Nestlé & Cargill v Doe: Lessons from Nevsun and the meaning of corporate accountability

A summary of the Alien Tort Statute and its application to corporate social accountability, justice for victims of international crime, and human rights violations

By: Sabrina Sukhdeo (2L)

(Photo caption: Cocoa pods on a tree. Photo courtesy of Pixabay)

Much of the world’s chocolate is the product of a global supply chain that operates on forced labour. This horrific fact forms the backdrop of an ambitious lawsuit that is currently before the U.S. Supreme Court.

Nestlé & Cargill v Doe is the story of three Malian citizens who were trafficked as children to Côte d'Ivoire. There, they were forced to work on cocoa plantations that supplied and were serviced by two U.S. based corporations, Nestlé USA and Cargill. This December, the Court will hear arguments on whether the two companies should be held liable under the Alien Tort Statute (ATS) for aiding and abetting forced labour.

Importantly, Nestlé will articulate once more the willingness and capacity of our legal institutions to hold accountable the corporations that thrive in the crevices of the law.  

The Alien Tort Statute: then and now

A 1980 case rescued the ATS, which was first adopted in the late 18^th century, from obscurity under a new interpretation that allowed foreign nationals to seek remedies in U.S. courts for human rights violations committed beyond American borders.

However, in 2013, the U.S. Supreme Court reigned in this modern application by imposing a presumption against extraterritorial application. To the Court in Kiobel v Dutch Petroleum, nothing suggested that the framers of the U.S. constitution intended the ATS to redress wrongs that occurred in foreign countries. At the time, this decision seemed to sound the death knell for corporate liability.  

Nonetheless, the Court left a sliver of hope: the presumption could be rebutted if the claim “touched and concerned” the U.S. This test affixed to an existing one laid out in Sosa v Alvarez-Machain that required two other considerations for a cause of action to proceed under the ATS. First, the violation must be of a “specific, universal, and obligatory” norm under international law. And second, “prudential factors” must not weigh in favour of non-justiciability.

In Nestlé & Cargill v Doe, the defendant corporation in Nestlé submitted that the place of injury and impugned conduct is Côte d’Ivoire, which clearly disqualifies the claim under the ATS. Furthermore, there is no peremptory norm of corporate liability since international law has long been confined to individuals.

However, the Malian plaintiffs argue that the conduct at issue is the aiding and abettingof forced labour, which occurred on American soil through funding and policy decisions made at Nestlé’s and Cargill’s headquarters. It follows, then, that the relevant peremptory norm is not as to who can bear liability. Rather, it is a norm against aiding and abetting slavery that must be established under international law.

Implications of Nevsun

Nestlé is just the latest in a string of corporate liability cases around the world. Just this year, three Eritrean refugees paved the way for Canadian corporations to be held liable for violations of customary international law. Nevsun Resources Ltd v Araya et al. was a landmark decision by the Supreme Court of Canada that spurned many oft-cited barriers against imposing corporate liability. The IHRP had the privilege to intervene in the case, successfully arguing that one such barrier, the act of state doctrine, had no place in Canadian common law.

Indeed, the U.S. Supreme Court may be persuaded to draw inspiration from the Canadian context. Nevsun highlighted the absurdity in automatically singling out corporations for immunity from international human rights law — after all, “states and individuals act through corporations.” The majority clarifies in this vein that there are no categories of liable and non-liable actors in international law. Rather, such law identifies violations of human rights and entrusts the state with determining the remedy. 

On this point however, the Court refused to comment on whether the Eritrean workers should be awarded damages for the alleged breaches of international law. True, this particular question was not before it. But, perhaps this is another nugget to consider from Nevsun. Even where corporate liability is possible in theory, it is not obvious how a successful claim might (ever) be litigated. Nor is it clear how corporate accountability may be realized with a view toward justice for the plaintiffs and beyond.  

Accountability, justice, and the law

Amnesty International announced this October that the Eritrean plaintiffs in Nevsun had reached a settlement with the Canadian mining company for an undisclosed amount after five years of litigation. No doubt, this is a relieving outcome for the former mine workers who can now focus their attention on their lives outside the courtroom.

However, this conclusion also sadly highlighted the limitations of the law in promoting corporate accountability for human rights abuses.

There is no amount of money that can begin to compensate for the indignity and cruelty the mine workers have endured at the hands of their government and Nevsun’s opportunistic greed. Nor would there have been justice in forcing the plaintiffs to describe and defend the details of their suffering through a lengthy trial—a retraumatizing process with no guarantee of “success”.

Both of these realities gesture to a more glaring problem: Can litigation truly hold Nevsun, Nestlé, or any company indicted for similar atrocities,  “accountable”?  The sites of exploitation — the plantations, mines, sweatshops, and so on — continue to lodge deeply unjust working conditions, yoked to a structure of dependency that guts the Global South to stuff the wallets of Western-owned companies. So long as these multinational corporations exist, empowered to impose themselves and their appetite for slave labour abroad, the violence will continue.

Thus, even at its sharpest, the legal system is a spindly stand-alone tool for challenging the conditions that incentivize harm — to both the people and the land — for corporate profit. It seems that our understanding of corporate social accountability must stretch beyond the law and seek out different imaginings of justice on the long journey towards corporate liability.