaintiffs brought their cases forward under the Alien Tort Statute. The Alien Tort Statute allows for foreign nationals to sue in US courts for human rights abuses committed abroad. In Jesner v. Arab Bank, the Supreme Court stated that the purpose of this law was to “promote harmony in international relations by ensuring foreign plaintiffs a remedy for international-law violations in circumstances where the absence of such a remedy might provoke foreign nations to hold the United States accountable.”
In order for the Supreme Court to find that US law should be extraterritorially applied under the Alien Tort Statute, the statute must specifically authorize this application and there must be a showing that conduct actually occurred within the United States. In this case, the plaintiffs alleged only general corporate decision making occurred in the United States. As a result, the Supreme Court found that application of the Alien Tort Statute to Nestlé and Cargill’s alleged conduct in this case would be an impermissible, extraterritorial application of the statute.
Justice Thomas, joined by Justices Gorsuch and Kavanaugh, sought to limit the authorized uses of extraterritoriality to those which might be recognized in the eighteenth century, when the statute was enacted. Five of the remaining members of the court joined in the disposition of the case, but the court did not reach a majority in whether to limit those causes of action under the statute. Rather, this case will preclude future cases of human rights abuses against corporations where defendants are only able to allege “general corporate decision making” occurred in the United States.