How EEOC v. Arabian American Oil Co. Invented the Modern Presumption Against Extraterritoriality

The presumption against extraterritoriality (“PAE”), like all canons of construction, is a shorthand rule of interpretation used by judges to determine how a statute should be applied. Under the PAE, where there exists ambiguity as to the geographical scope of a statute, the court is required to limit the statute’s application to acts which occur within the territorial limits of the United States. But the PAE, as originally construed in EEOC v. Arabian American Oil Co. (1991) (“Aramco”), and as elaborated upon in Morrison v. National Australia Bank Ltd. (2010) and, more recently, in Kiobel v. Royal Dutch Petroleum (2013), is of a relatively modern vintage for a judicial canon, as it did not exist in its current form until the second half of the 20th century. Prior to the 1950s, the PAE, as it is understood today, did not exist. The modern PAE is instead a conflation of two older canons of construction, and although both those canons are often described as ‘presumptions against extraterritoriality,’ neither canon functioned in the manner that the PAE does today.

These two prior canons, although related both to each other and the modern PAE, were used by the courts two answer two separate questions of statutory construction, and did not typically overlap in their application. The first of these canons, which for purposes of this post has been dubbed the presumption against absurdities (“PAA”), was a presumption that a statute does not provide for extraterritorial application when doing so or when such an interpretation would necessarily imply that the court possesses an unflattering opinion of Congress’ competence. The second canon, which will be referred to here as the presumption against universality (“PAU”), provided that when a statute uses words such as “any,” or “all,” or “every,” those words would not be presumed to have been intended literally when the statute’s context shows that Congress used those words with a more limited definition in mind.

The Presumption Against Absurdities

The PAA, as an offspring of the Charming Betsy Canon, was based in part on the assumed conformity between U.S. law and international law, and was used when a statute could be interpreted in a manner that would place it beyond Congress’ actual authority to enact, either under international law or domestic law. Under the PAA, courts presumed that Congress had a reasonable intent, rather than an unreasonable one, when enacting legislation — or, in other words, that courts should refrain from interpreting statutes in a manner which would make Congress look like a bunch of idiots. As it was well understood to 19th century jurists “that the legislation of every country is territorial [ and] that beyond its own territory, [a state's legislation] can only affect its own subjects or citizens,” Rose v. Himely (1808), statutes were not to be construed in a way that would extend their effect beyond this permissible realm. As such, courts applying the PAA would not interpret a statute to cover extraterritorial conduct when doing so would necessarily have unflattering implications about the perceived competence of the legislative branch.

The roots of the PAA can be seen in U.S. v. Palmer (1818), in which the Court considered a law proscribing certain acts committed by “any seaman.” The Court concluded that “it cannot be supposed, that the legislature intended to punish a seaman, on board a ship sailing under a foreign flag, under the jurisdiction of a foreign government[.]” The Court’s reasoning was that it “would be difficult to believe” that Congress could have actually intended something so foolish, and therefore an interpretation that makes Congress look less ignorant should be presumed. This was not a presumption against extraterritoriality, however, because the statute’s extraterritorial effect was not in question. The Court needed a way to interpret “any seamen” to apply to U.S. seamen that were outside of the U.S., and not to alien seamen that were outside of the U.S., and it did do by assuming that a literal interpretation of a statute cannot be correct when a less literal construction would not make Congress look like a bunch of rubes.

Following Palmer, the PAA would be invoked by the courts many times over the course of the 19th and 20th centuries, both to find that an extraterritorial effect was not warranted because it conflicted with international law, and also to find that extraterritorial effect was warranted where it would not conflict with international law. See The Apollon (1824) (“[D]oes it follow that the power to arrest her was meant to be given, after she had passed into the exclusive territory of a foreign nation? We think not. It would be monstrous to suppose that our revenue officers were authorized to enter into foreign ports and territories, for the purpose of seizing vessels which had offended against our laws. It cannot be presumed that Congress would voluntarily justify such a clear violation of the laws of nations. The arrest of the offending vessel must, therefore, be restrained to places where our jurisdiction is complete, to our own waters, or to the ocean, the common highway of all nations.”); Toland v. Sprague, 37 US 300 (1838) (“[I]t is easy to perceive why the restriction in regard to the process was confined to inhabitants of the United States. Plainly, because it would not have been necessary or proper to apply the restriction to those whom the legislature did not contemplate, as being within the reach of the process of the courts, either with or without restrictions.”); United States v. Coombs (1838) (“There is, then, no reason, founded in the language or policy of the clause, to insert a restriction and locality which have not been expressed by the legislature. On the contrary, upon general principles of interpretation, where the words are general, the Court are not at liberty to insert limitations not called for by the sense, or the objects, or the mischiefs of the enactment.”); Waring v. Clarke (1847) (“There is no escape from this result, unless it is to be implied that the amendments were proposed by persons careless or ignorant of the difference in the mode of trial of suits at common law and in admiralty”); Patterson v. Bark Eudora (1903) (holding that “[a]n act to amend the laws relating to American seamen” also applied to foreign seamen; as Congress in this instance legitimately had the power under international law to impose this statute, to read the statute so as to exclude them would be improper, and especially so where excluding foreign seamen would gravely undermine the congressional interests underlying the statute); American Banana v. United Fruit Co. (1909) (“In the case of the present statute the improbability of the United States attempting to make acts done in Panama or Costa Rica criminal is obvious[.]“); U.S. v. Freeman (1915) (“And yet all will concede that Congress did not intend to do anything so obviously futile as to denounce as criminal an act wholly done in a foreign country, such as is the delivery to the carrier where the shipment is from a foreign country into a State.”); Sandberg v. McDonald (1918) (“Congress certainly did not intend to punish criminally acts done within a foreign jurisdiction; a purpose so wholly futile is not to be attributed to Congress.”); United States v. Bowman (1922) (holding that an extraterritorial effect should be presumed where there was no conflict with external laws, and where the purpose of the law would plainly be served by applying extraterritorially: “It would hardly be reasonable to hold that if any one, certainly if a citizen of the United States, were to steal or embezzle such property which may properly and lawfully be in the custody of army or naval officers either in foreign countries, in foreign ports or on the high seas, it would not be in such places an offense which Congress intended to punish by this section.”); and Branch v. FTC (7th Cir. 1944) (holding that American Banana did not prevent extraterritorial application of the statute in question, because “[t]he exercise by the United States of its sovereign control over its commerce and the acts of its resident citizens therein is no invasion of the sovereignty of any other country or any attempt to act beyond the territorial jurisdiction of the United States.”).

Often, American Banana is wrongfully identified as the iconic modern case that established the presumption against extraterritoriality, based on its pronouncement that “[a]ll legislation is prima facie territorial.” This is a misreading of that case, however, as American Banana did not intend — or even contemplate — the PAE, as it was applied in Morrison or Kiobel. The statement from American Banana, in context, was as follows:

The foregoing considerations would lead in case of doubt to a construction of any statute as intended to be confined in its operation and effect to the territorial limits over which the lawmaker has general and legitimate power. “All legislation is prima facie territorial.” Ex parte Blain, In re Sawers, 12 Ch. Div. 522, 528; State v. Carter, 27 N.J. (3 Dutcher) 499; People v. Merrill, 2 Parker, Crim. Rep. 590, 596

Examining the Court’s citations clarify that American Banana was not a presumption against extraterritoriality, but a presumption against absurd applications of the law. The two American cases the Court cites to are both concerned with inter-state applications of domestic criminal law. See State v. Carter (holding that an indictment setting forth a felonious assault and battery in New York, in which the victim then came into New Jersey and died from the assault’s effects there, could not result in a criminal charge under New Jersey law); and People v. Merrill (1855) (“[t]he penal acts of one state can have no operation in another state.”).

And American Banana’s most famous statement, “[a]ll legislation is prima facie territorial,” was adopted from the British case of Ex parte Blain [1879]. The full quotation from that case was:

The governing principle is, that all legislation is prima facie territorial, that is to say, that the legislation of any country binds its own subjects and the subjects of other countries who, for the time, bring themselves within the allegiance of the legislating power.

By “territorial,” Ex parte Blain was not referring literally to a geographical limitation, but to the limitations on a nation’s sovereignty. This is nothing more than a restatement of U.S. case law on that same subject, as held by Rose v. Himely (1808):

It is conceded that the legislation of every country is territorial; that beyond its own territory, it can only affect its own subjects or citizens.

The PAA is based on this traditional understanding of the limitations on Congress’ prescriptive jurisdiction, which allows courts to assume that Congress had not contemplated exceeding these boundaries, even when a statute could be fairly read to extend beyond this permissible scope. The PAA, unlike the PAU, is therefore concerned with the actual limits of the U.S.’s sovereignty under international law, and as such, the PAA only arises when a proposed interpretation of a statute would in fact place the statute in conflict with either the laws of foreign states or the law of nations. The PAA does not apply to extraterritorial legislation which is not at risk of causing such conflicts.

The Presumption Against Universality

In contrast to the presumption against absurdities, the presumption against universality has little to no relation to international law, and it has no relation at all to the existence of any limitations on congressional power. Its primary use was as a judicial mechanism for repairing the imprecise edicts of a slightly sloppy legislative branch: in the language of Congress, “all things” does not mean “all things in the universe,” but rather “all things we meant to refer to in this law.” As such, under the PAU, when a statute uses a universal term, courts are not obligated to read into the statute a universal effect.

By applying the PAU, courts were thus able to free themselves from literal interpretations of vaguely worded statutes. When the legislature had included a universally inclusive term, but it seemed most probable that that no universal inclusion was intended, “all” and “every” were read instead as “all the subjects contemplated by this statute,” and “every act that is intended to be regulated by this section.” Unsurprisingly, then, the PAU often (but not exclusively) arose in cases concerning the proposed global application of a law, when all surrounding circumstances would suggest that only local regulation had been intended. See Cohens v. Virginia (1821) (“Congress must have considered itself as delegating to this corporate body powers for these objects, and for these objects solely. In delegating these powers, therefore, it seems reasonable to suppose that the mind of the legislature was directed to the City alone, to the action of the being they were creating within the City, and not to any extra-territorial operations. In describing the powers of such a being, no words of limitation need be used. They are limited by the subject.”); Brown v. Duchesne (1857) (“The general words used in the clause of the patent laws granting the exclusive right to the patentee to use the improvement, taken by themselves, and literally construed, without regard to the object in view, would seem to sanction the claim of the plaintiff. But this mode of expounding a statute has never been adopted by any enlightened tribunal — because it is evident that in many cases it would defeat the object which the Legislature intended to accomplish.”; “[T]hese acts of Congress do not, and were not intended to, operate beyond the limits of the United States; and as the patentee’s right of property and exclusive use is derived from them, they cannot extend beyond the limits to which the law itself is confined. And the use of it outside of the jurisdiction of the United States is not an infringement of his rights, and he has no claim to any compensation for the profit or advantage the party may derive from it.”); Ellis v. United States (1907) (“Without further elaboration of details we are of opinion that the persons employed by the two defendant companies were not laborers or mechanics and were not employed upon any of the public works of the United States within the meaning of the act. As in other cases where a broad distinction is admitted, it ultimately becomes necessary to draw a line, and the determination of the precise place of that line in nice cases always seems somewhat technical, but still the line must be drawn.”); N.Y. Cent. R.R. Co. v. Chisholm (1925) (“It is unnecessary for us to consider the power of Congress to impose civil liability upon citizens of the United States for torts committed within the territory of another nation. The present case presents nothing beyond a question of construction.”); Blackmer v. United States (1932) (“While the legislation of the Congress, unless the contrary intent appears, is construed to apply only within the territorial jurisdiction of the United States, the question of its application, so far as citizens of the United States in foreign countries are concerned, is one of construction, not of legislative power.”); Foley Bros. v. Filardo (1949) (“The question before us is not the power of Congress to extend the Eight Hour Law to work performed in foreign countries. Petitioners concede that such power exists. The question is rather whether Congress intended to make the law applicable to such work.”).

The modern restatement of the PAU was most plainly set forth in Foley Bros. v. Filardo. There, in interpreting the reach of a statute that used the phrased “every contract,” the Court held that “every” could be understood figuratively, rather than literally. In doing so, it applied “canon of construction” that permit the court to make inferences “whereby unexpressed congressional intent may be ascertained.” Foley Bros. v. Filardo (1949) (citing Blackmer v. United States (1932)). This allowed the Court to avoid reading the statute as it was actually written:

Nothing in the legislative history supports the conclusion of respondent and the court below that “every contract” must of necessity, by virtue of the broadness of the language, include contracts for work to be performed in foreign countries.

And, importantly, the Court’s holding in Foley Bros. regarding this ‘canon of construction’ was not based on prior caselaw which had excluded the extraterritorial reach of any statutes. Instead, the Court cited to U.S. v. Bowman (“The necessary locus, when not specially defined, depends upon the purpose of Congress”) and Blackmer v. U.S. (“By virtue of the obligations of citizenship, the United States retained its authority over him, and he was bound by its laws made applicable to him in a foreign country.”), and contrasted its holding in Foley Bros. with a prior cases in which, despite any explicit statement of extraterritoriality in the statutes in question, the Court had found the existence of an extraterritorial effect, where an extraterritorial effect appeared consistent with Congress’ purpose in enacting the statute. See Vermilya-Brown Co. v. Connell (1948) (“We think these facts indicate an intention on the part of Congress in its use of the word ‘possession’ to have the Act apply to employer-employee relationships on foreign territory under lease for bases. Such a construction seems to us to carry out the remedial enactment in accord with the purpose of Congress.”).

Unlike the PAA, the PAU is unconcerned with whether or not Congress had the authority under international law to enact the statute being considered. And, unlike the PAE, the PAU did not provide for a blanket preference that statutes are only to be applied territorially, nor did it provide that extraterritorial effects can only exist when Congress has won a complicated game of “Mother May I” in the drafting of its enactments. Instead, the canon’s purpose and effect was much more limited: when a statute contains words of a universal scope, the statute may, when appropriate, be interpreted to have a more limited scope than what is literally provided for.

The Invention of the Presumption Against Extraterritoriality

The modern PAE was officially recognized — if not invented — by the Court’s decision in Aramco. It was in Aramco that the new, more expansive canon of construction was announced, and given the name of the “presumption against extraterritoriality” by the Court. In doing so, the Court eliminated the implicit, but long-recognized, distinctions between the PAU and PAA. The new PAE included elements of both the PAU and the PAA, but was more extensive in its application, and more confused about the justification for its existence.

Although Aramco was not the very first case to wrongfully conflate the PAU and PAA (Benz v. Compania Naviera Hidalgo, S.A. (1957) had as well, in a more limited fashion), it was the first case to do so explicitly. The Court’s method of statutory construction, in interpreting Title VII of the Civil Rights Act, invoked PAA and the PAU simultaneously, while erroneously claiming that the two canons were one and the same:

It is a longstanding principle of American law “that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States.” Foley Bros., 336 U. S., at 285. This “canon of construction … is a valid approach whereby unexpressed congressional intent may be ascertained.” Ibid. It serves to protect against unintended clashes between our laws and those of other nations which could result in international discord. See McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U. S. 10, 20-22 (1963).

Contrary to the Court’s blithe assertion in Aramco, however, the “canon of construction” referred to in Foley Bros. did not “serve[] to protect against unintended clashes between our laws and those of other nations,” as was stated in McCulloch. The decision in Foley Bros. had been based on the PAU, and, relying on the previous decision in Blackmer, held that its decision was “one of construction, not of legislative power.” In contrast, McCulloch was based on the PAA; there, the Court had based its decision directly on Charming Betsy, holding that it could “find no basis for a construction which would exert United States jurisdiction over and apply its laws” in circumstances contrary to the holdings of the State Department, Congress, and international law.

But the conflation of the two lines of statutory construction stuck, and, post-Aramco, the PAU and the PAA were treated as one and the same. And, although the PAU and PAA had both been canons of limited scope, applying only to statutes which raised the specific problems of statutory construction that the canons were concerned with, Aramco’s PAE applies to all statutes without exception. To compound matters, Aramco also kicked off the invention of the previously unknown ‘clear indication’ rule. As a result, the PAE, as it is understood today, is as often used as a means of judicial constraint against the legislative branch as it used as a means of ascertaining congressional intent.

-Susan

The Extraterritorial Effect of Respublica v. De Longchamps

The Supreme Court’s recent decision in Kiobel v. Royal Dutch Petroleum held that the presumption against extraterritoriality applies to common law causes of action under the ATS, and that there is no evidence the First Congress had intended the ATS to confer jurisdiction over extraterritorial torts. The Court’s conclusion was based, in part, on its claim that the ATS had been specifically enacted in response to two “domestic” breaches of international law: the Marbois-Longchamps Affair and the arrest of a servant in Ambassador Van Berckel’s household:

Two notorious episodes involving violations of the law of nations occurred in the United States shortly before passage of the ATS. Each concerned the rights of ambassadors, and each involved conduct within the Union. In 1784, a French adventurer verbally and physically assaulted Francis Barbe Marbois — the Secretary of the French Legion — in Philadelphia. The assault led the French Minister Plenipotentiary to lodge a formal protest with the Continental Congress and threaten to leave the country unless an adequate remedy were provided. Respublica v. De Longschamps [sic], 1 Dall. 111 (O. T. Phila. 1784).

The Court held that, because there are two known domestic incidents that contributed to the ATS’s enactment, when the First Congress drafted the ATS it must have only had in mind domestic causes of action:

These prominent contemporary examples — immediately before and after passage of the ATS — provide no support for the proposition that Congress expected causes of action to be brought under the statute for violations of the law of nations occurring abroad.

The Court’s claim that the First Congress was concerned primarily with these two incidents is based on assumption, not the historical record. More significantly, however, the Court’s claim that Respublica v. De Longchamps “involved conduct within the Union” is, quite simply, wrong. The Longchamps case was understood by all involved to be a case involving the extraterritorial application of the law.

Kiobel was correct that the Longchamps case involved “a French adventurer verbally and physically assaulted [Secretary] Marbois.” But the Court’s summary description of the case conflates two wholly separate charges. Longchamps, a French expat, was charged with a verbal assault and a physical assault aginst Marbois, but it was only the verbal assault that fell afoul of the laws of nation. The charge for the physical assault was not under international law, but under municipal law:

Longchamps was initially charged with two counts: (1) “unlawfully and violently threatening and menacing bodily harm and violence to the person of the honorable Francis-Barbe De Marbois, Secretary to the Legation from France, and Consul General of France to the United States of America, in the mansion-house of the Minister Plenipotentiary of France,” and (2) “for an Assault and Battery committed upon the said Secretary and Consul, in a public street in the City of Philadelphia.”

The jury had no difficulty convicting Longchamps on the second count, and the Pennsylvania Court “[t]he second offence charged in the indictment, namely the Assault and Battery, needs no observations.”

But the first count was more problematic. One of the reasons that the Marbois Affair caused so much diplomatic unease is that Longchamps’ violation of the law of nations occurred not on the street, as the assault had, but in the hotel of the minister plenipotentiary of France. There was a great deal of uncertainty among both members of the Federal Congress and the government of Pennsylvania as to whether such an extraterritorial offense was even cognizable by a Pennsylvanian court.

This was a very real foreign relations concern for the United States. Marbois himself was not that important, and it wasn’t his personal indignation that was causing the Framers’ a foreign relations headache. The true party in interest was the Chevalier de la Luzerne, the French Ambassador — and the United States cared very much about maintaining his good graces.

The offense to Luzerne occurred two days prior to battery that occurred on the Philadelphia streets, when Longchamps went to the French minister plenipotentiary’s house and gotten into a verbal altercation with Marbois. Longchamps’ insults to the secretary were quite scanadalous, at least by the contemporary standards. The specific insult Longchamps was said to have made to Secretary Marbois was, “I will dishonor you, you naughty rascal!”

And it was this insult — or rather, the location where Longchamps said the insult — that was the real point of contention. Such an act was deemed a violation of the laws of nations, and French minister Luzerne wanted recompense. Believing that it had been an insult to the French nation’s honor, Luzerne — and also his friend, Van Berckel, the Dutch minister, who would later be involved in the 1787 event also cited by Kiobel – threatened to remove their respective legations from Philadelphia if the U.S. failed to take appropriate action against Longchamps under the laws of nations.

In fact, at Longchamps’ trial in July of 1784, it initially seemed that only the assault charge under municipal law would stand, as the jury originally found Longchamps to be guilty of only that offense. After a little bit of coaxing from the judges, however, the jury finally got it right, and convicted him of violating both the law of Pennsylvania and the law of nations:

The Jury, at first, found the defendant guilty of the Assault only; but, the Court desiring them to re-consider the matter, they returned with a verdict against him on both Counts.

Longchamps’ defense attorneys contested the validity of the count chargining a violation of the law of nations, arguing that only the municipal law of Pennsylvania could apply, as that was where the offense was committed. This claim was rejected by the Pennsylvania Court, which concluded that the law of nations — and not the municipal law of Pennsylvania — properly applied to Longchamps’ offense, because the offense had been committed extraterritorially, outside of the territory of Pennsylvania, where Pennsylvania law did not apply:

It must be determined on the principles of the laws of nations, which form a part of the municipal law of Pennsylvania; and, if the offences charged in the indictment have been committed, there can be no doubt, that those laws have been violated. The words used in the Minister’s house, (which is to be considered as a Foreign Domicil, where the Minister resides in full representation of his sovereign, and where the laws of the State do not extend) may be compared to the same words applied to the Judges, in a Court of Justice, where they sit in representation of the majesty of the People, of Pennsylvania.

The Pennsylvania Supreme Court’s decision was based on then-existing conceptions of the inviolability of the premises of a foreign minister. Although the doctrine was discarded shortly thereafter, in the 18th century, at the time that Longchamps was decided, the concept of the Franchise de l’hôtel was still in effect. Under this doctrine, a foreign minister’s dwelling (or domicile) was conceived to be “extra-territorial” to the nation where it sat. The laws of the host state did not enter upon or apply to the minister’s domicile, and the host sovereign could not exercise jurisdiction — whether civil or criminal — over acts which occurred within it, because the foreign minister’s hotel was considered to be under the jurisdiction and sovereignty of his home state.

Unsurprisingly, this doctrine lead to a great deal of abuse by ambassadors, who used their extraterritorial status to their own financial benefit, by shielding criminals and smugglers of all types. In fact, in the 16th and 17th centuries, prior to the more limited Franchise de l’hôtel, the law of nations recognized the more expansive Franchise du quartier — the right of the ambassador to claim privileged status over his entire city quarter. Under the Franchise du quartier, Ambassadors could, from their residences, grant asylum, enter into contracts, or try and execute servants for criminal violations, all under the law of the sovereign nation to which the embassy belonged.

By the late 18th century, the extent of a foreign minister’s exterritoriality had diminished from its earlier peak. The modern view — which is that foreign embassies are entitled to an extensive list of privileges and immunities, but are nevertheless within the territorial sovereignty of the nation in which they are located — was not yet fully established, however. And at the time of Longchamps’ trial, the Pennsylvanian authorities, the French legation, and the Federal government were all very much of the belief that Longchamps’ crime against the French legation had been committed on French soil, not U.S. soil. In requesting advice from Congress on how to proceed against Longchamps, the Supreme Executive Counsel of Pennsylvania specified that the offense had occurred “in the hotel of the Minister of France,” finding the location of the infraction to be of great signficance. Luzerne also made much of the location of the insul; his position was that France was entitled to exercise jurisdiction over the offense, because it had been extraterritorial to the United States, and he therefore requested that Longchamps be repatriated to France so that he could be prosecuted there.fn2

Although France’s extradition request was denied, Chief Justice McKean ultimately agreed with Pennsylvania’s Attorney General, William Bradford. Bradford argued, on behalf of the prosecution, that Longchamps’ insults were an offense against the law of nations, and that Pennsylvania’s law did not apply, because it had occurred “where the Minister resides in full representation of his sovereign, and where the laws of the State do not extend.” Under Pennsylvania law, use of insulting language was not a crime, and he could not be convicted for calling Marbois a dirty rascal. Under international law, however, such an act was an offens. The Supreme Court of Pennsylvania agreed with Bradford that the offense had been extraterritorial, and Longchamps’ conduct was therefore a criminal offense. The Pennsylvania Court also found that, even though the offense was under international law and not Pennsylvanian law, Longchamps could still be convicted of the offense by a Pennsylvania state court. As Bradford had argued, “the law of nations, which makes part of the common law of all nations, requires no particular forms of legal proceedings, but always adopts those of the municipal laws of the different countries of where it is in force.” The Pennsylvania Court accordingly found that the Law of Nations provided the substantive law which made Longchamps’ conduct a criminal offense, and that Pennsylvania provided the forum and procedural law under which Longchamps could be charged and convicted.

Bradford, as the Attorney General for the United States, would also later reaffirm the view that a  foreign minister’s dwelling-house was extraterritorial to the jurisdiction of the state where it was located. In his Opinion of June 24, 1794, at 1 Op. 47, Bradford noted that, unlike an ambassador’s dwelling, a foreign warship in the United States’ territorial waters was subject to that state’s jurisdiction: “[t]he commander of a foreign ship-of-war . . . cannot claim that extraterritoriality which is annexed to a foreign minister and to his domicil; but is conceived to be fully within the reach of, and amenable to, the usual jurisdiction of the State where he happens to be.” This decision echoes the language used in Respublica v. Longchamps, and does not support the Supreme Court’s conclusion in Kiobel that Longchamps “involved conduct within the Union.”

-Susan

fn1. As a legal matter, the offence of assault and battery on a public street was unquestionably a crime under the municipal law, and not the source of any legal uncertainty. It is of interest to note, however, that there is reason to be skeptical of the factual basis of the charge, and there is evidence that Marbois, not Longchamps, was the initial aggressor.

fn2. Luzerne’s demand for Longchamps to be extradited caused its own political difficulties. Longchamps was not without supporters in the U.S., and his extradition would have been domestically unpopular. This is part of why the case became such a flashpoint; the U.S. officials could not extradite Longchamps without causing a domestic scandal, and could not fail to convict him for a breach of international law without causing a foreign relations disaster.

Thomas Jefferson Disagrees with the Supreme Court’s Decision in Kiobel

In 1792, Thomas Jefferson, as the first Secretary of State, made note of complaints that had been lodged against the U.S. by both Spain and France. In different incidents, citizens of Georgia had breached international law by trespassing into Florida (then a part of Spain) and into the territorial waters of Santo Domingo for the purpose of recapturing and kidnapping slaves. In examining the remedies that might be available to the United States to prevent this situation from reoccurring in the future, Jefferson affirmed the Alien Tort Statute’s extraterritorial reach, taking it as obvious that the statute conferred jurisdiction over acts that took place in a foreign sovereign’s territory:

XXX. — Opinion relative to a case of recapture, by citizens of the United States, of slaves escaped into Florida, and of an American captain enticing French slaves from St. Domingo.

December 3, 1792.

Complaint has been made by the Representatives of Spain that certain individuals of Georgia entered the State of Florida, and without any application to the Government, seized and carried into Georgia, certain persons, whom they claimed to be their slaves. This aggression was thought the more of, as there exists a convention between that government and the United States against receiving fugitive slaves. The minister of France has complained that the master of an American vessel, while lying within a harbor of St. Domingo, having enticed some negroes on board his vessel, under pretext of employment, bought them off, and sold them in Georgia as slaves.

1. Has the general government cognizance of these offences? 2. If it has, is any law already provided for trying and punishing them?

1. The Constitution says .. that Congress shall have power to “define and punish piracies and felonies committed on the high seas, and offences against the law of nations.” These offences were not committed on the high seas, and consequently not within that branch of the clause. Are they against the law of nations, taken as it may be in its whole extent, as founded, 1st, in nature; 2d, usage; 3d, convention? So much may be said in the affirmative, that the legislators ought to send the case before the judiciary for discussion; and the rather, when it is considered that unless the offenders can be punished under this clause, there is no other which goes directly to their case, and consequently our peace with foreign nations will be constantly at the discretion of individuals.

2. Have the legislators sent this question before the Courts by any law already provided? The act of 1789, chapter 20, section 9, says the district courts shall have cognizance concur rent with the courts of the several States, or the circuit courts, of all causes, where an alien sues for a tort only, in violation of the law of nations: but what if there be no alien whose interest is such as to support an action for the tort? — which is precisely the case of the aggression on Florida. If the act in describing the jurisdiction of the Courts, had given them cognizance of proceedings by way of indictment or information against offenders under the law of nations, for the public wrong, and on the public behalf, as well as to an individual for the special tort, it would have been the thing desired.

The same act, section 13, says, the “Supreme Court shall have exclusively all such jurisdiction of suits or proceedings against ambassadors, or other public ministers, or their domestics or domestic servants, as a court of law can have or exercise consistently, with the law of nations.” — Still this is not the case, no ambassador, &c., being concerned here. I find nothing else in the law applicable to this question, and therefore presume the case is still to be provided for, and that this may be done by enlarging the jurisdiction of the courts, so that they may sustain indictments and informations on the public behalf, for offences against the law of nations.

[A note added by Mr. Jefferson at a later period. ]

On further examination it does appear that the 11th section of the judiciary act above cited gives to the circuit courts exclusively, cognizance of all crimes and offences cognizable under the authority of the United States, and not otherwise provided for. This removes the difficulty, however, but one step further; — for questions then arise, 1st. What is the peculiar character of the offence in question; to wit, treason, felony, misdemeanor, or trespass? 2d. What is its specific punishment — capital or what? 3d. Whence is the venue to come?

As these offenses had taken place in the territory of other sovereigns — and not upon the high seas, which is the geographical extent of Congress’ authority to prescribe “piracies and felonies” — Jefferson concluded that the Constitutional authority for acting against the Georgians’ incursions came from the “offences against the law of nations” clause. Jefferson then considered whether Congress had previously, pursuant to this authority, provided for any laws that might reach the challenged conduct and, in examining the section now known as the Alien Tort Statute, finds that Congress had. Unfortunately for Jefferson, the ATS would not protect the U.S.’s interest in this instance, leading him to  lament the apparent lack of federal jurisdiction for such a case to be heard before the federal courts: “what if there be no alien whose interest is such as to support an action for the tort?”

But Jefferson implicitly accepted that, under the ATS, an alien possessed an individual cause of action for an extraterritorial tort. The Attorney General at that time, Edmund Randolph, concurred with Jefferson that a civil claim could plainly exist over the slave abductors, even though the exercise of criminal jurisdiction under those circumstances was more questionable.

And although no plaintiff existed to have standing in the cases of the Florida and St. Domingo slave abductions — and thus no claim under the ATS was available — the permissibility of civil jurisdiction over the defendants was, to Jefferson, obvious. Constitutional authority to provide a cause of action over the offence was authorized under the “offences against the law of nations” clause; subject matter jurisdiction in the district courts was provided for by section 9 of the Judiciary Act of 1789; and personal jurisdiction was to be had over the defendants owing to both their presence in the state of Georgia and their status as U.S. citizens. No ‘presumption against extraterritoriality’ would have applied, under Jefferson’s understanding, because such a judicial construction would have directly undermined the congressional purpose underlying the ATS.

-Susan

Kiobel’s Bowman Problem: Where the Legislature Has Enacted Laws to Defend the U.S. Government’s Interests, the Presumption Against Extraterritoriality Does Not Apply

Last week, in Kiobel v. Royal Dutch Petroleum, et al., the Supreme Court deviated from its prior two decisions under the ATS, and held that the ATS does not confer jurisdiction over violations of the law of nations that occur within a foreign territory. The ATS, the Court can concluded, can be presumed to apply to activity on the high seas, but nevertheless cannot be presumed to apply to activity that occurs outside of both U.S. territory and the high seas:

the presumption against extraterritoriality applies to claims under the ATS, and that nothing in the statute rebuts that presumption. ‘[T]here is no clear indication of extraterritoriality here,’ and petitioners’ case seeking relief for violations of the law of nations occurring outside the United States is barred.

Although I fully agree with the Court’s conclusion that jurisdiction did not exist over the claims being asserted by the Kiobel plaintiffs, the majority’s reliance on the presumption against extraterritoriality to reach this holding is ill-placed. The Court’s claim that the ATS was not intended to apply abroad is ahistorical, as the legislature is not required to specifically define a locus for statutes enacted to defend the U.S.’s security interests. The nature of the statute is itself proof that it was intended to apply outside of U.S. territory.

Kiobel acknowledges that the First Congress’ intent in including the ATS in the Judiciary Act of 1789 was, at least in major part, in order to “avoid[] diplomatic strife” by ensuring there would be a federal forum in which the citizens of foreign states could be provided relief for violations of the laws of nations. If such relief was not made available, and an alien’s injuries were not remedied, then the United States could itself be liable for a breach of international law. Because a private individual’s violation of international law could endanger the United States’ national interest, and require the United States to offer restitution for the offense, an ATS suit was a matter of public, and not private, concern.

Given that background, it seems incongruous to hold that the ATS does not evidence an intent to apply extraterritorially. In fact, the Court’s own case law has already reached that same conclusion, finding that the presumption against extraterritoriality does not apply to laws which “are enacted because of the right of the Government to defend itself” — the precise purpose for which the ATS has been enacted. United States v. Bowman, 260 U.S. 94 (1922).

Bowman found that the presumption against extraterritoriality did not apply to a federal statute prohibiting “conspir[ing] to defraud a corporation in which the United States was and is a stockholder,” even though no extraterritorial locus specified in the statute’s text. Nevertheless, the Supreme Court reversed the district court’s holding that it lacked jurisdiction over the offense — which had taken place on ships in the high seas and in the territory of Brazil — because the crime had been “committed without the jurisdiction of the United States or of any State thereof and on the high seas or within the jurisdiction of [a foreign state].” Therefore, the Court concluded,

We have in this case a question of statutory construction. The necessary locus, when not specially defined, depends upon the purpose of Congress as evinced by the description and nature of the crime and upon the territorial limitations upon the power and jurisdiction of a government to punish crime under the law of nations. Crimes against private individuals or their property, like assaults, murder, burglary, larceny, robbery, arson, embezzlement and frauds of all kinds, which affect the peace and good order of the community, must of course be committed within the territorial jurisdiction of the government where it may properly exercise it. If punishment of them is to be extended to include those committed outside of the strict territorial jurisdiction, it is natural for Congress to say so in the statute, and failure to do so will negative the purpose of Congress in this regard.

But the same rule of interpretation should not be applied to criminal statutes which are, as a class, not logically dependent on their locality for the Government’s jurisdiction, but are enacted because of the right of the Government to defend itself against obstruction, or fraud wherever perpetrated, especially if committed by its own citizens, officers or agents. Some such offenses can only be committed within the territorial jurisdiction of the Government because of the local acts required to constitute them. Others are such that to limit their locus to the strictly territorial jurisdiction would be greatly to curtail the scope and usefulness of the statute and leave open a large immunity for frauds as easily committed by citizens on the high seas and in foreign countries as at home. In such cases, Congress has not thought it necessary to make specific provision in the law that the locus shall include the high seas and foreign countries, but allows it to be inferred from the nature of the offense.

Although Bowman concerned a criminal statute, and not a civil act, the Court’s reasoning in that case applies to the ATS with equal force. It was not necessary for Congress to make specific provision for the ATS’s jurisdictional reach, because the ATS could be presumed to reach any act which might endanger the U.S.’s national interests, so long as such jurisdiction could be exercised in conformity of international law. (And if the U.S. was prohibited under international law from exercising jurisdiction over a particular offense, then the ATS’s purpose would not be implicated anyway, because in such a case the U.S. would not be at risk of breaching international law by failing to provide a forum or remedy.)

Bowman also refutes Kiobel’s holding that the ATS could be implied to cover piracy even in the absence of a specific provision noting that Congress intended the statute to apply to the high seas. Although the majority conceded that the ATS extended to acts that took place outside the U.S. — which is precisely the sort of statutory construction that the presumption against extraterritoriality prohibits — the Court was unconcerned by this inconsistency. The majority swept this issue aside by stating, “We do not think that the existence of a cause of action against [pirates] is a sufficient basis for concluding that other causes of action under the ATS reach conduct that does occur within the territory of another sovereign[.]” But as Michael noted in a previous post, this distinction between ‘high seas’ and ‘foreign territory’ is a wholly new creation, unsupported by prior case law. This decision is also inconsistent with Bowman, in which the Court noted that, for statutes to which the presumption against extraterritoriality has been held to apply, it applies equally to acts committed on the high seas as to acts committed on foreign territories. Prior to Kiobel, when a statute failed to specify a locus, there was no basis by which a statute could be held to differentiate between the high seas and foreign territories — either both were out or both were in, absent a specific Congressional directive that such a distinction be made.

-Susan

Susan’s Theory of the Secret Fifth Amendment in Kiobel, as explained via gchat

Michael:
I had a thought
The entire United States argument against extraterritorial application in this case is built around something like act-of-state doctrine.
Why don’t we just apply act-of-state doctrine?

Susan:
You could, and it should be part of it. But even Nigeria didn’t actually make a law saying human rights abuses is totes okay.
And also “but the country said it was okay” is not a get out of jail free card once you start with the genocide stuff.

Michael:
Well, wait.
Act of state is just the judgment of the legality of another nation’s conduct, right?

Susan:
Yes, but we’re not (necessarily) judging another nation’s conduct, for one — it’s a Kirkpatrick situation. And second, I don’t think the purposes of the act of state doctrine are supported if it’s interpreted to require a court to go “whelp, it’s not my place to say that another country shouldn’t commit genocide.”

Michael:
No

Susan:
Act of State = choice of law.

Michael:
Pause
I’m saying that the United States’ argument is built around an idea that seems roughly equivalent to act-of-state.

“HERE, ALTHOUGH PETITIONERS’
SUIT IS AGAINST PRIVATE CORPORATIONS ALLEGED TO
HAVE AIDED AND ABETTED HUMAN RIGHTS ABUSES BY THE GOVERNMENT
OF NIGERIA, ADJUDICATION OF THE SUIT WOULD NECESSARILY
ENTAIL A DETERMINATION ABOUT WHETHER THE NIGERIAN
GOVERNMENT OR ITS AGENTS HAVE TRANSGRESSED LIMITS IMPOSED
BY INTERNATIONAL LAW”

Susan:
Ohhh, no I’d disagree with you. I have a half-written post on it, but I’d argue the U.S.’s position incorporates the international component of the 5th amendment.

Susan:
Yeah, but that’s foreign affairs stuff. Act of State requires a court to select the foreign sovereign’s law for the court’s rules of decision.

Michael:
?!

Susan:
So it’s kinda where jus cogens comes into play. Nigeria can’t make a law saying “lol genocide is okay.”

Michael:
This is the definition I’m familiar with:
“This doctrine says that a nation is sovereign within its own borders, and its domestic actions may not be questioned in the courts of another nation.”
Wait
I understand now

Susan:
That’s the one sentence version, but it doesn’t mean that U.S. courts are categorically forbidden from questioning foreign countries’ acts.

Michael:
We’re talking about two conceptions of the act-of-state doctrine.
Mine was the broader one.
Yours is the more limited Supreme Court version.
Fair.

Susan:
“As we said in Ricaud, “the act within its own boundaries of one sovereign State …
becomes … a rule of decision for the courts of this country.” 246 U.S. at 310. Act of state
issues only arise when a court must decide–that is, when the outcome of the case turns upon–
the effect of official action by a foreign sovereign. When that question is not in the case,
neither is the act of state doctrine.”
I agree with you, I think, as far as aiding and abetting cases go.
Maybe for different reasons, though.

Michael:
I’m not saying that I think Kiobel actually implicates act of state.
I’m just saying that the U.S. position sounds much like act of state, such that there is no need to make new law if the U.S. is correct.

Susan:
Yeah, agreed.
I think the U.S. is 100% right.

Michael:
But…
Ugh
The U.S. thinks that there IS a need to make new law DESPITE the fact that we have act of state doctrine to solve the very problem that the U.S. uses to support the supposed need for new law.

Susan:
Okay wait I’m misunderstanding, then. What new law does the US think is needed?

Michael:
1) The U.S. believes that the Court should hold that the ATS does not apply extraterritorially in cases involving corporations.
2) It substantiates that position at least in part by invoking a notion that sounds just like act of state doctrine.

Michael:
See the United States’ distinction between “individual foreign perpetrators” and corporations

Susan:
When found residing in the United States.
An individual foreigner abroad (that somehow still had sufficient US contacts) would be in the same place.

Michael:
Maybe it would be more accurate to say that the U.S. is against ATS liability for the extraterritorial acts of corporations that do not have their principal place of business or headquarters here

Susan:
Yeah, part of the equation is subsidy-to-parent jurisdictional veil piercing.

Michael:
Maybe I was over-emphasizing the U.S.’s use of the word “individual.”

Susan:
This is why it’s all a 5th Amendment Due Process issue. The reasonableness of the US’s adjudicative jurisdiction here is both unconstitutional and in violation of international law.

My take was that individual humans can usually only really “be” in one spot at one time. Corporations are in many places at once. So a corporation’s existence in the US is not dispositive, like a human’s is.

Michael:
I see.
An interesting argument, but the U.S. is making that argument as a matter of international law and foreign policy, not from a Fifth Amendment perspective, no?

Susan:
Okay so maybe they don’t specifically say it, but it’s in there if you squint hard enough.

Michael:
Hahaha.
The “secret” Fifth Amendment argument?

Susan:
The Fifth Amendment in Exile.
Basically, the ATS is open ended, and hands out causes of action for int’l law violations like candy (pretend all of this is true)
But the court, before exercising jurisdiction, still has to consider: Personal jurisdiction, exhaustion of remedies, forum non conveniens,
Act of State, international comity, choice of law, political question doctrine, foreign affairs/case-specific judicial deference, and in corporate cases, corporate/subsidy-parent veil piercing issues.
All of these doctrines have some Due Process consideration behind them. (Separation of powers for a lot of them, too, but due process is a biggie.)
Even if the text of the ATS creates an opening for these suits, it’s just a grant of subject matter jurisdiction. All of the Due Process jurisdictional questions must be considered separately.
Like they would in any foreign-defendant case, but because of the subject matter, the judicial due process doctrines are firing on all cylinders.
So when you have a pirate residing in the U.S. being sued for torture and genocide he did abroad, and his home country says “fuck that bastard, you can sue him,” and the U.S. political branches are going, “fuck that bastard, you can sue him,” then the due process concerns evaporate.

Michael:
Interesting.
I still don’t think the United States is making that argument
But ok.

Susan:
I think in section C they are getting at it,
even if they don’t invoke the magic words of Due Process. But everything the US is counseling the court to consider is a doctrine that was invented either to serve due process, separation of powers, or both.

Michael:
You should write a post
A quick post.

Susan:
Maybe at lunch I’ll play around with getting my other post to work in WP.
Or maybe I’ll be uber-lazy and just copy and paste the chat.

Michael:
There you go.

Eight Predictions on the Court’s Decision in Kiobel

With Supreme Court oral arguments on Kiobel v. Royal Dutch Petroleum set for tomorrow, it will still be a while yet before the Court releases its opinion. In the meantime, however, here are my predictions on what the outcome of the case will be. Once the Court has actually gotten around to issuing an order, I’ll check back to see if I managed to get any right.

  1. The Kiobel plaintiffs will lose. Either directly on the Supreme Court’s ruling, or after being kicked back to the lower courts with a directive to make findings that spell doom for the plaintiffs, the case against Royal Dutch/Shell will ultimately be dismissed.
  2. But not because of a finding that corporations cannot be liable under the Alien Tort Statute. The ATS was enacted as a mechanism allowing aliens injured by acts violations of international law to recover damages directly from the party who caused them harm, rather than having the U.S. itself make reparations to the victims. The ATS’s concern is not punishment, but in the financial reparation of damages. And, to that end, from the precedent set by prize law, marine torts, and other areas of the law which, in 1789, regularly featured civil claims for violations of the law of nations, there is plenty for the Court to draw from in finding that principles of agency law apply when ascertaining the entity liable for the damages under the ATS. Sosa already made it clear the Court is going to pay close attention to history in making pronouncements on the ATS’s scope and function, and an enquiry into the historical purpose of the statute necessitates a finding of corporate liability.
  3. Instead, Kiobel will be dismissed under principals of comity. If I had to bet, this is the battleground on which Kiobel will be fought. The hubris of allowing a suit brought by aliens against foreign companies for foreign torts will be too much for the Supreme Court to look past, and they will find that international comity requires that U.S. courts decline to exercise jurisdiction in the situation presented. The defendants are corporations based in and operated out of the United Kingdom and the Netherlands, and none of their corporate holdings in the U.S. had any direct involvement with Shell’s abhorrent practices in Ogoniland. Allowing suit against these companies in the U.S. is one step short of having U.S. federal courts declare themselves to be an international tribunal competent of adjudicating foreign state’s violations of the law of nations, and the Supreme Court just isn’t going to go there. Bonus prediction: look to see Charming Betsy invoked to explain why the Founders only intended the ATS to be limited to cases with either (a) a sufficient U.S. nexus, whether it be based on territorial concerns or personality jurisdiction, or (b) universal jurisdiction. If Justice Breyer gets his way, part (b) will be expansive and include Really Super Bad Awful Acts. Otherwise, it’ll be limited to piracy and any other crimes in the jurisdictional void.
  4. And possibly for failing to meet exhaustion requirements. The requirement that a plaintiff exhaust all domestic remedies before proceeding in a foreign forum was not a consideration in Sosa, but the Court noted then that “[w]e would certainly consider this requirement in an appropriate case. ” It’s also an issue that cropped up frequently in amici briefs submitted by foreign sovereigns in Kiobel, so the Court may consider it again now, assuming it doesn’t stop once it gets to the comity issue. Although I expect the Kiobel plaintiffs won’t be required to have filed suit in Nigeria in order to meet exhaustion requirements, their failure to pursue suits in the Netherlands and the UK may prove fatal. Particularly so for the UK — the fact that many of the plaintiffs, including the Kiobel family, are themselves UK citizens or residents puts the inappropriateness of a U.S. forum into stark relief.
  5. The Court may also look into the Second Circuit’s decisions regarding aiding-and-abetting liability. The “knowledge and purpose” standard for aiding and abetting liability under the ATS may get some dicta thrown its way, but as Kiobel can be decided without reaching the question of secondary liability, I would guess that it will not feature prominently in the Court’s decision. There may be some discussion, though, about aiding and abetting as a substantive violation vs. agency liability as a theory of recovery, and whether both are decided under domestic law, neither are, or one is but not the other.
  6.  Justice Scalia will author a very terse opinion dissenting in part.  Expect it to feature scathing but memorable descriptions about the purported ridiculousness of the Court exercising jurisdiction under the ATS.
  7. Justice Thomas will join Scalia’s dissent.  True story.
  8. Ultimately, even though the specific plaintiffs in this case will lose, the Court’s decision in Kiobel will strengthen, not weaken, a global regime of corporate liability for international human rights violations. The Court’s opinion will signal its intention to respect both international comity and international human rights. As such, one day, in a different case, with different facts, where the U.S. is a proper forum from which a judgment should be issued, Kiobel will ultimately provide support for a finding of corporate liability for violations of international law. And aside from that, the simple fact that the highest court in the U.S. will have gone on record acknowledging that the activities of corporations are indeed cognizable under international law will be a small but significant step in shaping global norms regarding corporate human rights abuses.


-Susan

Privateer Corporations and Agency Liability: A Response to the Cato Institute’s Amicus Brief in Kiobel

The Cato Institute’s amicus brief in Kiobel v. Royal Dutch Petroleum, along with a couple of other amici, repeatedly enact a straw man (straw law?) version of international law as it existed prior to 1789. The ATS, they argue, should be applied in the context of the law of nations of the Enlightment era, which is conceived to have been a limited, formalist creature, with no concern for individuals, dealing only with kings vis-à-vis kings. This idealist version of international law is then contrasted with international law as it exists today, which, in their view, is apparently some kind of bloated, sovereignty-munching leftist obsession with human rights. But while it is the case that international human rights law did not exist prior to the 20th century, Cato’s idealist version of international law ignores the fact that, for many centuries, the law of nations was an omipresent force of domestic legal systems in a manner which today’s domestic courts would scarcely be able to recognize. Domestic enforcement of private claims under international law was far more prevalent in 1789 than it was in 1989.

The Cato amicus’ delicate selections of quotes from Grotius are particularly inept at proving that international law in the 17th century matched Cato’s positivist depictions of it. Cato goes so far as to argue that in Kiobel “the Second Circuit employed an analysis based on the principles enunciated by Grotius,” which is that “under the law of nations corporations are not answerable in tort.” It is exceedingly unclear what precise “principles” Cato is referring to here, because Grotius certainly never made any direct assertions to that end. Grotius fully recognized that sub-sovereign entities were subject to rights and obligations under the law of nations, corporate entities included. In fact, Grotius got his start working as counsel for the Dutch East India Company, defending the company from claims that it had taken Portuguese prizes in violation of international law. His early works in particular were more advocacy pieces than treatises, intended as a defense of the Company’s right to engage in trade in the East Indies, and its powers to wage private war and take prizes.

In On the Law of War and Peace, which Cato quotes from, Grotius repeatedly acknowledges that private entities are capable of violating the law of nations, and can further be personally liable for those violations:
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