Washington DC – With its unanimous decision to reverse the lower court ruling in Jose Francisco Sosa v. Humberto Alvarez-Machain, et al., the U.S. Supreme Court has taken an important step in narrowing the scope of the Alien Tort Statute of the Judiciary Act of 1789 (ATS), according to officials with the National Foreign Trade Council and USA*Engage. The opinion particularly warned courts in the future to be “wary” of the foreign relations implications of using the ATS to impede the “discretion of the Legislative and Executive Branches in managing foreign affairs.”
“We welcome the Court’s ruling in the Sosa case, which more closely limits the use of the ATS – a statute that has been misused more and more often over the last decade,” said Bill Reinsch, President of the National Foreign Trade Council and Co-Chairman of USA*Engage. “Particularly distressing has been the use of the ATS in a growing number of cases against multinational corporations that do business around the world. While the Sosa case did not involve American business, we believe the Court’s opinion clearly indicates that the ATS should not be used to institute foreign policy in American courts. The decision is an important first step in defining the true meaning and intent of the centuries-old Alien Tort Provision. In the future, lower courts must take this narrower view in cases brought using the ATS.”
Citing an influx of unwarranted lawsuits brought in American courts against U.S. and international companies over the last decade which misinterpret the ATS, the National Foreign Trade Council, USA*Engage and several additional business organizations filed an amicus brief at the beginning of this year that was accepted in the Sosa case.
“We are gratified that the Supreme Court made clear the ATS is jurisdictional in nature; it has ‘raised the bar’ significantly in limiting which cases can be brought under the statute. With the tremendous growth in lawsuits brought to seek redress from corporations for the wrongs of foreign governments, the Court’s stricter approach to interpreting the law is prudent. Distorting the American legal system by using the ATS helps no one – it strains U.S. bilateral relations, discourages much needed U.S. foreign direct investment in developing countries and actually impedes the goals of those filing the lawsuits. While additional judicial interpretation will be needed to address the vagaries of the ATS that the Sosa opinion did not address, the opinion sets a vital precedent from which U.S. Courts can draw when interpreting this often-misused statute.”
The National Foreign Trade Council is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves 300 member companies through its offices in Washington and New York.
USA*ENGAGE is a coalition of more than 670 small and large businesses, agriculture groups and trade associations working to seek alternatives to the proliferation of unilateral U.S. foreign policy sanctions and to promote the benefits of U.S. engagement abroad. For more information on USA*ENGAGE and the harmful effects of unilateral trade sanctions, visit the USA*ENGAGE web site at www.usaengage.org