The
successive military governments of first Burma and now Myanmar have
a long and well-known history of imposing forced labor on their citizens. See, e.g., Forced labour in Myanmar (Burma): Report of the Commission
of Inquiry appointed under article 26 of the Constitution of the International
Labour Organization to examine the observance by Myanmar of the Forced
Labour Convention, 1930 (No. 29) Parts III.8, V.14(3) (1998) (describing
several inquiries into forced labor in Myanmar conducted between 1960
and 1992 by the International Labor Organization, and finding “abundant
evidence . . . showing the pervasive use of forced labour imposed on
the civilian population throughout Myanmar by the authorities and the
military”), http://www.ilo.org/public/english/standards/relm/gb/docs/gb273/myanmar.htm.
As detailed below, even before Unocal invested in the Project, Unocal
was made aware — by its own consultants and by its partners in
the Project — of this record and that the Myanmar Military might
also employ forced labor and commit other human rights violations in
connection with the Project. And after Unocal invested in the Project,
Unocal was made aware — by its own consultants and employees, its
partners in the Project, and human rights organizations — of allegations
that the Myanmar Military was actually committing such violations in
connection with the Project.
Before
Unocal acquired an interest in the Project, it hired a consulting company,
Control Risk Group, to assess the risks involved in the investment.
In May 1992, Control Risk Group informed Unocal that “[t]hroughout
Burma the government habitually makes use of forced labour to construct
roads.”6 Control Risk Group concluded
that “[i]n such circumstances UNOCAL and its partners will have
little freedom of manoeuvre.” Unocal’s awareness of the risk
at that time is also reflected in the deposition testimony of Unocal
Vice President of International Affairs Stephen Lipman (“Unocal
Vice President Lipman”):
[I]n
our discussions between Unocal and Total [preceding Unocal’s
acquisition of an interest in the Project], we said that the option
of having the [Myanmar] [M]ilitary provide protection[7]
for the pipeline construction and operation of it would be that they
might proceed in the manner that would be out of our control and not
be in a manner that we would like to see them proceed, I mean, going
to excess.
On
January 4, 1995, approximately three years after Unocal acquired an
interest in the Project, Unocal President Imle met with human rights
organizations at Unocal’s headquarters in Los Angeles and acknowledged
to them that the Myanmar Military might be using forced labor in connection
with the Project. At that meeting, Imle said that “[p]eople are
threatening physical damage to the pipeline,” that “if you
threaten the pipeline there’s gonna be more military,” and
that “[i]f forced labor goes hand and glove with the military
yes there will be more forced labor.” (Emphasis added.)
Two
months later, on March 16, 1995, Unocal Representative Robinson confirmed
to Unocal President Imle that the Myanmar Military might be committing
human rights violations in connection with the Project. Thus, Robinson
wrote to Imle that he had received publications from human rights organizations
“which depicted in more detail than I have seen before the increased
encroachment of [the Myanmar Military’s] activities into the villages
of the pipeline area.” Robinson concluded on the basis of these
publications that “[o]ur assertion that [the Myanmar Military]
has not expanded and amplified its usual methods around the pipeline
on our behalf may not withstand much scrutiny.”8
Shortly
thereafter, on May 10, 1995, Unocal Representative Robinson wrote to
Total’s Herve Madeo:
From
Unocal’s standpoint, probably the most sensitive issue is “what
is forced labor” and “how can you identify it.” I am
sure that you will be thinking about the demarcation between work
done by the project and work done “on behalf of” the project.
Where the responsibility of the project ends is very important.
This
statement is some evidence that Unocal knew that the Myanmar Military
might use forced labor in connection with the Project.
In
June 1995, Amnesty International also alerted Unocal to the possibility
that the Myanmar Military might use forced labor in connection with
the Project. Amnesty International informed Unocal that comments from
a Myanmar Department of Industry official “could mean that the
government plans to use ‘voluntary’ labor in conjunction with
the pipeline.” Amnesty International went on to explain that “what
they call ‘voluntary’ labor is called forced labor in other
parts of the world.”9
Later
that year, on December 11, 1995, Unocal Consultant John Haseman (“Unocal
Consultant Haseman” or “Haseman”), a former military
attache at the U.S. Embassy in Rangoon, reported to Unocal that the
Myanmar Military as, in fact, using forced labor and committing other
human rights violations in connection with the Project. Haseman told
Unocal that “Unocal was particularly discredited when a corporate
spokesman was quoted as saying that Unocal was satisfied with . . .
assurances [by the Myanmar Military] that no human rights abuses were
occurring in the area of pipeline construction.” Haseman went on
to say:
Based
on my three years of service in Burma, my continuous contacts in the
region since then, and my knowledge of the situation there, my conclusion
is that egregious human rights violations have occurred, and are occurring
now, in southern Burma. The most common are forced relocation without
compensation of families from land near/along the pipeline route;
forced labor to work on infrastructure projects supporting the pipeline
. . . ; and imprisonment and/or execution by the army of those opposing
such actions. . . . Unocal, by seeming to have accepted [the Myanmar
Military]’s version of events, appears at best naive and at worst
a willing partner in the situation.10
Communications
between Unocal and Total also reflect the companies’ shared knowledge
that the Myanmar Military was using forced labor in connection with
the Project. On February 1, 1996, Total’s Herve Chagnoux wrote
to Unocal and explained his answers to questions by the press as follows:
By
stating that I could not guarantee that the army is not using
forced labour, I certainly imply that they might, (and they might)
but I am saying that we do not have to monitor army’s behavior:
we have our responsibilities; they have their responsibilities; and
we refuse to be pushed into assuming more than what we can really
guarantee. About forced labour used by the troops assigned to provide
security on our pipeline project, let us admit between Unocal and
Total that we might be in a grey zone.
And
on September 17, 1996, Total reported to Unocal about a meeting with
a European Union civil servant in charge of an investigation of forced labor in Myanmar: “We were told that even if Total is
not using forced labor directly, the troops assigned to the protection
of our operations use forced labour to build their camps and to carry
their equipments.” In reply, Total acknowledged that forced labor
did indeed occur in connection with the pipeline: “We had to mention
that when we had knowledge of such occurrences, the workers have been
compensated.” Unocal President Imle testified at his deposition
that in Unocal’s discussions with Total, “[s]urrounding the
question of porters for the military and their payment was the issue
of whether they were conscripted or volunteer workers.” Imle further
testified that “the consensus was that it was mixed,” i.e.,
“some porters were conscripted, and some were volunteer.”
On March 4, 1997, Unocal nevertheless submitted a statement to the City
Counsel of New York, in response to a proposed New York City select
purchasing law imposed on firms that do business in Myanmar, in which
Unocal stated that “no [human rights] violations have taken place”
in the vicinity of the pipeline route.
D. Proceedings
Below.
In
September of 1996, four villagers from the Tenasserim region, the Federation
of Trade Unions of Burma (“the Trade Unions”), and the National
Coalition Government of the Union of Burma (“the Government in
Exile”) brought an action against Unocal and the Project. Nat’l
Coalition Gov’t of the Union of Burma v. Unocal, Inc., 176
F.R.D. 329, 334 (C.D. Cal. 1997) (“Roe I”). Plaintiffs
in Roe I alleged violations of the law of nations under the Alien Tort
Claims Act (“the ATCA”), 28 U.S.C. § 1350, and violations
of state law. One of the four individual Roe-Plaintiffs alleged
that the Myanmar Military subjected him to forced labor, without compensation
and under threat of death, along the pipeline route in connection with
the Project. The other three individual Roe-Plaintiffs alleged
they owned land located along the pipeline route, and were not compensated
when the land was confiscated by the Myanmar Military in connection
with the Project. The Trade Unions and the Government in Exile alleged
similar injuries to their members and citizens, respectively.
In
October of 1996, fourteen other villagers from the Tenasserim region
brought another action against Unocal, Total, Myanmar Oil, the Myanmar
Military, Unocal President Imle and Unocal CEO Beach. Doe I v. Unocal
Corp., 963 F. Supp. 880, 883 (C.D. Cal. 1997) (“Doe I”).
Plaintiffs in Doe I alleged that the Defendants’ conduct in connection
with the Project had caused them to suffer death of family members,
assault, rape and other torture, forced labor, and the loss of their
homes and property. The Doe-Plaintiffs sought to represent a
class of all residents of the Tenasserim region who have suffered or
are or will be suffering similar injuries. As in the Roe case,
liability in the Doe case was based on alleged violations of
the ATCA and state law. In addition, liability in the Doe case
was also based on alleged violations of the Racketeer Influenced and
Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1961 et seq.
On
March 25, 1997, the District Court granted in part and denied in part
Unocal’s motion to dismiss the Doe action. See Doe I,
963 F. Supp. 880. The District Court dismissed the claims against the
Myanmar Military and Myanmar Oil on the grounds that these defendants
were entitled to immunity pursuant to the Foreign Sovereign Immunities
Act, 28 U.S.C. §§ 1330, 1602 et seq. The District Court
also determined, however, that the act of state doctrine did not require
the dismissal of the claims against the other defendants, with the exception
of the expropriation claims.11 Moreover,
the District Court determined that subject matter jurisdiction was available
under the ATCA and that the Doe-Plaintiffs had pled sufficient
facts to state a claim under the ATCA. The District Court later denied
the Doe-Plaintiffs’ motion for class certification and dismissed
their claims against Total for lack of personal jurisdiction. See
Doe I v. Unocal Corp., 67 F. Supp. 2d 1140 (C.D. Cal. 1999); Doe
I v. Unocal Corp., 27 F. Supp. 2d 1174 (C.D. Cal. 1998), aff’d 248 F.3d 915 (9th Cir. 2001).
On
November 5, 1997, the District Court similarly granted in part and denied
in part Unocal’s motion to dismiss the Roe action. See
Roe I, 176 F.R.D. 329. The District Court determined that the Government
in Exile (wholly) and the Trade Unions (in part) lacked standing to
pursue their claims. The District Court’s other determinations
in the Roe action — regarding the act of state doctrine,
subject matter jurisdiction under the ATCA, and failure to state a claim
under the ATCA — were identical to its earlier determinations in
the Doe action regarding the same issues.
On
August 31, 2000, the District Court granted Unocal’s consolidated
motions for summary judgment on all of Plaintiffs’ remaining federal
claims in both actions. See Doe I v. Unocal Corp., 110 F. Supp.
2d 1294 (9th Cir. 2000) (“Doe/Roe II”). The District
Court granted Unocal’s motion for summary judgment on the ATCA
claims based on murder, rape, and torture because Plaintiffs could not
show that Unocal engaged in state action and that Unocal controlled
the Myanmar Military. The District Court granted Unocal’s motion
for summary judgment on the ATCA claims based on forced labor because
Plaintiffs could not show that Unocal “actively participated”
in the forced labor. The District Court also determined that it did
not have subject matter jurisdiction over the Doe-Plaintiffs’
RICO claim. Finally, after having granted summary judgment on all of
Plaintiffs’ federal claims, the District Court declined to exercise
its discretion to retain Plaintiffs’ state claims and dismissed
those claims without prejudice.
On
September 5, 2000, the District Court granted Unocal’s motion to
recover costs in the amount of $125,846.07. On November 29, 2000, the
District Court denied Plaintiffs’ joint Fed. R. Civ. P. 54(d)(1)
Motion to Retax, concluding that the motion actually constituted a time-barred
Fed. R. Civ. P. 59(e) Motion to Alter or Amend Judgment.
The Doe-Plaintiffs appeal the District Court’s dismissal of
their claims against the Myanmar Military and Myanmar Oil and the District
Court’s grant of summary judgment in favor of Unocal on their ATCA
and RICO claims against Unocal (No. 00-56603). The Roe-Plaintiffs
appeal the District Court’s grant of summary judgment in favor
of Unocal on their ATCA claims against Unocal (No. 00-56628). Plaintiffs
also appeal the District Court’s denial of their motion to retax
(Nos. 00-57195 & 00-57197). The four appeals have been consolidated.
We have jurisdiction under 28 U.S.C. § 1291, and we reverse in
part, affirm in part, and remand to the District Court for further proceedings
consistent with this opinion.
Part
3
6.
In the same year, the U.S. Department of State similarly reported that
“[t]he military Government [in Myanmar] routinely employs corvee
labor on its myriad building projects” and that “[t]he Burmese
army has for decades conscripted civilian males to serve as porters.”
U.S. Department of State, Country Reports on Human Rights Practices
for 1991 796-97 (1992).
7.
As noted above, the Production Sharing Contract between Total Myanmar
and Myanmar Oil provided that “[Myanmar Oil] shall . . . supply[
] or mak[e] available . . . security protection . . . as may be requested
by [Total Myanmar and its assigns],” such as Unocal. (Emphasis
added.)
8.
Similarly, the briefing book that Total prepared for Unocal President
Imle and Unocal CEO Beach on the occasion of their April 1996 visit
to the Project listed the following “area[ ] of concern”:
“army = additional burden on the local population.”
9.
Also in 1995, Human Rights Watch informed Unocal that forced labor was
so pervasive in Myanmar that Human Rights Watch could not condone any
investment that would enrich the country’s current regime. That
same year, the General Assembly of the United Nations “strongly
urge[d] the Government of Myanmar . . . to put an end to . . . the practices
of torture, abuse of women, forced labour . . . , and . . . disappearances
and summary executions . . . .” Situation of Human Rights in
Myanmar, U.N. General Assembly, 50th Sess., Agenda Item 112(c),
U.N. Doc. A/RES/50/194 (1995), http://www.un.org/documents/ga/res/50/ares50-194.htm.
10.
Similarly, on May 20, 1996, a State Department cable stated: “Forced
labor is currently being channeled, according to [non-governmental organization]
reports, to service roads for the pipeline to Thailand. . . . There
are plans for a helicopter pad and airstrip in the area . . . in part
for use by oil company executives.”
11.
Plaintiffs in both actions subsequently filed amended complaints that
do not contain claims based on expropriation of property.
