IBM, Ford Win Dismissal of Claims They Aided Apartheid

International Business Machines Corp. and Ford Motor Co. won dismissal of a lawsuit claiming the aided South Africa’s apartheid regime, with a judge saying they couldn’t be sued in the U.S. over actions of their units overseas.

That victims of apartheid can’t pursue their 12-year-old case against companies they alleged supplied computer systems to the former regime and vehicles to security forces is “regrettable,” U.S. District Judge Shira Scheindlin said in a ruling today in Manhattan.

The judge said she was bound by earlier court rulings barring U.S. lawsuits over corporate conduct that occurs in foreign countries, including a 2013 U.S. Supreme Court decision in a lawsuit accusing two foreign-based units of Royal Dutch Shell Plc of facilitating torture and executions in Nigeria.

The high court ruled that the 1789 Alien Tort Statute, which the apartheid victims sued under, generally doesn’t apply to conduct beyond U.S. borders. The law has been a favorite legal tool of human-rights’ activists seeking to hold corporations liable in the U.S.

The plaintiffs in the case, black South Africans who were victims of apartheid-era violence and discrimination, say the companies knowingly helped the former regime.

In April Scheindlin ruled that corporations may be liable for human rights abuses committed overseas. She said then that the plaintiffs could seek to file an amended complaint showing that the companies’ actions touched the U.S. with “sufficient force” to overcome the legal presumption that they aren’t liable under the Alien Tort law.

The proposed new allegations, while more detailed, are essentially the same as the earlier claims, Scheindlin said today.

Apartheid, or the institutionalized system of racial segregation, came to an end in South Africa in the early 1990s, in a series of steps that led to the formation of a democratic government in 1994, the U.S. Department of State says on its website.

The case is In re South African Apartheid Litigation, 02-md-O1499, U.S. District Court, Southern District of New York (Manhattan).

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