July 2, 2014

Fourth Circuit’s Post-Kiobel Ruling Revives ATS Claims Against U.S. Corporation for Violations Committed Abroad

Posted by Tyler Giannini and Susan Farbstein

On Monday, the Fourth Circuit Court of Appeals ruled that the presumption against extraterritoriality in Alien Tort Statute (ATS) cases, established by the April 2013 U.S. Supreme Court decision in Kiobel v. Royal Dutch Petroleum, Co., does not bar claims against a U.S. contractor for torture and mistreatment of foreign nationals in Iraq.

The Al Shimari v. CACI ruling is a major decision in the ongoing battle over the meaning and interpretation of Kiobel. Kiobel  held that there is a presumption against extraterritoriality in ATS cases unless the “claims touch and concern the territory of the United States with sufficient force,” in which case the presumption can be displaced. In Kiobel, the Supreme Court found the “mere corporate presence” of the defendant in the United States did not overcome the presumption.

The Fourth Circuit compared the factual circumstances in Kiobel with those in Al Shimari, and concluded that the corporate defendant had a much more significant connection to the United States than mere presence. In so ruling, it became the first appellate court to hold that the plaintiffs’ claims sufficiently “touch and concern” U.S. territory to displace the presumption.

In the wake of the Kiobel decision, lower courts across the country have wrestled with how to interpret the new “touch and concern” standard given the limited guidance provided by the Supreme Court. Some courts have avoided the complexities of the Kiobel presumption altogether. However, the Fourth Circuit embraced the challenge:

Although the “touch and concern” language in Kiobel may be explained in greater detail in future Supreme Court decisions, we conclude that this language provides current guidance to federal courts when ATS claims involve substantial ties to United States territory. We have such a case before us now, and we cannot decline to consider the Supreme Court’s guidance simply because it does not state a precise formula for our analysis.

Judge Barbara Keenan, writing for a unanimous panel, went on to explain, “A basic premise of the presumption against extraterritorial application is that United States courts must be wary of ‘international discord’ resulting from ‘unintended clashes between our laws and those of other nations.’” In her reasoning, she noted that “[t]his case does not present any potential problems associated with bringing foreign nationals into United States courts to answer for conduct committed abroad, given that the defendants are United States citizens.”

In her discussion, Judge Keenan summarized the various facts and considerations examined by the court that may provide a roadmap for other courts to follow in their own Kiobel analysis:

We conclude that the plaintiffs’ ATS claims ‘touch and concern’ the territory of the United States with sufficient force to displace the presumption against extraterritorial application based on: (1) CACI’s status as a United States corporation; (2) the United States citizenship of CACI’s employees, upon whose conduct the ATS claims are based; (3) the facts in the record showing that CACI’s contract to perform interrogation services in Iraq was issued in the United States by the United States Department of the Interior, and that the contract required CACI’s employees to obtain security clearances from the United States Department of Defense; (4) the allegations that CACI’s managers in the United States gave tacit approval to the acts of torture committed by CACI employees at the Abu Ghraib prison, attempted to “cover up” the misconduct, and “implicitly, if not expressly, encouraged” it; and (5) the expressed intent of Congress, through enactment of the TVPA and 18 U.S.C. § 2340A, to provide aliens access to United States courts and to hold citizens of the United States accountable for acts of torture committed abroad.8 Accordingly, we hold that the district court erred in concluding that it lacked subject matter jurisdiction under the ATS, and we vacate the district court’s judgment dismissing the plaintiffs’ ATS claims on that basis.

Last October, the Clinic filed an amicus curiae brief in the Al Shimari appeal on behalf of professors of legal history, who argued that the history and purpose of the ATS indicate that the Founders would have allowed claims against U.S. citizens. The Clinic has filed a similar amicus brief in several other pending ATS cases: Doe v. Cisco, Doe v. Drummond, and Doe v. Exxon. Over the past year, the Clinic has also been involved in litigation concerning the Kiobel presumption in two other cases in which it is co-counsel: In re South African Apartheid Litigation and Mamani v. Sanchez de Lozada.