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The Supreme Court Needs to Decide: Can Victims Sue Chiquita For Sponsoring Terrorism?


Eight years have passed since Chiquita, the global fruit giant, was convicted on felony charges of having financed terrorism in Colombia. The company paid fines to the U.S. government, but for more than a decade, victims have been denied damages in U.S. courts.

The reason? It’s simply not yet clear whether U.S. law guarantees foreigners the right to sue companies under U.S. jurisdiction, even for crimes committed, in part, in the United States.

The Supreme Court now has the opportunity to resolve that. On Friday the Court will conference Cardona v. Chiquita Brands International, a class-action suit brought on behalf of some 4,000 victims of state-sponsored terrorism in Colombia. Legal experts say the case provides the ideal vehicle to decide whether U.S. civil law can hold multinationals accountable for overseas wrongdoing.

At issue is the scope of the Alien Tort Statute (ATS), an eighteenth-century anti-piracy law re-appropriated in the 1980s as a domestic enforcement mechanism for international human rights. The Court has already determined that only real live people—as opposed to corporate “persons”—can be brought to justice for international torture under the Torture Victims Protection Act. So proponents see the ATS as one of the last available legal provisions to hold corporations financially liable for the human rights performance of their global operations.

The fate of ATS claims against Dole Fruit and Drummond coal, other U.S. multinationals linked to paramilitary violence in Colombia, could hinge on the Supreme Court’s decision to hear the Chiquita case. The ATS has also been invoked by plaintiffs from Guatemala, Indonesia, and Burma with similar allegations of U.S. corporate malfeasance.

The relevant jurisprudence is complicated and heavily debated. But the facts in the Chiquita case could scarcely be more straightforward. As William Dodge, a University of California-Hastings international law professor and former State Department adviser, told me, “If there is any corporate case in which the Supreme Court is going to allow suits under the ATS, it’s going to be this one.”

For years, Chiquita made what its own legal counsel called a “business decision” to finance horrendous violence. If the Supreme Court doesn’t set a precedent now, there’s no reason to believe other companies won’t do the same in the future.

By its own admission, laid out in a factual proffer submitted for federal court records, Chiquita made at least 100 payments between 1997 and 2004 to the United Auto-Defense Forces of Colombia (AUC). The paramilitary coalition of narco-traffickers and right-wing death squads has been responsible for the rape, torture, murder, disappearance, and forced displacement of hundreds of thousands of Colombians. The company paid AUC, internal communications show, for “security” services, disguising the payments for accounting purposes. Chiquita did all this against the repeated and express warnings of its lawyers and with the repeated and express authorization of the highest ranking executives at its Ohio headquarters, as documents obtained by the National Security Archive reveal.

(Chiquita declined to comment for this story, citing an ongoing corporate merger. Notably, the company is trying to prevent the National Security Archive from acquiring about 10,000 more documents Chiquita was required to turn over to the federal government. The company claims that the information would unduly bias ongoing cases against it.)  

Of the $1.7 million total exchanged, $825,000 came after the U.S. State Department placed the AUC on its terrorist sanctions list, in 2001. Of that, more than $300,000 came after Justice Department officials in 2003 instructed the company to immediately halt all payments, the Justice Department confirmed to me.  

During the years the AUC was on Chiquita’s payroll, the group forced some 60,000 people from their homes in the banana-growing Urabá region of just one state, according to Verdad Abierta, a leading conflict research center. An additional 3,778 people were killed, 432 of them in mass slaughters. By 2005, the murder rate in one banana-shipping municipality had reached 393 per 100,000 residents, or more than nine times that of Baltimore, the major U.S. city with the highest rate that year.

Chiquita continues to dispute the nature of its dealings with the AUC (including in a previous email correspondence with me). Its representatives insist that AUC was extorting payments from the company. But, beyond dispute, the paramilitary atrocities did further the company's interests. According to the National Union School (ENS), 668 members of Colombia’s largest banana workers union were murdered between 1991 and 2006. By way of comparison, between 1999 and 2005, the rest of the world combined saw 314 similar killings of union members.

Bananas weren’t the only business that thrived under the AUC’s watch. The group, which occupied the power vacuum left in the drug trade following the collapse of other notorious Colombian cartels, moved cocaine and weapons through the same ports that fed U.S. demand for its favorite fruit. In November 2001, two months after the AUC was designated a terrorist group, Chiquita loading facilities were used to bring 3,400 AK-47 assault rifles and five million rounds of ammunition into the country from AUC trafficking partners in Nicaragua. A Cincinnati Enquirer investigation had previously found that the company covered up the bribes its Colombian counsel paid to secure access to the same dock.

In 2007, Chiquita, the first and, to date, only company convicted of “engaging in transactions with a specially designated global terrorist,” settled with the U.S. Justice Department for $25 million. That year, the company netted $3.46 billion in sales. During the period its conduct violated U.S. anti-terror law, Chiquita brought in $49.4 million—almost twice the penalty fee—from its Colombian holdings alone, according to the Justice Department. In 2005, the company informed its shareholders that it had sold those assets, its most valuable, for roughly $40 million, while also keeping distribution rights to the bananas they produced.

Chiquita has never faced prosecution in Colombia, where the AUC’s sprawling political and economic support networks remain largely intact. And neither Chiquita nor the U.S. government—which has sent billions to the Colombian military, in full knowledge of its extensive paramilitary ties and abysmal human rights record—has since made any attempt to compensate the millions of Colombian victims.

Chiquita, however, has found the money to lobby against stronger penalties for terrorism financiers. As of last summer, according to a Daily Beast investigation, the company had spent $780,000 trying to block the still-stagnant Justice Against Sponsors of Terrorism Act, which could expose the company to liability in the event that the class-action being brought against it under the Alien Tort Statute is denied.

Gross though these injustices may be, the Supreme Court does not concern itself with the moral merits of individual cases. By electing to hear Cardona v. Chiquita, the court would be acknowledging the significant legal ambiguities resulting from 2013’s Kiobel v. Royal Dutch Petroleum, in which the court avoided deciding whether corporations, in general, can be sued under the Alien Tort Statute.

That underlying confusion is partly why several legal experts consulted for this article believe the Chiquita suit is likely to make the Supreme Court oral arguments docket.

Despite a unanimous, 9-0 vote, Kiobel revealed a deeply conflicted court. In one of three divergent concurrences to Chief Justice John Roberts’ majority opinion, Justices Ginsburg, Kagan, and Sotomayor all shared in Justice Stephen Breyer’s reading that the ATS applies when cases meet one of three criteria: when the defendant is a U.S. national; when the conduct occurs on U.S. soil; or when the conduct “substantially and adversely” impacts a “national interest.”

Justice Clarence Thomas joined Justice Samuel Alito in taking a much narrower view. According to their standard, cases may have standing only when conduct “sufficient to violate an international law norm” occurs, and only then when the “focus” of the conduct occurs on U.S. soil, and only then when the norm meets universal “requirements of definiteness and acceptance.”

In his own, separate concurrence, official court weathervane Justice Anthony Kennedy signaled a willingness to readdress the ATS, writing that “further elaboration and explanation” would be necessary. It takes only four votes for the court to hear a case, but if the liberal justices doubted Kennedy’s ultimate intentions, they could shoot down the Chiquita suit defensively. Or the Supreme Court could opt to wait for more divergent opinions to emerge from the lower court before intervening.

John Bellinger, a former National Security Council legal adviser, told me he would be “very surprised” for the Court to take Cardona v. Chiquita so soon after handing down a similar ruling. “That’s just not how the Court works,” said Bellinger, who filed an amicus brief in Kiobel on behalf of BP, Monsanto, and other corporations, arguing against extraterritorial ATS jurisdiction.

But Cardona v. Chiquita already proves the need for some clarification. The most recent Chiquita decision threw out the plaintiffs’ claims, almost on their face. Building off Alito’s minority concurrence, Judge David Sentelle ruled in U.S. 11th Circuit Court that because the AUC's rapes, tortures, and massacres—the “relevant conduct”—did not occur in the United States, the victims have no grounds for suit here. Within such an interpretation, it would appear, U.S. corporations can legally fund overseas terrorism, provided the U.S. government hasn’t defined it as such.

This gets to what’s truly at stake in this case. All that Sentelle—a “tenther” conservative and intellectual protégé of former Senator Jesse Helms, the longtime cheerleader for CIA dirty war in Central America—did was reaffirm a conclusion Chiquita’s own sordid history makes abundantly clear: Terrorism isn’t terrorism when it’s performed in the service of U.S. interests.

None other than Eric Holder, then Chiquita’s legal counsel, implied as much at the company’s 2007 sentencing hearing.

In closing arguments the lead prosecutor for the government characterized Chiquita’s conduct as “morally repugnant” and insisted that “the terrorism statutes do not distinguish among listed foreign terrorist organizations ... as to their relative criminality or their relative threat to the national security interests of the United States.”

Holder responded by asking why the government hadn’t acted more decisively, once it was made aware of Chiquita’s ongoing subversion of America’s ostensible war on terror. What would have happened, Holder wondered, if Chiquita “came in and said they were paying al-Qaeda”?

Holder’s intent was to imply that the government had behaved negligently, not that his client was getting off easy. But the discrepancy is a real one, and for a Supreme Court now weighing what it has framed as a matter of foreign policy, Holder’s thought experiment deserves to be taken at face value.

This story has been updated to clarify John Bellinger's role in Kiobel and to correct the court for which Judge David Sentelle issued his ruling.