Ratha v. Rubicon Res., LLC

111 F.4th 946

Keo RATHA; Sem Kosal; Sophea Bun; Yem Ban; Nol Nakry; Phan Sophea; Sok Sang, Plaintiffs-Appellants, v. RUBICON RESOURCES, LLC, Defendant-Appellee.

No. 23-55299

United States Court of Appeals, Ninth Circuit

Argued and Submitted March 27, 2024 Pasadena, California

Filed July 31, 2024

Appeal from the United States District Court for the Central District of California, John F. Walter, District Judge, Presiding, D.C. No. 2:16-cv-04271-JFW-AS

Agnieszka M. Fryszman (argued), Nicholas J. Jacques, Madeleine Gates, and Emily Ray, Cohen Milstein Sellers & Toll PLLC, Washington, D.C.; Dan Stormer, Hadsell Stormer Renick & Dai LLP, Pasadena, California; Catherine Sweetser, UCLA Law Clinics, Los Angeles, California; Paul Hoffman and John C. Washington, Schonbrun Seplow Harris Hoffman & Zeldes LLP, Hermosa Beach, California; for Plaintiffs-Appellants.

Barbara E. Taylor (argued), Bryan D. Daly, Charles L. Kreindler, and Melissa K. Eaves, Sheppard Mullin Richter & Hampton LLP, Los Angeles, California, for Defendant-Appellee.

Margaret Lee, Human Trafficking Legal Center, Washington, D.C.; Aaron Halegua, Aaron Halegua PLLC, New York, New York; for Amici Curiae Members of Congress Representative Nadler, et al.

John Burton, The Law Offices of John Burton, Pasadena, California; Allison Gill and Johanna Lee, Global Labor Justice — International Labor Rights Forum, Washington, D.C.; Avery Kelly and Alicia Brudney, Corporate Accountability Lab, Chicago, Illinois; for Amici Curiae Human and Workers' Rights Organizations and United States Shrimp Producers. Julia Romano, King & Spalding LLP, Los Angeles, California; Zoe M. Beiner, King & Spalding LLP, Washington, D.C.; Anne M. Voigts, King & Spalding LLP, Palo Alto, California; for Amicus Curiae Professor David Abramowitz.

Before: Susan P. Graber, Sandra S. Ikuta, and Danielle J. Forrest, Circuit Judges.

Opinion by Judge Ikuta;

Dissent by Judge Graber

OPINION

IKUTA, Circuit Judge:

This appeal raises the question whether the district court erred in declining to reopen a final judgment under Rule 60(b)(6) of the Federal Rules of Civil Procedure. In granting summary judgment in favor of the defendant, the district court held that plaintiffs, alleged victims of human trafficking, failed to adduce evidence that the defendant had "knowingly benefitted from participation in a venture that [the defendant] knew or should have known was engaged in" various acts that violated the Trafficking Victims Protection Reauthorization Act (TVPRA), 18 U.S.C. § 1595(a). We upheld this ruling on appeal. Ratha v. Phatthana Seafood Co., 35 F.4th 1159, 1164 (9th Cir. 2022) (Ratha I), modifying 26 F.4th 1029 (9th Cir. 2022). Congress subsequently enacted new legislation amending the TVPRA to impose liability on a defendant who knowingly "attempted to benefit" from such a violation. The district court denied plaintiffs' Rule 60(b)(6) motion to reopen the final judgment and apply the new legislation, partially on the ground that it did not apply to events that preceded its enactment. Arguing that the new legislation merely clarified what § 1595(a) had meant all along, plaintiffs now appeal the denial of their Rule 60(b)(6) motion.

I

A

In 2000, Congress passed the Trafficking Victims Protection Act (TVPA). Pub. L. No. 106-386, div. A, 114 Stat. 1466 (2000) (codified as amended at 18 U.S.C. §§ 1589-1594). The TVPA created and expanded criminal penalties in order "to combat trafficking in persons, ... to ensure just and effective punishment of traffickers, and to protect their victims." § 102(a). The TVPA enhanced the penalties for the existing crimes of peonage, 18 U.S.C. § 1581, enticement into slavery, § 1583, and sale into involuntary servitude, § 1584. It also created the new offenses of providing or obtaining forced labor under specified circumstances, § 1589, "[t]rafficking with respect to peonage, slavery, involuntary servitude, or forced labor," § 1590, and "[s]ex trafficking of children or by force, fraud, or coercion," § 1591. Attempted violations of these provisions were also criminalized, as § 1594 provided that "[w]hoever attempts to violate section 1581, 1583, 1584, 1589, 1590, or 1591 shall be punishable in the same manner as a completed violation of that section." 18 U.S.C. § 1594(a).

In 2003, Congress amended the TVPA by enacting the TVPRA. Pub. L. No. 108-193, 117 Stat. 2875 (2003). Among other things, the TVPRA added a civil remedy provision, codified at 18 U.S.C. § 1595, that provided in pertinent part:

An individual who is a victim of a violation of section 1589, 1590, or 1591 of this chapter may bring a civil action against the perpetrator in an appropriate district court of the United States and may recover damages and reasonable attorneys fees.

TVPRA § 4(a)(4)(A), 117 Stat. at 2878. The provision created "a civil cause of action that permits victims of trafficking to recover compensatory and punitive damages from individuals who violate the TVPA." Ditullio v. Boehm, 662 F.3d 1091, 1100 (9th Cir. 2011).

In 2008, Congress amended § 1595 to expand the TVPRA's civil remedies. See William Wilberforce Trafficking Victims Protection Reauthorization Act of 2008, Pub. L. No. 110-457, § 221, 122 Stat. 5044, 5067. As amended, § 1595(a) provided a civil remedy for any violation of the TVPRA, and allowed victims to bring an action not only against perpetrators of a violation of the TVPRA, but also against anyone who "knowingly benefits, financially or by receiving anything of value from participation in a venture which that person knew or should have known has engaged in an act in violation of this chapter." 18 U.S.C. § 1595(a) (2008). As amended, the civil remedy provision provided:

An individual who is a victim of a violation of this chapter may bring a civil action against the perpetrator (or whoever knowingly benefits, financially or by receiving anything of value from participation in a venture which that person knew or should have known has engaged in an act in violation of this chapter) in an appropriate district court of the United States and may recover damages and reasonable attorneys' fees.

18 U.S.C. § 1595(a) (2022).¹

B

Keo Ratha, Sem Kosal, Sophea Bun, Yem Ban, Nol Nakry, Phan Sophea, and Sok Sang (collectively, "plaintiffs") are villagers from rural Cambodia who worked at seafood processing factories in Thailand's Songkhla province. Plaintiffs claimed they suffered abuse while working at these factories, in that they "were paid less than promised, charged for accommodations, charged for other unexpected expenses, unable to leave without their passports, which they were told would not be returned until recruitment fees and other amounts were paid, and subjected to harsh conditions," during the period "from sometime in 2010 until October 2012." Ratha I, 35 F.4th at 1165 (cleaned up). At the time plaintiffs worked there, the factories were owned by Phatthana Seafood Co., Ltd. ("Phatthana") and S.S. Frozen Food Co., Ltd. ("S.S. Frozen"), both Thai corporations that are not parties to this appeal.

Rubicon Resources, LLP ("Rubicon") is a United States company that was formed in 1999 as a joint venture to market and sell Thai seafood in the United States. The owners of Phatthana owned a stake in the Rubicon venture.²

In October 2011, Rubicon ordered 14 containers of shrimp from Phatthana's Songkhla factory, intending to sell those containers to Walmart for resale to consumers in the United States.

In January 2012, Ratha, who was employed by S.S. Frozen in its Songkhla factory, complained about his working conditions to the Phnom Penh Post, a Cambodian news organization. The Post published an article with Ratha's allegations. Following the publication of this article, Rubicon stopped its attempts to sell the Phatthana shrimp and hired a consultant to review conditions at Phatthana. In the months that followed, the Thai and Cambodian governments conducted investigations into Phatthana. Although the Thai government "concluded that no crimes ha[d] been committed," it did identify "violations of the labor protection law" and "intervened to address unlawful practices on the part of [Phatthana]."

After the results of the Thai and Cambodian investigations, Rubicon resumed its attempts to sell the Phatthana shrimp to Walmart but was unsuccessful due to Walmart's concerns about working conditions in Phatthana's Songkhla factory. The shrimp was eventually returned to Thailand and destroyed.

C

In June 2016, plaintiffs sued Phatthana, S.S. Frozen, Rubicon, and Wales under the civil remedy provision of the TVPRA, 18 U.S.C. § 1595(a) (effective December 23, 2008 through January 4, 2023).

Plaintiffs alleged that they were the "victims of peonage, forced labor, involuntary servitude and human trafficking, in violation of 18 U.S.C. §§ 1581, 1584, 1589, 1590, 1592, and 1593A." They alleged that Phatthana and S.S. Frozen were the perpetrators of these offenses, and that Rubicon and Wales knowingly benefitted from Phatthana's and S.S. Frozen's unlawful conduct. The complaint alleged that Rubicon "provided a market and worked to expand that market ... knowing the conduct would continue, benefitting from it, and intending to benefit from it."

All defendants moved for summary judgment. The district court concluded that it lacked extraterritorial jurisdiction over Phatthana and S.S. Frozen because plaintiffs had not established that those companies were "present in the United States," for purposes of 18 U.S.C. § 1596(a)(2). The court therefore granted the companies' motions for summary judgment. The district court also granted summary judgment in favor of Rubicon and Wales on three alternative grounds. The district court based its ruling on its interpretation of § 1595(a), which at the time imposed liability on "the perpetrator (or whoever knowingly benefits, financially or by receiving anything of value from participation in a venture which that person knew or should have known has engaged in an act in...