US Appeals Court Clears Tech Giants in Cobalt Child Labor Case

In a significant ruling that may have widespread implications for global supply chains and the technology industry, a US federal appeals court has ruled in favor of several major technology companies accused of aiding and abetting child labour in cobalt mines in the Democratic Republic of the Congo (DRC). On Tuesday, the court dismissed the appeal brought forth by former child miners and their guardians against five prominent technology companies: Alphabet (Google's parent company), Apple, Dell Technologies, Microsoft, and Tesla.

The case revolved around allegations that these companies indirectly promoted child labour by purchasing cobalt, an essential component for lithium-ion batteries found in a plethora of electronic devices. According to the lawsuit, the companies had supposedly "deliberately obscured" their reliance on cobalt mines that employed children under oppressive conditions driven by poverty and starvation, in order to secure a steady supply of the metal. It was alleged that the companies’ actions resulted in the perpetuation of forced labour and that their supply chains were entangled with these abhorrent practices.

The court's decision was primarily based on the argument that engagement in the global cobalt market did not necessarily equate to participation in a business venture that relied on forced or child labour, as per the federal Trafficking Victims Protection Reauthorization Act. Circuit Judge Neomi Rao stated that while the plaintiffs had the legal right to sue for damages, they failed to demonstrate a connection beyond a buyer-seller relationship between the tech companies and their suppliers, nor could they prove the companies had any significant control or influence over mining operations to prevent the exploitation of child labour.

Judge Rao pointed out that within the complex context of labour trafficking, numerous other entities, such as labour brokers, cobalt consumers, and the government of the DRC, also share responsibility. In essence, the judge determined that the allegations made against the technology firms did not suffice to establish active or knowing engagement in a joint enterprise with entities utilizing child labour.

Plaintiffs’ representatives are considering further appeals and have not ruled out the possibility of filing new lawsuits if future conduct by the companies fits the court-dependent criteria outlined.

Counsel for the plaintiffs, Terry Collingsworth, expressed dissatisfaction with the court's verdict, suggesting that it incentivizes companies to maintain opacity in their supply chain relationships, which could potentially contradict their public-facing zero-tolerance polices concerning child labour. The attorney declared that the battle for accountability is not over yet.

In response to the court's judgment, Dell emphasized its ongoing commitment to the human rights of workers and asserted that it had never consciously sourced products derived from the exploitation of child labour. Google, at the time, chose not to comment, while Apple, Microsoft, and Tesla, along with their lawyers, have not issued a public response.

This court ruling reaffirms a previous dismissal of the case by US District Judge Carl Nichols in November 2021. Notably, none of the cobalt suppliers involved in the allegations—Eurasian Resources Group, Glencore, Umicore, and Zhejiang Huayou Cobalt—were named as defendants in this lawsuit.