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Corporate Legal Accountability Quarterly Bulletin - Issue 29, December 2018

Welcome to our Corporate Legal Accountability Quarterly Bulletin -- highlighting a specific topic each quarter, as well as key developments in corporate legal accountability.  The Corporate Legal Accountability hub on our website provides objective, concise information about lawsuits against companies in which human rights abuses are alleged .
This bulletin and previous issues are also available in ChineseFrench, GermanRussian and Spanish.
Quarterly highlight

Legal developments
New blog posts
Other news
Quarterly highlight

The Zero Draft Treaty on Business and Human Rights

In July 2018, the open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights (IGWG) released the first official draft of the legally binding instrument on business and human rights. This “Zero Draft” and the later released Draft Optional Protocol were discussed, for the first time, during the 4th session of the IGWG in October 2018. The week long meeting saw a record number of roughly 300 civil society representatives who traveled to Geneva to participate in the debate, marking a key milestone in a complex and lengthy process, against the backdrop of a political context which has become increasingly challenging since the UN Human Rights Council voted by majority to begin negotiations in June 2014.

With the UN Guiding Principles on Business and Human Rights (UNGPs) the international human rights community succeeded in establishing an unprecedented normative framework for companies’ human rights responsibilities.  Meanwhile, the Treaty process has consolidated action, spurred cooperation, and stimulated healthy debate among international and local human rights and corporate accountability groups.

As an organization, and as highlighted in our recent blog piece, we believe that the Treaty process is complementary to the implementation of the UNGPs, and that an inclusive and open debate is crucial to ensure these initiatives deliver for everyone. Having said that, it is important to acknowledge that the release of the Zero Draft offers a critical opportunity to move beyond voluntary principles and establish an international framework for legal liability for companies who fail to live up to their human rights responsibilities.

Key Concerns Raised in the framework of the IGWG

During the 4th session of the IGWG in Geneva, civil society, academics, activists, states and other stakeholders have voiced a myriad of concerns, endorsements and suggestions regarding the Zero Draft Treaty (our coverage of the session, including daily summaries of the discussions is available here; and our Zero Draft Blog Series highlights a diverse range of voices from different thought-leaders). Civil society criticism of the treaty revolved around a number of key concerns, including the scope of the treaty, the protection of groups at heightened risk of human rights abuse, and victim’s access to remedy.

Some critics of the Draft demand that the binding instrument create direct obligations for companies and include the criminal liability of companies and individuals (the Zero Draft only establishes direct obligations for states), and that it apply to all corporations, including national and state-owned (the Zero Draft only applies to transnational corporations). Numerous stakeholders have emphasised the need to clearly define the rights and definition of victims, calling for the inclusion of provisions on the protection of human rights defenders, including women human rights defenders, as key actors for corporate accountability and for the effective protection of victims in conflict-affected areas, including those under occupation. Another key demand is the strengthening of preventative and mandatory human rights due diligence and the improvement of enforcement and complaint mechanisms to ensure effective access to remedy for victims of corporate human rights abuse.

Tests for an Effective Treaty Going Forward

The Business & Human Rights Resource Centre tracks the human rights impacts of over 8,000 companies and we make direct approaches to companies in relation to over 400 allegations of corporate human rights abuse each year. What have we learned? Big business enjoys an inequality of power and wealth over the communities and workers in their operations and supply chains, which leads to impunity. For instance, our Corporate Human Rights Benchmark gave 100 of the world’s largest companies an average score of just 16% for their Remedies and Grievance Mechanisms. It is this prevailing impunity that emboldens ruthless companies to pursue profit at the cost of the welfare of workers and communities; and that a legally binding treaty – if done right – has the potential to remedy.

The UN Guiding Principles and Treaty process must reconcile the inequality of arms between communities and corporations, by reinforcing each other as an international system that pursues genuine protection and remedy for victims. As detailed in the Oral Statement we delivered at the IGWG, an effective Treaty must pass three key tests, for all businesses, transnational, national, and state-owned.

Firstly, regulation must take account of the particular needs of people at high risk of vulnerability in companies’ operations and supply chains. Proper consultation of these stakeholders is key. This includes addressing gender-specific risks. For instance 85% of workers in the Cambodian apparel sector are women, because they are some of the “cheapest needles” for global apparel brands. The protection of human rights defenders working on business activities must also be addressed, as attacks on them grow rapidly.

Secondly, the Treaty should strengthen access to effective remedy and justice nationally and extraterritorially for when things go wrong. The Treaty should guarantee extraterritorial obligations by states, piercing the “corporate veil” that subsidiaries use to avoid justice, and insist on mutual cooperation and legal assistance across borders.

Finally, the Treaty should accelerate and reinforce national and international trends towards mandatory transparency and mandatory due diligence, to ensure that companies take adequate action to prevent abuse. Given the profound loss of public trust in global markets since the economic crisis of 2008, we need the UN Guiding Principles to ensure that human rights are put at the heart of business. An effective Treaty could serve to reinforce the Principles, to the benefit of all.
Overview of Key Resources & Documents on the Zero Draft
  • 4th Session of IGWG:  
Legal developments

New case profiles

Lawsuit by Appleby against BBC & The Guardian (re Paradise Papers)
On 4 December 2017, the law firm Appleby filed a lawsuit in the UK against the BBC and the Guardian over their reporting of leaked documents that allegedly detailed offshore tax-avoidance schemes of some of the world’s largest companies, known as the Paradise Papers. Appleby sought a permanent injunction to prevent further use of the information. On 4 May 2018, the parties announced that they had settled the lawsuit after the media outlets agreed to reveal to Appleby which documents may have supported their reporting.

Lawsuit by Apple against Attac (re tax avoidance protests)
On 4 January 2018, Apple filed a lawsuit in France against the Association for the Taxation of Financial Transactions and Aid to Citizens (Attac) over their December 2017 campaign against alleged tax evasion by Apple. Apple claimed that Attac’s activists vandalised its shops and presented an imminent threat to the security of its employees and customers. On 12 February 2018, the court dismissed the lawsuit ordering Apple to pay Attac’s legal fees.

Lawsuit against Vale-BSGR (re complicity in violence against villagers in Guinea)
On 11 September 2018, a local NGO filed a lawsuit with a Guinean court against the mining consortium Vale-BSGR. The lawsuit alleges complicity in killings, arrests, arbitrary detentions and torture of villagers in Zogota in 2012. Plaintiffs claim that the company provided vehicles to the Guinean defense and security forces to help them quell protests over the consortium’s recruitment policy. Vale-BSGR denies allegations.


Updates to existing case profiles

Abu Ghraib prisoners’ lawsuit against CACI, Titan (now L-3)
The hearing of the lawsuit alleging CACI’s conspiracy to abuse detainees at Abu Ghraib prison in Iraq is scheduled for 23 April 2019 at the US Federal Court for the Eastern District of Virginia.

Gold miner silicosis litigation (re So. Africa)
A trust that will disburse funds for mine workers who suffered silicosis and tuberculosis will be established in April 2019, following the May settlement of the class action lawsuit against 30 gold mining companies, including African Rainbow Minerals, Anglo American, AngloGold Ashanti, Gold Fields, Harmony and Sibanye-Stillwater.

Lawsuit against BHP Billiton & Vale (re dam collapse in Brazil)
On 2 October 2018, Brazilian prosecutors reached a final compensation deal with Samarco, Vale and BHP Billiton, which included payments for relatives of the 19 people killed in the dam collapse and those who lost their properties. In November, more than 240,000 plaintiffs, including Brazilian municipalities and indigenous communities, brought a lawsuit before the UK High Court in Liverpool against BHP Billiton seeking compensation for damages caused by the dam collapse.

Lawsuits against Drummond (re financing of paramilitaries in Colombia)
In October 2018, the Colombian Specialised Criminal Prosecutor's Office reopened the investigation against eight current and former Drummond officials over allegations of financing paramilitaries' war crimes in Colombia from 1996 to 2006. The company denied that it supported illegal armed groups.

Lawsuit against Intl. Finance Corp. (IFC) lawsuit (re financing of coal-fired plant in India & its negative impact) 
On 31 October 2018, the US Supreme Court heard Indian villagers' appeal challenging the immunity of the international Finance Corporation (IFC) under US law. Several judges signalled that the court was likely to back the IFC. A ruling is expected by the end of June 2019.

Lawsuit against KiK (re deadly fire in Baldia textile factory, Pakistan)
On 29 November 2018, a German court held a first oral hearing of the case brought by the survivors and family members of the victims of a factory fire in Pakistan.

Lawsuit against Nestlé & Cargill (re child labour in Côte d'Ivoire)
On 23 October 2018, a US Court of Appeal allowed the lawsuit against Nestle and Cargill over alleged complicity in child slavery on cocoa plantation in Côte d'Ivoire to proceed under the Alien Tort Statute.

Lawsuit against Oxec S.A. (re consultation for hydroelectric plants, Guatemala)
On 9 November 2018, the court of Verapaz sentenced indigenous activist Bernardo Caal, who led the campaign against the construction of the Oxec hydroelectric plants in Guatemala, to 7 years and 4 months in prison over allegedly false accusations of robbery and illegal detentions. The charges were pressed by the employees of the company in charge of the plants’ construction. 

Lawsuit against Samsung (re misleading advertising and human rights abuses, France)
On 16 October 2018, an investigating judge of the High Court in Paris heard the arguments of plaintiffs in the lawsuit alleging misleading business practices in relation to working conditions at Samsung factories in China, South Korea and Vietnam. On 1 November, Samsung agreed to compensate South Korean factory workers for work-related illnesses allegedly caused by exposure to toxic chemicals. This news could influence the judicial investigation in France.


Other legal news

Construction firm Vinci faces new complaint filed in France over alleged abuse of migrant workers' rights in Qatar; company responds

Sweden authorises indictment of Lundin Oil executives over alleged complicity in war crimes in So. Sudan; company denies allegations

So. Korea's Supreme Court orders Japanese firm to compensate WWII workers in forced labour lawsuit

France: NGOs & local authorities threaten to sue Total if it fails to adequately address climate change crisis

North Korean worker files criminal complaint against Dutch ship-building firm for allegedly profiting from forced labour

Survivors of post-election violence on Kericho tea plantation in Kenya submit public letter to Unilever's CEO Paul Polman in response to company’s statement about their case

New blog posts
Labour exploitation in Saipan (again): What difference does 20 years make?, Aaron Halegua, New York University School of Law, 29 Nov 2018

France's law on the corporate duty of vigilance: process, pedagogy and pragmatism as the way forward, Elsa Savourey, Herbert Smith Freehills, 23 Oct 2018

Tracking the companies tackling gender violence, Elli Siapkidou, Equileap, 4 Oct 2018

If you are interested in contributing to a guest post on corporate legal accountability, please contact us. 
Other news

From Business & Human Rights Resource Centre

RWE lawsuit: First test case in Europe to clarify responsibilities of carbon majors for climate change – interview with lawyers Dr. Roda Verheyen (legal counsel in Lliuya v. RWE AG); Roxana Baldrich& Christoph Bals, Germanwatch

Reports, articles & guidance by leading experts & organizations

The Road Less Traveled: How Corporate Directors Could be Held Individually Liable in Sweden for Corporate Atrocity Crimes Abroad, Miriam Ingeson, Uppsala University & Alexandra Lily Kather, European Center for Constitutional and Human Rights, on EJIL: Talk!, 13 Nov 2018

Experts reflect on the Zero Draft of the legally binding treaty on business and human rights Never Send To Know ..., Critical commentary on the US Supreme Court decision Jesner v. Arab Bank, Francisco Javier Zamora Cabot, Maria Chiara Marullo, Red Tiempo de los Derechos - Papeles El tiempo de los derechos, 22 Oct 2018 [full text available only in Spanish]

How the #MeToo Movement Has Shifted the Legal Landscape and What Businesses Are Doing About It, Snell & Wilmer on JD Supra, 18 Oct 2018

With politicians on its side, pipeline company ratchets up intimidation campaign, Mark Hand, ThinkProgress, 22 Oct 2018

[podcast] The trillion-dollar question: Can private lawyers hold drug companies accountable for the opioid epidemic?, Reuters, Oct, 2018

A New And Restrictive Approach To Piercing The Corporate Veil, Stephen G. Ross & Andrew Yolles, Rogers Partners LLP via Mondaq, 8 Oct 2018

New book: The HPV Vaccine on Trial: Seeking Justice for a Generation Betrayed, Mary Holland, Kim Mack Rosenberg, Eileen Iorio, 2 Oct 2018

Is the World Bank Group Above the Law?, Barry Yeoman, Nation (USA), 22 Sep 2018
One week of justice, 26 November – Geneva; 28-29 November – Dortmund; 3 December – Rome

London Launch of the Business and Human Rights Practitioners’ Network and its inaugural event, 20 November, London

Human rights and climate change, Panel discussion, 8 November, London
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