Unocal case on alleged human rights abuses set for trial - News that Works - Brief Article

HR Magazine, August, 2002 by Adrienne Fox

For the first time, a U.S. corporation will stand trial for alleged human rights violations committed by a foreign entity in a joint-venture project overseas. The case against Unocal Corp. of E1 Segundo, Calif., may find the oil company "vicariously liable" for having knowledge of and benefiting from alleged slave-like working conditions enforced by one of its partners in the Yadana pipeline project, the Myanmar (formerly Burma) military.

The suit was brought in 1996 by the Washington, D.C.-based International Labor Rights Fund (ILRF) on behalf of several Myanmar workers who cleared land and established roads for the pipeline between 1993 and 1996.

The California Superior Court ruled that Unocal did not directly commit human rights violations, but it set a September trial date to hear arguments on whether the company is liable for actions committed by the Myanmar military during the preparation for the pipeline.

"The standard operating procedure for companies is to blame their foreign partner," says Terry Collingsworth, executive director and general counsel of the ILRF. "This ruling is a significant change that will foreclose that option for them."

The "vicariously liable" doctrine, which is not limited to California, holds that joint-venture partners bear responsibility for each other's actions involving their common business. The case may expose other U.S. companies to legal responsibility of human rights violations committed abroad by their overseas partners.

The plaintiffs seek compensatory and punitive damages, including divestment of Unocal's Yadana project profits.

Unocal claims that it did not know or benefit from any human rights violations because, if they occurred, they were separate from the specific Yadana pipeline project. "We're not talking about issues relating to our employees," says Barry Lane, spokesperson for Unocal. "It's actions of the Burmese military unrelated to the project. Workers on our project are not at issue here."