The Return of the Alien Tort Statute

One of the things that makes trade interesting is that most of its battles are never really over. They may go away temporarily, but they always return for another round. A current example of that is the Alien Tort Statute (ATS). This law has a long history. It is embedded in the Judiciary Act of 1789, one of the first laws enacted by the first Congress. The ATS part of that statute consists of one sentence: “The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” There is virtually no legislative history to explain it. Still, the general view is that it was intended to clarify that federal, rather than state, courts had jurisdiction over matters such as attacks on foreign ambassadors on U.S. soil or piracy. (The issue of state versus federal authority was big at the time.)

For nearly 200 years, the ATS was essentially dormant, but in 1980 it was resuscitated when two Paraguayan citizens living in New York used it to sue another Paraguayan citizen, also living in New York, alleging that he was responsible for the kidnapping, torture, and killing of one of their relatives in Paraguay. The court permitted the suit to go forward, which over the years has led to a steady stream of additional cases, often directed at large companies, seeking damages for actions committed in other countries, usually by non-Americans.

Many of these cases made it to the Supreme Court, which has consistently narrowed the scope of what the law permits. In a 2004 case, Sosa v. Alvarez-Machain, the court concluded that the ATS was fundamentally a jurisdictional provision that did not create a new cause of action. However, the court also held that courts could recognize a “narrow set” of causes of action based on common law. It enumerated three of those: violations of safe conduct, infringement on the rights of ambassadors, and piracy, but it also left the door open to others. In 2013, in Kiobel v. Royal Dutch Petroleum Co., the court excluded claims involving foreign plaintiffs and defendants for actions that occurred entirely outside the United States. In 2018, in Jesner v. Arab Bank, PLC, the court ruled that foreign corporations could not be defendants. In Nestlé USA Inc. v. Doe, the court further narrowed the scope of the ATS by deciding that the nexus between the alleged tort (child trafficking and forced labor in Côte d’Ivoire’s cocoa fields) and the United States (where the companies allegedly made decisions to partner and purchase from those farms) was too tenuous.

The steady trickle of these cases has complicated the efforts of U.S. companies, primarily in natural resource sectors like agriculture as well as minerals and petroleum extraction, to do business in often-difficult foreign locations. Unlike companies in retail, those in natural resource sectors do not have a choice of location—they must go where the resources are and contend with governments and private parties who do not always have the best interests of the local people at heart. That exposes them to risks of involvement in corruption and human rights violations. These cases also arise because real harms occur, and the plaintiffs who bring them often have no functioning court in the place where the abuse happened, which is part of why the questions the statute raises are genuinely difficult. The U.S. Foreign Corrupt Practices Act helps protect U.S. companies from the former, but the Supreme Court’s interpretations of the ATS have opened the door to them being accused of complicity in the latter. While chocolate is not a national security item (at least not for everyone), the United States is increasingly dependent on a wide variety of critical minerals sourced in problematic countries with questionable labor standards. The ambiguity of court rulings in ATS cases thus far increases the risk for companies trying to operate in those locations.

Despite the extensive litigation and frequent visits to the Supreme Court, three questions remain open to debate—guaranteeing the lawsuits will continue:

1. What other causes of action might be permitted beyond those enumerated in Sosa?
2. Can U.S. corporations be sued? In Jesner, the court ruled out foreign corporations as defendants but did not opine on U.S. corporations, although in separate concurring opinions in that case, five justices suggested U.S. corporations could be held liable under the ATS.
3. What does “aiding and abetting” mean in the context of the ATS? Past decisions have made clear that in order to find liability under the ATS, there needs to be a U.S. connection. In Nestlé USA, the court concluded that the fact that the companies were located in the United States and management decisions were made here was not sufficient to establish the necessary connection. However, the court did not go further and suggested what domestic conduct might be enough to establish a nexus.

There is now a case pending before the Supreme Court that provides an opportunity to answer these questions: Cisco Systems, Inc. v. Doe I. In this case, Falun Gong members have accused Cisco of designing, customizing, and maintaining a nationwide surveillance system in China that enabled identifying, targeting, and subsequently persecuting Falun Gong adherents. The district court dismissed the suit, but the Ninth Circuit Court of Appeals revived it, which has led to an appeal to the Supreme Court. The case is noteworthy because it allows the court to address the questions above.

A definitive ruling on these questions, whichever way it comes out, would give companies and plaintiffs alike more certainty regarding what torts are covered and who can be considered a defendant. That would allow companies to better assess the risks of doing business and give them more guidance on what due diligence they need to undertake to protect themselves from liability. It would equally give plaintiffs a clearer picture of which claims the statute will and will not support. Either way, more clarity from the court will help U.S. companies assess risk and better understand their obligations in third countries.

Author’s Note: I retired from CSIS on March 29, 2026. I plan to continue writing this column and participating in the Trade Guys podcast, so please continue to read and listen. However, my CSIS email address will no longer be working, so if readers or podcast listeners want to contact me directly, they should do so at [email protected].

William A. Reinsch is a senior adviser (non-resident) and Scholl Chair emeritus with the Economics Program and Scholl Chair at the Center for Strategic and International Studies in Washington, D.C.