Doe v. Exxon Mobil Corp.
United States District Court for the District of Columbia
573 F. Supp. 2d 16 (2008)
Exxon Mobil (defendant) was the parent company of an Indonesian subsidiary, EMOI (defendant), which processed natural gas at a field the Indonesian government required to be guarded by military security. Although EMOI nominally paid for the security forces, Exxon closely oversaw the arrangement, providing funding and strategic support and directly implementing and enforcing controls over EMOI's handling of the security relationship because EMOI was ill-equipped to manage it alone. The military forces allegedly tortured and killed Indonesian residents, and eleven Indonesians (plaintiffs) sued Exxon and EMOI in tort. Exxon moved for summary judgment, arguing it was merely a parent company and not liable for the subsidiary's alleged conduct.
Whether a parent company is liable for the acts of its subsidiary under agency theory when the parent manifests a desire for the subsidiary to act on its behalf, the subsidiary consents, the parent has the right to control the entrusted matter, and the parent actually exercises that control directly.