Doe v. Nestle USA, Inc.

There is no definite rule of corporate immunity or liability, so for each Alien Tort Statute claim, international law will determine corporate liability and domestic tort law will determine whether a corporation is subject to the standards underlying the claim.

The Ivory Coast is a vital part of the chocolate industry. Nestle USA, Inc. (“Nestle”) dominates the market, and maintains relations with the Ivorian farmers through financial and technical assistance. Nestle, aware of the prevalence of child slavery in the Ivory Coast, disregarded the fact that many Ivorian farmers took advantage of child labor. While aware that child labor was being used, Nestle continued to work with the Ivorian farmers to acquire high volumes of chocolate for a low price. As a result of the mistreatment the former child slaves of the Ivory Coast (“Doe”) endured, they brought suit against Nestle for aiding and abetting child slavery under the Alien Tort Statute (“ATS”). The district court granted Nestle’s motion for summary judgment, finding that there was no claim for which relief could be granted. On appeal, the Ninth Circuit applied “customary international law” to the ATS claim in order to determine liability for such a crime. Domestic tort law provides for whether recovery from the corporation will be allowable. Under this analysis, the panel found that under international law, Nestle had the requisite mens rea for the “aiding and abetting claim under either a knowledge or purpose standard.” The panel held that this was established by the fact that Doe’s “allegations suggest that a myopic focus on profit over human welfare drove the defendants to act with the purpose of obtaining the cheapest cocoa possible, even if it meant facilitating child slavery.” The panel declined however, to adopt an actus reus standard for analyzing aiding and abetting liability. Instead, the panel remanded this question to the district court, giving Doe the opportunity to amend their complaint to fit within the recent decisions of Prosecutor v. Perisic and Prosecutor v. Tadic. REVERSED and VACATED.