Legal analysis: Shell Nigeria lawsuits

13 Sep 2011 admin

Michael D. Goldhaber is an expert on human rights law and corporate accountability in the US. In his recent article in AM Law Daily, he offers up his views on the settlement between claimants from the village of Bodo and Shell over massive oil spills caused by the company in 2008-2009.

Royal Dutch Shell has been sued so many times over its conduct in Nigeria that its cases offer a laboratory experiment for human rights litigation.

After thirteen years of arduous U.S. alien tort litigation, Wiwa v. Shell resulted in a piddling $15.5 million settlement in 2009. Kiobel v. Shell has done even worse. Nearly a decade after the case was filed, it has succeeded only in abolishing the corporate alien tort within the Second Circuit, and if the U.S. Supreme Court accepts cert, it may do the same nationwide.

Now comes the “Bodo” case, which emerged from obscurity three weeks ago. On August 3, four months after farmers and fishermen from the village of Bodo filed a common law complaint in London high court, Shell’s Nigerian subsidiary admitted liability for a pair of oil spills in return for the parent company’s dismissal from the suit. The Financial Times trumpeted the potential for a payout of over $400 million, although the Shell Petroleum Development Company called this number “massively in excess of the true position.”

As Goldhaber makes clear, the Bodo case is far from over.

the Bodo deal was not a one-sided plaintiffs victory. Corporate formalities matter intensely to both Shell and its human rights critics. As Dutch plaintiffs lawyer Liesbeth Zevgeld has put it, “Shell headquarters believes it is untouchable, but we believe it is legally responsible for damage caused in Nigeria.”  More generally, parental liability for the conduct of foreign subsidiaries has been called the leading legal question in European business human rights. With Royal Dutch’s dismissal from the Bodo suit, that battle shifts to the impending Dutch trial of Oguru v. Shell, which seeks the cleanup of three oil spills elsewhere in the Niger delta. The stakes may be somewhat lower in the Netherlands, because Dutch courts lack the sort of class action rules that let U.K. lawyers aggregate 69,000 villagers’ claims for loss of livelihood.

Read the full article here.

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