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, vs. RIO TINTO plc and RIO TINTO LIMITED, Defendants.


CASE NO. CV 00-11695-MMM(MANx)


UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA


221 F. Supp. 2d 1116; 2002 U.S. Dist. LEXIS 16235; 156 Oil & Gas Rep. 403


July 9, 2002, Decided
July 9, 2002, Filed; July 11, 2002, Entered


DISPOSITION: [**1] Defendants' motion to dismiss granted in part and denied in part. Ex Parte Application GRANTED and Plaintiffs' motion to strike GRANTED.
COUNSEL: For ALEXIS HOLYWEEK SAREI, PAUL E NERAU, THOMAS TAMUASI, PHILLIP MIRIORI, GREGORY KOPA, METHODIUS NESIKO, ALOYSIUS MOSES, RAPHEAL NINIKU, GARBIEL 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, MAGDALENE PIGOLO, plaintiffs: 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, Seattle, WA. Kevin P Roddy, Hagens Berman, Los Angeles, CA.
For RIO TINTO, RIO TINTO LIMITED, defendants: 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 UNITED STATES OF AMERICA, movant: Vincent M Garvey, Amanda Quester, US Department of Justice, Washington, DC.
JUDGES: MARGARET M. MORROW, UNITED STATES DISTRICT JUDGE.
OPINIONBY: MARGARET M. MORROW
OPINION: [*1120]
AMENDED ORDER GRANTING DEFENDANTS' MOTION TO DISMISS
Plaintiffs, who are current[**2] 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 [*1121] abstain under the doctrine of international comity.
I. FACTUAL AND PROCEDURAL BACKGROUND n1
------Footnotes ------
n1 The facts recited in this section are taken from the first amended complaint, as defendants do not, for purposes of their jurisdictional attack, take issue with the facts alleged by plaintiffs.
------End Footnotes------[**3]
Bougainville is an island in the South Pacific located just off the main island of Papua New Guinea ("PNG"). n2 Like other regions of PNG, Bougainville is rich in natural resources, including minerals such as copper and gold. n3 Bougainville's rivers are also a key natural resource. n4 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." n5
------Footnotes ------
n2 See First Amended Complaint, P2.
n3 See id.
n4 See id., P99.
n5 Id.
------End Footnotes------
Defendants Rio Tinto plc, n6 a British corporation, and Rio Tinto Limited, n7 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. n8 During the 1960's, the Rio Tinto Group decided to build a mine in the village[**4] of Panguna on Bougainville. n9 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. n10 To obtain the required assistance, Rio Tinto allegedly offered the government 19.1% of the mine's profits. n11 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 "the 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." n12
------Footnotes ------
n6 Before June 1997, Rio Tinto plc was named RTZ Corporation plc or "RTZ." (See id., P42.)
n7 Before June 1997, Rio Tinto Limited was called Conzinc Riotinto of Australia or "CRA." (See id., P43.)
n8 See id., PP50-51.
n9 See id., P3.
n10 See id., P4.
n11 See id.[**5]
n12 Id., P4:2-5.
------End Footnotes------
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. n13 So that it could operate the mine, the Australian Colonial Administration n14 granted BCL leases over 12,500 hectares [*1122] of Bougainvillean land. n15 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"). n16 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. n17
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n13 See id., P101. Although the Rio Tinto Group has reduced its holdings in Rio Tinto Limited (and thus BCL) over the years, plaintiffs allege that it "exercised complete, effective and pervasive control" over the corporation at all times relevant to their claims. (Id., P46.) Indeed, as of 1999, they assert that the Rio Tinto Group still owned a 53.6% interest in BCL. (Id.)[**6]
n14 Papua New Guinea was a colony of Australia until 1975.
n15 First Amended Complaint, P101.
n16 See Appendix to Defendants' Request for Judicial Notice in Support of Motion to Dismiss ("Defs.' RJN"), Ex. JJ. Under Rule 201 of the Federal Rules of Evidence, a court may take judicial notice of facts that are either "(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned" without converting a motion to dismiss into a motion for summary judgment. FED.R.EVID. 201. See also Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001).
n17 See id., Ex. JJ, P15.
------End Footnotes------
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. n18 The Australian government[**7] purportedly responded by imprisoning approximately two hundred Bougainvilleans. n19 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. n20 When the Rorovana refused, plaintiffs assert that

"one 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." n21


In addition to forcing many villagers off their land, Rio Tinto allegedly destroyed huge[**8] portions of the rain forest while constructing the mine. n22
------Footnotes ------
n18 See First Amended Complaint, P104.
n19 See id.
n20 See id., P105.
n21 Id., PP106-07.
n22 See id., P125.
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By 1972, construction was complete, and operations at the Panguna Mine commenced. n23 The mine pit was approximately one-half kilometer deep and seven kilometers wide. n24 Plaintiffs allege that each day, approximately 300,000 tons of ore and waste rock were blasted, excavated, and removed from the pit, n25 producing 180,000 [*1123] tons of copper concentrate and 400,000 ounces of gold annually. n26 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, [**9] 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." n27


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. n28 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. n29
------Footnotes ------
n23 See id., P7.
n24 See id., P127.
n25 See id.
n26 See id., P138.
n27 Id., P6.
n28 See id., P134.
n29 See id., P136.
------End Footnotes------
Plaintiffs assert that, in addition to copper and gold, the mine produced more than one billion tons of[**10] waste. n30 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. n31 [*1124] 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. n32 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. n33
------Footnotes ------
n30 See id., P138.
n31 See id., PP128-33. Plaintiffs allege that BLC also dumped chemicals from the copper concentrator into the Kawerong River. (See id., P148.) These chemicals purportedly include dissolved copper, residual lime, aluminum, mercury, cadmium, lead, zinc, arsenic, xanthates, methyl isobutyl carbinol, and polyacrylmide monomer. (Id.)
n32 See id., P140.
n33 See id., PP141-42.
------End Footnotes------
Mining operations in Bougainville allegedly[**11] polluted not only the island's waterways, but also its atmosphere. n34 Plaintiffs assert that "dust clouds from the mining operations combined with emissions from the copper concentrator, [and] created a poisonous mix which polluted the air." n35 As a result of this air pollution, the number of Bougainvilleans suffering from respiratory infections and asthma purportedly increased. n36 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. n37 The diminished food supply that resulted purportedly caused many Bougainvilleans to suffer health problems. n38
------Footnotes ------
n34 See id., P150.
n35 Id.
n36 See id., PP150, 156
n37 See id., PP150-51.
n38 See id., P151.
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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[**12] 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, especially among children. Obesity, particularly among women, became common when they had to abandon their traditional diet for European tinned and packaged foods . . . . A deep sense of social malaise set in which expressed itself in clan tensions, depression, alcohol abuse, rage, traffic accidents and incidents of violence - all distress signals of people severed from their roots." n39