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Arab Bank Wants New|Trial on Hamas Liability

BROOKLYN (CN) - The judge overseeing the unprecedented terror-funding trial against Arab Bank this summer committed "substantial errors" that entitles the bank to a new trial, it said Friday.

It has been nearly three weeks since a federal jury held Arab Bank liable for providing material support to known terrorist groups stemming from 24 terrorist attacks in Israel between 2000 and 2004.

The families of 300 victims filed the suit in Brooklyn a decade ago under the Anti-Terrorism Act, which allows American victims of attacks to seek compensation. Hamas was named a terrorist group by the U.S. in 1997.

In its motion for a new trial filed Friday, the bank says because U.S. District Judge Brian Cogan "committed substantial errors in conducting the trial."

"We respectfully submit that this verdict was the inevitable consequence of a series of incorrect and prejudicial rulings," according to the 25-page request submitted by the bank's attorney, Shand Stephens, with DLA Piper.

"The conditions for ordering a new trial are easily satisfied here, where significant errors were made in charging the jury and in admitting and excluding evidence that would have meaningfully impacted a reasonable juror's deliberations," the filing continues.

Also Friday, Arab Bank separately renewed its motion for judgment as a matter of law.

Arab Bank says it was "harshly sanctioned for its compliance with foreign privacy laws and the related demands of its foreign regulators."

It also complains that the court barred it from explaining to the jury why it could not produce certain bank records, "namely, due to the requirements of foreign law and government directives, and instead repeatedly instructed the jury that the bank simply refused' to comply with the court's discovery orders."

Lead plaintiff's attorney Gary Osen told the jury that the bank refused to provide documents, but Shand says the judge barred his team from explaining to the jury that even though it provided ample documents that plaintiffs' attorneys had requested, it was bound by foreign laws restricting the release of other documents.

On Friday, Osen was unmoved by the bank's motion.

"A jury found Arab Bank complicit in two dozen terrorist attacks that killed more than 100 people," Osen said, adding that the bank's motions "raise no new legal issues."

He added that there is no "colorable issue of law justifying the bank's motion and its ultimate appeal, after damages have been assessed, stands no greater chance of success."

Plaintiffs' attorney Michael Elsner, with Motley Rice, called the bank's motions "baseless."

"The bank repeats the same tone-deaf arguments that have been rejected by the court time over time in the history of the lawsuit," Elsner said.

However, the bank's attorneys said in papers filed Friday: "Not only was the bank broadly precluded from introducing any evidence or testimony," but the judge's statement to the jury that it "refused to provide certain documents" and "to answer questions" allowed them to wrongly "infer that the bank knowingly provided financial services to Hamas terrorists."

Such "preclusions and adverse inference severely prejudiced the bank at trial and improperly deprived it of its right to a fair trial," according to the filing.

Arab Bank called it wrong as well for Cogan to bar certain testimony from its banking experts. This mistake resulted in a verdict that "is not supported by the full evidentiary record and conflicts with controlling law," the filing states.

Another "manifest error" from Cogan involved his instruction to the jury that that the bank violated the Anti-Terrorism Act with the "routine processing of funds transfers, involving undesignated charities and individuals, with the participation of more than 50 other global banks."

Cogan wrongly freed plaintiffs of the burden of proving that the bank acted with an "evil motive" or an "intent to harm someone," according to the filing.

During trial, Osen accused the bank knowingly provided banking services for known Hamas leaders, and processing payment from the Saudi Committee to pay out families of suicide attackers.

Maintaining that it had done nothing wrong, Arab Bank said it could not have possibly known who it was banking with, and that it always adhered to banking laws.

"It is far from clear that providing financial services to such [charitable] organizations evidenced a malicious intention; that question should have been presented to, and answered by, the jury," the bank said Friday.

The plaintiffs should have been required to show that the bank's executives caused plaintiffs' injuries, and the bank should have been allowed to present evidence of lawful adherence to relevant foreign laws, according to the filing.

"The relevance of foreign law to the bank's state of mind was not lost, however, on the jury," the filing states.

Also at issue is the introduction of out-of-court statements in which alleged Hamas members claimed responsibilities for various attacks. Arab Bank says these materials were inadmissible hearsay.

It took issue as well with how the case was "aggregated" from eight different complaints to include nearly 300 plaintiffs claiming injuries from 24 different attacks and carried out by more than 100 alleged operatives over four years.

"As predicted, this trial structure severely prejudiced the bank by permitting plaintiffs to present evidence to the jury pertaining to 24 separate Hamas attacks, even though that evidence was irrelevant to particular incidents," the filing states

Arab Bank additionally challenged the application of "a sanctions order found to be 'erroneous' by the United States."

"The time to correct these errors is now," Stephens wrote.


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