US jus­tices ques­tion Arab Bank li­a­bil­ity in ter­ror­ist at­tacks

The Jerusalem Post - - NEWS - • By LAWRENCE HUR­LEY

WASH­ING­TON (Reuters) – Con­ser­va­tive US Supreme Court jus­tices on Wed­nes­day sig­naled con­cern about al­low­ing com­pa­nies to be sued un­der Amer­i­can law for hu­man rights abuses abroad in a case in­volv­ing al­le­ga­tions that Arab Bank Plc helped fi­nance ter­ror­ist at­tacks in Is­rael and the Pales­tinian ter­ri­to­ries.

Chief Jus­tice John Roberts and Jus­tice Sa­muel Al­ito, both con­ser­va­tives, in­di­cated that US for­eign pol­icy ten­sions that could arise from such cases would be a rea­son to curb cor­po­rate li­a­bil­ity. Con­ser­va­tive Jus­tice An­thony Kennedy, who of­ten casts the de­cid­ing vote in big cases, also ap­peared sym­pa­thetic to the bank’s ar­gu­ments.

Their re­marks dur­ing an hour of ar­gu­ments in the case raised the pos­si­bil­ity that the court, with a 5-4 con­ser­va­tive ma­jor­ity, could rule in fa­vor of the Jor­dan-based bank in the law­suit seek­ing to hold it fi­nan­cially li­able for the Is­lamist at­tacks.

The court’s four left-wingers in­di­cated that cor­po­ra­tions should not be im­mune. Even if the court ruled in fa­vor of the roughly 6,000 plain­tiffs su­ing the bank, the law­suit could still be dis­missed on other grounds once it re­turns to lower courts.

The plain­tiffs, ap­peal­ing a lower court’s rul­ing block­ing the suit, have ac­cused the bank of be­ing the “pay­mas­ter” be­hind at­tacks in­clud­ing sui­cide bomb­ings be­cause of its role in pro­cess­ing cer­tain fi­nan­cial trans­ac­tions. The plain­tiffs in­clude rel­a­tives of non-US cit­i­zens killed in at­tacks and sur­vivors of the in­ci­dents.

The plain­tiffs said Arab Bank used its New York branch to trans­fer money that helped Ha­mas and other groups fund at­tacks and re­ward fam­i­lies of the per­pe­tra­tors be­tween 1995 and 2005.

The un­der­ly­ing le­gal ques­tion is whether cor­po­ra­tions can be sued un­der a US law called the Alien Tort Statute, which dates to 1789. In re­cent years, hu­man rights lawyers have used it to seek dam­ages against com­pa­nies in US courts for hu­man rights vi­o­la­tions abroad.

A rul­ing that elim­i­nates cor­po­rate li­a­bil­ity would fur­ther limit the reach of that law, which was al­ready nar­rowed by a 2013 Supreme Court rul­ing.

“I‘m con­cerned about the for­eign en­tan­gle­ment is­sue,” Roberts told the plain­tiffs’ lawyer, Jef­frey Fisher.

Roberts said up­hold­ing cor­po­rate li­a­bil­ity could lead to a “prob­lem­atic re­sult” by in­creas­ing for­eign pol­icy fric­tions with other coun­tries such as Jor­dan, which filed a brief say­ing that hold­ing the bank li­able would un­der­mine the king­dom’s re­la­tion­ship with the United States.

Kennedy echoed ar­gu­ments made in the bank’s court papers, in­di­cat­ing he agrees that obli­ga­tions im­posed by the “law of na­tions, which gives rise to in­ter­na­tional hu­man rights claims, gen­er­ally ap­ply to na­tions and some­times in­di­vid­u­als, but not cor­po­ra­tions.”

But lib­eral Jus­tice Elena Ka­gan said it makes lit­tle sense to bar law­suits against com­pa­nies while al­low­ing them against in­di­vid­u­als, in­clud­ing cor­po­rate ex­ec­u­tives.

“Why on Earth would you draw a dis­tinc­tion of this kind?” Ka­gan asked the bank’s lawyer, Paul Cle­ment.

The lead plain­tiff in the Arab Bank case is Joseph Jes­ner, whose Bri­tish cit­i­zen son Jonathan, a stu­dent at the Har Etzion Yeshiva in Gush Etzion, was killed at age 19 in a 2002 sui­cide bomb­ing of a No. 4 bus as it was pass­ing through Al­lenby Street in front of the Great Syn­a­gogue in Tel Aviv. Ha­mas claimed re­spon­si­bil­ity for the at­tack, which killed a to­tal of six peo­ple, and wounded ap­prox­i­mately 70 oth­ers.

The bank said in court papers that the US gov­ern­ment has called it a con­struc­tive part­ner in the fight against ter­ror­ism fi­nanc­ing.

In its 2013 rul­ing, the Supreme Court did not re­solve the cor­po­rate li­a­bil­ity ques­tion when it ruled in fa­vor of Royal Dutch Shell Plc over a law­suit claim­ing the com­pany was com­plicit in a crack­down on pro­test­ers in Nige­ria.

The jus­tices in­stead nar­rowed the law’s reach, say­ing claims must suf­fi­ciently “touch and con­cern” the United States to over­come the pre­sump­tion that the Alien Tort Statute does not cover for­eign con­duct. A 2015 Cham­ber of Com­merce study said that in the two years af­ter that rul­ing, 70% of law­suits un­der the Alien Tort Statute were dis­missed on those grounds.

In a sep­a­rate case, a New York jury in 2014 found Arab Bank li­able for fa­cil­i­tat­ing two dozen ter­ror­ist at­tacks in Is­rael.

A rul­ing is due by the end of June.

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