Jesner v. Arab Bank, PLC
Headline: Human-rights suits against foreign companies limited as Court rules foreign corporations cannot be sued under the Alien Tort Statute, blocking many overseas victims from suing foreign banks in U.S. courts.
Holding: The Court held that the Alien Tort Statute does not allow suits against foreign corporations in U.S. federal courts, so the plaintiffs’ ATS claims against Arab Bank were properly dismissed.
- Blocks ATS lawsuits in U.S. courts against foreign corporations.
- Leaves victims able to sue individual perpetrators and use other statutes like the Anti‑Terrorism Act.
- Shifts any change on corporate international liability to Congress to decide.
Summary
Background
About 6,000 foreign nationals sued Arab Bank, a major Jordanian bank with a New York branch, saying terrorist attacks abroad were aided by banking transactions cleared through its New York office and by transfers tied to a Texas charity. The suits were brought in U.S. federal court under the Alien Tort Statute (ATS), which allows aliens to sue in U.S. courts for certain violations of international law. Lower courts dismissed the ATS claims based on earlier Second Circuit rulings, and the case reached the Supreme Court.
Reasoning
The Court considered whether federal courts may impose ATS liability on foreign corporations without Congress’ approval. Using the Sosa framework, the Court noted that international law is unclear about corporate liability, that Congress has already limited some remedies (for example, the Torture Victim Protection Act targets individuals), and that creating broad corporate liability raises separation‑of‑powers and foreign‑relations concerns. The majority concluded that courts should not recognize ATS causes of action against foreign corporations and affirmed the dismissal of the claims against Arab Bank.
Real world impact
As a result, many suits by non‑U.S. victims seeking money from foreign companies under the ATS will be barred; plaintiffs may still pursue individual employees or other statutes like the Anti‑Terrorism Act. The Court emphasized that Congress, not judges, should decide whether and how to allow corporate ATS liability, so future change depends on legislation. The litigation has already strained diplomatic relations, a concern the Court cited in its decision.
Dissents or concurrances
Justices ALITO and GORSUCH wrote separate opinions agreeing with the outcome for different reasons (separation of powers and prudence). Justice SOTOMAYOR dissented, joined by three colleagues, arguing the ATS can reach corporate defendants and that the case should be evaluated on narrower grounds.
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