After years of litigation in which Arab Bank has denied any wrongdoing, on February 9, 2018 the Second Circuit ruled in Arab Bank’s favor in a unanimous decision overturning the District Court’s liability verdict in Linde v. Arab Bank. The Second Circuit found that the Court erred in failing to provide the jury with adequate instructions, an outcome that brings finality to this case and means the Bank is not liable for the alleged injuries.
In July 2004, the first of a number of civil lawsuits was filed against Arab Bank by victims of terrorism in Israel and the Palestinian Territories in the U.S. District Court for the Eastern District of New York; additional actions were filed in the ensuing years. The plaintiffs included American citizens, who sued under the Anti-Terrorism Act (ATA), and foreign nationals, who sued under the Alien Tort Statute (ATS). They did not allege that the Bank engaged in acts of terrorism. Rather, they claimed that the Bank provided banking services to individuals or organizations that it allegedly knew to be affiliated with terrorist groups. Arab Bank has denied any wrongdoing; it maintains that it provided lawful and legitimate banking services, including the processing of automated, electronic fund transfer instructions in conformity with governing compliance rules. The Bank did not knowingly or intentionally do business with terrorists, but rather adopted measures to combat terrorist financing.
On November 6, 2012, Senior Judge Jack B. Weinstein dismissed in its entirety Mati Gill v. Arab Bank, PLC, the first case to reach a final judgment. In this case brought under the ATA, Judge Weinstein evaluated the evidence and found that it did not support the claim “that the Bank acted with an improper state of mind or proximately caused plaintiff’s injury.” [Read the full opinion here.]
On February 9, 2018, the U.S. Court of Appeals for the Second Circuit unanimously reversed the District Court’s liability verdict in Linde v. Arab Bank, ruling that the Court erred in failing to provide the jury with adequate instructions. This outcome brings finality to the cases brought under the ATA. [Read the full opinion here.]
Alien Tort Statute
On August 23, 2013, Eastern District Court Judge Brian M. Cogan ordered the dismissal of separate claims filed by more than 6,000 plaintiffs against Arab Bank under the ATS. The decision dismissed more than 90 percent of the claims pending against the Bank. [Read the opinion here.]
In December 2015, the U.S. Court of Appeals for the Second Circuit unanimously affirmed this dismissal, and 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. [Read the brief here.]
The Supreme Court heard oral argument on October 11, 2017. The Bank is confident that the matter will be disposed of in its favor.