The Alien Tort Statute (ATS) allows noncitizens to bring civil actions in US federal courts for a select class of particularly egregious violations of international law. Human rights activists have pushed the boundaries of the ATS in recent decades, and the Supreme Court has responded by establishing several limiting rules for ATS jurisdiction. Most recently, in April 2018, the Supreme Court ruled in Jesner v Arab Bank that foreign corporations cannot be defendants in ATS suits. Following Jesner, plaintiffs in ongoing ATS suits have dropped key corporate defendants from their complaints. This Comment argues that courts and litigants should pause to consider how “foreign corporation” ought to be defined when applying the Jesner rule to transnational corporations. While a formalistic rule based on place of incorporation or location of headquarters might seem the obvious choice, it is not a necessary one.
This Comment considers possible alternatives and concludes that a functional standard that determines a corporation’s “foreignness” based on its actual ties to the United States best serves the purpose of the ATS as defined by Jesner. To that end, this Comment introduces a standard I call the Functional Foreignness Test, which defines a foreign corporation as a corporation whose ties to the United States are at least as strong as to any other nation. Such a standard ensures that ATS jurisdiction, which can have substantial implications for both foreign relations and human rights, does not turn on a formality that may have little relation to a corporation’s actual ties or activities.
"Legal Fictions and Foreign Frictions: An Argument for a Functional Interpretation of Jesner v Arab Bank for Transnational Corporations,"
University of Chicago Law Review: Vol. 86
, Article 4.
Available at: https://chicagounbound.uchicago.edu/uclrev/vol86/iss8/4