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Apple and other major tech companies don’t have to compensate victims of forced child labor that provided cobalt for the lithium-ion batteries used in many electronic devices, a US appeals court ruled. The lawsuit filed by former miners from the Democratic Republic of the Congo alleged that Apple, Alphabet, Dell, Microsoft, and Tesla violated a trafficking law that makes it illegal to participate in a “venture” that engages in forced labor.
The plaintiffs allege the technology companies participated in a venture with their cobalt suppliers by purchasing the metal through the global supply chain,” the US Court of Appeals for the District of Columbia Circuit noted in its ruling issued yesterday.
A US District Court previously dismissed the lawsuit, and a panel of three appeals court judges unanimously affirmed the dismissal yesterday. “Purchasing an unspecified amount of cobalt through the global supply chain is not ‘participation in a venture’ within the meaning of the TVPRA [Trafficking Victims Protection Reauthorization Act of 2008],” the ruling said. “We therefore affirm the district court’s dismissal of the complaint.”
The plaintiffs in John Doe 1, et al. v. Apple Inc., et al. include four former miners, seven legal representatives of former miners who are still children, and five representatives of child laborers who were killed in cobalt mining operations, the ruling said. The miners were “recruited as children to engage in dangerous mining operations and suffered tunnel collapses, falls, and other accidents that left them paralyzed, disfigured, or worse,” the ruling said.
“The forced labor was organized or overseen by agents or subsidiaries of the Tech Companies’ cobalt suppliers,” judges wrote. Plaintiffs “began mining at a young age to avoid starvation and to support their families,” and say they were pressured to remain in the mines despite unsafe and exploitative working conditions.
Buying cobalt doesn’t create a “venture”
Companies such as Glencore, Huayou, and Eurasian Resources Group obtain cobalt from subsidiaries in the DRC. Glencore sells cobalt to Umicore, which “refines the cobalt and sells it to Apple, Alphabet, and Microsoft, as well as to intermediaries that in turn sell to Dell and Tesla,” the ruling said. Huayou sells processed cobalt to Apple, Dell, and Microsoft, and Eurasian Resources owns a mine from which it sells cobalt to Tesla.
“Several plaintiffs insist they were trapped in a ‘debt bondage situation’ where ‘sponsors’ gave out food and funds as an advance but deducted the amount of the advance, along with other costs, from the plaintiffs’ earnings when the cobalt was sold,” the ruling said. “Other miners were told that if they did not continue working in the mines, they would be blacklisted and barred from working at any other mines in the region.”
In a brief, tech companies said the lawsuit targeted “five purchasers of refined cobalt far removed from the labor abuses allegedly occurring at cobalt mines.” The brief said the defendants “have established policies and due-diligence practices to eradicate child labor in the international network of their suppliers,” and that the “alleged injuries are not fairly traceable” to any of the defendants’ conduct.
Plaintiffs argued that the global cobalt supply chain is a “venture” as defined in the US law and that tech companies “participated in that venture with the full knowledge that cobalt suppliers and their subsidiary mining companies employed and trafficked in forced labor,” the ruling said. They sought financial damages, injunctive relief, and other remedies on behalf of themselves and “a class of similarly situated child miners in the DRC.”
Appeals court judges ruled that the plaintiffs have standing to pursue damages claims for injuries and deaths, but they didn’t agree with plaintiffs that the US tech companies are liable:
The plaintiffs have not adequately alleged the Tech Companies participated in a venture because there is no shared enterprise between the Companies and the suppliers who facilitate forced labor. The Tech Companies own no interest in their suppliers. Nor do the Tech Companies share in the suppliers’ profits and risks. Although a formal business relationship is not necessary to be a participant in a venture, something more than engaging in an ordinary buyer-seller transaction is required to establish “participation” in an unlawful venture.
