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Was Shell’s $15.5 Million Alien Tort Settlement A Win ‘For the Principles of Human Rights Law’?


By Alison Frankel

June 10, 2009

In a lengthy analysis at The Am Law Daily of Monday’s $15.5 million settlement between Royal Dutch Shell and Nigerian plaintiffs who accused the oil giant of complicity in the torture and death of activists protesting Shell’s drilling in the Ogoni region of the Niger delta, American Lawyer senior international correspondent Michael Goldhaber points out that the biggest winner in the case may be the cause of international human rights.

“A settlement is a victory,” Michael Hausfeld, an architect of the Holocaust settlements who was not involved in the Shell case, told Goldhaber. “Every settlement advances the principles of human rights law.”

Goldhaber argues that the Shell case established significant precedents for plaintiffs seeking to hold corporations accountable for human rights abuses. In 2002, for instance, the U.S. Court of Appeals for the Second Circuit, in reversing a lower court ruling that dismissed the case on forum non conveniens grounds, wrote that “torture committed under color of law of a foreign nation is ‘our business.'” And in a pretrial ruling just this April, Manhattan federal district court judge Kimba Wood affirmed that extrajudicial execution is a violation of the law of nations (reversing her own previous ruling), as are cruel, inhuman and degrading treatment; and prolonged arbitrary detention.

“After thirteen years, our clients felt they had made enough good law,” said plaintiffs counsel Jennie Green of the Center for Constitutional Rights. And, as Goldhaber notes, $15.5 million–while probably less than Shell spent on its Cravath, Swaine & Moore lawyers in the case–is “an immense sum for residents of the Niger Delta.”

So while the disputed facts of what happened in Ogoni in the early 1990s were not tested in a court of law and weighed by a jury, Goldhaber says, “[the case] has left its mark on law and legal culture–and in this respect the movement for business human rights is the big winner.”

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