Supplemental Brief — Nestlé USA, Inc., Petitioner v. John Doe I, et al.

No. 19-416

IN THE

Supreme Court of the United States

_________

NESTLÉ USA, INC.,

Petitioner,

v.

JOHN DOE I, ET AL.,

Respondents.

_________

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

_________

SUPPLEMENTAL BRIEF FOR PETITIONER

_________

THEODORE J. BOUTROUS JR.

PERLETTE MICHÈLE JURA

GIBSON, DUNN &

CRUTCHER LLP

333 South Grand Avenue

Los Angeles, CA 90071

(213) 229-7000

tboutrous@gibsondunn.com

NEAL KUMAR KATYAL

Counsel of Record

CRAIG A. HOOVER

HOGAN LOVELLS US LLP

555 Thirteenth Street, N.W.

Washington, DC 20004

(202) 637-5600

neal.katyal@hoganlovells.com

Counsel for Petitioner

RULE 29.6 DISCLOSURE STATEMENT

The disclosure made in the petition for a writ of

certiorari remains accurate.

(i)

ii

TABLE OF CONTENTS

Page

RULE 29.6 DISCLOSURE STATEMENT .................. i

TABLE OF AUTHORITIES ...................................... iii

INTRODUCTION ........................................................ 1

ARGUMENT ............................................................... 3

I.

THE NINTH CIRCUIT’S DECISION

WARRANTS REVIEW AND A THIRD

QUESTION SHOULD BE ADDED

ON AIDING-AND-ABETTING

LIABILITY ........................................................ 3

II.

THE COURT SHOULD GRANT

BOTH PETITIONS........................................... 6

CONCLUSION .......................................................... 12

iii

TABLE OF AUTHORITIES

Page(s)

CASES:

Burwell v. Hobby Lobby Stores, Inc.,

573 U.S. 682 (2014) ................................................ 7

Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A.,

511 U.S. 164 (1994) ............................................ 5, 6

Doe VIII v. Exxon Mobil Corp.,

654 F.3d 11 (D.C. Cir. 2011) .................................. 5

Gratz v. Bollinger,

539 U.S. 244 (2003) ................................................ 7

Grutter v. Bollinger,

539 U.S. 306 (2003) ................................................ 7

Jesner v. Arab Bank, PLC,

138 S. Ct. 1386 (2018) ................................ 4, 5, 8, 9

Kiobel v. Royal Dutch Petroleum Co.,

569 U.S. 108 (2013) ........................................ 2, 4, 8

Riley v. California,

573 U.S. 373 (2014) ................................................ 7

RJR Nabisco, Inc. v. European Cmty.,

136 S. Ct. 2090 (2016) .......................................... 11

United States v. Stitt,

139 S. Ct. 399 (2018) .............................................. 7

RULES:

Sup. Ct. R. 12.6 ....................................................... 10

Sup. Ct. R. 25.1 ....................................................... 10

Sup. Ct. R. 25.3 ....................................................... 10

IN THE

Supreme Court of the United States

_________

No. 19-416

_________

NESTLÉ USA, INC.,

Petitioner,

v.

JOHN DOE I, ET AL.,

Respondents.

_________

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

_________

SUPPLEMENTAL BRIEF FOR PETITIONER

_________

INTRODUCTION

Petitioner Nestlé USA, Inc. (Nestlé) and the United

States agree that this Court should review the legal

questions presented here. As the United States

underscores, there is an entrenched circuit split on

both questions Nestlé’s petition for certiorari raises.

Those questions are important and recurring, and

the Court should take this opportunity to answer

them.

As to the additional question the United States

proposes adding, Nestlé agrees here too. The issue

whether a cause of action for aiding and abetting a

violation of international law may be implied under

(1)

2

the Alien Tort Statute (ATS) warrants the Court’s

review. U.S. Br. I. The Court should take that issue

up.

But Nestlé disagrees with the suggestion that these

three cert-worthy issues should not be answered

with this case before it, alongside Cargill, Inc. v.

John Doe I, No. 19-453. Both petitions for certiorari

seek review of the same underlying Ninth Circuit

decision, and both squarely raise the three questions

presented under different facts. The United States’

brief convincingly explains why the Court should

grant the petition in Cargill, but it does not persuasively set forth why it would be disadvantageous to

the Court to have the differing sets of facts in the

Nestlé case squarely before it as well.

It is true, as the United States notes, that the

Ninth Circuit gave Plaintiffs yet another chance to

amend their complaint to “specifically identify the

culpable conduct attributable to” Nestlé’s domestic

affiliates for purposes of Article III standing. Pet.

App. 46a. But that ruling was inextricably bound up

with the holding that the United States agrees is

worthy of review. The Ninth Circuit held that the

allegations about Nestlé’s domestic conduct “touch

and concern the territory of the United States * * *

with sufficient force to” state a domestic ATS claim.

Kiobel v. Royal Dutch Petroleum Co., 569 U.S. 108,

124-125 (2013). At the same time, it remanded for

additional standing allegations based on doubts

about whether Plaintiffs’ injuries were even traceable to Nestlé at all. Nestlé’s petition thus affords the

Court an opportunity to clarify that, at a minimum,

“an ATS claim cannot overcome the extraterritoriality bar where—as here—plaintiffs have not even

3

alleged that their injuries can be traced to the domestic conduct of a defendant.” Pet. 15. If, in the

course of that analysis, the Court determines that

after fifteen years and three separate complaints, the

allegations of traceability are still so thin that they

fail to satisfy even Article III, the Court can so hold.

The existence of that possibility is not a vehicle

problem; it is a powerful confirmation of the need for

this Court’s review.

This Court should therefore grant this petition and

the petition for certiorari filed by Cargill. As the

United States agrees, the Cargill petition is worthy

of review. There is no need to hold this petition

pending disposition of that case. And granting both

petitions would aid this Court’s review. The Court

has often recognized that it is valuable to have a

variety of fact patterns before it when it elucidates

how to apply a legal standard, as resolving the

extraterritoriality question here requires. Granting

both petitions would allow the Court to provide more

comprehensive guidance.

ARGUMENT

I.

THE NINTH CIRCUIT’S DECISION

WARRANTS REVIEW AND A THIRD

QUESTION SHOULD BE ADDED ON

AIDING-AND-ABETTING LIABILITY.

Nestlé and the United States are in full agreement

that the two questions presented in Nestlé’s petition

for certiorari warrant review. The United States

also asks this Court to add a third question regarding aiding-and-abetting liability, and Nestlé joins

that request.

4

1. The first question in Nestlé’s petition is whether

allegations of general corporate activity in the United States are sufficient to overcome the bar against

extraterritorial claims under the ATS. Pet. 14-24.

As the United States explains, the “proper extraterritoriality analysis for this and similar fact patterns

represents an important, recurring issue that has

divided the courts of appeals and warrants this

Court’s review.” U.S. Br. 18. And the Ninth Circuit’s “analysis was in error.” Id. at 20. “[E]xcising

petitioners’ foreign conduct leaves nothing remaining

except the generic functions associated with any

corporate headquarters, such as oversight of foreign

operations.” Id. Such “generic functions” are not

sufficient to state a claim under the ATS, even

assuming aiding-and-abetting liability exists. Id.

Further, “given the sensitive foreign-relations concerns that ATS suits implicate, the need to police

extraterritoriality constraints is especially pressing.”

Id. at 20-21 (citing Kiobel, 569 U.S. at 117). Review

of this first question is therefore warranted.

The second question in Nestlé’s petition is whether

domestic corporations are subject to liability under

the ATS. “This important question has divided the

circuits and warrants this Court’s review.” Id. at 8.

The Ninth Circuit “failed to engage meaningfully

with Jesner,” and reached the wrong result. Id.

And, contrary to Plaintiffs’ suggestion, Opp. 21, “ATS

suits against domestic corporations frequently involve claims of aiding and abetting misconduct

abroad—which often implicate the policies and

conduct of foreign states,” U.S. Br. 11. In this very

case, Plaintiffs have alleged that “several of the cocoa

farms in Côte d’Ivoire from which Defendants source

5

are owned” or “protected by government officials.”

Id. (quoting Compl. ¶ 50).

2. The United States recommends that a third

question should be added: “Whether a cause of action

for aiding and abetting a violation of international

law may be implied under the ATS.” Id. at I. That

“is a significant issue that has percolated extensively

in the courts of appeals and is ripe for this Court’s

review.” Id. at 13. And, though not raised in

Nestlé’s petition for certiorari, it was pressed and

passed upon below. Id. at 13-14.

The Ninth Circuit resolved the question incorrectly.

“Just as Jesner declined to extend liability beyond

individual perpetrators to foreign corporations, so too

this Court should decline to extend liability beyond

primary violators to aiders and abettors.” Id. at 15;

see also Br. for the United States as Amicus Curiae

in Support of Petitioners 8, Am. Isuzu Motors, Inc. v.

Ntsebeza, 553 U.S. 1028 (2008) (No. 07-919), 2008

WL 408389; Doe VIII v. Exxon Mobil Corp., 654 F.3d

11, 87 (D.C. Cir. 2011) (Kavanaugh, J., dissenting in

part), vacated on other grounds by Doe VIII v. Exxon

Mobil Corp., 527 F. App’x 7 (D.C. Cir. 2013). That is

the inescapable upshot of Central Bank of Denver,

N.A. v. First Interstate Bank of Denver, N.A., 511

U.S. 164 (1994). There, the Court explained that

“when Congress enacts a statute under which a

person may sue and recover damages from a private

defendant for the defendant’s violation of some

statutory norm, there is no general presumption that

the plaintiff may also sue aiders and abettors.” Id. at

182. Rather, to hold that civil statutes impliedly give

rise to aiding-and-abetting liability would be a “vast

expansion of federal law,” and courts should decline

6

such a rule in the absence of “congressional direction

to do so.” Id. at 183. This baseline principle of

congressional primacy is all the more vital in this

case, because “[a]iding-and-abetting liability * * *

risks disruption to U.S. foreign policy.” U.S. Br. 16.

Nestlé thus agrees that the Court should add the

aiding-and-abetting question proposed by the United

States, which furnishes yet another ground for

reversal of the Ninth Circuit’s misguided decision.

II.

THE COURT SHOULD GRANT BOTH

PETITIONS.

Nestlé and the United States part ways on only one

point: The United States recommends that the Court

grant only the petition for certiorari in Cargill, Inc.

v. John Doe I, No. 19-453, and hold Nestlé’s petition

in abeyance. In Nestlé’s view, both petitions should

be granted so that this Court can consider the full

range of allegations Plaintiffs have made in this case

when resolving the extraterritoriality question.

As a preliminary matter, Nestlé agrees that the

Cargill petition is a “suitable vehicle” for the Court

to resolve the three legal questions before it. U.S.

Br. 22. If the Court grants only that petition and

reverses the judgment of the Ninth Circuit, it would

be appropriate for the Court to grant Nestlé’s petition, vacate the judgment of the Ninth Circuit, and

remand for further proceedings. Nestlé would necessarily prevail on remand: The claims against Nestlé

could not survive because any amendment would be

futile in light of this Court’s decision.

But the Court would benefit from having both petitions before it. The Court has often recognized,

explicitly or implicitly, that considering a variety of

7

fact patterns can sharpen the legal questions presented and aid this Court’s ability to provide comprehensive guidance to lower courts. For instance,

the Court granted certiorari in both Grutter v. Bollinger, 539 U.S. 306 (2003), and Gratz v. Bollinger,

539 U.S. 244 (2003), “so that this Court could address the constitutionality of the consideration of

race in university admissions in a wider range of

circumstances,” id. at 260. Similarly, in Riley v.

California, 573 U.S. 373 (2014), this Court granted

and consolidated two cases, one involving a “smart”

phone and one involving a “flip” phone, to determine

the applicability of the search-incident-to-arrest

doctrine. This sort of joint grant and consolidation is

routine. See, e.g., Ford Motor Co. v. Montana Eighth

Judicial Dist. Court, No. 19-368; Chiafalo v. Washington, No. 19-465; Fin. Oversight & Mgmt. Bd. for

Puerto Rico v. Aurelius Inv., LLC, No. 18-1334; Epic

Sys. Corp. v. Lewis, No. 16-285; Bank of Am. Corp. v.

City of Miami, No. 15-1111. The Court has granted

and consolidated multiple petitions over the United

States’ recommendation to grant one and hold the

other. See, e.g., United States v. Stitt, 139 S. Ct. 399

(2018); Burwell v. Hobby Lobby Stores, Inc., 573 U.S.

682 (2014).

Here, the allegations regarding Nestlé are different

than the allegations regarding Cargill, and so granting both petitions would furnish the Court a greater

variety of factual material to consult when delimiting

the outer bounds of the ATS. To take one example,

Nestlé is the subsidiary of a foreign corporation,

unlike Cargill, which is a purely domestic corporation. That fact could be relevant both to whether the

claims are impermissibly extraterritorial and to

whether it makes sense to draw a distinction be-

8

tween domestic and foreign corporations after Jesner. The majority opinion in Kiobel, for instance,

noted that the defendants there were foreign, 569

U.S. at 111-112, and Justice Breyer’s concurrence

highlighted the fact that the “defendants [we]re two

foreign corporations” as a factor informing why

“jurisdiction d[id] not lie,” id. at 139 (Breyer, J.,

concurring in the judgment).

More broadly, Kiobel explained that the “presumption against extraterritorial application helps ensure

that the Judiciary does not erroneously adopt an

interpretation of U.S. law that carries foreign policy

consequences not clearly intended by the political

branches.” Id. at 116. Targeting U.S. subsidiaries of

foreign multinationals for almost entirely foreign

conduct risks raising the same foreign policy consequences. Cf. Br. of the Governments of the Kingdom

of the Netherlands and the United Kingdom of Great

Britain and Northern Ireland as Amici Curiae in

Support of Neither Party 17-18, Kiobel, 569 U.S. 108

(No. 10-1491), 2012 WL 2312825 (arguing that the

“presence of a U.S. corporate affiliate is not a sufficient basis to establish U.S. jurisdiction over ATS

claims against a foreign parent or affiliated corporation for unrelated activities that have no effect in the

U.S.”). The Court in Kiobel was also concerned that

“accepting [plaintiffs’] view would imply that other

nations, also applying the law of nations, could hale

our citizens into their courts for alleged violations of

the law of nations occurring in the United States, or

anywhere else in the world.” 569 U.S. at 124. This

case raises an analogous concern: that other nations

might hale a foreign subsidiary of a U.S. corporation

into a foreign court for injuries suffered in some third

nation.

9

Similarly, a suit against a domestic subsidiary

carries many of the same foreign policy concerns that

motivated this Court’s decision in Jesner as a suit

against the foreign parent itself. See Jesner v. Arab

Bank, PLC, 138 S. Ct. 1386, 1402-03 (2018) (majority

op.); id. at 1405-06, 1407-08 (plurality op.); id. at

1410-12 (Alito, J., concurring in part and concurring

in the judgment); id. at 1418-19 (Gorsuch, J., concurring in part and concurring in the judgment). For

instance, the Jesner plurality was concerned that, if

the suit were allowed in that case, it “could subject

American corporations to an immediate, constant

risk of claims seeking to impose massive liability for

the alleged conduct of their employees and subsidiaries around the world, all as determined in foreign

courts.” Id. at 1405 (plurality op.). If U.S. courts

may impose liability on U.S. subsidiaries of foreign

corporate families for U.S.-based conduct only tangentially related to foreign injuries, that would invite

foreign nations to do the same thing to foreign subsidiaries of U.S.-based multinationals. That could

“establish a precedent that discourages American

corporations from investing abroad.” Id. at 1406

(plurality op.). In short, then, it would benefit the

Court to have the particular circumstances of the

Nestlé case before it as it answers the questions

presented.

The United States contends that holding this case

is appropriate because “[t]he court of appeals declined to find standing on the current pleadings as to

Nestlé and remanded for repleading.” U.S. Br. 22.

“[T]he potential absence of jurisdiction on the current pleadings as to Nestlé,” according to the United

States, “could prevent the Court from reaching the

merits in th[is] case.” Id. at 23. That somewhat

10

tenuous vehicle problem might conceivably be an

argument against certiorari if this were the only

petition before the Court. But it is not a compelling

argument against certiorari if the Court is already

going to examine these ATS issues in Cargill’s petition. And, if anything, the existence of this traceability issue only highlights the need for this Court’s

review of Nestlé’s petition. The pertinent facts are

squarely before the Court right now and ripe for

adjudication.1

That there is even still a question related to standing after so many years of litigation is a powerful

indication of how far off course the Ninth Circuit

veered in its opinion. The Ninth Circuit has already

definitively ruled that Plaintiffs had displaced the

presumption against extraterritorial application

based on the paper-thin allegations in the complaint,

so the extraterritoriality issue is ripe for review. Pet.

Reply 8. The fact that the Ninth Circuit simultaneously expressed concern that those same allegations

fall short of alleging an injury traceable to Nestlé’s

conduct just gives the Court a chance to clarify that,

at a minimum, “an ATS claim cannot overcome the

extraterritoriality bar where—as here—plaintiffs

have not even alleged that their injuries can be

1

There is also no difference in the volume of briefs. Nestlé is a

respondent in the Cargill case under Supreme Court Rule 12.6.

If this Court grants only the Cargill petition, that status allows

Nestlé to file an opening brief and reply brief in support of

Cargill. See Sup. Ct. R. 25.1 (“Any respondent * * * who

supports the petitioner * * * shall meet the petitioner’s * * *

schedule for filing documents.”); Sup. Ct. R. 25.3 (“Any respondent * * * supporting the petitioner * * * may file a reply

brief.”); see, e.g., California v. Texas, No. 19-840.

11

traced to the domestic conduct of a defendant.” Pet.

15. If it is doubtful that Plaintiffs’ injuries are even

traceable to Nestlé, it is a fortiori the case that no

conduct relevant to the ATS’s focus occurred in the

United States. See RJR Nabisco, Inc. v. European

Cmty., 136 S. Ct. 2090, 2101 (2016). This should be a

relatively easy case and will allow the Court to draw

a clear and useful line for what is not sufficient for

an ATS claim. The existence of a traceability question, then, is a feature and not a bug of this petition.

If, in assessing extraterritoriality, the Court determines that the allegations against Nestlé do not

even satisfy Article III’s traceability requirement, it

can so hold. The Court could add a question related

to Plaintiffs’ standing if it wants specific briefing on

that issue. But the fundamental point is that the

facts, as pled now three separate times by Plaintiffs,

do not come close to the sort of conduct that federal

courts should deem sufficient to support an ATS

claim. Having this fact pattern before the Court can

only help the Court resolve these issues, far better

than a set of hypotheticals, when it also has the

separate set of facts in Cargill before it.

12

CONCLUSION

The petition for a writ of certiorari should be

granted. Otherwise, the petition should be held, and

disposed of as appropriate in light of the Court’s

disposition of the Cargill petition.

THEODORE J. BOUTROUS JR.

PERLETTE MICHÈLE JURA

GIBSON, DUNN &

CRUTCHER LLP

333 South Grand Avenue

Los Angeles, CA 90071

(213) 229-7000

tboutrous@gibsondunn.com

NEAL KUMAR KATYAL

Counsel of Record

CRAIG A. HOOVER

HOGAN LOVELLS US LLP

555 Thirteenth Street, N.W.

Washington, DC 20004

(202) 637-5600

neal.katyal@hoganlovells.com

Counsel for Petitioner

JUNE 2020