For years, foreign plaintiffs relied on a law known as the Alien Tort Statute (ATS) to bring claims in US courts for violations committed overseas. The ATS allowed foreign nationals to sue persons or companies located in the US for violations of international law committed abroad. The law, originally passed in 1789, didn’t see much action until the 1980’s when it was revived to bring cases against foreign officials who participated in war crimes. However, beginning in the early 2000s, a series of Supreme Court decisions dialed back the law’s applicability and limited its usefulness. This led to plaintiffs finding other avenues to bring similar suits. One avenue was used in the recent Chiquita lawsuit which relied on the Transitory Tort Doctrine (TTD). Ropes & Gray writes about the TTD and how it differs from the ATS stating:
“While there are some similarities between ATS and TTD claims, a TTD claim involves a level of complexity that is absent in ATS cases. This is because cases brought under TTD apply the law of the jurisdiction the tort was committed in—here, Colombia—rather than American law. Application of another country’s law often requires additional expert opinions and presents difficulty for American juries unfamiliar with the other jurisdiction’s legal concepts. This added level of complexity not only increases the number of resources needed to conduct a trial, but also increases unpredictability in the outcome due to inconsistencies across countries’ tort laws.”
The $38.3 million verdict awarded in the Chiquita case may encourage more foreign plaintiffs to pursue cases using TTD. Chiquita will appeal and TTD may not hold up to scrutiny at the appellate level. However, assuming that the courts allow claims based on TTD to move forward, US courts will be expected to apply laws of foreign jurisdictions more frequently. This added complexity makes cases more difficult all around. As corporate supply chain due diligence increases, along with AI and other technological developments that can identify human rights abuses, deforestation and other ESG risks outside traditional US jusridiction, companies should be prepared to defend their actions abroad in US courts and ensure that they have the legal expertise to interpret and explain foreign law to US courts as part of their defense.
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