<html> <head> <META http-equiv="Content-Type" content="text/html"> <title>Emerging Issues of Human Rights Responsibility in the Extractive and Manufacturing Industries: Patterns and Liability Risks</title> <meta name="keywords" content="Corporate human rights responsibility, corporate social responsibility, multinational corporations, extractive industries, manufacturing industries, domestic adjudication, extraterritorial/universal jurisdiction, civil and criminal remedies."> <meta name="description" content=""> <meta name="dc.title" content="Emerging Issues of Human Rights Responsibility in the Extractive and Manufacturing Industries: Patterns and Liability Risks"> <meta name="dc.subject.name.corporate" content="Northwestern University (Chicago, IL)"> <meta name="dc.subject" content="Academic,Law,Intellectual Property"> <meta name="dc.publisher" content="Northwestern University Journal of International Human Rights, Northwestern University School of Law"> <meta name="dc.creator" content="Caroline Kaeb"> <meta name="dc.date.modified" content="6/6/2008 3:17:38 PM"> <meta name="dc.language" content="eng"> <meta name="dc.rights" content="Copyright 2005 Northwestern University,"> <meta name="e-mail" content="j-monteverde2006@law.northwestern.edu"> <meta name="robot" content="Index, Follow"><script language="JavaScript" type="text/javascript" src="/journals/JIHR/js/JIHR.js"></script><link REL="stylesheet" HREF="http://www.law.northwestern.edu/journals/Styles/JIHRdefault05.css" TYPE="text/css"> </head> <body bgcolor="#ffffff"> <form name="docMetadata"><input type="hidden" name="title" value="Emerging Issues of Human Rights Responsibility in the Extractive and Manufacturing Industries: Patterns and Liability Risks"><input type="hidden" name="author" value="Caroline Kaeb"><input type="hidden" name="pagination" value=""><input type="hidden" name="startpage" value=""><input type="hidden" name="endpage" value=""><input type="hidden" name="issueTitle" value=""><input type="hidden" name="issueDate" value="Spring 2008"><input type="hidden" name="vol" value="6"><input type="hidden" name="n" value="2"><input type="hidden" name="jTitle" value="Northwestern University Journal of International Human Rights"><input type="hidden" name="cite" value=""></form> <table CELLSPACING="0" WIDTH="100%"> <tr VALIGN="TOP"> <td ALIGN="left" WIDTH="50%"><span class="citation">Cite as: 6 Nw. U. J. Int'l Hum. Rts. 327<i> at </i>http://www.law.northwestern.edu/journals/jihr/v6/n2/5</span></td> <td ALIGN="right" WIDTH="50%"><span class="copyright"><a href="http://www.law.northwestern.edu/journals/JIHR/">JIHR Home</a> &gt; <a href="http://www.law.northwestern.edu/journals/jihr/v6/"> Volume 6</a> &gt; <a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/"> Issue 2</a> (Spring 2008) </span></td> </tr> </table><a name="ARTICLETOP"></a><br><br><div class="journalTitle">Northwestern University Journal of International Human Rights</div> <h1 class="section1"></h1> <div class="title">Emerging Issues of Human Rights Responsibility in the Extractive and Manufacturing Industries: Patterns and Liability Risks</div><br><div class="title"></div><br><div class="title"></div><br><div class="title"></div> <div class="author">Caroline Kaeb<sup><a id="*" name="*" href="#note*">*</a></sup></div> <div class="author"></div> <div class="infoLinks"><a style="text-decoration: underline;" href="Kaeb.pdf">pdf version</a></div> <div style="display:none;"><br><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDA0NCVB" onClick="return targetopener(this)">I.Introduction</a><blockquote class="outline"></blockquote><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDADRCVB" onClick="return targetopener(this)">II.Human Rights in a Business Context: the Extractive Industries </a><blockquote class="outline"><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDA5SCVB" onClick="return targetopener(this)">A.Complicity Charges: the Case of Shell in Nigeria</a><br><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDA2SDVB" onClick="return targetopener(this)">B.Human Rights Problems in the Extractive Industries: A Widespread and Multi-faceted Issue </a><br></blockquote><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDA3DS0" onClick="return targetopener(this)">III.Human Rights in a Business Context: the Manufacturing Industries</a><blockquote class="outline"><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDAHFS0" onClick="return targetopener(this)">A.Corporate Structures </a><br><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDAWHS0" onClick="return targetopener(this)">B.The Case of Nike</a><br><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDAPSS0" onClick="return targetopener(this)">C.Beyond Nike: MNCs' Responsibility for Human Rights Performance of Supplier Factories</a><br></blockquote><a href="http://www.law.northwestern.edu/journals/jihr/v6/n2/5/index.htm#IDA5YS0" onClick="return targetopener(this)">IV.Conclusions</a><blockquote class="outline"></blockquote></div><a name="IDA0NCVB"></a><h2 class="section2"><a name="IDA3NCVB"></a>I.&nbsp;&nbsp;&nbsp;&nbsp;Introduction</h2><a name="para1" id="para1"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;1</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross human rights violations -- such as forced displacement, forced labor, genocide and torture -- have long made international headlines and been on the political agenda of the international community. In a changing and globalized world, human rights violations are no longer associated solely with governments, but also with multinational corporations ("MNCs"). The Business and Human Rights Resource Center -- widely acknowledged as providing the broadest array of "balanced information of business and human rights"<span class="noteRef"><sup><a href="#note1" name="1">1</a></sup></span> -- has documented abuses ranging from health and safety violations in the workplace, to murder, torture, and forced displacement at the hands of military and security forces protecting company facilities. Indeed, attention to corporate human rights responsibility, the issue's significance for contemporary business practice, and the need for regulative outreach to non-state actors have increased tremendously. </p><a name="para2" id="para2"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;2</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Often the human rights performance of corporations and their host governments overseas are intertwined and complicate the allocation of responsibility. The latest case to feature extensively in international headlines,<span class="noteRef"><sup><a href="#note2" name="2">2</a></sup></span> that is emblematic of interdependencies between states and corporation, concerns the oil operations of the France-based Total S.A. ("Total") in Myanmar (formerly Burma). The activities of Total in conjunction with the U.S.-based Unocal Corp. ("Unocal") in Burma resulted in prominent litigation against the respective corporations in European and North-American jurisdictions. Major cases against MNCs<span class="noteRef"><sup><a href="#note3" name="3">3</a></sup></span> for human rights violations committed abroad have been brought in both U.S courts under the U.S. Alien Tort Statute<span class="noteRef"><sup><a href="#note4" name="4">4</a></sup></span> ("ATS") and European domestic courts.<span class="noteRef"><sup><a href="#note5" name="5">5</a></sup></span> Like its joint venture partner Unocal, Total was alleged to have used forced labor provided by the Burmese government to build a pipeline. The case against Total on charges of complicity in crimes against humanity has just been reopened in Belgian courts, after cases against Unocal in U.S. courts and against Total in French courts had been settled on similar charges.<span class="noteRef"><sup><a href="#note6" name="6">6</a></sup></span> The case of Total shows that out-of-court settlements will not protect MNCs in the long-run from liability; rather, corporations themselves, NGOs with human rights agendas, academics, and policymakers must recognize and address the significance of corporate human rights issues. </p><a name="para3" id="para3"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;3</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This article presents a case study on corporate human rights performance in the extractive and manufacturing industries in various country contexts. The analysis evolves around two main studies on Royal Dutch/Shell and Nike which shed light on the dynamics underlying contemporary business practices in host countries and the sector-specific patterns of human rights problems. In particular, the studies explore human rights violations related to business activities in terms of the local political situation and corporate structures of the parent-subsidiary relationship. Additional examples from the respective industrial sector further illustrate: first, the various kinds of alleged human rights violations; second, the corporation's potential involvement in the abuses in the context of the legal standards at stake; and finally, the implications of public scrutiny and litigation for corporate policies. Thus, the article intends to give an account of liability risks<span class="noteRef"><sup><a href="#note7" name="7">7</a></sup></span> for both the extractive and manufacturing sectors that is closely related to policy parameters. </p><a name="para4" id="para4"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;4</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One reason for focusing on alleged abuses in the extractive and manufacturing sectors is that these sectors have been the subject of intense public scrutiny and criticism for their human rights performance abroad. Also, these industrial sectors illustrate challenges of corporate human rights responsibility and implications for corporate policies that are common and applicable to most other sectors. The analysis will show that corporations tend to shift from formally denying to acknowledging and assuming responsibility for their impact on society. </p><a name="IDADRCVB"></a><h2 class="section2"><a name="IDAGRCVB"></a>II.&nbsp;&nbsp;&nbsp;&nbsp;Human Rights in a Business Context: the Extractive Industries<span class="underline"></span></h2><a name="para5" id="para5"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;5</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This section analyzes human rights violations in the extractive sector by focusing on the activities of Royal Dutch/Shell<span class="noteRef"><sup><a href="#note8" name="8">8</a></sup></span> and its Nigerian subsidiary ("Shell")<span class="noteRef"><sup><a href="#note9" name="9">9</a></sup></span>, the biggest oil producer in Nigeria with a longstanding history of oil extraction in the Niger delta. The main reason for focusing on Shell is that many of its oil facilities are close to local communities that have continuously and increasingly protested the exploitation of their land over the last decade.<span class="noteRef"><sup><a href="#note10" name="10">10</a></sup></span> In the face of protests, Shell has become more vulnerable to accusations of complicity in human rights violations committed by government security forces. Furthermore, the case of Shell in Nigeria shows a pattern of human rights problems that is intrinsic to most oil and mining corporations. </p><a name="para6" id="para6"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;6</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following sections describe human rights violations that occur in the midst of business operations in the host country<span class="noteRef"><sup><a href="#note11" name="11">11</a></sup></span> and elaborate on the common parameters of liability risks in the extractive industries. </p><a name="IDA5SCVB"></a><div class="section3">A.&nbsp;&nbsp;&nbsp;&nbsp;Complicity Charges: the Case of Shell in Nigeria</div><a name="para7" id="para7"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;7</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shell is peculiar compared to other oil corporations: rather than relying on support from its home government, it cooperates closely with host governments to initiate and maintain its oil operations abroad.<span class="noteRef"><sup><a href="#note12" name="12">12</a></sup></span> Given these close relationships, Shell was particularly vulnerable to charges of complicity in state human rights abuses against local communities in the oil areas -- especially against the Ogoni people. </p><a name="IDA3TCVB"></a><div class="section4"><a name="IDAAUCVB"></a>1.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Corporate Structures in the Local Political Context</span></div><a name="para8" id="para8"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;8</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When facing allegations of human rights violations, Shell, like many other oil companies, often points to the difficult political and social environment in which it conducts its oil operations.<span class="noteRef"><sup><a href="#note13" name="13">13</a></sup></span> In 1999, Shell -- while acknowledging that human rights problems surrounded its oil operations in Nigeria -- stressed that "major human rights violations do not generally exist in a vacuum, but within a nexus of corruption, poverty, poor public services and infrastructure, governmental instability and other factors which make it difficult for business to operate."<span class="noteRef"><sup><a href="#note14" name="14">14</a></sup></span> Thus, the boundaries between the local political context in which human rights violations occur and a corporation's intrinsic sphere of influence and responsibility are often blurred.</p><a name="para9" id="para9"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;9</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indeed, the environment in which MNCs operate is often characterized by deep frictions among opposing local factions, usually the official government and local communities.<span class="noteRef"><sup><a href="#note15" name="15">15</a></sup></span> Such tense situations in the host country make it difficult to draw the line between governmental and corporate responsibility for human rights violations.<span class="noteRef"><sup><a href="#note16" name="16">16</a></sup></span></p><a name="para10" id="para10"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;10</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A closer look at the corporate structures of oil companies and their relationship with host governments is necessary to define the scope of corporate human rights responsibility. In many oil extracting countries, the oil industry is nationalized; as a result, oil corporations often operate in a joint venture with the host government. For example, Royal Dutch/Shell's Nigerian subsidiary, the Shell Petroleum Development Company (SPDC), is a minority shareholder in a joint venture with the Nigerian National Petroleum Company; Shell serves as the operating partner in the joint venture making all operational decisions.<span class="noteRef"><sup><a href="#note17" name="17">17</a></sup></span> Thus, corporate and governmental interests in the protection of oil facilities and oil production are largely intertwined. This interdependence provides the basis for complicity charges against MNCs, as well as calls by communities and NGOs for oil corporations to use their joint venture influence to promote greater respect for human rights in governmental policies.<span class="noteRef"><sup><a href="#note18" name="18">18</a></sup></span></p><a name="IDAPWCVB"></a><div class="section4"><a name="IDASWCVB"></a>2.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Setting the Scene: Security on the Ground</span></div><a name="para11" id="para11"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;11</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Complicity charges against MNCs must be evaluated in light of the security risks in the host country. Security issues are one of the most urgent problems facing oil corporations in many of their operating countries. According to Human Rights Watch ("HRW"), sabotage of pipeline projects, intimidation of company and contractor staff, and hostage-taking do occur, even though companies and local communities dispute the prevalence of these incidents, particularly sabotage.<span class="noteRef"><sup><a href="#note19" name="19">19</a></sup></span></p><a name="para12" id="para12"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;12</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These security risks are rooted in protests against corporate policies that often have detrimental effects on local communities. In Nigeria, for instance, the Ogoni people allege that Shell Nigeria coercively appropriated land for oil production without adequate compensation and caused environmental degradation.<span class="noteRef"><sup><a href="#note20" name="20">20</a></sup></span> The unequal distribution of gains for Shell and losses for local communities has sparked protests that result in security risks to the oil corporation. </p><a name="para13" id="para13"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;13</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to protect their staff and facilities, oil corporations hire so-called "supernumerary police," trained and recruited by the Nigerian police. Additionally, corporations may enlist Nigerian government security forces, such as the Mobile Police.<span class="noteRef"><sup><a href="#note21" name="21">21</a></sup></span> Furthermore, the Nigerian government has set up special Task Forces to handle security issues in the oil production areas, such as the Rivers State Internal Security Task Force that was created to respond to the Ogoni crisis. Because these multiple relationships create several lines along which human rights abuses can occur, each incident needs to be examined individually in order to allocate responsibility for the abuses.</p><a name="IDAZYCVB"></a><div class="section4"><a name="IDA2YCVB"></a>3.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">The Range of Liability Risks</span></div><a name="para14" id="para14"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;14</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Human rights violations are most commonly committed by government security forces in response to protests against oil operations.<span class="noteRef"><sup><a href="#note22" name="22">22</a></sup></span> Major MNCs, such as Shell and Chevron Corporation ("Chevron"), have been accused of complicity in crimes against humanity, summary execution, extrajudicial killings, arbitrary detention, torture, cruel, inhumane or degrading treatment, and other violations of international law, such as infringements on the right to life, liberty and security of the person, and the right to peaceful assembly and association.<span class="noteRef"><sup><a href="#note23" name="23">23</a></sup></span></p><a name="para15" id="para15"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;15</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Complicity charges were brought against Royal Dutch/Shell and its Nigerian subsidiary SPDC in U.S. courts under the ATS and the Torture Victim Protection Act (TVPA) in <i>Wiwa v. Royal Dutch Petroleum</i><span class="noteRef"><sup><a href="#note24" name="24">24</a></sup></span> and <i>Kiobel v. Royal Dutch Petroleum</i>.<span class="noteRef"><sup><a href="#note25" name="25">25</a></sup></span> Like the <i>Wiwa </i>plaintiffs, the <i>Kiobel</i> plaintiffs claimed that they and their kin were subjected to human rights violations by the Nigerian government, violations in which the corporate defendants were complicit.<span class="noteRef"><sup><a href="#note26" name="26">26</a></sup></span> The allegations against Royal Dutch/Shell and its Nigerian subsidiary are substantially similar in both cases and hinge upon two sets of incidents.<span class="noteRef"><sup><a href="#note27" name="27">27</a></sup></span> The first set involved violations against local residents by Nigerian military police/security forces allegedly requested by Shell Nigeria in order to protect company facilities and contain protests. Specifically, <i>Wiwa </i>and<i> Kiobel </i>plaintiffs claimed that the security forces beat and shot locals protesting the destruction of their property for pipeline construction purposes in April 1993, and shot three people, killing one of them, in October 1993 near a Shell flow station at Korokoro, Rivers State, Nigeria.<span class="noteRef"><sup><a href="#note28" name="28">28</a></sup></span> The plaintiffs alleged that the military police used vehicles supplied by Royal Dutch/Shell and that corporate staff were present during the assaults.<span class="noteRef"><sup><a href="#note29" name="29">29</a></sup></span></p><a name="para16" id="para16"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;16</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The second set of incidents involved the arbitrary detention, trial and ultimate execution in 1995 of the "Ogoni 9," including Ken Saro-Wiwa and Barinem Kiobel, all leaders of the Movement for the Survival of the Ogoni People (MSOP).<span class="noteRef"><sup><a href="#note30" name="30">30</a></sup></span> After eight months of detention without being charged, Ken Saro-Wiwa (president of the MSOP) and other leaders of the protest movement were put on trial before a special court under "formal" charges of murder.<span class="noteRef"><sup><a href="#note31" name="31">31</a></sup></span> Owens Wiwa -- son of Ken Saro-Wiwa -- was subject to multiple unlawful detentions from December 1993 until April 1994, and was allegedly assaulted and tortured repeatedly during his detentions.<span class="noteRef"><sup><a href="#note32" name="32">32</a></sup></span></p><a name="para17" id="para17"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;17</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The plaintiffs in <i>Wiwa </i>and<i> Kiobel </i>alleged that Royal Dutch/Shell -- operating directly and through its Nigerian subsidiary -- cooperated and even conspired with Nigerian authorities in order to contain the protest movement and secure its oil operations in the Niger Delta.<span class="noteRef"><sup><a href="#note33" name="33">33</a></sup></span> The plaintiffs claimed that the trial failed to satisfy international standards of due process because there was no possibility for appeal and witnesses were bribed by the defendants to give false testimony.<span class="noteRef"><sup><a href="#note34" name="34">34</a></sup></span> The plaintiffs further alleged that the defendants offered Ken Saro-Wiwa his freedom in exchange for an end to the MSOP's international protests against Shell.<span class="noteRef"><sup><a href="#note35" name="35">35</a></sup></span></p><a name="para18" id="para18"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;18</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On February 22, 2002, the U.S. District Court for the Southern District of New York in <i>Wiwa</i> denied most of the defendant's motions to dismiss and held that the plaintiffs were entitled to file their actions under the ATS and the TVPA.<span class="noteRef"><sup><a href="#note36" name="36">36</a></sup></span> In September 2006, the court in <i>Kiobel</i> granted the motions to dismiss with regard to extrajudicial killings, forced exile, destruction of property, and right to life, liberty and personal assembly.<span class="noteRef"><sup><a href="#note37" name="37">37</a></sup></span> However, the court preserved the general claim of aiding and abetting under the ATS and the particular claims concerning crimes against humanity and torture, as well as arbitrary arrest and detention.<span class="noteRef"><sup><a href="#note38" name="38">38</a></sup></span> The court certified all issues for interlocutory appeal.<span class="noteRef"><sup><a href="#note39" name="39">39</a></sup></span></p><a name="para19" id="para19"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;19</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The claims against Royal Dutch/Shell reveal a broad range of human rights problems facing MNCs. Whereas the first set of incidents involves abuses committed by security forces that are either contracted, requested by, or otherwise acting with the awareness of the corporation, the second set of cases pertains to more general allegations of corporate support of repressive policies in the host country. </p><a name="para20" id="para20"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;20</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The distinction between these types of human rights problems correspond to the categories of beneficial and so-called silent complicity. The Global Compact identifies three categories of corporate complicity -- direct complicity, beneficial complicity and silent complicity.<span class="noteRef"><sup><a href="#note40" name="40">40</a></sup></span> On one end of the spectrum is direct complicity, and on the other is silent complicity, mere presence in a country with repressive policies. Beneficial complicity lies somewhere in between.<span class="noteRef"><sup><a href="#note41" name="41">41</a></sup></span></p><a name="para21" id="para21"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;21</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Direct complicity exists where a corporation knowingly assists violations of international law committed by a state; to date, direct complicity has only been found in a limited number of cases.<span class="noteRef"><sup><a href="#note42" name="42">42</a></sup></span> So-called "silent complicity" refers to non-action, for example, the silence of a corporation in the face of systematic or continuous human rights violations by host country authorities. Under this concept, silence is deemed not to be neutral;<span class="noteRef"><sup><a href="#note43" name="43">43</a></sup></span> rather, the company is expected to "raise systematic and continuous human rights abuses with the appropriate authorities."<span class="noteRef"><sup><a href="#note44" name="44">44</a></sup></span> For example, corporations were accused of "silent complicity" for investing and operating in apartheid South Africa, since their business activities arguably helped to perpetuate a regime of discrimination and racism.<span class="noteRef"><sup><a href="#note45" name="45">45</a></sup></span> Thus, a multitude of corporations were sued under the ATS in U.S Courts.<span class="noteRef"><sup><a href="#note46" name="46">46</a></sup></span> The plaintiffs claimed that the corporation's mere business activity in apartheid South Africa constituted a violation of the law of nations and thus created a cause of action under the ATS.<span class="noteRef"><sup><a href="#note47" name="47">47</a></sup></span> The District Court for the Southern District of New York held that it "must be extremely cautious in permitting suits here based upon a corporation's doing business in countries with less than stellar human rights records"<span class="noteRef"><sup><a href="#note48" name="48">48</a></sup></span> and thus decided that a corporation's business activities alone are not sufficient to provide a basis for ATS jurisdiction.<span class="noteRef"><sup><a href="#note49" name="49">49</a></sup></span> In October 2007, the Second Circuit Court of Appeals vacated the District Court's dismissal of the plaintiffs' ATS claims and remanded for further proceedings.<span class="noteRef"><sup><a href="#note50" name="50">50</a></sup></span></p><a name="para22" id="para22"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;22</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beneficial complicity, also referred to as indirect complicity,<span class="noteRef"><sup><a href="#note51" name="51">51</a></sup></span> is more difficult to conceptualize since it lies at the edge of accountability and liability.<span class="noteRef"><sup><a href="#note52" name="52">52</a></sup></span> It pertains to situations where there is no direct corporate involvement in the execution of human rights violations by a third party, but the violations occur in the context of business activities and the corporation benefits from the violations.<span class="noteRef"><sup><a href="#note53" name="53">53</a></sup></span> The most common example of beneficial complicity is the situation where security forces use repressive measures when protecting company facilities or containing peaceful protests.<span class="noteRef"><sup><a href="#note54" name="54">54</a></sup></span> The major lawsuit against Unocal in U.S. courts involves allegations of beneficial complicity in the human rights violations committed by the government in the furtherance of an oil pipeline project.<span class="noteRef"><sup><a href="#note55" name="55">55</a></sup></span></p><a name="IDA3CDVB"></a><div class="section4"><a name="IDAADDVB"></a>4.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Complicity Standards under the Ninth Circuit Ruling</span></div><a name="para23" id="para23"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;23</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Complicity standards were first defined with respect to corporate liability under the ATS by the U.S. Court of Appeals for the Ninth Circuit in <i>Doe v. Unocal</i>.<span class="noteRef"><sup><a href="#note56" name="56">56</a></sup></span> Relying heavily on standards developed by the International Criminal Tribunal for the former Yugoslavia (ICTY) and the International Criminal Tribunal for Rwanda (ICTR), the court held that complicity requires "knowing practical assistance or encouragement that has a substantial effect on the perpetration of the crime"<span class="noteRef"><sup><a href="#note57" name="57">57</a></sup></span>; under this reasonable knowledge test, a plaintiff must show that the corporation "knew or had reason to know" that its actions assisted the crime.<span class="noteRef"><sup><a href="#note58" name="58">58</a></sup></span> This <i>mens rea</i> requirement creates an important nexus between the action of the direct perpetrator and the corporation.</p><a name="para24" id="para24"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;24</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A broad array of indicators may establish this nexus, including the fact that a corporation derives economic benefits from the violations; in such cases, the complicity is often referred to as "beneficial/beneficiary complicity."<span class="noteRef"><sup><a href="#note59" name="59">59</a></sup></span> Other indicators may include the nature of the business relation, i.e. the level of corporate control in a private-public joint venture, the continuation of corporate assistance despite awareness of the violations, and the presence of a common goal.<span class="noteRef"><sup><a href="#note60" name="60">60</a></sup></span> Neither scholars nor courts have settled yet which indicators establish the required nexus.<span class="noteRef"><sup><a href="#note61" name="61">61</a></sup></span> Ralph Steinhardt, a prominent scholar in the field, points to the difficulty to "handle the intermediate case where a corporation simply benefits [from abuses], without contractual nexus," i.e. the corporation is not connected with the government by contract regarding joint venture projects or provision of security services.<span class="noteRef"><sup><a href="#note62" name="62">62</a></sup></span></p><a name="para25" id="para25"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;25</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The <i>Unocal </i>court also had to define the <i>actus reus</i> requirement to establish complicity. Granting Unocal's motion for summary judgment in 2000, the U.S. District Court for the Central District of California argued that Unocal's conduct did not satisfy the standard of "active participation" in using forced labor, as the corporation merely knowingly accepted the benefits of forced labor utilized in furtherance of a joint pipeline project with the government.<span class="noteRef"><sup><a href="#note63" name="63">63</a></sup></span> Following the jurisprudence of the ICTY, the Court of Appeals rejected this view and held that the act of assistance does not have to actually cause the violations of the principal, here the host government.<span class="noteRef"><sup><a href="#note64" name="64">64</a></sup></span> Rather, the court deemed it sufficient that the acts of the accomplice have a "[substantial] effect on the commission of the crime," such that the abuses would "most probably" not have occurred "in the same way" without the participation of the corporation.<span class="noteRef"><sup><a href="#note65" name="65">65</a></sup></span></p><a name="IDAPGDVB"></a><div class="section4"><a name="IDASGDVB"></a>5.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Agency and Joint Action Liability</span></div><a name="para26" id="para26"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;26</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To establish third-party liability for corporate human rights abuses under the ATS, U.S. courts have preferred the theory of aiding and abetting under international law, as seen in the court's decision in <i>Unocal</i>.<span class="noteRef"><sup><a href="#note66" name="66">66</a></sup></span></p><a name="para27" id="para27"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;27</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;However, imputation may also be established under federal common law rules, such as joint venture liability, agency liability and reckless disregard.<span class="noteRef"><sup><a href="#note67" name="67">67</a></sup></span> In <i>Wiwa</i>, the court agreed with the plaintiffs that Royal Dutch/Shell "dominated and controlled" Shell Nigeria and thus principles of agency liability applied.<span class="noteRef"><sup><a href="#note68" name="68">68</a></sup></span> Under agency law, the corporation, as the principal, is liable for the acts of the agent and cannot put forward as a defense that the agent was merely authorized to perform lawful, non-tortious acts.<span class="noteRef"><sup><a href="#note69" name="69">69</a></sup></span> Accordingly, the plaintiffs claimed that the existence of an agency relationship between Royal Dutch/Shell and its Nigerian subsidiary rendered Shell responsible for the "willful participa[tion]" of its Nigerian subsidiary in "joint action" with Nigerian government that violated the plaintiffs' rights.<span class="noteRef"><sup><a href="#note70" name="70">70</a></sup></span> However, the court found that there was no need to employ this theory of imputation since the plaintiffs presented sufficient facts to support an immediate "significant cooperative action" between Royal Dutch/Shell and the Nigerian government in committing the abuses at issue.<span class="noteRef"><sup><a href="#note71" name="71">71</a></sup></span></p><a name="IDA2IDVB"></a><div class="section4"><a name="IDA5IDVB"></a>6.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">The Corporate <i>Actus Reus</i></span></div><a name="para28" id="para28"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;28</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporate acts that consitute an <i>actus reus</i> and trigger complicity liability may take on various forms. Often human rights violations are preceded by a corporation's request for security protection by government forces. In <i>Wiwa, </i>for example, the plaintiffs claimed that Royal Dutch/Shell directly, or through its local subsidiary, "recruited the Nigerian police and military to suppress MSOP" and ensure that oil "development activities could proceed 'as usual.'"<span class="noteRef"><sup><a href="#note72" name="72">72</a></sup></span> The plaintiffs further alleged that Royal Dutch/Shell made payments to the military, provided logistical support (such as transportation and weapons),<span class="noteRef"><sup><a href="#note73" name="73">73</a></sup></span> and participated in the overall planning and coordination of the "security operations" by attending regular meetings with the security forces.<span class="noteRef"><sup><a href="#note74" name="74">74</a></sup></span></p><a name="para29" id="para29"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;29</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>Wiwa </i>is not the only case concerning abuses by security forces. In an incident at Umuechem in 1990, Shell was also accused of being complicit in the "killing of eighty unarmed civilians and the destruction of hundreds of homes" by security forces whose protection Shell had explicitly requested.<span class="noteRef"><sup><a href="#note75" name="75">75</a></sup></span><span class="underline"></span></p><a name="para30" id="para30"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;30</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporations often contest their alleged connection to public security forces<span class="noteRef"><sup><a href="#note76" name="76">76</a></sup></span> which is difficult to reconstruct since the criminal acts do not occur in a corporation's inner "sphere of influence."<span class="noteRef"><sup><a href="#note77" name="77">77</a></sup></span> Shell acknowledged direct payment to Nigerian security forces on at least one occasion.<span class="noteRef"><sup><a href="#note78" name="78">78</a></sup></span> However, it strongly denied inferences that a security arrangement involving possible payment to the Special Task Force in the Ogoni region existed, even though the <i>Guardian</i> reported in 1995 about a Nigerian government document implying an arrangement of such kind.<span class="noteRef"><sup><a href="#note79" name="79">79</a></sup></span> While Royal Dutch/Shell increasingly acknowledges its responsibility for human rights violations by security forces,<span class="noteRef"><sup><a href="#note80" name="80">80</a></sup></span> its local subsidiaries have been more reluctant to accept such responsibility.<span class="noteRef"><sup><a href="#note81" name="81">81</a></sup></span> Still, even Shell Nigeria admits to "the gap between its intentions and its current performance."<span class="noteRef"><sup><a href="#note82" name="82">82</a></sup></span> Though quite tentative, this statement reflects rising awareness of the human rights problems. </p><a name="para31" id="para31"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;31</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cases in which subcontracted security forces commit excessive acts may involve indirect corporate complicity. However, where corporate staff are present when military forces commit abuses -- as was alleged of Shell -- and take no steps to prevent the abuses from occurring, the nexus between corporate acts and human rights abuses is even closer and implicates direct complicity.<span class="noteRef"><sup><a href="#note83" name="83">83</a></sup></span></p><a name="para32" id="para32"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;32</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In this context, legal responsibilities are difficult to allocate because the effects of the corporate acts are often not immediate, but rather intermediated by political dynamics in the host country. For instance, Shell once called for the intervention of the naval forces, whose subsequent deployment of the Mobile Police led to the assault of numerous local community members.<span class="noteRef"><sup><a href="#note84" name="84">84</a></sup></span> In such instances, corporations often defend themselves by referring to their mere legal obligation to inform Nigerian authorities when a threat to oil production exists.<span class="noteRef"><sup><a href="#note85" name="85">85</a></sup></span></p><a name="para33" id="para33"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;33</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Furthermore, determining either the nature or degree of private-public involvement and cooperation is not an easy task; defining in clear terms the realm of corporate responsibilities stemming from this relationship is even more complex. Certainly, oil corporations tend to operate in difficult political and social environments. Nonetheless, the economic interest in oil production -- on the part of both corporations and host governments -- has exacerbated frictions with local communities in the oil producing areas, deepened discontent in the delta, and might have often lead to repressive government responses.<span class="noteRef"><sup><a href="#note86" name="86">86</a></sup></span> This undeniable link should be taken into consideration when determining the responsibility of MNCs for human rights abuses.</p><a name="IDASODVB"></a><div class="section4"><a name="IDAVODVB"></a>7.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">The Extraterritorial Reach of Jurisdiction</span></div><a name="para34" id="para34"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;34</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>Wiwa </i>holds MNCs liable for human rights abuses occurring in the context of their business activities abroad. The liability risk for MNCs is particularly significant since U.S. courts assert personal jurisdiction over business entities incorporated under the sitting jurisdiction, as well as over non-resident units of MNCs where an affiliate is present in U.S. jurisdiction and has a "sufficient" relationship with the non-resident unit.<span class="noteRef"><sup><a href="#note87" name="87">87</a></sup></span> Precisely, the relationship must be of such a nature that "two [entities] can be regarded as a single unit for the service or process."<span class="noteRef"><sup><a href="#note88" name="88">88</a></sup></span> To determine whether a sufficient relationship exists, courts consider various factors, including ownership, control, and the (even temporary) presence of corporate officials of the non-resident entity on U.S. territory.<span class="noteRef"><sup><a href="#note89" name="89">89</a></sup></span></p><a name="para35" id="para35"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;35</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under these standards, the Second Circuit Court of Appeals asserted personal jurisdiction over the two holding companies: Royal Dutch Petroleum Company (incorporated in the Netherlands) and Shell Transport and Trading Co. (incorporated in the UK).<span class="noteRef"><sup><a href="#note90" name="90">90</a></sup></span> The court found that an Investor Relations Office in New York was "facilitating the relations of the parent holding companies with the investment community."<span class="noteRef"><sup><a href="#note91" name="91">91</a></sup></span> Thus, a sufficient relationship between the affiliate and non-resident units was established even though the Investors Relations Office was "nominally part of Shell Oil Company" -- whose shares are all held by the independent U.S subsidiary<span class="noteRef"><sup><a href="#note92" name="92">92</a></sup></span> -- and not of the parent holdings.<span class="noteRef"><sup><a href="#note93" name="93">93</a></sup></span></p><a name="IDA4QDVB"></a><div class="section4"><a name="IDABRDVB"></a>8.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Shell's Response: A Changed Human Rights Approach</span></div><a name="para36" id="para36"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;36</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the face of public scrutiny of its operations, particularly in Nigeria, Shell adopted a stakeholder-sensitive corporate policy that holds itself responsible for an inner sphere of employee rights and an outer sphere of community rights and security policies.<span class="noteRef"><sup><a href="#note94" name="94">94</a></sup></span> Thus, Shell incorporated a model of corporate human rights responsibilities in its management agenda that follows the policy guidelines of the Global Compact.<span class="noteRef"><sup><a href="#note95" name="95">95</a></sup></span> Generally, corporations in the extractive and energy sector have become increasingly aware of the human rights problems surrounding security arrangements. Thus, many corporations which were subject to public scrutiny, including Shell, Chevron, Rio Tinto and AngloGold Ashanti, participated in a multi-stakeholder dialogue with various governments and NGOs that resulted in the adoption of the Voluntary Principles on Security and Human Rights.<span class="noteRef"><sup><a href="#note96" name="96">96</a></sup></span> These Principles set out best practices for extractive corporations in forming their relationships with public and private security forces.<span class="noteRef"><sup><a href="#note97" name="97">97</a></sup></span></p><a name="para37" id="para37"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;37</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;But the difficulty in assigning "relevant performance measures (metrics) that can be verified," as pointed out by Shell, accentuates the practical problems that MNCs face in carrying out their responsibilities outside the workplace, and needs further analysis as well as better legal standards and guidelines.<span class="noteRef"><sup><a href="#note98" name="98">98</a></sup></span></p><a name="IDA2SDVB"></a><div class="section3">B.&nbsp;&nbsp;&nbsp;&nbsp;Human Rights Problems in the Extractive Industries: A Widespread and Multi-faceted Issue </div><a name="para38" id="para38"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;38</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Human rights problems are not peculiar to Shell in Nigeria. A multitude of corporations in the extractive industries face similar problems in various country contexts. In order to illustrate the patterns elaborated above, the following section outlines further human rights abuses that have occurred in the context of extractive operations and have drawn public scrutiny. </p><a name="IDAWTDVB"></a><div class="section4"><a name="IDAZTDVB"></a>1.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Killings, Arbitrary Detention, Torture in Nigeria</span></div><a name="para39" id="para39"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;39</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Claims were brought against the U.S.-based ChevronTexaco Corporation<span class="noteRef"><sup><a href="#note99" name="99">99</a></sup></span> ("Chevron") in <i>Bowoto v. Chevron Texaco Corp.</i>, alleging liability for "their own acts and the acts of CNL" (Chevron Nigeria Limited) in two incidents that occurred in the Nigerian Delta region.<span class="noteRef"><sup><a href="#note100" name="100">100</a></sup></span> The first took place in May 1998 and resulted in the shooting of protesters at Chevron's Parabe offshore platform and the subsequent detention and torture of the protest leader.<span class="noteRef"><sup><a href="#note101" name="101">101</a></sup></span> The protesters were residents of the Niger Delta demanding a larger contribution from Chevron toward the development of the oil extracting area.<span class="noteRef"><sup><a href="#note102" name="102">102</a></sup></span> The plaintiffs claimed that CNL acted "in concert with" Chevron when it recruited Nigerian government forces to intervene and transported their soldiers in CNL-leased helicopters.<span class="noteRef"><sup><a href="#note103" name="103">103</a></sup></span> Furthermore, the plaintiffs claimed that CNL personnel were on board the helicopters.<span class="noteRef"><sup><a href="#note104" name="104">104</a></sup></span> CNL confirmed that a CNL employee was in one helicopter for observatory purposes, but lacked control over the Nigerian military action.<span class="noteRef"><sup><a href="#note105" name="105">105</a></sup></span> The second incident, as described by the plaintiffs, occurred in January 1999; soldiers in a CNL-leased helicopter opened fire on two villages, Opia and Ikenyan, injuring and killing several people.<span class="noteRef"><sup><a href="#note106" name="106">106</a></sup></span> The soldiers were allegedly paid by CNL the day after the attacks.<span class="noteRef"><sup><a href="#note107" name="107">107</a></sup></span> Chevron's spokesman Charles Stewart acknowledged the payment to the soldiers, but stressed that the money was merely part of regular payments to Nigerian soldiers for protecting its facilities.<span class="noteRef"><sup><a href="#note108" name="108">108</a></sup></span></p><a name="para40" id="para40"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;40</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On March 22, 2004, the District Court for the Northern District of California denied Chevron's motion for summary judgment because the plaintiffs presented evidence of an "extraordinarily close relationship between the parents and subsidiaries prior to, during and after the attacks."<span class="noteRef"><sup><a href="#note109" name="109">109</a></sup></span> Moreover, the court found that the relationship could be sufficient for a reasonable jury to qualify the local subsidiary as an agent of Chevron, for whose actions the latter can be held liable.<span class="noteRef"><sup><a href="#note110" name="110">110</a></sup></span> Factors supporting an agency relationship included the high volume of communications between the defendant and its local subsidiary on the days of the security incidents, close parent-subsidiary monitoring, integral company policies, and overlap in management staff.<span class="noteRef"><sup><a href="#note111" name="111">111</a></sup></span></p><a name="para41" id="para41"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;41</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finally on August 14, 2007, the court issued a series of orders denying other motionsby Chevron for summary judgment.<span class="noteRef"><sup><a href="#note112" name="112">112</a></sup></span> Accordingly, since the plaintiffs had established enough evidence that "CNL personnel were directly involved in the attacks, that CNLhad paid and transported the GSF [Nigerian government security forces], and that CNL knew that GSF were prone to use excessive force,"<span class="noteRef"><sup><a href="#note113" name="113">113</a></sup></span> the case went to trial.</p><a name="IDAOXDVB"></a><div class="section4"><a name="IDARXDVB"></a>2.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Murder, Rape and Torture in Furtherance of Forced Labor in Burma</span></div><a name="para42" id="para42"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;42</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One of the most prominent corporate human rights cases to-date was settled in California state and federal courts. The case concerned charges against Unocal<span class="noteRef"><sup><a href="#note114" name="114">114</a></sup></span> for complicity in human rights violations in relation to the Yadana pipeline project in Burma (today Myanmar) in the 1990s. The pipeline project was a joint-venture between the U.S.-based Unocal, the state-run Myanmar Oil and Gas Enterprise, Thailand's major oil exploration firm PTTEP, and the French corporation Total.<span class="noteRef"><sup><a href="#note115" name="115">115</a></sup></span> Unocal was allegedly complicit in the murder, rape, and torture of local residents by the Burmese Military, which Unocal had contracted to provide security services to the pipeline project. The plaintiffs claimed that the abuses were committed in furtherance of forced labor for the construction of the pipeline.<span class="noteRef"><sup><a href="#note116" name="116">116</a></sup></span></p><a name="para43" id="para43"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;43</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Though ultimately vacated and settled out-of-court,<span class="noteRef"><sup><a href="#note117" name="117">117</a></sup></span> the Ninth Circuit Court of Appeals, in reversing the District Court's summary judgment on the major ATS claims,<span class="noteRef"><sup><a href="#note118" name="118">118</a></sup></span> held that "the evidence . . . supports the conclusion that Unocal gave practical assistance to the Burmese Military in subjecting Plaintiffs to forced labor."<span class="noteRef"><sup><a href="#note119" name="119">119</a></sup></span> According to the court, the practical assistance "took the form of hiring the Burmese Military to provide security and build infrastructure along the pipeline route" and giving logistical information to the military about where to provide security in daily meetings.<span class="noteRef"><sup><a href="#note120" name="120">120</a></sup></span> Given the District Court's finding that Unocal knew that forced labor was used,<span class="noteRef"><sup><a href="#note121" name="121">121</a></sup></span> the Ninth Circuit further held that a reasonable factfinder could conclude that Unocal "knew or should reasonably have known" that its payment and provision of logistical information would "assist or encourage the Myanmar Military to subject Plaintiffs to forced labour."<span class="noteRef"><sup><a href="#note122" name="122">122</a></sup></span> In response to allegations of complicity in forced labor, a Unocal spokesman said that the company acknowledged that human rights abuses may have taken place in Burma, but that Unocal operated under high ethical standards and rejected allegations of complicity with the military as unsubstantiated.<span class="noteRef"><sup><a href="#note123" name="123">123</a></sup></span></p><a name="para44" id="para44"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;44</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Similar charges against another partner in the Yadana joint venture pipeline project, the French corporation Total, were filed in French and Belgian courts.<span class="noteRef"><sup><a href="#note124" name="124">124</a></sup></span> The victims claimed that Total also provided logistical and financial support to the military, which had coerced locals into labor for the construction of the pipeline.<span class="noteRef"><sup><a href="#note125" name="125">125</a></sup></span></p><a name="para45" id="para45"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;45</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although French courts only exercise home state jurisdiction,<span class="noteRef"><sup><a href="#note126" name="126">126</a></sup></span> Belgian courts, like those of the U.S., exercise extraterritorial jurisdiction over suspects of foreign nationality for international crimes committed abroad.<span class="noteRef"><sup><a href="#note127" name="127">127</a></sup></span> The French Total case was ultimately settled,<span class="noteRef"><sup><a href="#note128" name="128">128</a></sup></span> but in Belgium, criminal proceedings initiated in 2002 by four Myanmar refugees<span class="noteRef"><sup><a href="#note129" name="129">129</a></sup></span> have just been reopened after the Belgian Constitutional Court held that a person recognized as a refugee in Belgium enjoys the same rights as a Belgian citizen.<span class="noteRef"><sup><a href="#note130" name="130">130</a></sup></span> Thus, the provisions of the Belgian Criminal Code prescribing criminal jurisdiction over crimes -- especially international crimes<span class="noteRef"><sup><a href="#note131" name="131">131</a></sup></span> -- committed abroad allowed further investigation and prosecution of the case against Total.<span class="noteRef"><sup><a href="#note132" name="132">132</a></sup></span></p><a name="para46" id="para46"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;46</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;According to the leading/largest French news agency, Total's only comment regarding the reopening of the Belgian case has been that the corporation has "taken note" of it.<span class="noteRef"><sup><a href="#note133" name="133">133</a></sup></span> In general, Total recognizes the controversy surrounding its presence abroad, particularly in Myanmar, while stressing the difficult political context in which oil corporations usually operate. On its corporate webpage, Total states: "Unfortunately, the world's oil and gas reserves are not necessarily located in democracies, as a glance at a map shows."<span class="noteRef"><sup><a href="#note134" name="134">134</a></sup></span></p><a name="para47" id="para47"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;47</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the face of public critique of their relations with repressive governments, Total has made human rights performance an integral part of its Corporate Social Responsibility ("CSR") policies, describing its effort to address the "critical issue of human rights" in its business operations abroad as an effort to "reconcil[e] security [for its employees and assets] and human rights"<span class="noteRef"><sup><a href="#note135" name="135">135</a></sup></span> as well as to spur community development.<span class="noteRef"><sup><a href="#note136" name="136">136</a></sup></span> Total has subscribed to the Voluntary Principles on Security and Human Rights and implemented a two-pronged policy to (1) conduct human rights training sessions for its security staff, and to (2) "[f]ormaliz[e] relations between Total subsidiaries and governments on security issues."<span class="noteRef"><sup><a href="#note137" name="137">137</a></sup></span> The difficult standing that oil corporations have when operating in countries with repressive regimes has become patent in the recent debate over political sanctions against the military regime in Myanmar. In this context, home governments have urged MNCs -- and especially Total -- to freeze their investments in Myanmar.<span class="noteRef"><sup><a href="#note138" name="138">138</a></sup></span> Total continues to operate in Myanmar arguing that "[f]ar from solving Myanmar's problems, a forced withdrawal would only lead to our replacement by other operators probably less committed to the ethical principles guiding all our initiatives."<span class="noteRef"><sup><a href="#note139" name="139">139</a></sup></span></p><a name="IDA33DVB"></a><div class="section4"><a name="IDAA4DVB"></a>3.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Forced Displacement in Sudan</span></div><a name="para48" id="para48"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;48</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 1998, Canadian oil corporation Talisman Energy Inc. ("Talisman") acquired a stake in a major oil project in Sudan.<span class="noteRef"><sup><a href="#note140" name="140">140</a></sup></span> On November 8, 2001, Talisman was charged with complicity in crimes against humanity, war crimes, and genocide committed by government forces contracted to secure local oil projects.<span class="noteRef"><sup><a href="#note141" name="141">141</a></sup></span> The plaintiffs claimed that Talisman aided and abetted the forced displacement of non-Muslim Sudanese from its oil extraction area in South Sudan, as well as the resultant extrajudicial killings, torture, rape, and physical destruction of civilian homes.<span class="noteRef"><sup><a href="#note142" name="142">142</a></sup></span></p><a name="para49" id="para49"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;49</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In its defense, Talisman claimed that its management was unaware of the forced displacement conducted in and close to their oil concession areas.<span class="noteRef"><sup><a href="#note143" name="143">143</a></sup></span> The District Court for the Southern District of New York found that "the government was [in fact] heavily engaged in providing security for the GNPOC [Greater Nile Petroleum Operating Company Limited as the entity conducting operations on behalf of the Consortium members under their agreements with the government] concession."<span class="noteRef"><sup><a href="#note144" name="144">144</a></sup></span> In particular, the court substantiated that Talisman worked on drafting guidelines for the Consortium's interaction with the military in terms of providing logistical support.<span class="noteRef"><sup><a href="#note145" name="145">145</a></sup></span> Even though the court held that there was evidence "that Talisman was informed that Government forces forcibly displaced civilian populations to create a buffer zone around oil development sites,"<span class="noteRef"><sup><a href="#note146" name="146">146</a></sup></span> the court granted the defendants' motion for summary judgment on September 12, 2006, since the plaintiffs failed to provide sufficient evidence that Talisman "performed any act that assisted the Government in its violations of international law."<span class="noteRef"><sup><a href="#note147" name="147">147</a></sup></span></p><a name="para50" id="para50"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;50</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With regard to Talisman's decision to withstand public pressure to close its operations in Sudan for a long time, a Senior Manager at Talisman explained that as an indirect investor in the pipeline project, the corporation was able to continue its "advocacy with the Government of Sudan for tolerance and the protection of human rights" and be actively engaged in community development programs in the oil concession areas.<span class="noteRef"><sup><a href="#note148" name="148">148</a></sup></span> Elaborating on the developments surrounding Talisman's withdrawal from Sudan, he recalls that public pressure peaked in 2001, when the U.S. House of Representatives passed a version of the Sudan Peace Act that would have led to the delisting of Talisman shares from the New York Stock Exchange. The final bill adopted by Congress did not contain these sanctions; still, it provided the backdrop against which Talisman announced in October 2002 the sale of its interest in the project.<span class="noteRef"><sup><a href="#note149" name="149">149</a></sup></span></p><a name="IDA5AS0"></a><div class="section4"><a name="IDACBS0"></a>4.&nbsp;&nbsp;&nbsp;&nbsp;<span class="decorate">Alleged Human Rights Violations in the Mining Industries</span></div><a name="para51" id="para51"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;51</span>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Companies in the mining sector have also frequently been accused of complicity in human rights violations against local communities committed by private or public security forces. For example, such accusations have been brought against Barrick Gold in Papua New Guinea<span class="noteRef"><sup><a href="#note150" name="150">150</a></sup></span> and AngloGold Ashanti in the Democratic Republic of Congo.<span class="noteRef"><sup><a href="#note151" name="151">151</a></sup></span></p><a name="para52" id="para52"></a><p class="paragraph"><span class="paragraphMarker">&#182;&nbsp;52</span>&n