DC Circuit - The FindLaw DC Circuit Court of Appeals Opinion Summaries Blog

Court Sends Back Americans' Case Against Hezbollah

In the summer of 2006, Hezbollah militants killed more than 1,000 civilians in a bloody attack on Northern Israel.

After kidnapping and killing several Israeli soldiers, they fired thousands of rockets into civilian cities, towns, and villages. When it was over, nearly 2,000 people were dead.

Some years later, survivors sued for their injuries in Kaplan v. Central Bank of the Islamic Republic of Iran. Unfortunately, their battles are not over.

Bad News

American, Israeli, and Canadian plaintiffs filed two separate actions in 2009 and 2010. In the first case, the Americans sued Hezbollah under the Anti-Terrorism Act (ATA) and North Korea under the Foreign Sovereign Immunities Act.

In the second case, the same plaintiffs sued Iranian banks under the Alien Tort Statute (ATS) for funding the attacks. A trial judge dismissed both complaints, saying they were precluded by an "act-of-war" exception for Hezbollah and separately for the banks on other grounds.

However, the judge found that Iran and North Korea defaulted on claims against them and awarded more than $169 million in damages against them. The plaintiffs appealed the dismissals.

The U.S. DC Circuit Court of Appeals gave the plaintiffs some good and some bad news. The good news was the appeals court vacated the trial court dismissals of the ATA claims. The bad news was, it affirmed the dismissals of the ATS claims.

Not So Good News

Remanding the case, the appeals court said the trial judge must first determine whether it has jurisdiction for the claims under the ATA. Then it has to apply the act-of-war exception.

In any case, the appeals court was guided by a recent decision involving American claims against Arab Bank for a Jordanian attack. In Jesner v. Arab Bank, the U.S. Supreme Court said foreign corporations are not subject to liability under the ATS.

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