US court throws out $655 m. terrorism judgment against PA

The appealed judgment, handed down by a Manhattan jury in US federal district court in February 2015, was the biggest judgment ever against the PA in the US.

Courtroom sketch of US terror trial (photo credit: REUTERS)
Courtroom sketch of US terror trial
(photo credit: REUTERS)
A US Appeals Court on Wednesday threw out a $655.5 million terrorism judgment from February 2015 against the Palestinian Authority, in a blow to efforts to hold it liable in American courts for attacks in Israel during the second intifada that killed 33 Americans.
The Second US Circuit Court of Appeals in New York ordered the case dismissed, saying that the American court system had no jurisdiction over the PA or its parent organization, the PLO. It wrote that a lower court judge had made a mistake in concluding otherwise and allowing a trial to even take place.
The appealed judgment, handed down by a Manhattan jury in US Federal District Court in February 2015, was the biggest judgment ever against the PA in the US and one of the first major anti-terrorism rulings, along with the September 2014 decision against Amman-based Arab Bank for financing terrorism.
Shurat Hadin – Israel Law Center, which along with attorney Kent Yalowitz of law firm Arnold Porter, brought the case on behalf of the families of the second intifada victims, vowed to appeal the ruling to the US Supreme Court.
“This is a legal technicality and the Palestinians will not escape their liability hiding behind it. The families will continue to pursue them to the Supreme Court and in all other forums,” Shurat Hadin said.
The plaintiffs’ central narrative at trial was that a large number of PA employees, including many policemen and commanders, had been arrested and convicted by Israel as having organized, planned and perpetrated attacks against Americans in Israel.
The six attacks in 2001-2004 during the second intifada killed 33 people and wounded hundreds. The case featured an array of star witnesses, including top PLO official Hanan Ashrawi, former top IDF intelligence and military prosecution officials and the head of the PA’s security police.
There was also heart-wrenching testimony from the relatives of victims, such as Chana Goldberg, who brought the jury to tears talking about the breakdown of her family following the murder of her father, Scott.
But no emotion was enough before the appeals court, which said that neither the attacks nor the PA or PLO had sufficient ties to the US, including their lobbying activities, for American courts to have jurisdiction.
It also found no evidence the attacks specifically targeted American citizens. Rather, it called them “random and fortuitous.”
Judge John Koeltl wrote for the appeals court, “The terror machine gun attacks and suicide bombings that triggered this suit and victimized these plaintiffs were unquestionably horrific. But the federal courts cannot exercise jurisdiction in a civil case beyond the limits prescribed by the due process clause of the Constitution, no matter how horrendous the underlying attacks or morally compelling the plaintiffs’ claims.”
Part of the PA’s win had to do with the facts that it is not a state under US law and the precedent of a negative ruling against another Shurat Hadin case, the Bank of China terrorism-financing case.
That case was ultimately undermined by the Israeli government’s refusal to produce a former agent as a key witness.
PLO official Ashrawi responded to the decision, stating, “We think its proof of the independence of the judicial system in the US and in particular, the Supreme Court, because in the first place all other courts have refused to deal with cases against the PA on the basis of non-jurisdiction, and of the one court that did rule, unfortunately I knew that file and I knew that it had all sorts of legal problems.
“The fact that the appeals court threw it out means that there is justice, finally. We are not concerned about future cases being brought forth against the PA, because this group, Shurat Hadin, specializes in just birthing lawsuits...
any kind of lawsuit can be made against anybody on the basis of terrorism violence... they pursued it in New York with this one court.... That it was dismissed sends a final message to this organization and others like it.”
PA lawyer Gassan Baloul of Squire Patton Boggs LLP responded to the ruling saying, “We are very gratified that the court fully accepted our clients’ consistent position that the PA and the PLO are not subject to the jurisdiction of the United States courts in these matters.”
Shurat Hadin and Yalowitz said one issue they had with the appeals court decision was that “Congress passed the Anti-Terrorism Act after the PLO killed Leon Klinghoffer [in 1985, shooting him as he sat in his wheelchair aboard the Achille Lauro cruise ship,] in order to protect Americans wherever in the world they traveled. The very terrorists who prompted the law have now hidden behind the US Constitution to avoid responsibility for their crimes.”
They added that, “This cruel decision must be corrected so that these families may receive justice...
The time has come for the US Congress and the State Department to intervene on the side of American victims of terrorism to ensure that these families are compensated by the PA and PLO for these crimes.”
In April, the three-judge panel of the same appeals court heard oral argument by the sides. A defining moment came when the judges told the PA lawyer, Mitchell R.
Berger, that his defense could be used to uproot the US Anti-Terrorism Act, which has been one of the major bases to sue foreign terrorists in the US, said sources close to the plaintiffs.
At the same time, Shurat Hadin said in April that it was at most “cautiously optimistic” about beating back the appeal, since the judges had been hard to read.
In a reply brief relating to the appeal, the PA had written, “Plaintiffs to seek to create for defendants an untenable whipsaw: not sovereign enough for purposes of the ATA [Anti-Terrorism Act] and FSIA [Foreign Sovereign Immunities Act], but too close to sovereign to be entitled to due process.”
The PA claimed a double standard.
When US law might save it from being sued in the US for activities that occurred in Israel, it was not being treated as a state.
But when American law made it easier to sue it in the US, it was being treated as a quasi-state.
The PA had cited three recent rulings by other courts that dismissed similar ATA cases due to the lack of personal jurisdiction by US courts over the foreign defendants. It further argued that its few US connections, including two embassies, engaged only in diplomatic but not commercial activities.
In general, courts cannot handle a case against a defendant unless there is some physical or business connection between a defendant and the country where the court resides.
Adam Rasgon contributed to this report.