Trading Up: Is Section 337 the New ATS?

Abstract

There is a crisis in international human rights law. In a series of cases, the Supreme Court has drastically reduced the Alien Tort Statute’s utility as a vehicle for transnational justice, effectively ending a remarkable four-decade string of human rights litigation under the statute. Since 1980, private plaintiffs have filed hundreds of ATS suits in federal courts seeking to hold a rogue’s gallery of international despots, torturers, mass murderers, and their corporate accomplices accountable for violations of international law. But ATS suits proved controversial. The Court’s hamstringing of the ATS was driven largely by concerns over assertions of extraterritorial jurisdiction by private parties that might embroil the U.S. in sensitive foreign policy disputes.

As internationally minded social justice activists and scholars mourn the ATS’s demise, they are avidly seeking a replacement. Many increasingly look to state law and state courts as a vehicle for transnational redress. Yet, state law is even more problematic than the ATS as a vehicle for asserting extraterritorial jurisdiction over overseas misconduct and potentially threatens U.S. foreign policy.

There is a better option, at least for corporate misconduct, which accounts for the vast majority of the ATS suits. Long overlooked as a remedial tool for extraterritorial violations, Section 337 unfair competition actions in the International Trade Commission (ITC) are well-suited to hold corporations accountable for supply chain abuses. Under Section 337 the ITC has the power to block the importation of goods produced abroad using a broad range of unfair methods and practices. Section 337 is also better positioned than state law remedies to withstand the criticisms that felled the ATS. Its use of in rem jurisdiction and focus on imports avoids the extraterritorial concerns raised by the ATS and other judicial remedies. In addition, the ITC offers an underappreciated hybrid model of private and public enforcement, which mitigates concerns that its decisions will undermine U.S. foreign policy.

Expanded use of Section 337 to address misconduct abroad may be particularly attractive to American policymakers in our current circumstances. A new presidential administration is struggling to address unfair trade practices that harm domestic industries and workers while avoiding the damaging economic fall-out from the Trump trade wars. The ITC presents a ready-made tool to level the playing field for American industries, helping our economy recover from the current economic crisis while advancing human rights and environmental justice.

Keywords: International Trade Commission, Alien Tort Statute, Administrative Law, Unfair Competition, Public Enforcement, Private Enforcement, International Human Rights, Supply Chains

JEL Classification: K3