Over the past 15 years, there has been a sharp rise in lawsuits brought against American companies, as well as foreign companies with a substantial U.S. presence, that are premised on alleged personal or environmental injuries occurring abroad. These cases raise the question of whether U.S. courts should be the venue for cases concerning conduct occurring outside the territory of the United States. They have also been characterized by controversial and abusive tactics by plaintiffs and their lawyers.
Many of those transnational lawsuits have been filed in the U.S. by plaintiffs’ class action firms, public interest attorneys and non-governmental organizations. Some have been filed in federal courts under the 200-year old Alien Tort Statute (ATS), while many more have been brought in state courts under common law theories of liability.
These cases raise several concerns. One is the use of U.S. courts for adjudicating disputes that occurred outside of the country. It is a generally established principle that U.S. courts should not hear cases involving foreign conduct unless there is a significant nexus to the United States. By undermining this principle, these cases set a precedent that could be used to expose Americans to litigation in foreign courts over conduct occurring in the United States.
Equally troubling are the tactics used in these cases. According to ILR’s study Think Globally, Sue Locally, transnational cases are characterized by a number of features, including aggressive media tactics, organized protests and boycotts of corporate defendants, political pressure and, in some cases, outright fraud and abuse by plaintiffs’ lawyers. In the major transnational case against Chevron in Ecuador, four federal courts have found the proceedings tainted by fraud.
In April 2013, the U.S. Supreme Court ruled in Kiobel v. Royal Dutch Petroleum that claims of wrongful conduct on foreign soil cannot be brought in U.S. courts under the ATS. This ruling has substantially limited the use of the ATS in transnational cases, but does not deter cases brought under state common law. A complete list of lawsuits against corporations under the Alien Tort Statute can be found here.
August 11, 2015
This paper explores the effect of the U.S. Supreme Court's Kiobel decision on Alien Tort Statute (ATS) litigation in lower courts, and how lower courts have struggled to determine whether Kiobel permits U.S. corporations to be sued under the ATS for alleged torts in foreign countries. Read More
October 21, 2014
This collection of essays examines the shifting legal landscape of federal claims by foreign plaintiffs in the federal courts and focuses on the most common statutes invoked by foreign plaintiffs, as well as the threshold issues of personal jurisdiction and pleading standards that govern such suits. Read More
All Results for Transnational
February 14, 2019 | News
National Law Journal reports that Sens. Chuck Grassley (R-IA), John Cornyn (R-TX), Thom Tillis (R-NC), and Ben Sasse (R-NE) reintroduced the Litigation Funding Transparency Act, which would require third party litigation funding arrangements to be disclosed in litigation.... Read More
February 13, 2019 | Blogs
Billions of dollars are being invested in lawsuits by sophisticated hedge funds that, according to some of these firms, yield huge money for them. Yet neither the defendant, nor in many cases the actual plaintiffs, have any idea that this is happening.... Read More
February 01, 2019 | News
A group of 30 chief legal officers and general counsel sent a letter to the chief counsel and secretary of the Federal Rules Committee calling for full disclosure of third party litigation funding (TPLF), The Recorder reports.... Read More
January 31, 2019 | Blogs
As bone-chilling cold grips a large part of the country, a group of 30 general counsel and senior litigators from major U.S. companies gave a cool reception to third party litigation funding (TPLF) in a letter sent today to the Advisory Committee on Civil Rules. The letter supports a petition to the Committee, led by the U.S. Chamber Institute for Legal Reform (ILR) and co-signed by 29 other trade associations, advocating a rule requiring transparency for funding agreements in federal civil lawsuits. ... Read More
January 29, 2019 | News
In the latest sign of the explosive growth of the litigation funding industry, the Australian Broadcasting Corporation reports that U.S.-based litigation funder Burford Capital is entering the Australian market.... Read More
January 04, 2019 | News
A London judge rejected an attempt by litigation funder Vannin Capital to collect the £14 million ($17.7 million) they believed they are owed from funding a lawsuit against the Royal Bank of Scotland (RBS), Law360 reports.... Read More
December 21, 2018 | News
U.K.-Based Litigation Funders Have War Chest Larger Than $1.6 Billion... Read More
December 20, 2018 | Blogs
In June 2019, a UK court will decide if two different huge collective actions will be allowed to move forward, giving plaintiffs' lawyers and litigation financiers massive paydays, while consumers get next to nothing.... Read More
December 05, 2018 | News
An ABA Journal "In-Depth" story shows how litigation financing has grown into a "multi-billion-dollar global industry," and the "legal and ethical concerns" that come from it.... Read More
December 03, 2018 | News
The U.S. branch of Australian litigation funder IMF Bentham announced a new U.S.-focused fund that is expected to hit $500 million by the end of the year and potentially grow as high as $1 billion, Law360 reports.... Read More