Supreme Court Takes Up Terror-Support Appeal Against Arab Bank

MANHATTAN (CN) – The U.S. Supreme Court agreed Monday to consider whether foreigners whose families were maimed or killed in attacks on Israel can sue Arab Bank and other institutions they say supported terrorism.

Though U.S. citizen victims have held Arab Bank liable for suicide bombings on Israeli civilians between 2000 and 2004, noncitizen families have been less successful in U.S. courts.

The Supreme Court on Monday took up one such New York case that the Second Circuit tossed out on the basis of the Alien Tort Statute.

This 1789 law had been precisely what the Supreme Court cited in the 2013 case Kiobel v. Royal Dutch Petroleum, an unsuccessful attempt by Nigerians attempting to hold the Netherlands-based oil giant for being in league with the torture of activists.

In its 2015 Arab Bank decision, the Second Circuit said its hands were tied.

“At a time when large corporations are often among the more important actors on the world stage, and where actions and their effects frequently cross international frontiers, Kiobel I and Kiobel II may work together to prevent foreign plaintiffs from having their day in court in a far greater proportion of tort cases than Congress envisioned when, centuries ago, it passed the ATS,” the 35-page opinion states.

Seeing a silver lining to that ruling, however, an attorney for the plaintiffs emphasized the Second Circuit’s sense of a “growing consensus” that the Kiobel precedents did not entirely obliterate the possibility of corporate liability for conduct abroad.

“While we are disappointed with the recent decision, we remain convinced that a corporation may be held liable for violations of customary international law under the ATS,” attorney Michael Elsner had said in 2015. “We take solace in the panel’s decision that the ATS may indeed allow for corporate liability – a reading consistent with decisions of the Supreme Court and with every other circuit court which has considered the issue.”

Elsner noted in a statement Monday that it is time for the Supreme Court to clarify its precedent.

“Immunizing corporations who finance terrorists from liability for violations of customary international law is wrong and inconsistent with the language and purpose behind the ATS,” said Elsner, of the firm Motley Rice. “Our clients welcome the Supreme Court’s resolution of the conflict that has developed between the Second Circuit and the other circuit courts around the country that have decided that corporations, just like private citizens, should be responsible for violations of customary international law.  This decision has important implications for the fight against global terrorism. Disarming clients from their right to bring civil lawsuits is a victory for terrorist financiers.”

In addition to Elsner, the families will be represented at the Supreme Court by Jeffrey Fisher of Stanford Law School and Mark Werbner of Sayles Werbner.

Paul Clement, the former U.S. solicitor general, is representing Arab Bank for the law firm Kirkland & Ellis.

In reaction to the court’s grant of certiorari, a spokesman for Arab Bank argued that the precedent is clear. 

“Since the Supreme Court issued its decision in Kiobel, the federal appellate courts have uniformly dismissed extraterritorial ATS claims like these, involving foreign plaintiffs suing a foreign corporation for injuries sustained on foreign soil,” the bank’s statement says. “There is nothing new warranting a different outcome here.

“The bank did not cause plaintiffs’ injuries, and there is no basis under international law or the Supreme Court’s ATS decisions to reinstate these dismissed claims.”

Arab Bank also noted its reputation as “a constructive partner with the U.S. in working to prevent terrorist financing.”

When the Second Circuit denied a rehearing of the Arab Bank case last year, U.S. Circuit Judge Rosemary Pooler lamented that the court had missed an opportunity to fix a precedent that is “almost certainly incorrect.”

The federal appeals court’s chief judge was more resigned.

“If the easiest course was to follow a precedent that the panel dislikes, it could have done what appellate judges must frequently do: swallow hard,” an 8-page concurrence from Chief Judge Dennis Jacobs states.

Per its custom, the U.S. Supreme Court did not issue any statement in taking up the case.

Arab Bank’s courtroom opponents are approximately 6,000 citizens of Afghanistan, Argentina, Canada, France, Israel, the Philippines, Poland, Romania, Russia, Ukraine and Uzbekistan, among other countries. They say the bank administed a program on behalf of the Saudi Committee for the Support of the Intifada al Quds that provided death benefits to the families of Palestinian suicide bombers.

“The Saudi Committee transferred payments exceeding $100 million through Arab Bank’s New York branch to be converted into U.S. dollars to allow a free flow of money to terrorists in the Palestinian Territories,” according to a statement from the firm Motley Rice. “The bank also held bank accounts for such renowned terrorists as Sheikh Ahmed Yassin, the founder and spiritual leader of Hamas; Saleh Shehadeh, another founder of Hamas and the founder of the military wing of Hamas; and Ismail Haniyeh, the former head of the Hamas government in Gaza. The list of accountholders at the bank served as a ‘who’s who’ in terrorist circles in the Palestinian Territories.”