Sarei v. Rio Tinto Plc.

• Citation: 221 F.Supp.2d 1116
• Decision Date: 09 July 2002
• Docket Number: No. CIV.00-11695 MMM.,CIV.00-11695 MMM.
• Parties: Alexis Holyweek SAREI, Paul E. Nerau, Thomas Tamuasi, Phillip Miriori, Gregory Kopa, Methodius Nesiko, Aloysius Moses, Raphael Niniku, Gabriel Tareasi, Linus Takinu, Leo Wuis, Michael Akope, Benedict Pisi, Thomas Kobuko, John Tamuasi, Norman Mouvo, John Osani, Ben Korus, Namira Kawona, Joanne Bosco, John Pigolo, and Magdelene Pigolo, individually and on behalf of themselves and all others similarly situated, Plaintiff, v. RIO TINTO PLC and Rio Tinto Limited, Defendants.
• Court: U.S. District Court — Central District of California

Page 1116

221 F.Supp.2d 1116

Alexis Holyweek SAREI, Paul E. Nerau, Thomas Tamuasi, Phillip Miriori, Gregory Kopa, Methodius Nesiko, Aloysius Moses, Raphael Niniku, Gabriel Tareasi, Linus Takinu, Leo Wuis, Michael Akope, Benedict Pisi, Thomas Kobuko, John Tamuasi, Norman Mouvo, John Osani, Ben Korus, Namira Kawona, Joanne Bosco, John Pigolo, and Magdelene Pigolo, individually and on behalf of themselves and all others similarly situated, Plaintiff, v. RIO TINTO PLC and Rio Tinto Limited, Defendants.

No. CIV.00-11695 MMM.

United States District Court, C.D. California,

July 9, 2002.

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Steve W. Berman, Jeffrey T. Sprung, Hagens & Berman, Seattle, WA, Brent R. Walton, Hagens & Berman, Los Angeles, CA, Paul Luvera, Joel D. Cunningham, Luvera Barnett Brindley, Beninger & Cunningham, Seatle, WA, Kevin P. Roddy, Hagens & Berman, Los Angeles, CA, for plaintiff.

Charles Ernest Patterson, Morrison & Foerster, Los Angeles, CA, James J. Brosnahan, Jack W. Londen, Morrison & Foerster, San Francisco, CA, Anthony L. Press, Morison & Foerster, Los Angeles, CA, for defendants.

Vincent M. Garvey, Amanda Quester, U.S. Department of Justice, Washington, DC, for movant.

AMENDED ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

MORROW, District Judge.

Plaintiffs, who are current and former residents of the island of Bougainville in Papua New Guinea, filed this putative class action against defendants Rio Tinto plc and Rio Tinto Limited under the Alien Tort Claims Act, 28 U.S.C. § 1350. Plaintiffs allege that defendants' mining operations on Bougainville destroyed the island's environment, harmed the health of its people, and incited a ten-year civil war, during which thousands of civilians died or were injured. They assert that defendants are guilty of war crimes and crimes against humanity, as well as racial discrimination and environmental harm that violates international law. Defendants have moved to dismiss the complaint, arguing that the court lacks subject matter jurisdiction and that plaintiffs have failed to state a claim upon which relief can be granted. Defendants contend alternatively that the action should be dismissed on forum non conveniens grounds, because its raises questions that are nonjusticiable under the act of state or political question doctrines, and because the court should abstain under the doctrine of international comity.

I. FACTUAL AND PROCEDURAL BACKGROUND¹

Bougainville is an island in the South Pacific located just off the main island of Papua New Guinea ("PNG").² Like other regions of PNG, Bougainville is rich in natural resources, including minerals such as copper and gold.³ Bougainville's rivers are also a key natural resource.⁴ Plaintiffs allege that, for many years, one of these — the Jaba River — "was a major source of food for many residents of Bougainville, and use of the riches of the Jaba River was an integral part of the way of life of many."⁵

Defendants Rio Tinto plc,⁶ a British corporation, and Rio Tinto Limited,⁷ an Australian corporation (collectively "Rio Tinto Group" or "Rio Tinto"), are part of an international mining group headquartered in London, which operates over sixty mines and processing plants in forty countries worldwide, including the United States.⁸ During the 1960's, the Rio Tinto Group decided to build a mine in the village of Panguna on Bougainville.⁹ Plaintiffs allege that Rio Tinto needed the cooperation and assistance of PNG's government to do so, because constructing the mine necessitated displacing villages and destroying massive portions of the rain forest.¹⁰ To obtain the required assistance, Rio Tinto allegedly offered the government 19.1% of the mine's profits.¹¹ PNG accepted, and plaintiffs allege that thereafter, the mine became "a major source of income for PNG and provided [an] incentive for the PNG government to overlook any environmental damage or other atrocities Rio committed." They also assert that "[t]he financial stake of the PNG government effectively turned the copper mine into a joint venture between PNG and Rio [Tinto] and allowed Rio [Tinto] to operate under color of state law."¹²

To hold its interest in and operate the Panguna Mine, Rio Tinto established Bougainville Copper Limited ("BCL"), a Papua New Guinea company and a majority-owned subsidiary of Rio Tinto Limited.¹³ So that it could operate the mine, the Australian Colonial Administration¹⁴ granted BCL leases over 12,500 hectares of Bougainvillean land.¹⁵ In 1967, BCL and the PNG government entered into a formal agreement "concerning the development of certain mineral deposits in Bougainville," which was ultimately codified as the "Mining (Bougainville Copper Agreement) Act of 1974" ("the Copper Act").¹⁶ Among other things, the Copper Act regulated the disposal of waste from mining operations, and vested in PNG's Department of Minerals and Energy the power to control and monitor pollution generated by the mine.¹⁷

A. Impact Of The Mine On The People And Environment of Bougainville

Plaintiffs assert that, from the inception of the project, Bougainville residents resisted Rio Tinto's efforts to build the mine. When a Rio Tinto exploration team set up camp on Bougainville in 1965, islanders allegedly destroyed the camp and expelled the team.¹⁸ The Australian government purportedly responded by imprisoning approximately two hundred Bougainvilleans.¹⁹ Islanders also refused to surrender land to Rio Tinto. A group of Bougainvilleans — the Rorovana — were allegedly told that if they did not accept Rio Tinto's offer of $105 per acre and $2 per coconut tree, their land would be taken without compensation.²⁰ When the Rorovana refused, plaintiffs assert that

"[o]ne hundred riot police, especially trained and equipped by the Australian government, were flown to Bougainville to help the surveyors mark out the areas of land owned by the Rorovana people that [BGL] wanted. On August 1, 1969, surveyors, supported by police wearing gas masks and carrying truncheons, drove in the first concrete peg.... On August 5, 1969, riot police carrying batons, shields, rifles and respirators attacked a group of about 65 unarmed villagers, men, woman and children. The police fired a barrage of 150 tear gas cannisters at them, yet the people stood firm. Then the police charged them with their batons, clubbing both men and women who were forced off their land."²¹

In addition to forcing many villagers off their land, Rio Tinto allegedly destroyed huge portions of the rain forest while constructing the mine.²²

By 1972, construction was complete, and operations at the Panguna Mine commenced.²³ The mine pit was approximately one-half kilometer deep and seven kilometers wide.²⁴ Plaintiffs allege that each day, approximately 300,000 tons of ore and waste rock were blasted, excavated, and removed from the pit,²⁵ producing 180,000 tons of copper concentrate and 400,000 ounces of gold annually.²⁶ Jean Michael Cousteau, who observed the mine in 1988, described it as follows:

"Surrounded by dense rain forest and tropical stillness lies one of the world's largest man-made holes in the ground. When the ore is completely extracted, the pit will measure nearly 8,000 feet across and around 1,200 feet deep. It would take two Golden Gate Bridges to span the hole, and if the Empire State Building were set at the bottom, only the antenna on top would rise above the rim of the mine.... Though it amounts to a vast treasury of copper ... the ore is extremely low grade.... Thus, to make the mine profitable, it must turn out a tremendous volume. That requires an operation using immense equipment and 4,000 people working in three eight-hour shifts seven days a week."²⁷

Within ten years of commencing operations, the Panguna Mine was one of the largest copper mines in the world. Plaintiffs allege that it was highly profitable for Rio Tinto.²⁸ Indeed, they contend that, by the early 1980s, BCL was responsible for approximately 23% of the Rio Tinto Group's profit despite the fact that it represented only 9.4% of the group's total assets.²⁹

Plaintiffs assert that, in addition to copper and gold, the mine produced more than one billion tons of waste.³⁰ After the waste (i.e., waste rock and tailings) was removed from the mine pit, it was allegedly deposited into the Kawerong-Jaba river system.³¹ Plaintiffs contend that, in this fashion, fertile river valleys were turned into wasteland, entire forests died, and three thousand hectares of land were completely destroyed.³² They further contend that a significant portion of the tailings placed in the Jaba River were ultimately deposited into Empress Augusta Bay, destroying the fish that were a major food source for the Bougainvilleans.³³

Mining operations in Bougainville allegedly polluted not only the island's waterways, but also its atmosphere.³⁴ Plaintiffs assert that "[d]ust clouds from the mining operations combined with emissions from the copper concentrator, [and] created a poisonous mix which polluted the air."³⁵ As a result of this air pollution, the number of Bougainvilleans suffering from respiratory infections and asthma purportedly increased.³⁶ Additionally, pollution from the mine allegedly changed the island's climate, damaged its crops, caused fish to develop ulcerations and die, and forced many animals out of their habitats.³⁷ The diminished food supply that resulted purportedly caused many Bougainvilleans to suffer health problems.³⁸

Plaintiffs contend that Rio Tinto's operation of the Panguna Mine impacted the entire island of Bougainville. They assert that Rio Tinto not only destroyed the land and polluted the environment, but also undermined the physical and mental health of the islanders. Plaintiffs allege:

"Deaths from upper respiratory infections, asthma and TB increased. Many children had impaired hearing due to chronic middle ear infections. Coughs and colds became commonplace,...