Multinational corporations’ perceptions on the future generation of human rights litigation are subtly altered by a specific type of legal story that receives little attention in the United States. One such instance is the Alabama Drummond verdict. Terrence Collingsworth, an attorney, and his nonprofit organization, International Rights Advocates, pursued claims for almost 20 years, claiming that the coal producer in Alabama was involved in murders committed by paramilitary organizations in Colombia during the conflict-ridden early 2000s. Under laws intended to grant foreign litigants access to American jurisdiction for serious violations of human rights, the claims were filed in U.S. courts. Despite years of work, none of them resulted in a verdict against Drummond. Collingsworth was sued by the firm in the opposite action, which succeeded. $256 million was the jury’s award.
It’s not only a big verdict. It is structurally peculiar. Regardless of the underlying merits, the majority of international litigation involving claims of violations of human rights in conflict areas is settled amicably by settlements that defendants pay. Twenty years ago, Drummond made the decision to fight. Several of the initial lawsuits against the corporation were dropped at different stages of the legal process because they were unable to prove the direct corporate involvement they claimed. The countersuit, on the other hand, put forth a different theory, claiming that Collingsworth and his group had made up some of the main charges, paid witnesses to give false testimony, and organized a public campaign to harm Drummond’s business connections without the supporting evidence that human rights lawsuits typically need.
That theory was fully accepted by the jurors. In addition to $52 million in compensatory and punitive damages for defamation, the award of $68 million under the Racketeer Influenced and Corrupt Organizations Act was immediately tripled to $204 million under RICO. The portion that will have the biggest impact on the legal community is the RICO component. RICO is rarely used in civil lawsuits involving NGOs and human rights lawyers because it was first created to target organized crime. It is even less common to apply it to a successful, fully tripled verdict. Other defendants will closely examine the precedent set by this case, which holds that human rights litigation campaigns may be considered racketeering operations when underlying activity is determined to be fraudulent.
Speaking with those who follow international human rights litigation, it seems that this ruling opens up a more awkward discussion than the headlines would imply. There has been some real accountability for grave abuses thanks to the legal framework developed over the last thirty years surrounding instances including the Alien Tort Statute, the Torture Victim Protection Act, and corporate participation.
Additionally, it has resulted in a category of cases where the finance mechanisms around plaintiffs, the sourcing of witnesses, and the evidence standards have been more loosely managed than American judicial systems are designed to handle. At the challenging nexus of those two realities is the Drummond case. Legally speaking, the initial accusations were not reckless. According to the jury’s conclusions, some of the evidence was generated in a way that went beyond what is permitted by law.
Here, the Colombian context is important, and it’s important to be truthful. In the late 1990s and early 2000s, the nation experienced a period of unparalleled paramilitary violence, much of which was aimed against civilians, journalists, and labor organizers in areas that were home to sizable foreign mining and oil enterprises. In the broadest sense, there was a pattern of multinational firms operating in certain areas while paramilitary groups used violence against local people and unions. During that time, a number of Colombian executives at other businesses were found guilty of sending money to paramilitary groups. However, none of that was adequate to support the particular accusations in this instance. American jurors base their decisions on the facts that is offered in court, not on the overall history of violence in a particular area. There are repercussions to that distinction.
On appeal, the result can be significantly changed. The Eleventh Circuit will probably examine both the RICO applicability and the amount of the underlying compensatory damages. Damage awards of this magnitude are usually subject to appeal scrutiny. Defense lawyers will attempt to contest the defamation award’s unique legal features. The structural truth of the verdict is unlikely to change, regardless of whether the final figure is $256 million, $100 million, or anything else. A federal jury in Alabama came to the unanimous conclusion that false testimony had been used to support a human rights litigation campaign. Even if individual harm components are changed, it is difficult to reverse that judgment.
As this case progresses, there’s a sense that the outcome will subtly alter how plaintiffs’ companies and human rights organizations handle corporate responsibility lawsuits. Attorneys and organizations who deal with witness sourcing in conflict areas now face much greater legal risks. As litigation insurance costs rise and risk profiles grow more difficult to control, funding for these cases—much of which comes from foundations and individual donors who have supported our work for years—may become increasingly difficult to get. Critics of the ruling will keep bringing up the chilling effect on legitimate human rights activity. Supporters will keep emphasizing the deterrent against falsified witness testimony.
