(Reuters) -
Indonesian villagers who accused Exxon Mobil Corp's security forces of murder,
torture and other atrocities have regained their right to sue the giant oil
company in the United States.
A federal
appeals court said on Friday that companies are not immune from liability under
a 1789 U.S. law known as the Alien Tort Statute for "heinous conduct"
allegedly committed by its agents in violation of human rights norms.
The 15
villagers contended in their lawsuit that family members were killed and that
others were "beaten, burned, shocked with cattle prods, kicked, and
subjected to other forms of brutality and cruelty" amounting to torture in
Indonesia's Aceh province between 1999 and 2001, a period of civil unrest.
A divided
panel of the D.C. Circuit Court of Appeals said Exxon Mobil should be forced to
defend against such charges.
Given that
laws in civilized nations hold corporations responsible for lesser wrongs,
"it would create a bizarre anomaly to immunize corporations from liability
for the conduct of their agents in lawsuits brought for shockingly egregious
violations of universally recognized principles of international law,"
Judge Judith Rogers wrote for a 2-1 majority.
Friday's
decision reversed part of a ruling by the federal district court in Washington,
D.C.
It is also
at odds with a landmark ruling last September by the federal appeals court in
New York, raising the prospect that the U.S. Supreme Court could try to resolve
the dispute.
"The
ruling basically says that corporations are not above the law," said
Jennifer Green, a University of Minnesota law professor and director of that
school's human rights litigation clinic, who submitted a brief on the
plaintiffs' behalf. "When corporations have knowledge that they are aiding
and abetting human rights abuses, they can be held liable in a U.S.
court."
Exxon
Mobil, based in Irving, Texas, said it is reviewing Friday's decision, calling
the plaintiffs' claims "baseless." Indonesia's government has also
opposed the lawsuit.
"NOT
ABOVE THE LAW"
The
villagers sought to hold Exxon Mobil responsible for having retained soldiers
from Indonesia's military as guards for a natural gas facility in Aceh, despite
knowing of past human rights abuses by Indonesia's army and that the contract
would lead to human rights violations against Aceh villagers.
In its
ruling, the D.C. Circuit also upheld the district court dismissal of claims
under a different law, the Torture Victim Protection Act.
It returned
the case to that court, where a jury could decide liability and any
compensatory or punitive damages.
"We
have fought these baseless claims for many years," Exxon Mobil spokesman
Patrick McGinn said in a statement.
"While
conducting its business in Indonesia, ExxonMobil has worked for generations to
improve the quality of life in Aceh through employment of local workers,
provision of health services and extensive community investment. The company
strongly condemns human rights violations in any form."
Agnieszka
Fryszman, a lawyer for the plaintiffs, said the decision makes clear that
corporations would be "as liable as anyone else" for violating
international human rights norms.
DISSENT
Friday's
decision puts the D.C. Circuit in agreement with the 11th U.S. Circuit Court of
Appeals, which has jurisdiction in Alabama, Florida and Georgia.
It also put
both courts at odds with the 2nd U.S. Circuit Court of Appeals, which said
companies are not liable in U.S. courts for violating international human
rights law.
That case
was brought against Royal Dutch Shell Plc by the families of seven Nigerians
executed by a former military government. They accused Shell of helping
Nigerian authorities violently suppress protests against its oil exploration
and development in the 1990s. [ID:nN04244684]
The 2nd
Circuit decision applies in New York, Connecticut and Vermont.
Judge Brett
Kavanaugh dissented from Friday's decision, saying it would be "quite
odd" for a U.S. court to allow Alien Tort Statute claims against a
corporation based on customary international law, when no international
tribunals would.
He also
said the ruling could harm U.S.-Indonesian relations, and perhaps damage the
war on terrorism.
Kavanaugh
was appointed to the bench by President George W. Bush. Rogers and Judge David
Tatel, who comprised the majority, were appointed by President Bill Clinton.
Exxon
shares closed up 6 cents at $82.42 on the New York Stock Exchange.
The case is
John Doe VIII et al v. Exxon Mobil Corp et al, D.C. Circuit Court of Appeals,
No. 09-7125.
(Reporting
by Jonathan Stempel; additional reporting by Anna Driver in Houston and James
Vicini in Washington, D.C.; editing by Tim Dobbyn, Andre Grenon and Matthew Lewis)
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