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 judgment 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 applied to companies and heard oral arguments on 11 October 2017. 

On 24 April 2018,  the U.S. Supreme Court ruled that foreign corporations cannot be sued in the US for complicity in human rights abuses abroad. The ruling, decided by a 5-to-4 vote upheld the decision of the United States Court of Appeals for the Second Circuit, in New York, which ruled in favor of Arab Bank arguing that corporations may not be sued under the Alien Tort Statute. According to the ruling, explicit congressional authorisation is required in cases involving international human rights cases against foreign defendants.

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.

 All documents available here.

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Author: Francisco Javier Zamora Cabot, Maria Chiara Marullo, Red Tiempo de los Derechos - Papeles El tiempo de los derechos

"Never Send To Know ..., Comentario Crítico a la Sentencia Jesner v. Arab Bank, del Tribunal Supremo de los Estados Unidos", 22 Oct 2018

En estas páginas,..., proponemos nuestras reflexiones críticas, desde la perspectiva del Derecho internacional privado, en torno a la sentencia del Tribunal Supremo de los Estados Unidos en el caso Jesner v. Arab Bank, que ha sentado un precedente importante en el proceso de restricción del acceso a los tribunales de los Estados Unidos en litigios sobre violaciones de los Derechos Humanos, haciéndolos imposibles respecto de las empresas extranjeras y, probablemente, preparando el terreno para que suceda lo propio con las domésticas.  Gracias a una lectura historicista del Alien Tort Claims Act (ATS o ATCA), el Alto Tribunal afirma que ni el tenor literal del texto ni los precedentes apoyan una excepción a los principios generales, deduciendo que debe ser el Poder Legislativo el que considere si el interés público podría servirse en caso de imponer nuevas responsabilidades sustantivas y, entre ellas, una norma que impusiese responsabilidad sobre entidades artificiales como las empresas.  De todo lo cual deduce que “.…sería inapropiado que los tribunales extendiesen la responsabilidad bajo el ATS a las empresas extranjeras, a salvo de una acción en tal sentido a cargo del Congreso”.

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25 October 2018

New paper critically examines US Supreme Court ruling in Jesner v. Arab Bank

Author: Francisco Javier Zamora Cabot, Maria Chiara Marullo, Red Tiempo de los Derechos - Papeles El tiempo de los derechos

"Never Send To Know ..., Critical commentary on the US Supreme Court decision Jesner v. Arab Bank", 22 Oct 2018

...[W]e propose our critical insights, from the International private law perspective, of the ruling of the Supreme Court of the United States in the case Jesner v. Arab Bank.  This judgment has set an important precedent in relation with the process of access restriction to courts in the United States as far as international disputes involving serious infringements on Human Rights are concerned, making them impossible with regard to foreign corporations...Due to a historical reading of the Alien Tort Claims act (ATS or ATCA), the High Court states that neither the literal wording of the text nor the precedents support an exception to the general principles, reaching the conclusion that it falls within the scope of the Legislative Power to consider whether the public interest could be a resource in the event that new substantive responsibilities were imposed and, among them, a rule requiring liability over artificial entities as it happens with companies....

[Full text available only in Spanish]

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19 October 2018

Corporate Liability Under the US Alien Tort Statute: A Comment on Jesner v Arab Bank

Author: William S. Dodge, Business & Human Rights Journal

...[T]he US Supreme Court tried to answer whether corporations are subject to suits for human rights violations under the Alien Tort Statute (ATS).

In [two] decisions, the Court failed to answer that question, instead imposing other limitations on the ATS cause of action...

In 2013, the Supreme Court applied the presumption against extraterritoriality in Kiobel v. Royal Dutch Petroleum, limiting the ATS cause of action to claims that 'touch and concern the territory of the United States.'

In 2018, the Court held in Jesner v. Arab Bank that 'foreign corporations may not be defendants in suits brought under the ATS', leaving open the possibility of suits against US corporations...

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24 April 2018

Opinion analysis: Court bars lawsuits against foreign corporations under Alien Tort Statute

Author: Amy Howe, SCOTUSBlog (USA)

Nearly seven years ago, the Supreme Court agreed to decide whether corporations can be sued under the Alien Tort Statute...The justices ultimately did not resolve the corporate liability question in that case...[T]oday they did settle the issue, holding...that foreign corporations may not be sued under the ATS.  The decision will almost certainly put a halt to foreign plaintiffs to hold foreign corporations responsible in U.S. courts for human rights violations abroad...Jesner v. Arab Bank, was filed in the United States by victims of terrorist attacks that occurred between 1995 and 2005 in Israel...The court emphasized that when Congress enacted the ATS, its primary goal was to avoid foreign-relations problems by making sure that federal courts were available to review lawsuits by foreign nationals alleging violations of international law “where the failure to provide one might cause another nation to hold the United States responsible for an injury to a foreign citizen.”  But in this case and others, the court continued, allowing a lawsuit to go forward in U.S. courts was having precisely the opposite effect, creating “significant diplomatic tensions with Jordan...” Moreover...the court should generally refrain from creating or extending new grounds for lawsuits...Justice Sonia Sotomayor...castigated her colleagues for absolving “corporations from responsibility under the ATS for conscience-shocking behavior.”...

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24 April 2018

Decision: US Supreme Court in Jesner vs. Arab Bank

Author: Supreme Court of the United States

Attached is the 90-page judgment by the US Supreme Court in the case of Jesner vs. Arab Bank.

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24 April 2018

Supreme Court Rejects Liability for Foreign Corporations in International Human Rights Cases

Author: Charity Ryerson, Corporate Accountability Lab (USA)

...[T]he Supreme Court ruled...that foreign corporations cannot be sued for egregious human rights violations under the Alien Tort Statute (ATS). Here is our...take on the opinion. In short: the majority’s opinion appears to have more to do with market fundamentalism than the administration of justice, and sets a problematic precedent for victims’ access to remedy...[I]t lays the framework to eliminate liability even for domestic companies...While there is a reasonable argument that this case doesn’t have enough connection to the US for US courts to have jurisdiction, the Court made a sweeping ruling based on these limited facts that will harm other plaintiffs bringing cases with much more connection to the US going forward...[T]hey decide...not only do these human rights cases need to “touch and concern” the US, the defendant cannot be a foreign corporation...Kennedy relies primarily on the argument that there is no corporate liability under international law...The next time the ATS comes before the Supreme Court...the defendant will argue powerfully that this opinion forecloses corporate liability altogether, not just for foreign companies.  Kennedy also relies on the separation of powers, arguing that it should be Congress’ role to determine whether corporations are subjects of the ATS...He writes “[A]llowing plaintiffs to sue foreign corporations under the ATS could establish a precedent that discourages American corporations from investing abroad, including in developing economies where the host government might have a history of alleged human rights violations..."

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24 April 2018

The Supreme Court Just Gave Unscrupulous American Corporations Another Reason to Expatriate

Author: Marco Simons, Earth Rights International (USA)

The Supreme Court ruled this morning that foreign corporations cannot be sued in U.S. courts under the U.S. Alien Tort Statute (ATS). The ATS only allows suits for the worst violations of international law – like genocide, torture, and crimes against humanity. So, as the four dissenting justices stated, the Court’s decision “absolves corporations from responsibility under the ATS for conscience-shocking behavior.”

The case, Jesner v. Arab Bank, was brought by victims of terrorism against a Jordanian bank which was found to have abetted suicide bombings in the Middle East. They brought suit in New York because Arab Bank used its New York branch to route these transactions. A jury found Arab Bank liable...At some point, Congress needs to step in. Why on earth would we want to give foreign corporations special privileges to violate the law without consequence – and give U.S. corporations additional incentives to expatriate?

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24 April 2018

U.S. top court curbs human rights claims against companies

Author: Lawrence Hurley, Reuters (USA)

Foreign corporations cannot be sued in American courts for human rights abuses committed overseas, the U.S. Supreme Court ruled on Tuesday, refusing to revive a lawsuit claiming Jordan-based Arab Bank Plc helped finance militant attacks in Israel and the Palestinian territories...The 5-4 decision ended a lawsuit by some 6,000 non-U.S. citizen plaintiffs, including survivors and relatives of people killed in attacks, filed under a 1789 U.S. law called the Alien Tort Statute that accused Arab Bank of being the “paymaster” to militant groups...The ruling left open the possibility of U.S. corporations being sued under the Alien Tort Statute in limited circumstances. 

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30 October 2017

Jesner oral arguments, Justice-by-Justice

Author: Beth Van Schaack, Stanford University, in Just Security

...I summarize, Justice-by-Justice, some of the key issues raised by Supreme Court and the responses of the parties’ lawyers and the United States government as amicus curiae.

...Justice Samuel Alito focused in on the norm-identification process long established by Sosa v. Alvarez-Machain, which requires courts to consider whether the plaintiff has alleged an established rule of international law.

...Justice Neil Gorsuch was quite fixated on a 2011 law review article suggesting that the ATS was drafted in order to address situations in which the defendant hails from the United States... 

...Justice Anthony Kennedy stayed focused on the core question: does Sosa require plaintiffs to show that international law affirmatively recognizes a cause of action against corporations for international law violations? 

...Justice Stephen Breyer reasoned that Sosa and the treaties address both persons and entities.

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12 October 2017

Oral arguments in Jesner v. Arab bank: Supreme Court may favor two steps to corporate liability for human rights violations

Author: William Dodge, University of California, on Just Security

...At oral argument, the Justices seemed to be looking at the question in two steps: (1) whether customary international law permits corporate liability; and (2) assuming it does, whether the ATS cause of action should be interpreted to permit corporate liability.

...[T]he key question at step one of the ATS analysis is whether the customary international law norms that are actionable under the ATS distinguish between natural persons and corporations...none of these norms do.

At the second step in the analysis, some of the Justices expressed concern about the foreign relations implications of holding corporations liable for human rights violations. 

...The concerns expressed at oral argument by the more conservative Justices have little to do with corporate liability...

...the particular norm of customary international law must apply to a corporation before a corporation may be sued under the ATS for violating that norm... all of the norms actionable under the ATS do apply to corporations.

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