Symposium: The lessons of Nuremberg
on Jul 25, 2017 at 10:14 am
Beth Van Schaack is the Leah Kaplan Visiting Professor in Human Rights at Stanford Law School. She is also the executive editor of Just Security.
As the U.S. Supreme Court takes up the question of whether the Alien Tort Statute supports claims against corporations in Jesner v. Arab Bank, PLC, the scope of corporate liability during the World War II era has assumed renewed relevance. The fact that the International Military Tribunal at Nuremberg did not criminally prosecute any corporations, as such, in the postwar period gets trotted out in support of two contentions: that international law does not recognize corporations as being capable of violating international law and that corporations cannot be held legally accountable if they commit international delicts. For example, in support of his conclusion in Kiobel v. Royal Dutch Petroleum Co. that corporations cannot be sued under the ATS, Judge José Cabranes of the U.S. Court of Appeals for the 2nd Circuit reasoned that “at the time of the Nuremberg trials, corporate liability was not recognized as a ‘specific, universal, and obligatory’ norm of customary international law.” Subsequent 2nd Circuit panels have largely, with some reluctance, considered themselves bound by this ruling. By contrast, every other circuit to consider the issue has drawn the opposite conclusion from the Nuremberg history as did the U.S. government in its amicus brief in Kiobel. This lopsided circuit split brought the question to the Supreme Court.
At the close of World War II, the Allies were faced with the prospect of bringing to justice potentially thousands of war criminals from all sectors of German society. To respond to these unprecedented events, they looked to international law. They convened the first international tribunals with jurisdiction over individuals and organizations accused of committing international crimes. They prosecuted industrialists alongside government officials — public and private actors, heads of state and the rank-and-file — under various theories of responsibility. They dismantled, liquidated, sequestered or otherwise sanctioned corporations that were central to Axis aggression and atrocities, at times for the purpose of paying reparations to victims. And they declared certain public and private organizations to be criminal and subsequently prosecuted individual members under res judicata theories of varying intensity. What lessons for contemporary ATS litigation should the Supreme Court draw from these varied responses of the Allies — in and out of the courtroom — to corporate malfeasance during the war? At bottom, nothing about the history of this era suggests that the Allies considered corporate liability to be legally foreclosed by international law. Rather, the diplomats and jurists of the time recognized that corporations are capable of violating international law and of being held accountable for doing so.
To be sure, as the Nuremberg tribunal was being convened, the Allies did consider establishing a regime of corporate criminal liability. Abraham L. Pomerantz, U.S. Deputy Chief Counsel at Nuremberg in charge of the industrialist cases, floated a proposal dedicated to the concept of prosecuting corporations in their corporate capacity. Nonetheless, for a range of pragmatic and prudential reasons, the proposal was not pursued. As an historian of the era has explained: “Corporate and associational criminal liability was seriously explored, and was never rejected as legally unsound. These theories of liability were not adopted, but not because of any legal determination that it was impermissible under international law.” Rather, as revealed in the documentary history and subsequent scholarship, although the Nuremberg architects believed that imposing a regime of corporate criminal responsibility was legally available to them under international law, they ultimately chose not to prosecute corporate entities for a variety of reasons: because these institutions were dealt with under different legal frameworks, because of shifting political winds in Europe, because the Allies saw the need to rebuild the peacetime German economy, and because the Allies were already focused on establishing another groundbreaking concept — the principle of individual criminal responsibility. Invoking this latter principle, the Allies prosecuted a range of corporate actors — industrialists, managers, and their staff — who ran the corporations that enabled, and profited from, the Holocaust and the Nazi program of aggressive war.
Although the industrialist cases all placed natural persons in the dock, the judgments reveal that the judges considered corporations to be capable of violating international law — including multilateral law-of-war treaties and customary international law. With regard to the activities of the I.G. Farben conglomerate in occupied territory, for example, one tribunal found that “the proof establishes beyond a reasonable doubt that offences against property … were committed by Farben, and that these offences were connected with, and an inextricable part of the German policy for occupied countries.” The Farben tribunal found no difficulty in determining that a company was legally capable of breaching the 1907 Hague Convention: “Where private individuals, including juristic persons, proceed to exploit the military occupancy by acquiring private property against the will and consent of the former owner, such action, not being expressly justified by any applicable provision of the Hague Regulations, is in violation of international law.”
In this way, the judges considered the responsibility of the corporation qua corporation, even though they could only ascribe individual criminal liability by virtue of the terms of their tribunal’s charter. Indeed, the Farben tribunal noted that its task was to determine how to translate the corporate criminality that existed under international law into individual criminal responsibility with respect to the defendants in the dock: “One cannot condone the activities of Farben in the field of Spoliation. If not actually marching with the Wehrmacht, Farben at least was not far behind. But translating the criminal responsibility to personal and individual criminal acts is another matter.” The judges situated corporate culpability within corporate policies and knowledge of abuses and then identified “some positive conduct” on the part of the individual defendant that “constitute[d] ordering, approving, authorizing, or joining in the execution of a policy or act which is criminal in character.” In several cases, the judges conceived of an individual defendant as an accomplice to a corporate principal.
Although the Allies focused their prosecutorial energies on corporate officials, corporations that stood accused of committing international crimes did not escape censure. As criminal trials were occurring throughout war-torn Europe, the Allies, acting under the authority of international law in their capacity as postwar occupying powers, were also dismantling elements of the Third Reich’s military-industrial infrastructure most associated with the commission of international crimes. Corporations that utilized concentration-camp inmates or Allied prisoners of war as slave labor in their factories; that engaged in the plunder, expropriation or spoliation of property in occupied territories; and that supplied the Nazi extermination and war machinery with poison gas and armaments were held accountable by the Allies for their rapacious business practices through a whole range of sanctions suited to their corporate form, including dissolution (“the corporate death penalty”), sequester, seizure, fines, and the exaction of reparations. For example, Control Council Law No. 43 prohibited the manufacture of specific war materials. Any legal entity found to be in breach of these restrictions was subject to criminal prosecution before occupation courts. Pronouncements like these were intended to debilitate the future war potential of a nation state that had already ruptured world order twice since the turn of the century; prevent another rearmament; eliminate Nazi instrumentalities of aggression and repression; and create a pool of assets for the payment of reparations. Through this program of decartelization and dissolution, the worst corporate offenders would effectively cease to exist. It was thus logical to focus scarce judicial resources on individual industrialists who profited personally from the war and who might have gone on to lead other conglomerates if not sanctioned.
Meanwhile, the Allies also implemented a form of organizational criminal liability that involved both the dissolution of organizations that were essential to the Third Reich and judicial declarations of those organizations’ criminality pursuant to the Nuremberg Charter. The theory was that in subsequent proceedings, any individual member of one of the criminal organizations would face a presumption of guilt that would be rebuttable with evidence that membership was involuntary or that a member lacked knowledge of the organization’s criminal object and purpose. The penalty imposed would be based upon the degree of the individual’s complicity in the actions of the indicted organization. Ultimately, the International Military Tribunal declared three of the indicted organizations to be criminal: the Leadership Corps of the Nazi Party, the Gestapo/SD and the SS. The Reich cabinet was acquitted because it was a small group of senior personnel who could be prosecuted individually. The IMT determined that the General Staff/High Command was an instrumentality of the state rather than a membership organization or institutional entity. The IMT acquitted the SA, the so-called Stormtroopers, because its criminal actions fell outside the tribunal’s temporal jurisdiction. Although some later military tribunals did not uniformly apply res judicata in quite the way that had been originally envisioned given its guilt-by-association implications, little angst was expressed at the time about the legal viability of organizational criminality.
It is notable that all six organizations indicted by the IMT had been dissolved by the time they were declared criminal, attesting to the added significance of these penal proceedings. Furthermore, although the effect of declaring an organization to be criminal did facilitate the prosecution of individuals who were members of the organization, that was not the sole aim. Criminalizing the organizations was also intended to protect the state and society against the threat posed by the existence of such organizations and to deploy the expressive function of the criminal law. The impact of, and message conveyed by, criminalizing these Nazi-era organizations could not be achieved by simply prosecuting individual members. The principle thus stands that the IMT did indict and convict organizations, which supports the ultimate conclusion that corporations — another type of juridical entity — can violate international law and be held responsible for doing so.
All of this state practice transpired within the framework of international law at the time. What is most important as the Supreme Court considers Jesner is not whether or not corporations were criminally punished at Nuremburg, but rather that the victorious Allies — and the judges to whom they entrusted the unenviable task of adjudicating the worst crimes known to humankind — recognized, and indeed seemed to assume, that corporations can violate international law and that they did so — appallingly and shamefully — during World War II. The Allies also understood that corporations enjoy no blanket immunity from accountability. Instead, they operated from the assumption that international law placed a range of enforcement means at their disposal — including criminal, civil and administrative remedies — to address and redress these corporate violations depending on their preferences and the operative legal frameworks. Nothing in the Nuremberg history or precedent indicates that international law would preclude a nation from pursuing any or all of these options in the face of corporate violations of international law, including through civil suits under a statute such as the ATS.