Last week, a group of Colombian plaintiffs asked the U.S. Supreme Court to revive their lawsuit against banana giant Chiquita. This case presents an opportunity for the Supreme Court to clarify its 2013 decision in Kiobel v. Royal Dutch Shell and give much needed guidance to plaintiffs and businesses regarding when a corporation may be liable under U.S. law for human rights abuses committed abroad.
The civil war began in earnest in the early-1960s, when high levels of poverty and income inequality sparked an uprising by leftist guerrillas. In response, a network of paramilitary militias sprang up to protect landed interests. These groups were funded by a combination of drug money, U.S. government largesse and, as we will see, American corporate dollars.
In the late-1990s, the paramilitary network was formalized under an umbrella organization known as Autodefensas Unidas de Colombia (AUC) (United Self-Defense Forces of Colombia), which came to include more than 30,000 fighters by 2000.
The birth of the AUC sparked the bloodiest period of the war, marred by thousands of massacres mostly carried out by AUC forces. Over the course of a 10-year period, the AUC "waged a campaign of brutal violence," which included widespread forcible displacement, torture, and the murder of "thousands of campesinos, Afro-Colombians, indigenous persons, trade unionists, human rights advocates, religious leaders and other civilians."
The day before the attacks of Sept. 11, 2001, the U.S. State Department officially designated the AUC a "foreign terrorist organization" (a designation which was removed this past July).
Roughly 70 years after the "banana massacre," Chiquita’s Colombian subsidiary, Banadex, began funding the AUC. The company allegedly stopped paying the AUC in 2004, a year after the company itself brought the fact of the payments to the attention of the U.S. Department of Justice (DOJ). (A Chiquita employee apparently learned of the AUC’s 2001 designation as a foreign terrorist organization and questioned whether it was a good idea to be funding it.)
Chiquita claimed that the payments it made to the AUC were extorted; yet, documents obtained in 2013 by George Washington University’s National Security Archive (the NSA Documents) demonstrate that Chiquita hired the AUC to provide security for its Banadex employees. A company memo from 2000, for example, admits that Colombian paramilitaries had formed a front company to disguise "the real purpose of providing security" to Banadex. The same memo contains the statement: “We should continue making the payments; we can’t get the same level of support from the military."
Four months later, family members of individuals killed by Colombian paramilitary groups in the 1990s and early 2000s filed suit against Chiquita under the Alien Tort Statute (ATS) in a district court in New Jersey. The plaintiffs argued that Chiquita’s payments made it complicit in extrajudicial killings, torture, forced disappearances, crimes against humanity and war crimes committed by Colombian paramilitary and rebel groups.
Other victims’ families later brought similar claims against Chiquita in other U.S. courts, all of which were consolidated in a 2008 multidistrict litigation (MDL) to be tried in Florida. By 2011, after even more claims were folded into the MDL, Chiquita stood accused in U.S. court of contributing to the killing of more than 4,000 Colombian nationals.
In a significant victory for the Colombian plaintiffs, the Florida district court in 2011 denied Chiquita’s motion to dismiss. Chiquita appealed and the 11th Circuit ultimately reversed. The circuit court held that, under the test set forth in the U.S. Supreme Court’s 2013 decision in Kiobel v. Royal Dutch Petroleum, plaintiffs had not alleged a sufficient connection between Chiquita’s actions and the territory of the United States. As such, American courts did not have jurisdiction to hear the claims.
As I have explained here, here and here, the Supreme Court's Kiobel opinion was confusingly opaque and has primarily been used by lower courts to deny plaintiffs' access to justice for human rights abuses committed by American corporations abroad. In reversing the district court and tossing plaintiffs’ complaint against Chiquita, the 11th Circuit adopted a particularly extreme view of Kiobel and the (limited) scope of the ATS, stating simply: "The ATS does not apply extraterritorially."
The majority’s radical position prompted a strong dissent from Judge Beverly Martin, who pointed out that, although the murders all took place in Colombia, it was Chiquita’s conduct in the United States -- namely, "reviewing, approving and concealing a scheme of payments and weapons shipments to Colombian terrorist organizations" -- that formed the basis of its ATS liability. To Judge Martin, this was conduct that "touched and concerned" the territory of the U.S. with "sufficient force" to overcome the presumption against the territorial application of the ATS, as apparently required by Kiobel. As Marco Simons, legal director for EarthRights International (one of several counsel to the Colombian plaintiffs in Chiquita), put it: "It seems pretty straightforward that when a U.S. citizen – a human being or a corporation – finances terrorism, victims of that terrorist violence should be able to try to prove their case in U.S. courts."
Importantly, less than a month before the 11th Circuit’s Chiquita decision, the 4th Circuit held in Al Shimari v. CACI that this same type of conduct -- approval in the U.S. of conduct that violates international law abroad -- was sufficient to satisfy the Supreme Court’s Kiobel test. In reaching this conclusion, the 4th Circuit stated that it must "consider a broader range of facts than the location where the plaintiffs actually sustained their injuries" -- a proposition with which the 11th Circuit clearly disagreed in Chiquita.
In order to clarify its interpretation of federal law, the Supreme Court will often use disagreement within the country’s circuit courts (a so-called “circuit split”) as a basis for accepting a particular case. As Al Shimari and Chiquita make clear, there is fundamental disagreement among the circuits about how to apply Kiobel and when, if ever, a U.S. corporation can be liable for human rights abuses committed abroad. With any luck, the Supreme Court will agree and use the Chiquita case to provide some much needed guidance on this very important question.
Image credit: Flickr/Dawn Huczek
Trained as a lawyer, I now focus on legal business development, corporate social responsibility (CSR), and business & human rights. My past experience includes work on complex commercial litigation, international human rights advocacy, education policy, pro bono legal representation, and analysis of CSR challenges in both the private and public sectors.