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Arab Bank Wins Antiterrorism Act Appeal

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By George Khoury, Esq. on February 12, 2018 10:00 AM

A 15-year-old case has finally reached a final conclusion thanks to a Second Circuit ruling vacating judgment and remanding the matter. Due to a settlement agreement where the parties stipulated to not proceed with a retrial, the circuit court's order effectively ends the litigation related to three terrorist attacks that date back to before 2005.

The case against Arab Bank was filed under the Antiterrorism Act, which extended liability to any organization that provides support to terrorist organization. The bank is alleged to have turned a blind eye to terrorist organizations providing monetary incentives to attackers and their families. And while a federal jury found the bank liable, the appellate court found that the errors at the trial court level warranted the verdict being vacated and a remand.

Covenant Not to Retry

As part of a $100 million settlement as to damages, the plaintiffs in the case agreed to forgo any retrial of the matter. This means that as a result of the appeal coming down in favor of Arab Bank, the plaintiffs have lost their case and damages. The appellate court ruled that, as a matter of law, it could not find that the evidence supported the finding that "the bank knew it was playing a role in violent or life endangering acts whose apparent intent was to intimidate or coerce civilians or to affect a government."

The plaintiffs unconvincingly asserted that any error in instructing the jury by the court was harmless due to the fact that the jury found causation. Additionally, the appellate court found it unconvincing that the congress had passed the Justice Against Terrorism Act after trial. Notably, the JATA extends ATA liability to anyone who aids and abets terrorism.

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