Unshackling Foreign Corporations: Kiobel’s Unexpected Legacy

Abstract

Kiobel v. Royal Dutch Petroleum disfavors American corporations. While largely unshackling foreign corporations from the risk of being haled before an American court to answer for human rights abuses abroad, the decision keeps American corporations constrained by human rights law. This is because application of the Alien Tort Statute, as announced in Kiobel, turns on whether a corporation’s actions “touch and concern” the United States. American corporations are simply far more likely to satisfy that standard than foreign corporations.

The argument proceeds as follows. First, this paper shows that American corporations are, for practical purposes, still bound by human rights law, enforceable in U.S. courts. Second, it demonstrates that foreign corporations, however, are largely freed by Kiobel from similar obligations enforceable in U.S. courts. After describing this differential treatment and why it matters, the paper concludes by delineating possible ways to resolve Kiobel’s asymmetrical effects. Perhaps most promisingly, Congress could level the playing field by declaring the Alien Tort Statute to have extraterritorial effect, against foreign and domestic concern alike.

Keywords: extraterritoriality, Alien Tort Statute, Kiobel v. Royal Dutch Petroleum, foreign corporations, multinational corporations, transnational law, transnational litigation