Jam v. International Finance Corp.: May International Organizations Violate Rights with Impunity?

Tomorrow, the Supreme Court will hear oral argument in a case that will decide the scope of immunity for international organizations in our courts. This issue facing the Supreme Court in Jam v. International Finance Corporation is whether, when the International Organizations Immunities Act of 1945 said that international organizations should have the “same immunity” in American courts as foreign governments, it actually meant that international organizations should enjoy greater immunity in U.S. courts than that currently enjoyed by foreign governments.

When the International Organizations Immunities Act was enacted in 1945, foreign governments were entitled to absolute immunity, so could not be sued in a U.S. court for any claim whatever. But that changed in 1976, when Congress passed the Foreign Sovereign Immunities Act, which exempted from immunities certain categories of lawsuits challenging foreign government action that were not quintessentially sovereign in nature, for example, when they engage in profit-making activities or contract with United States companies.

Undoubtedly, the ability of organizations like the World Bank to do certain work without fear of suit is essential and important to civil society. For that reason, like foreign governments, these international organizations are granted immunity in the United States, but restricted to genuinely public governmental activities. But if the Supreme Court rules that the words “same immunity” are frozen in time as of the 1945, then international organizations who make profits, commit environmental damage, violate human rights, or breach contracts with United States companies would be absolutely immune from suit, even though the many governments that comprise them are not. An organization like the International Finance Corporation will receive more protection from the legal consequences of its actions in United States courts than say, even our closest ally, the United Kingdom.

A number of former Secretaries of State and Secretaries of the Treasury—some of them our friends—have urged the Court to hold that international organizations should continue to receive absolute immunity. Like us, they want the good work of international organizations to continue undisrupted by threat from legal process in national courts.  While we fully share their goal, they are mistaken in their reading of the law. First, they argue that some international organizations are fundamentally different from foreign governments because they not independent actors, instead serving their missions as defined by all their member states. But that is a reason to give the same, not more immunity, to international organizations—whose only claim to immunity is their relation to foreign governments—than is given to the foreign governments themselves. Second, the former Secretaries argue that some international organizations require absolute immunity to perform their missions, or their resources will be drained. Yet the organization before the Supreme Court—the International Finance Corporation (“IFC”)—has received since its founding more than $569 million from the United States government alone and has a net annual income of $1.28 billion. It is hard to see why restricting its immunity to the same level as its sovereign members will impoverish that organization, as opposed to make it more careful not to commit, say, environmental harms in the course of making business financing (as the plaintiffs alleged occurred here). Finally, these friends argue that it is the job of Congress, not the courts, to alter international organization immunities. But as an amicus brief that we joined, by a group of leading scholars of international law and organization explains, Congress enacted the 1945 statute fully expecting immunity rules for international organizations to change over time. As the law governing the immunities of foreign governments has evolved, it is only common sense that the “same immunity” that Congress intended international organizations to receive would also evolve along with it.

We have the greatest admiration for the international organizations that do such vital work in our country and elsewhere. But if their employees commit egregious crimes, cheat local businesspeople, or commit mass environmental torts or human rights violations, justice and fairness demand that they be held as accountable as foreign states. The Supreme Court should rule that such worthy organizations are entitled to the same, not greater, immunity from domestic lawsuits as the sovereign nations that comprise them.

Photo of the courtroom of the U.S. Supreme Court by Alex Wong/Getty Images.

 

About the Author(s)

Harold Hongju Koh

Sterling Professor of International Law, Yale Law School; Legal Adviser, U.S. Department of State (2009-13), Assistant U.S. Secretary of State for Democracy, Human Rights and Labor (1998-2001)

Patrick Pearsall

Chair of Jenner & Block's Public International Law Practice, Adjunct Professor at Georgetown University Law Center, appointed member of the Hong Kong International Arbitration Centre’s List of Arbitrators