EarthRights International

The massive Tata Mundra coal-fired power plant has caused human and environmental damage in the state of Gujarat, and grassroots organization Machimar Adhikar Sangharsh Sangathan (MASS, Association for the Struggle for Fishworkers’ Rights) has been working with EarthRights International (EarthRights) to hold the International Finance Corporation (IFC) to account. In April 2015, they came together to file a lawsuit against the IFC – which provides critical funding to the Tata Mundra project and is a member of the World Bank Group. The loan IFC provided was predicated on provisions that the company may not cause damage to surrounding communities, and the IFC retained supervisory authority for the project. As the IFC failed to take action to address the damage, EarthRights and MASS filed a lawsuit against them in federal court in Washington DC, which eventually took them to the U.S. Supreme Court.

This landmark case would see a range of Bertha Justice Fellows and Alumnx contribute, including current supervising attorney Michelle Harrison and Fellows Zamira Djabarova, McKenna (“Kenna”) Graziano, Patrick Boyle and Lindsay Bailey joining over the years.

In 2011, the local fishing and farming communities that MASS represented had raised complaints to the IFC using its internal grievance mechanism, hoping to solve the issue. In 2013, the internal grievance mechanism ultimately agreed with virtually all of the complaints, finding the IFC had failed to abide by its own environmental and social safeguards at virtually every step of the project. It called for the IFC to take remedial action. But the IFC management ignored those findings and refused to act. Air and water pollution from the plant has caused major increases in respiratory conditions. Further, with the destruction of the local marine environment and fish populations, fishing families have been unable to sustain their livelihoods.

In a historic ruling in February 2019, four years after the lawsuit was filed, the U.S. Supreme Court found that the IFC, World Bank Group and similar international organizations do not have “absolute” immunity from suit in U.S. courts. In other words, they are not “above the law.” This means the World Bank Group can be sued under the same circumstances as foreign governments, and in U.S. courts. Following the Supreme Court decision, the IFC has announced a number of important policy reforms.

Bertha Fellows Kenna Graziano and Lindsay Bailey have played central roles in briefing the legal issues following the Supreme Court ruling. In January 2020, the U.S. District Court of Columbia held its first hearing on the IFC’s new motion to dismiss the case. The district court ultimately dismissed the motion finding that the plaintiffs had not satisfied the commercial activity exception to immunity. The plaintiffs appealed that decision, but in July 2021, the D.C. Circuit Court of Appeals affirmed the decision, and in August 2021, the plaintiffs asked the full D.C. Circuit Court of Appeals to rehear the case, known as “en banc” rehearing.

While this legal battle is still ongoing in the U.S., the IFC remains the world’s largest loan provider for private-sector development projects globally. The potential impact of this casework on communities and the planet is huge.