TransCanada Corporation has sued the United States alleging that the Obama administration’s rejection of the Keystone XL pipeline exceeded his power under the U.S. Constitution.

Lori Wallach

TransCanada also filed legal action under the North American Free Trade Agreement (NAFTA) claiming the pipeline permit denial was “arbitrary and unjustified.”

The Canadian company is seeking $15 billion as part of its NAFTA claim.

“It boils down to is a foreign corporation deciding that the U.S. taxpayers ought to give them $15 billion because they don’t like the outcome of our government decision that this pipeline was bad for our country and bad for the environment,” Public Citizen’s Lori Wallach told Amy Goodman on Democracy Now. “And where they’re going to get this money extracted from us is an extrajudicial — not U.S. court, not U.S. law — forum — the investor-state tribunal allowed under NAFTA. And the U.S. has faced about a dozen of these attacks under NAFTA, all from Canada, but we have 50 agreements that have this outrageous system. Hardly any of those countries with those agreements actually have investors here. So, up to now, we haven’t lost one of these cases; however, the Trans-Pacific Partnership, overnight, if implemented, would double our liability. Right now, 50 agreements, about 9,000 companies are cross-registered from one of those countries that we have the agreement with operating in the U.S. to attack our laws in these tribunals. Overnight, the TPP would give 9,500 more companies — big multinationals from Japan, in banking, in manufacturing, mining firms from Australia — the right to do this. So this case, hopefully, is like the canary in the coal mine letting us know what we’d be getting into.”

In May, 2015, President Obama ripped into trade critics like Wallach.

“Critics warn that parts of this deal would undermine American regulation, food safety, worker safety, even financial regulations,” Obama said. They’re making this stuff up. This is just not true. No trade agreement is going to force us to change our laws.”

Goodman asked Wallach about Obama’s May speech.

“The making stuff up comment is going to have to get shelved, because not only is this attack by TransCanada on our domestic, democratic government decision not to have a pipeline the exact kind of case he said couldn’t possibly happen — well, it just did, $15 billion being demanded by a — from a tribunal of three private sector attorneys, because this investor-state system, it’s not judges.” Wallach said. “There are no conflict-of-interest or impartiality rules. These are folks who rotate between one day suing a government for a corporation and the next day being the judge. And they all hear cases amongst themselves. They call themselves ‘the club.’ And there’s no outside appeal, and there’s no limit on how much money they can order a government to pay. And if a government doesn’t pay, by the way, the company has the right to seize government assets — seize government assets — to extract our tax dollars. So, number one, this case is exactly the kind of case President Obama said folks were making things up when they were worried about this. Well, now it’s happened.”

“But this follows one month after the U.S. Congress, because the WTO threatened billions in trade sanctions, gutted another consumer law. Hate to tell folks, if they didn’t notice in the grocery store, but those customer meat — the country-of-origin labels we all use to figure out where our meat comes from, the WTO said we couldn’t have those anymore. And so, Congress, at the face of these sanctions, said, ‘Oh, better get rid of that law.’ So, two examples, live and real, compared to what President Obama promised.”

“But more broadly about the TPP, here’s the thing folks need to know. The actual language that TransCanada is using in this case, because they filed a brief, is the same language that, word for word, is replicated in TPP. So there are bells and whistles that have been changed between the investor-state language in NAFTA and TPP. In many ways, actually, TPP expands investor-state. It allows more kinds of challenges. Hell, it even allows challenges of government contracts for foreign companies’ concessions on natural resources in foreign land. That was not in NAFTA. However, the actual claims being made by TransCanada, that language is word for word in the TPP. And you can see the analysis of that on our website, TradeWatch.org. You can look at the text now and use our analysis as basically a guided tour.”