Under that proper framework, the outcome of this case should be clear: because all relevant conduct that allegedly violated the law of nations occurred abroad, and only the incidental and mechanistic clearing of dollars occurred in the United States, there is no basis for an ATS suit… - Institute of International Bankers
In 2006, 6,000 foreign citizens injured in Israel during the Second Intifada filed a case against Arab Bank under the Alien Tort Statute (“ATS”), a 1789 jurisdictional statue. These plaintiffs, who are not directly connected to the United States, alleged that Arab Bank is responsible for their injuries—not because the Bank participated in these attacks, but because the Bank allegedly processed financial transactions for individuals later placed on a list of prohibited persons. While these transactions took place in Jordan and other foreign countries, plaintiffs claim that they have jurisdiction to bring their case in the U.S. because the electronic transactions were routinely cleared in New York. This case, Jesner et al. v. Arab Bank, PLC, was dismissed in 2013 by the United States District Court for the Eastern District of New York, which ruled that corporations cannot be held liable under the ATS. The United States Court of Appeals for the Second Circuit unanimously affirmed this dismissal in December 2015. In April 2017, the Supreme Court of the United States granted the plaintiffs’ petition to hear the case. On August 21, 2017, Arab Bank submitted its brief with the Supreme Court, making its case that the Court should affirm the Second Circuit’s decision. The entire brief is available here.
Fast Facts about the Case
- Plaintiffs are 6,000 non-U.S. citizens injured in alleged terrorist attacks occurring in Israel and surrounding environs from 1995-2005, with no direct connection to the United States. They never made a case against Arab Bank in Israel, the location of the attacks, nor did they sue in Jordan, where the Bank is headquartered. Counsel for the plaintiffs freely admit to filing suit in New York, nearly 6,000 miles away from the site of the attacks, in search of “enormous punitive awards,” which are rarely granted in Israel.
- Arab Bank is not alleged to have had any involvement in planning, funding or committing the attacks that caused plaintiffs’ injuries. And plaintiffs concede that they cannot prove any direct causal link between the Bank’s conduct and their injuries.
- Plaintiffs claim that the Bank violated international law, and is therefore subject to liability under the ATS, for providing financial services outside of the U.S. to individuals with an alleged affiliation with, or relation to, terrorists located outside of the U.S. Many of these financial services included fund transfers that originated at other prominent global banks.
- The only alleged U.S. connection in this case is ministerial dollar-clearing services: the routine, electronic processing of transfers through automated U.S. systems that checked each transfer against the U.S.’s OFAC list of known or suspected terrorists. More than $1.5 trillion are cleared through New York in this manner each day.
- The U.S. government describes Arab Bank as a “constructive partner” in “working to prevent terrorist financing.” For this and other reasons, the U.S. has told the Supreme Court that the “unwarranted continuation of this case would be detrimental to the foreign-policy interests of the United States.”
- The Kingdom of Jordan, a close U.S. ally, has also told the Supreme Court that the Jesner case “has been a recurring source of concern in the U.S.-Jordan relationship for more than a decade” and “threatens to destabilize Jordan’s economy and undermine its cooperation with the United States.”
- The United States District Court for the Eastern District of New York dismissed the Jesner case in 2013 on the basis of the Second Circuit Court of Appeal’s 2010 decision in Kiobel v. Royal Dutch Petroleum Co. (“Kiobel I”), which held that corporations are not proper ATS defendants. The Second Circuit Court of Appeals affirmed the district court’s dismissal of Jesner in 2015 and denied the Jesner plaintiffs’ request for rehearing en banc in 2016.
- The Supreme Court granted the Jesner plaintiffs’ petition for certiorari to consider whether corporations are proper ATS defendants—a question it left unresolved in its 2013 decision in Kiobel v. Royal Dutch Petroleum Co. (“Kiobel II”), which held that courts only have subject matter jurisdiction over ATS claims that “touch and concern” the U.S. with “sufficient force.” Now before the Supreme Court, Arab Bank argues that Jesner is subject to dismissal under the reasoning of both Kiobel I and Kiobel II.