9th Circuit Digs Into Nestle Child Slavery Suit

     (CN) - In a long replacement opinion Thursday, the 9th Circuit explained why former child slaves on West African cocoa plantations may be able to sue Nestle under the Alien Tort Statute.
     The plaintiffs, named as John Does in a 2009 first amended complaint filed against Nestle USA and others in Los Angeles, claimed that they were forced as children to work on Ivorian cocoa plantations for up to 14 hours per day, six days a week, given only scraps of food to eat, and endured whippings and beatings.
     Children who tried to escape were forced to drink urine or had their feet cut open, the plaintiffs said.
     At issue is whether Nestle, a major cocoa purchaser, knew about and supported the conditions in the name of profit.
     Joined by the human rights organization Global Exchange, the Does said they filed in the Northern District of California because Mali lacks basic laws and the Ivory Coast's courts are "notoriously corrupt."
     A divided 9th Circuit panel found in December 2013 that plaintiffs may have standing under the Alien Tort Statute (ATS).
     "Corporations may be liable under ATS so long as presumption against extraterritorial application is overcome," the unsigned 9th Circuit opinion said.
     The San Francisco-based appeals court withdrew the eight-page December opinion Thursday, and replaced it with an expanded 32-page opinion, also on behalf of a divided panel.
     The new majority opinion, this time attributed to Judge Dorothy Nelson, concurs with the prior ruling that the violation of universal norms may be a basis for an ATS claim against a corporation.
     "The prohibition against slavery is universal and may be asserted against the corporate defendants in this case," Nelson wrote. "Private, non-state actors were held liable at Nuremberg for slavery offenses. Moreover, the statutes of the International Criminal Tribunals for Rwanda and the former Yugoslavia are broadly phrased to condemn 'persons responsible' for enslavement of civilian populations. The prohibition against slavery applies to state actors and non-state actors alike, and there are no rules exempting acts of enslavement carried out on behalf of a corporation."
     A compelling economic explanation for Nestle's alleged aiding and abetting of child labor can also be found in the Does' allegations.
     "Reading the allegations in the light most favorable to the plaintiffs, one is led to the inference that the defendants placed increased revenues before basic human welfare, and intended to pursue all options available to reduce their cost for purchasing cocoa," Nelson wrote. "Driven by the goal to reduce costs in any way possible, the defendants allegedly supported the use of child slavery, the cheapest form of labor available."
     Since the Supreme Court's ruling in Kiobel v. Royal Dutch Petroleum barred ATS torture claims against Shell Petroleum, the 9th Circuit also ruled that plaintiffs deserve a chance to amend their complaint with allegations that some of the activity underlying their claim took placed in the United States.
     Judge Johnnie Rawlinson again dissented from the ruling, arguing that mere knowledge of the child slavery prevalent on its suppliers' cocoa plantations was not enough to make Nestle liable for that conduct.
     "Plaintiffs and the majority concede that any and all actions taken by defendants were motivated by the desire for profits rather than an intent to enslave children," Rawlinson wrote. "This concession is fatal to the amended complaint as presently couched. There is absolutely no allegation that defendants have violated any governing law or regulation in their quest for profits. And profit-seeking is the reason most corporations exist. To equate a profit-making motive with the mens rea required for ATS aiding and abetting liability would completely negate the constrained concept of ATS liability."
     Rawlinson did concur, however, that the plaintiffs should be allowed to amend their complaint.