Arab Bank lawsuit (re terrorist attacks in Israel)

Arab Bank HQ Credit_jean pierre x_wikicommons

Between 2004 and 2010, families of the victims and survivors of the terrorist attacks in Israel, the West Bank and the Gaza Strip that occurred between 1995 and 2005 filed several lawsuits under the Alien Tort Statute and the Anti-Terrorist Act in a US federal district court against the Jordanian-based Arab Bank.  The plaintiffs are US and foreign nationals.  The lawsuits allege the Bank provided financial services that allowed several Palestinian militant organizations to engage in terrorist activities, claiming the Bank knew or should have known its accounts were being used to pay the families of suicide bombers.  Arab Bank denied the claims.

Between 2007 and 2010, the court dismissed all claims of foreign plaintiffs under the Anti-Terrorist Act.  In 2013, a US judge also dismissed the claims of foreign plaintiffs under the Alien Tort Statute with reference to the Kiobel v. Royal Dutch Petroleum case, ruling that the plaintiffs cannot bring lawsuits against companies under this law.  In 2016, the court of appeal affirmed the lower court's judgement and denied a rehearing of the case.  On 3 April 2017, the Supreme Court accepted the plaintiffs’ request to decide on whether the Alien Tort Statute applies to companies.  A decision is expected in Autumn 2017.

In 2014, the claims of US plaintiffs against Arab Bank went on trial.  The jury found the bank liable under the US Anti-Terrorist Act for knowingly providing assistance to Palestinian militant group Hamas and consequently being complicit in terrorist attacks that took place between 2001 and 2004.  Damages were to be assessed in a separate trial.  However, Arab Bank reached a confidential settlement with the US claimants ahead of the trial.


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4 August 2017

Commentary: US Alien Tort Statute & corporate liability in Arab Bank lawsuit over alleged complicity in financing terrorism

Author: Amy Howe, SCOTUS Blog (USA)

“An introduction to the Alien Tort Statute and corporate liability: In Plain English”, 24 Jul 2017

…[O]n October 11, the Supreme Court will hear oral argument in a case brought by victims of terrorist attacks…under the Alien Tort Statute [ATS], a federal law that gives federal courts jurisdiction over “any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States”.

…[P]laintiffs [have] increasingly relied on the ATS as the basis for lawsuits filed in U.S. courts…against multinational corporations for their role in “aiding and abetting” human-rights violations…[I]n Jesner v. Arab Bank[,] the plaintiffs…contend that Arab Bank “violated the law of nations insofar as it financed terrorism…”. In their view…the history and purpose of the ATS…reinforce that the ATS applies equally to corporations…[S]enators emphasize that the ATS is the only avenue for civil lawsuits “against financial entities that use U.S. operations to aid terrorist attacks on foreign nationals overseas.”

…Arab Bank counters that …U.S. law does not allow corporations to be held liable in similar areas of the law…The U.S. Chamber of Commerce and other business groups echo…the bank’s arguments against corporate liability…

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29 June 2017

CCR Submits Amicus Brief to Supreme Court Affirming the Alien Tort Statute as Key Tool for Holding Corporations Accountable for Human Rights Violations

Author: Center for Constitutional Rights

The Center for Constitutional Rights [CCR] and the International Federation for Human Rights [FIDH] submitted an amicus curiae brief to the Supreme Court in Jesner v. Arab Bank in defense of the Alien Tort Statue (ATS) as a critical legal tool to hold corporations accountable for egregious human rights violations…the [ATS]…allows non-U.S. citizens to sue…when their cases “touch and concern” the U.S….CCR and FIDH made the following statement:

["]The [CCR] and the [FIDH] submit that the unequivocal answer to the question of whether corporations may be held accountable for human rights abuses under the [ATS] is yes...

[b]ut we…express concern that the framing of [this] case…risks limiting the application of the ATS to cases with sounding in “terrorism” or “national security,”…rather than maintaining it as a broad, essential legal tool for defending human rights…

Jesner is an opportunity for the Supreme Court to affirm to the lower courts that the ATS must be applied in a way consistent with international human rights law…["]

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28 June 2017

Here We Go Again: Corporate Liability for International Law Violations Returns to the Supreme Court

Author: Marco Simons, EarthRights International

In a case called Jesner v. Arab Bank, the Supreme Court will again consider whether corporations can be sued for serious violations of international law.

Jesner involves allegations that the defendant, Arab Bank, supported international terrorism by financing suicide bombings in Israel and making "martyrdom" payments to the families of deceased bombers. 

American victims of these attacks already won a jury trial against Arab Bank, in which the bank was found liable for violating the U.S. Anti-Terrorism Act. But foreign victims need to proceed under the ATS instead, and their claims were dismissed. The trial court applied the original Kiobel I ruling that said that corporations cannot be sued under the ATS.

A three-judge panel of the Second Circuit affirmed this dismissal, but recognized that Kiobel I had been widely criticized...

Yesterday, ERI filed an amicus brief in the case, arguing that of course corporations can be sued...

We'll be watching this case closely as it develops; it's likely to be argued sometime this fall. We hope the Supreme Court will finally correct the Second Circuit's mistake in Kiobel I. There is simply no sense in a rule of corporate immunity for terrorism, genocide and torture - the most powerful economic actors in the world should not be given free reign to finance and profit from the worst abuses...

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27 June 2017

Brief of Amici Curiae - Center for Constitutional Rights and International Federation for Human Rights in support of neither party

Author: Center for Constitutional Rights & International Federation for Human Rights

[Full text of the amici curiae brief by the Center for Constitutional Rights and International Federation for Human Rights arguing that:

1) the Alien Tort Statute ["ATS"] must be interpreted and applied in line with fundamental human rights principles;

2) general principles of law affirm the viability of the ATS to address serious human rights violations by corporations; and

3) because it applies broadly to all corporate actors, the ATS must not be interpreted in a way that preferences national security interests or the remediation of alleged terrorist acts]

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27 June 2017

Human Rights, Labor, and Responsible Investor Groups Call on the Supreme Court to Put People Before Profit

Author: International Corporate Accountability Roundtable (ICAR), Interfaith Center on Corporate Responsibility (ICCR) & Service Employees International Union (SEIU)

Today...[three organizations] filed an amicus curiae brief in support of the petitioners in Jesner v. Arab Bank, PLC, which is scheduled to be heard at the United States Supreme Court in the fall. The case will determine whether the Alien Tort Statute (ATS) can provide an avenue to deliver justice to victims of corporate harms. The ATS permits non-Americans to sue for international human rights abuses...

[They] argue that the increased role and power of corporations in modern society requires the establishment and enforcement of clear rules around their behavior, including their operations abroad. The brief further argues that when corporations have harmed the public, victims must have access to justice...

Not only is the ATS an important vehicle to deliver justice to victims, the brief outlines that accountability under the ATS is also vital to protecting investors from the legal, reputational, and operational risks stemming from corporate involvement in human rights violations...

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27 June 2017

Joseph Jesner, et al. v. Arab Bank, Plc

Author: Interfaith Center on Corporate Responsibility (ICCR), International Corporate Accountability Roundtable (ICAR) & Service Employees International Union (SEIU)

Given the increased role and power of corporations in modern society, clear rules for their behavior, including their behavior abroad in countries that lack functioning judiciaries, must be established and enforced. Corporate liability under the ATS not only reflects Congressional intent but is also in the best interests of both the public and investors.

…[C]orporate liability under the ATS is required to ensure access to remedy for victims of violations of customary international law and to ensure that corporations respect those international standards. In particular, corporate liability under the ATS is necessary to encourage good corporate behavior and to protect individuals located in countries…where the capacity of the judiciary, law enforcement institutions, and other actors may be weak or under threat. Denying liability not only leaves a vacuum in which corporations can act to breach international legal standards, but it also creates perverse incentives, including encouraging the creation of corporate entities to minimize or evade liabilities…

Corporate liability under the ATS is also vital to protecting investors from the legal, reputational, and operational risks stemming from corporate complicity in violations of customary international law…

Given that most corporations comply with the law, foreclosing liability under the ATS would permit bad corporate actors to take advantage of their law-abiding competitors by violating customary international law with little up-front risk, giving these bad actors an advantage when competing with compliant enterprises for investment funds…

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3 April 2017

Arab Bank releases statement on U.S. lawsuit

Author: Arab Bank

Arab Bank released the following statement regarding today’s order by the U.S. Supreme Court granting the petition for writ of certiorari in Jesner et al. v. Arab Bank, plc.  The petition addresses the May 2016 decision by the Second Circuit Court of Appeals to uphold the District Court’s dismissal of plaintiffs’ claims brought under the Alien Tort Statute (ATS).  "The Bank is confident that the Supreme Court will confirm the decisions of the District Court, as well as the Second Circuit Court of Appeals, dismissing the claims brought against the Bank by the non-U.S. plaintiffs."  "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 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." The U.S. government described Arab Bank as "a constructive partner with the U.S. in working to prevent terrorist financing."...

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3 April 2017

Supreme Court to Weigh if Firms Can Be Sued in Human Rights Cases

Author: Adam Liptak, New York Times

The Supreme Court agreed on Monday to decide whether corporations may be sued in American courts for complicity in human rights abuses abroad. The case concerns Arab Bank, which is based in Jordan and has been accused of processing financial transactions through a branch in New York for groups linked to terrorism. The plaintiffs in the case seek to hold the bank liable for attacks...The case turns on the meaning of the Alien Tort Statute...The federal appeals courts are divided over whether corporations may be sued under the law. The new case, Jesner v. Arab likely to produce an answer. It is an appeal from a decision...which ruled in favor of Arab Bank, saying that corporations may not be sued under the 1789 law. The plaintiffs in the case said the bank had “served as the ‘paymaster’ for Hamas and other terrorist organizations...The bank responded that it had helped the United States in “the fight against terrorism financing and money laundering” and was not accused by the plaintiffs of being “involved in the planning, financing or commission of the attacks that caused their injuries.”...

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3 April 2017

The Moment of Truth Has Come – US Supreme Court to Decide whether the Alien Tort Statute “Categorically Forecloses Corporate Liability"

Author: Nadia Bernaz, Middlesex University School of Law, on RightsasUsual

On 3 April 2017, the US Supreme Court granted certiorari in Jesner v Arab Bank, PLC.  The issue to be decided is whether the Alien Tort Statute (ATS) “categorically forecloses corporate liability”.  If the Supreme Court decides that the ATS does indeed categorically foreclose corporate liability, it will be the end of ATS-based business and human rights litigation in the United States.  This is a big deal...As disappointing as the Kiobel decision was for the human rights community,...the principle that corporations can be sued under the Alien Tort Statute was intact.  The Court refused to address the question directly but it is hard to reconcile the Kiobel decision with the idea that corporations cannot be sued at all under the Alien Tort Statute.  By noting for example that “it would reach too far to say that mere corporate presence” in the United States is enough to subject a defendant to ATS liability, the Supreme Court implied that something more than corporate presence could subject corporate defendants to such liability.  If it was the Court’s intention to reject corporate liability under the ATS altogether, why making this point?  Logically, therefore, the US Supreme Court should decide that the ATS does not categorically foreclose corporate liability...

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13 May 2016

USA: The current state of Alien Tort litigation in the business & human rights context

Author: Michael Goldhaber, American Lawyer (USA)

"The Global Lawyer: The 'Zombie' Alien Tort, Three Years After Kiobel", 12 May 2016

When the U.S. Supreme Court restricted the reach of the Alien Tort Statute in Kiobel v. Royal Dutch Shell, I wrote that it had created a "zombie doctrine,” leaving the corporate alien tort not quite alive and not quite dead. Three years later, the zombie is looking rather spry. On Thursday the U.S. Court of the Appeals for the Fourth Circuit heard oral argument in an alien tort case accusing a military contractor of torturing detainees at Abu Ghraib prison. The case…was dismissed…on political question grounds after the Fourth Circuit had refused to dismiss it under Kiobel. Two weeks ago…, a different judge declined to dismiss the case against the psychologists who designed the "black site" interrogation program on either Kiobel or political question grounds…The Supreme Court has passed on the chance to revisit Kiobel at least twice…Most alien tort cases will continue to be blocked by defenses like justiciability or forum non conveniens…Prudent plaintiffs lawyers will develop strategies under state law, or under acts designed to combat terror, torture, or human trafficking. I stand by my point that the Alien Tort Statute requires sympathetic interpretation.


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