Washington (AFP) - German carmaker Daimler AG is not liable in the United States for human rights abuses allegedly committed by a subsidiary during Argentina's dictatorship, the Supreme Court ruled Tuesday.
The top American judicial authority sided with the company in a suit filed by 22 former employees, or their relatives, of a Mercedes Benz plant in the South American country.
A California appeals court had earlier ruled that a suit by the 21 Argentines and a Chilean could go ahead.
The plaintiffs claim managers at the plant collaborated with the Argentine regime between 1976 and 1983, during a period known as the country's "Dirty War."
But the Supreme Court said: "Daimler is not amenable to suit in California for injuries allegedly caused by conduct of MB Argentina that took place entirely outside the United States."
Daimler AG has a wholly owned subsidiary in California, Mercedes Benz-USA, and the claimants had argued that Daimler makes billions of dollars by selling its luxury vehicles there.
But the nine-member high court said in its unanimous decision that "even assuming, for purposes of this decision, that MBUSA qualifies as at home in California, Daimler's affiliations with California are not sufficient to subject it to the general jurisdiction of that state's courts."
According to Justice Ruth Bader Ginsburg, who penned the ruling, the California court had "no warrant to conclude that Daimler, even with MBUSA's contacts attributed to it, was at home in California, and hence subject to suit there on claims by foreign plaintiffs having nothing to do with anything that occurred or had its principal impact in California."
She added that "considerations of international rapport thus reinforce our determination that subjecting Daimler to the general jurisdiction of courts in California would not accord with the fair play and substantial justice due process demands."
The claimants alleged that the management at the subsidiary had identified resisters or agitators and disclosed their names to authorities, allowing violent police raids, arbitrary arrests and torture.
Some employees disappeared and were presumed killed.
The chief of police in charge of such actions was subsequently hired by Mercedes as the head of security to cover up his actions, according to the class-action suit.
The Supreme Court did not rule on the actual subject matter of the suit.
Daimler, in an email to AFP, said it was "very pleased" with the Supreme Court's decision, saying it concludes its prolonged litigation in the United States.
"Furthermore, we have always regarded the accusations as groundless," it added.
In Argentina, a lawyer representing claimants expressed dismay at the ruling.
"It's a big disappointment," Eduardo Fachal, who worked at the subsidiary from 1974 to 1985, told AFP.
"The next step is to turn to international organizations, maybe the Inter-American Court of Human Rights or straight to the United Nations."
The plaintiffs had pointed to two US laws in their effort to seek reparations from Daimler -- the Torture Victims Protection Act and the Alien Tort Statute, which dates back more than two centuries and allows foreigners to sue in US court for violations of international law.
But the justices said that recent Supreme Court rulings had rendered the claims under these acts "infirm."
Last year, in another win for big business, they ruled that US justice does not have the jurisdiction to determine whether oil giant Shell was complicit in acts of torture by the Nigerian government.
The panel unanimously rejected a collective lawsuit by 12 plaintiffs -- relatives of Nigerians executed by the former military government -- who accused the Anglo-Dutch firm of complicity in rights violations.