Amicus Curiae Brief — Robert Bartlett, et al., Petitioners v. Muhammad Baasiri, et al.
Supreme Court briefDec 28, 2023
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No. 23-568
In the Supreme Court of the United States
ROBERT BARTLETT, ET AL.,
v.
Petitioners
DR. MUHAMMAD BAASIRI AND
JAMMAL TRUST BANK SAL,
Respondents.
On Petition for Writ of Certiorari to the
United States Court of Appeals for the Second Circuit
BRIEF ON BEHALF OF JEWISH ORGANIZATIONS
AND ALLIES, AS AMICI CURIAE, IN SUPPORT OF
PETITIONERS
DANIEL KAMINETSKY
AGUDATH ISRAEL OF
AMERICA
42 Broadway, 14th Floor
New York, NY 10004
ABBA COHEN
AGUDATH ISRAEL OF
AMERICA
1730 Rhode Island
Avenue NW Suite 1004
Washington, DC 20036
MARK TRACHTENBERG
Counsel of Record
KAYLEN STRENCH
HAYNES AND BOONE, LLP
1221 McKinney St., Suite 4000
Houston, TX 77010
(713) 547-2528
mark.trachtenberg
@haynesboone.com
SCOTT E. WHITMAN
HAYNES AND BOONE, LLP
800 17th Street NW, Suite 500
Washington, DC 20006
LUCAS B. DRILL
HAYNES AND BOONE, LLP
8000 Towers Crescent Dr., RYAN PAULSEN
Suite 900
HAYNES AND BOONE, LLP
Tysons, VA 22182
2801 N. Harwood St., Ste 2300
Dallas, TX 75201
Counsel for Amici Curiae
(Additional Amici Curiae listed on inside cover)
NATHAN J. DIAMENT
UNION OF ORTHODOX
JEWISH
CONGREGATIONS OF
AMERICA
1730 Rhode Island
Avenue NW
Suite 509
Washington, DC 20036
STEVEN C. SHEINBERG
STEVEN M. FREEMAN
ANTI-DEFAMATION LEAGUE
605 Third Avenue
New York, NY 10158
JONATHAN M. ROTTER
GLANCY PRONGAY &
MURRAY LLP
1925 Century Park East,
Suite 2100
Los Angeles, CA 90067
JONATHAN L. SHERMAN
STEVEN ORLOW
ONE ISRAEL FUND, LTD.
445 Central Ave #210,
Cedarhurst, NY 11516
*
DANIEL R. PALUCH
GIPSON HOFFMAN & PANCIONE
1901 Avenue of the Stars
Suite 1100
Los Angeles, CA 90067
Counsel for StandWithUs
*
*
i
TABLE OF CONTENTS
Page
TABLE OF CONTENTS ............................................. i
TABLE OF AUTHORITIES...................................... iii
INTEREST OF AMICI CURIAE ................................1
INTRODUCTION ........................................................4
SUMMARY OF ARGUMENT .....................................7
ARGUMENT ...............................................................9
I. The Petition raises vital issues for American
citizens in Jewish communities locally and
abroad. ....................................................................9
A. Hezbollah aims to destroy the Jewish
people and the State of Israel. ....................... 10
B. Hezbollah relies on corrupt private
financial institutions to finance its
terrorist operations. ........................................ 13
C. Congress enacted a comprehensive
statutory scheme to disrupt terror
support networks. ........................................... 16
II. The Second Circuit’s decision defies
precedent, undercuts the anti-terrorism
legislative framework, and raises grave
constitutional concerns. ....................................... 21
A. The
Second
Circuit’s
decision
misinterprets this Court’s binding
precedent. ........................................................ 21
ii
B. The Second Circuit’s interpretation of
the FSIA defies its text and structure, as
well as the broader anti-terrorism
statutory scheme. ........................................... 24
C. The
Second
Circuit’s
decision
misunderstands the FSIA’s historical
context and contradicts legislative
intent. .............................................................. 26
CONCLUSION .......................................................... 29
iii
TABLE OF AUTHORITIES
Page(s)
Cases
Andrus v. Texas,
142 S. Ct. 1866 (2022) ....................................... 22
Argentine Rep. v. Amerada Hess Shipping
Corp., 488 U.S. 428 (1989) ................................ 24
Bartlett v. Baasiri,
81 F.4th 28 (2nd Cir. 2023)......................... 26, 28
Boim v. Holy Land Found. for Relief & Dev.,
549 F.3d 685 (7th Cir. 2008) ....................... 16, 17
Dole Food Co. v. Patrickson,
538 U.S. 468 (2003) ........... 7, 8, 20, 21, 22, 23, 24
Estates of Ungar v. Palestinian Auth.,
304 F. Supp. 2d 232 (D.R.I. 2004) .................... 16
FDA v. Brown & Williamson Tobacco Corp.,
529 U.S. 120 (2000) ....................................... 8, 25
Federal Repub. of Germany v. Elicofon,
358 F. Supp. 747 (E.D.N.Y. 1970) .................... 20
First Nat. Bank v. Banco Para El Comercio
Exterior de Cuba,
462 U.S. 611 (1983) ........................................... 20
Freeman v. HSBC Holdings PLC,
No. 14CV6601DLICLP, 2018 WL
3616845 (E.D.N.Y. July 27, 2018) .................... 14
iv
Holder v. Humanitarian Law Project,
561 U.S. 1 (2010) ............................................... 28
Kilburn v. Socialist People’s Libyan Arab
Jamahiriya,
376 F.3d 1123 (D.C. Cir. 2004) ......................... 26
OI Eur. Grp. B.V. v. Bolivarian Rep. of
Venezuela Petroleos de Venezuela,
73 F.4th 157 (3d Cir. 2023) ............................... 20
Olympia Express, Inc. v. Linee Aeree
Italiane, S.P.A.,
509 F.3d 347 (7th Cir. 2007) ....................... 23, 24
Owens v. Rep. of Sudan,
531 F.3d 884 (D.C. Cir. 2008) ........................... 25
Rodriguez de Quijas v. Shearson/Am. Exp.,
Inc., 490 U.S. 477 (1989) ................................... 22
TIG Ins. Co. v. Rep. of Argentina,
967 F.3d 778 (D.C. Cir. 2020) ............... 23, 24, 27
Turkiye Halk Bankasi A.S. v. United States,
598 U.S. 264 (2023) ....................................... 8, 24
Verlinden B.V. v. Center Bank of Nigeria,
461 U.S. 480 (1983) ..................................... 26, 27
Rules
SUP. CT. R. 10(a) ............................................... 24, 29
SUP. CT. R. 10(c)...................................................... 20
v
Statutes
18 U.S.C. § 2331 ........................ 7, 16, 17, 18, 24, 25
18 U.S.C. § 2333(a) ................................................. 18
18 U.S.C. § 2334 ..................................................... 25
28 U.S.C. § 1330(a) ............................................. 8, 24
28 U.S.C. § 1602 ...................................................... 7
28 U.S.C. § 1603(b)(2) .................................... 8, 9, 21
28 U.S.C. § 1604 ................................................. 8, 24
28 U.S.C § 1607(a) .................................................. 25
Justice Against Sponsors of Terrorism Act
(JASTA), Pub. L. No. 114-222,
130 Stat. 852, (2016) ............................... 7, 18, 25
Other Authorities
H.R. 2297, 114th Cong. (2015) ............................... 18
S. Rep. No. 102-342 (1992) ..................................... 17
Anna Ahronheim, Iran pays $830 million to
Hezbollah, THE JERUSALEM POST
(Sept. 18, 2017),
https://www.jpost.com/middle-east/irannews/iran-pays-830-million-to-hezbollah505166. .............................................................. 14
vi
Benjamin Allison, Hezbollah's Precision
Threat to Israel, LAWFARE
(Oct. 31, 2023 9:51 AM),
https://www.lawfaremedia.org/article/he
zbollah-s-precision-threat-to-israel .................. 12
Bruce Riedel, The Brookings Institution,
Who are the Houthis, and why are we at
war with them?, (Dec. 18, 2017)
https://www.brookings.edu/articles/whoare-the-houthis-and-why-are-we-at-warwith-them/ ................................................... 10, 11
CONGRESSIONAL RESEARCH SERVICE,
Lebanese Hezbollah, available at
https://crsreports.congress.gov/product/p
df/IF/IF10703 (last visited, Dec. 18,
2023) .................................................................... 4
Dion Nissenbaum, At Israel-Lebanon
Border, Fears Grow of a Second Front,
WALL STREET JOURNAL
(Oct. 12, 2023 2:09 pm ET)
https://www.wsj.com/world/middleeast/at-israel-lebanon-border-fears-growof-a-second-battlefront-cda25139 ..................... 11
Dr. Majid Rafizadeh, In first, Hezbollah
confirms all financial support comes
from Iran, Al Arabiya News
(Jun. 25, 2016 12:00 AM GST),
https://english.alarabiya.net/features/20
16/06/25/In-first-Hezbollah-s-Nasrallahconfirms-all-financial-support-comesfrom-Iran ........................................................... 15
vii
Emanuel Fabian, Gallant: Hezbollah has
fired over 1,000 munitions at Israel since
start of war, TIMES OF ISRAEL
(Nov. 19, 2023)
https://www.timesofisrael.com/gallanthezbollah-has-fired-over-1000munitions-at-israel-since-start-of-war/ .............. 6
Gabriel Toueg, Brazil nabs suspected
Hezbollah operatives said planning
attacks on Jewish targets, TIMES OF
ISRAEL (Nov. 8, 2023 11:39 pm)
https://www.timesofisrael.com/brazilnabs-suspected-hezbollah-operativessaid-planning-attacks-on-jewish-targets ......... 13
Hamas Charter (1988),
https://www.memri.org/reports/covenant
-islamic-resistance-movement%E2%80%93hamas ........................................... 10
The Hizballah Program: An Open Letter,
THE JERUSALEM QUARTERLY (Jan. 1,
1988), available at https://www.ict.org.il/
UserFiles/The%20Hizballah%20Program
%20-%20An%20Open%20Letter.pdf ............ 5, 10
Joseph Jesner, et al. v. Arab Bank, PLC,
138 S. Ct. 1386 (2018), 32 N.Y. Int'l L.
Rev. 43 (2019) .................................................... 14
viii
Joyce Karam, Iran pays Hezbollah $700
million a year, US official says, THE
NATIONAL (Jun. 6, 2018),
https://www.thenationalnews.com/world/
the-americas/iran-pays-hezbollah-700million-a-year-us-official-says-1.737347 .......... 14
Kali Robinson, What Is Hezbollah?,
COUNCIL ON FOREIGN RELATIONS,
available at https://www.cfr.org/
backgrounder/what-hezbollah (last
updated Oct. 14, 2023 11:04 am EST)........ 10, 11
Matthew Levitt, HEZBOLLAH, THE GLOBAL
FOOTPRINT OF LEBANON’S PARTY OF GOD
(2013) ..................................................... 11, 13, 14
Matthew Levitt, Hezbollah Isn't Just in
Beirut. It's in New York, Too., FOREIGN
POLICY (Jun. 14, 2019 4:03 am)
https://foreignpolicy.com/2019/06/14/hezb
ollah-isnt-just-in-beirut-its-in-new-yorktoo-canada-united-states-jfk-torontopearson-airports-ali-kourani-iran ...................... 5
News Desk, Hezbollah pounds Israeli
border sites in solidarity with Gaza, THE
CRADLE.CO (Dec. 3, 2023)
https://new.thecradle.co/articles/hezbolla
h-pounds-israeli-border-sites-insolidarity-with-gaza .......................................... 12
ix
News Wires, French court upholds Syria
'complicity in crimes against humanity'
charge against Lafarge, FRANCE 24
(May 18, 2022 14:42),
https://www.france24.com/en/livenews/20220518-paris-court-upholdscharges-of-complicity-in-crimes-againsthumanity-linked-to-lafarge-s-cementplant-in-syria..................................................... 19
OFFICE OF THE DIRECTOR OF NATIONAL
INTELLIGENCE, Interactive Timeline,
Lebanese Hizballah: Select Worldwide
Operational Activity 1983-2017,
available at
https://www.dni.gov/nctc/groups/032004_
Hizballah_Activity-InteractiveNCTC/index.html#/ (last visited, Dec. 13,
2023) .................................................................... 5
Patrick Wintour, How Iran uses proxy forces
across the region to strike Israel and US,
THE GUARDIAN (Nov. 1, 2023 1:00 EDT),
https://www.theguardian.com/global/202
3/nov/01/how-iran-uses-proxy-forcesacross-the-region-to-strike-israel-and-us ... 14, 15
Shaan Shaikhand and Ian Williams,
Hezbollah's Missiles and Rockets,
CENTER FOR STRATEGIC AND
INTERNATIONAL STUDIES (Jul. 5, 2018)
https://www.csis.org/analysis/hezbollahsmissiles-and-rockets ......................................... 13
x
Statement by President George Bush Upon
Signing S. 1569, 28 Weekly Comp. Pres.
Docs. 2112 (Oct. 29, 1992) ................................ 17
Terror suspects arrested in Europe,
including several linked to Hamas who
were allegedly plotting against Jews,
CBS NEWS (Dec. 15, 2023 6:39 am),
https://www.cbsnews.com/news/hamasgermany-denmark-terror-attacks-foiledagainst-jewish-targets/ ....................................... 6
U.S. DEP'T OF STATE, Bureau of
Counterterrorism, COUNTRY REPORTS ON
TERRORISM 2020 (2020) ..................................... 12
U.S. DEP’T OF STATE, STATE SPONSORS OF
TERRORISM, available at
https://www.state.gov/state-sponsors-ofterrorism/ (last visited, Dec. 24, 2023) ............. 25
U.S. DEP'T OF THE TREASURY, Following
Terrorist Attack on Israel, Treasury
Sanctions Hamas Operatives and
Financial Facilitators (Oct. 18, 2023),
available at https://home.treasury.gov/
news/press-releases/jy1816 ............................... 19
U.S. DEP’T OF THE TREASURY, Treasury
Labels Bank Providing Financial
Services to Hizballah as Specially
Designated Global Terrorist
(Aug. 29, 2019), available at
https://home.treasury.gov/news/pressreleases/sm760 .................................................. 16
xi
U.S. DEPT. OF JUSTICE, Lafarge Pleads
Guilty to Conspiring to Provide Material
Support to Foreign Terrorist
Organizations (Oct. 18, 2022), available
at https://www.justice.gov/opa/pr/lafargepleads-guilty-conspiring-providematerial-support-foreign-terroristorganizations ..................................................... 19
1
INTEREST OF AMICI CURIAE 1
The undersigned amici encompass a broad
spectrum of American Jewish organizations and their
allies, whose members include American victims of
terrorist attacks perpetrated by Hezbollah, Hamas, Al
Qaeda, and ISIS. Though amici’s missions and
viewpoints differ in certain respects, they are firmly
united in their commitment to ensuring that all
victims of international terrorism are compensated to
the fullest extent allowed by the Justice Against
Sponsors of Terrorism Act (“JASTA”).
JASTA’s secondary liability provision offers an
essential mechanism for compensating victims and
their families, holding terrorist organizations and
their material supporters accountable, and deterring
future terrorism. The Second Circuit’s decision
obstructs these statutory objectives, significantly
enhancing the ability of Hezbollah and like-minded
groups to finance and execute terrorist attacks around
the world.
Agudath Israel of America. Agudath Israel of
America, founded in 1922, is a national grassroots
Orthodox Jewish organization. Among its other
functions and activities, Agudath Israel articulates
1 In accordance with Rule 37.6, counsel affirms that no counsel
for any party authored this brief in whole or in part. No person
or entity other than amici and the undersigned counsel
contributed the costs associated with the preparation and
submission of this brief. Additionally, consistent with Rule 37.2,
amici provided notice to counsel for both parties of their intent
to file this brief.
2
and advances the position of the Orthodox Jewish
community on a broad range of legal issues affecting
religious liberty. Agudath Israel regularly intervenes
at all levels of government to advocate and protect the
interests of the Orthodox Jewish community
throughout the United States and the world.
Given the large population of American Jews who
reside in Israel and across the globe, Agudath Israel
is committed to ensuring the United States can
protect Americans abroad, including by holding
accountable terrorists and their supporters in U.S.
courts. As current events in Israel make all too clear,
acts of international terrorism frequently have killed
or injured American Jews and many others. Agudath
Israel is profoundly interested in reducing the number
of terrorist attacks committed by cutting off terror
funding.
The Anti-Defamation League (“ADL”). The ADL
is a 501(c)(3) not-for-profit anti-hate organization
founded in 1913 “to stop the defamation of the Jewish
people and to secure justice and fair treatment to all.”
For decades, ADL has been at the forefront of
analyzing and reporting on the actions of domestic
and international extremist and terrorist groups.
These groups pose a substantial threat to the safety
and security of Americans and others throughout the
world.
Union of Orthodox Jewish Congregations of
America (“OU”). The OU is the nation’s largest
Orthodox
Jewish
synagogue
organization,
representing nearly 1,000 congregations. The OU,
through its Advocacy Center, has participated in
many cases nationwide that implicate important
3
matters of
community.
concern
to
the
Orthodox
Jewish
The OU is especially alarmed by the devastating
impact of terrorism on its constituents and American
citizens globally. The OU seeks to ensure that
terrorists cannot exploit U.S. laws to avoid
punishment and that victims of international terror—
including those from the Orthodox Jewish
community—can seek justice in American courts.
One Israel Fund, Ltd. (“OIF”). OIF is the premier
U.S. charity fulfilling humanitarian, educational,
religious, and civilian security needs for Israeli and
American residents of Judea and Samaria (the West
Bank) and the Gaza “Envelope”—areas that are
frequent targets of terror attacks. For the safety of
these residents, OIF seeks to ensure that all avenues
to thwart terrorism are available. Accordingly, OIF
seeks this Court to ensure that Respondent faces the
American justice system for providing material
support to Hezbollah.
StandWithUs. StandWithUs is an international
non-partisan education organization that supports
Israel and fights antisemitism. StandWithUs inspires
and empowers students and communities with
leadership training and educational programs on
hundreds of college campuses, high schools, and
middle schools. Through these programs, distribution
of print and digital materials, and legal action
resources to protect the rights of students and
community
members
facing
antisemitism,
StandWithUs’s many departments work together to
provide individuals with the tools necessary to teach,
identify, define, expose, and act against anti-Jewish
4
and anti-Zionist bigotry in its many forms. Founded
in 2001 and headquartered in Los Angeles,
StandWithUs has programs on six continents.
*
*
*
INTRODUCTION
Next year marks the thirtieth anniversary of the
heinous Argentine Israelite Mutual Association
bombing. On that day in 1994, a suicide bomb ripped
through a Jewish community center in Buenos Aires,
claiming 85 lives and injuring 300 more. The bombing
closely followed a deadly attack on the Israeli
Embassy in Buenos Aires, which killed 29 and
wounded 242. Both tragic events came a decade after
the 1983 attacks on the U.S. Marine barracks in
Beirut—which killed 241, and the U.S. embassy,
which killed 63, and the 1984 attack on the U.S.
embassy annex in Beirut, which killed 24.
The common factor in these attacks is their
perpetrator—Hezbollah, the Lebanon-based terrorist
organization. Hezbollah is a critical component of
Iran’s global terror apparatus, serving as Iran’s proxy
in Lebanon, Africa, South America, and beyond. 2
Hezbollah’s principal objective is “the Destruction of
Israel . . . the hated enemy that must be fought until
See
CONGRESSIONAL RESEARCH SERVICE, Lebanese
Hezbollah, available at https://crsreports.congress.gov/product/
pdf/IF/IF10703 (last visited, Dec. 18, 2023).
2
5
the hated ones get what they deserve.” 3 Its efforts to
support and commit terrorist attacks throughout the
world have continued unabated. 4 And its
sophistication and perceived legitimacy enhance its
ability to seamlessly operate worldwide. 5
Hezbollah raises funds to support its terrorist
activities through sophisticated criminal enterprises,
including illegal drug trafficking and diamond sales.
Hezbollah then launders its illicit gains through
corrupt financial institutions like respondent Jammal
Trust Bank (“JTB”), exploiting the U.S. banking
system in the process. Hezbollah also relies heavily on
material support from its principal backer, Iran,
which utilizes entities like JTB to circumvent antiterror laws.
Recent events only underscore the havoc that
terrorist groups can wreak. The October 7, 2023,
Massacre perpetrated by Hamas—another Iranbacked terror group—showcased the ongoing, exigent
3 The Hizballah Program: An Open Letter, THE JERUSALEM
QUARTERLY (Jan. 1, 1988), available at https://www.ict.org.il/
UserFiles/The%20Hizballah%20Program%20%20An%20Open%20Letter.pdf (“Hezbollah Open Letter”).
OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE,
Interactive Timeline, Lebanese Hizballah: Select Worldwide
Operational Activity 1983-2017, available at https://www.
dni.gov/nctc/groups/032004_Hizballah_Activity-InteractiveNCTC/index. html#/ (last visited, Dec. 13, 2023).
4
5 See Matthew Levitt, Hezbollah Isn’t Just in Beirut. It’s in
New York, Too., FOREIGN POLICY (Jun. 14, 2019 4:03 am)
https://foreignpolicy.com/2019/06/14/hezbollah-isnt-just-inbeirut-its-in-new-york-too-canada-united-states-jfk-torontopearson-airports-ali-kourani-iran/.
6
threat posed by state-sponsored terrorism. And
although Hamas explicitly targeted Jewish
communities in Israel, this threat extends to others
around the globe. Victims of the October 7 attacks hail
from 40 countries, including the United States. 6 And
European law enforcement recently foiled a Hamas
plot against Jewish targets in Europe. 7
To counteract the illicit financial networks that
support terrorist groups like Hezbollah and Hamas,
Congress has carefully constructed a framework of
anti-terrorism legislation aimed at deterring terror
financing and compensating terror victims.
But the Second Circuit’s decision imperils this
anti-terrorism framework that has been critical to the
fight against international terrorism. By interpreting
the Foreign Sovereign Immunities Act (“FSIA”) in a
way that expands immunity for terrorists’ corporate
supporters, the court impairs an essential tool for
preventing
future
attacks
against
Jewish
communities around the world, Americans traveling
or living abroad (including servicemembers stationed
in the Middle East), and countless other targets.
Congress did not intend such a result. At stake is the
Hezbollah also continues to target Israel. See Emanuel
Fabian, Gallant: Hezbollah has fired over 1,000 munitions at
Israel since start of war, TIMES OF ISRAEL (Nov. 19, 2023)
https://www.timesofisrael.com/gallant-hezbollah-has-fired-over1000-munitions-at-israel-since-start-of-war/.
6
7 See, e.g., Terror suspects arrested in Europe, including several
linked to Hamas who were allegedly plotting against Jews, CBS
NEWS (Dec. 15, 2023 6:39 am), https://www.cbsnews.com/news/
hamas-germany-denmark-terror-attacks-foiled-against-jewishtargets/.
7
efficacy and availability of the United States’ civil
anti-terrorism remedy.
SUMMARY OF ARGUMENT
The Court should grant the petition8 for at least
two reasons.
First, because the Second Circuit’s decision
impairs key statutory mechanisms for addressing the
financing of terrorism, allowing the decision to stand
will amplify threats to Jews and other Americans
around the world. Foreign donors and facilitators of
terrorism, sometimes acting in concert with their
governments, provide material financial support to
Hezbollah and other terrorist groups through private
corporations like JTB. Congress has enacted finelytuned legislation to thwart these aiders and abettors,
like the Anti-Terrorism Act (“ATA”), 18 U.S.C. § 2331
et seq., and JASTA. The Second Circuit’s decision,
however, gives foreign governments a roadmap for
using the FSIA’s state instrumentality exception to
evade these statutes, with potentially devastating
consequences for amici and the world at-large. 28
U.S.C. §§ 1602 et seq.
Second, the decision below defies this Court’s
precedent and ignores the FSIA’s text, structure, and
purpose. The Second Circuit’s interpretation
irreconcilably conflicts with the Court’s decision in
Dole Food Co. v. Patrickson, 538 U.S. 468 (2003) and
the several other courts of appeals that subsequently
have addressed this issue. In Dole, the Court
See Petition for a Writ of Certiorari, at pp. ii–xvii, for a
complete listing of the Petitioners.
8
8
unequivocally held that because the “plain text of
[§ 1603(b)(2)] is expressed in the present tense,” the
FSIA “requires that instrumentality status be
determined at the time suit is filed.” Id. at 478. By
deviating from this unambiguous dictate—and wellreasoned decisions from other circuits—the Second
Circuit misreads the FSIA and undercuts its
effectiveness.
Additionally, the Second Circuit’s opinion
disregards this Court’s admonition to read statutory
provisions in “context and with a view to their place
in the overall statutory scheme.” FDA v. Brown &
Williamson Tobacco Corp., 529 U.S. 120, 133 (2000).
In rejecting the time-of-filing rule, the Second Circuit
ignores the established link between immunity and
jurisdiction rooted in the FSIA’s statutory structure.
See Turkiye Halk Bankasi A.S. v. United States, 598
U.S. 264, 276 (2023) (citing 28 U.S.C. §§ 1330(a),
1604). Moreover, it frustrates the central purposes of
Congress’s greater anti-terrorism scheme.
The decision below also misconstrues important
historical context. Congress passed the FSIA to
replace the Executive Branch’s unstable, ad hoc
approach to immunity determinations. Yet the Second
Circuit’s decision undermines this objective, inviting
foreign sovereigns to engage in gamesmanship and, in
turn, eroding predictability. Moreover, while
Congress intended for the FSIA to balance comity
with the political branches’ foreign policy agenda, the
Second Circuit’s decision thwarts Congress’s and the
Executive Branch’s capacity to implement antiterrorism efforts—like using SDGT designations to
combat
terror
financing.
These
anomalous
9
consequences not only pose serious practical concerns;
they also demonstrate that the Second Circuit’s
interpretation sharply contradicts congressional
intent.
In sum, the Court should grant the petition to
resolve (1) the important question of whether a
defendant’s status as an instrumentality of a foreign
state under 28 U.S.C. § 1603(b)(2) can attach after the
complaint is filed, and (2) the circuit split created by
the decision below.
ARGUMENT
I.
The Petition raises vital issues for
American citizens in Jewish communities
locally and abroad.
The political branches have responded to terrorist
networks supported by foreign banks and
corporations by enacting targeted policies and a
robust federal statutory scheme. But the Second
Circuit’s decision seriously undermines these efforts.
Under the Second Circuit’s holding, foreign
sovereigns—including those specifically seeking to
finance terrorism and those that are merely
indifferent—can insulate their preferred corporations
from civil suits brought by terrorist attack victims in
American courts. When a private bank faces suit (or
even after a court has ordered it to pay damages), the
foreign government can simply nationalize it or place
it in a temporary government receivership, blanketing
it in FSIA immunity. This reading of the FSIA is
patently wrong and creates a giant loophole in the
statutory scheme.
10
Given the anti-Jewish and anti-Israel motivations
driving many international terrorist groups, Jewish
communities around the world are likely to suffer
disproportionately from a breakdown of this statutory
framework. 9
A. Hezbollah aims to destroy the Jewish
people and the State of Israel.
Hezbollah’s steadfast resolve to eradicate the
Jewish people and Israel were part of its central,
founding principles, 10 and remain so, as detailed in
Hezbollah’s 2009 “updated” manifesto. 11 In its forty-
9 Amici focus here on Hezbollah, given the facts of the case.
But the need to ensure the anti-terrorism statutory scheme
works effectively applies equally to other terrorist groups like
Hamas, Islamic Jihad, ISIS, Al Qaeda, and the Houthis, most of
which share Hezbollah’s genocidal ambitions towards the Jewish
people. See, e.g., Hamas Charter art. 7, para. 4 (1988),
https://www.memri.org/reports/covenant-islamic-resistancemovement-%E2%80%93hamas (“The hour of judgment shall not
come until the Muslims fight the Jews and kill them”); Bruce
Riedel, The Brookings Institution, Who are the Houthis, and why
are
we
at
war
with
them?,
(Dec.
18,
2017)
https://www.brookings.edu/articles/who-are-the-houthis-andwhy-are-we-at-war-with-them/ (“[D]eath to Israel, curse the
Jews”).
10 Hezbollah Open Letter, at 3–5.
11 Kali Robinson, What Is Hezbollah?, COUNCIL ON FOREIGN
RELATIONS, available at https://www.cfr.org/backgrounder/whathezbollah (last updated Oct. 14, 2023 11:04 am EST) (“Robinson,
Hezbollah”).
11
year history, Hezbollah has not veered from these
overarching goals. 12
But its political power, global influence, financial
resources, and military capabilities have grown
dramatically in the intervening decades. 13 Hezbollah’s
military prowess looms large over the current IsraelHamas war. U.S. government leaders worry that
Hezbollah will react to Israel’s response to the October
7th attacks by opening a “second front” of fighting in
Northern Israel. 14 Recent reports corroborate these
fears. Hezbollah has been “pound[ing] Israeli border
12 Hezbollah has killed many Americans along the way.
Hezbollah’s deliberate and intertwined targeting of Americans
and Jews was explicit in two 1985 attacks. In a plane hijacking,
Hezbollah kidnapped U.S. military personnel and passengers
with Jewish-sounding names and murdered an American
servicemember. Matthew Levitt, HEZBOLLAH, THE GLOBAL
FOOTPRINT OF LEBANON’S PARTY OF GOD, 54–55 (2013). The same
year, Hezbollah bombed both an American airline office and
synagogue in Copenhagen. Id. at 58.
13 Hezbollah “wields significant power in Lebanon, where it
operates as both a Shiite Muslim political party and militant
group,” raising a veil between its more legitimate functions as
the former and barbaric actions when acting as the latter.
Robinson, Hezbollah, supra.
See Dion Nissenbaum, At Israel-Lebanon Border, Fears
Grow of a Second Front, WALL STREET JOURNAL (Oct. 12, 2023
2:09 pm ET) https://www.wsj.com/world/middle-east/at-israellebanon-border-fears-grow-of-a-second-battlefront-cda25139.
14
12
sites in solidarity with Gaza”—thus exploiting an
already volatile situation to assist Hamas. 15
These recent attacks are merely a continuation of
Hezbollah’s longstanding campaign against Israel.
Over the past two decades, Hezbollah periodically has
fired rockets into Israel, including during the 2006
Hezbollah-Israel War. Future attacks are inevitable.
Some reports estimate that Hezbollah currently
possesses up to 150,000 rockets in its arsenal. 16 And
recent assessments suggest Hezbollah is producing its
own precision-guided missiles and drones. 17 As
Hezbollah obtains more precise weaponry from
foreign backers like Iran, it will only become more
dangerous. 18
Hezbollah’s ambition to murder Jews is not limited
to Israelis, as demonstrated by the 1994 Argentinian
bombings, among many other examples. Just days
after the October 7, 2023 attacks, authorities foiled a
Hezbollah-led plot aimed at recruiting Brazilian
News Desk, Hezbollah pounds Israeli border sites in
solidarity with Gaza, THE CRADLE.CO (Dec. 3, 2023)
https://new.thecradle.co/articles/hezbollah-pounds-israeliborder-sites-in-solidarity-with-gaza.
15
16 U.S. DEP’T OF STATE, Bureau of Counterterrorism, COUNTRY
REPORTS ON TERRORISM 2020 (2020).
Benjamin Allison, Hezbollah’s Precision Threat to Israel,
LAWFARE (Oct. 31, 2023 9:51 AM), https://www.lawfaremedia.org
/article/hezbollah-s-precision-threat-to-israel.
17
18 Id.
13
citizens to perpetuate attacks against synagogues and
other Jewish targets. 19
In short, the threat Hezbollah poses to the Jewish
people, Israel, and thus amici—as well as Americans
everywhere—is as significant as ever.
B. Hezbollah relies on corrupt private
financial institutions to finance its
terrorist operations.
Hezbollah maintains its status as “the world’s
most heavily armed non-state actor” 20 through several
extensive and diverse funding sources.
Hezbollah amasses revenue from a wide range of
criminal activities, including narcotics, weapons and
conflict diamond trafficking, and its control of key
criminal networks in South America, Africa, and the
Middle East. It solicits donations through its
ostensible charities around the world. And perhaps
most significantly, Iran funnels extensive support to
19 Gabriel Toueg, Brazil nabs suspected Hezbollah operatives
said planning attacks on Jewish targets, TIMES OF ISRAEL ( Nov.
8, 2023 11:39 pm) https://www.timesofisrael.com/brazil-nabssuspected-hezbollah-operatives-said-planning-attacks-onjewish-targets/; see also Levitt, HEZBOLLAH at 387-88 (describing
2014 arrest of Hezbollah operative plotting attacks on Jews and
Israelis in Peru); Id. at 381 (describing 2008 Hezbollah plot in
New Zealand “planning terrorist attacks against Israeli interests
abroad”).
20 Shaan Shaikhand and Ian Williams, Hezbollah’s Missiles
and Rockets, CENTER FOR STRATEGIC AND INTERNATIONAL
STUDIES (Jul. 5, 2018) https://www.csis.org/analysis/hezbollahsmissiles-and-rockets.
14
Hezbollah through the global financial system. 21 U.S.
intelligence estimates that Iran provides Hezbollah
with $700 million per year in cash outlays alone. 22 And
Israel has suggested that the amount could be as high
as $830 million annually. 23 Notably, these funds are
often collected and distributed in U.S. dollars—the
“preferred currency” for terror organizations and their
supporters. 24
Leveraging its substantial financial sway, Iran
has made Hezbollah the crown jewel of its terror
network, using it as its proxy in launching terror
attacks in Lebanon, Syria, and, relevant here, Iraq. 25
Hezbollah’s “campaign of attacks, bombings,
hijackings and direct military confrontations with
Israel in the 1990s and 2000s has served Tehran’s
The 1994 Buenos Aires bombing was facilitated by
international bank transfers. Levitt, HEZBOLLAH at 89 (transfers
from Iran’s Bank Melli through a local branch of Deutsche Bank).
21
22 Joyce Karam, Iran pays Hezbollah $700 million a year, US
official says, THE NATIONAL (Jun. 6, 2018), https://www.
thenationalnews.com/world/the-americas/iran-pays-hezbollah700-million-a-year-us-official-says-1.737347.
23 Anna Ahronheim, Iran pays $830 million to Hezbollah, THE
JERUSALEM POST (Sept. 18, 2017), https://www.jpost.com/middleeast/iran-news/iran-pays-830-million-to-hezbollah-505166.
24 Michael Fabrizio, Joseph Jesner, et al. v. Arab Bank, PLC,
138 S. Ct. 1386 (2018), 32 N.Y. Int’l L. Rev. 43, 44 (2019); see
Freeman v. HSBC Holdings PLC, No. 14CV6601DLICLP, 2018
WL 3616845, at *2 (E.D.N.Y. July 27, 2018) (discussing the
reliance of Iran on the U.S. banking system given the instability
of the Iranian Rial).
Patrick Wintour, How Iran uses proxy forces across the
region to strike Israel and US, THE GUARDIAN (Nov. 1, 2023 1:00
EDT), https://www.theguardian.com/global/2023/nov/01/howiran-uses-proxy-forces-across-the-region-to-strike-israel-and-us.
25
15
strategic objectives in the Middle East without
provoking any direct military confrontations with
Israel.” 26
The US and other global leaders have adopted
policies to target Hezbollah’s sources of financing. But
Hezbollah has voiced its defiant resolve to circumvent
such restrictions. Its leader, Hassan Nasrallah, has
proudly declared: “No law will prevent us from
receiving [financial assistance].” 27
Corrupt
financial
institutions—like
Respondent—have served a critical role in funding
Hezbollah by helping it covertly move vast sums
between its global networks and money laundering
operations. As the Department of Treasury
highlighted when announcing its designation of JTB
as a Specially Designated Global Terrorist (“SDGT”):
[JTB] has a longstanding relationship with
a key Hizballah financial entity and . . .
knowingly facilitates the banking activities
of U.S.-designated entities openly affiliated
with Hizballah[.] . . . Hizballah has used
26 Id.
Dr. Majid Rafizadeh, In first, Hezbollah confirms all
financial support comes from Iran, Al Arabiya News (Jun. 25,
2016 12:00 AM GST), https://english.alarabiya.net/features/2016
/06/25/In-first-Hezbollah-s-Nasrallah-confirms-all-financialsupport-comes-from-Iran.
27
16
accounts at [JTB] to pay its operatives and
their families. . . . 28
In short, institutions like JTB are an
indispensable vehicle for financing Hezbollah’s
terrorist activities.
C. Congress enacted a comprehensive
statutory scheme to disrupt terror
support networks.
Over several decades, Congress has enacted a
comprehensive statutory framework intended “to
deter and punish acts of international terrorism.”
Estates of Ungar v. Palestinian Auth., 304 F. Supp. 2d
232, 238 (D.R.I. 2004). But terror groups and their
“financial angels” often have thwarted these efforts
through “procedural gamesmanship.” Boim v. Holy
Land Found. for Relief & Dev., 549 F.3d 685, 690 (7th
Cir. 2008). The Second Circuit’s decision enables
further gamesmanship, striking a blow to the vital
anti-terrorism legislative framework.
When enacting JASTA and the ATA, Congress was
clear that these statutes were intended to reach
foreign financial institutions—like JTB—that provide
material support to terrorist organizations that
endanger Americans. Congress aimed to accomplish
two related, specific objectives.
U.S. DEP’T OF THE TREASURY, Treasury Labels Bank
Providing Financial Services to Hizballah as Specially
Designated Global Terrorist (Aug. 29, 2019), available at
https://home.treasury.gov/news/press-releases/sm760
(“JTB SDGT Designation”).
28
17
First, both Congress and the Executive Branch
intended for the ATA to provide American terror
victims with a civil remedy in federal courts for
extraterritorial acts of terrorism. A Senate report
notes Congress intended for the ATA to “open[] the
courthouse door to victims of international terrorism,”
and to “extend[] the same jurisdictional structure” at
the core of “American criminal law to the civil
remedies that [the ATA] defines.” S. Rep. No. 102-342,
at 45 (1992). And President George H. W. Bush
affirmed that the ATA provides “a remedy . . . for
Americans injured abroad by senseless acts of
terrorism.” 29
Second, Congress intended for the ATA to deter
international terrorism by exposing financial
institutions that knowingly provide material support
to terrorist organizations to civil liability resulting
from that support—thereby cutting off their primary
funding streams. See S. Rep. 102-342, at 22 (“[T]he
imposition of liability at any point along the causal
chain of terrorism, [] would interrupt, or at least
imperil, the flow of money.”); see also Boim, 549 F.3d
at 690 (“Damages are a less effective remedy against
terrorists and their organizations than against their
financial angels.”).
These purposes are evident throughout the
statutory scheme. Congress included in JASTA’s
statement of purpose that the act was designed to
provide “civil litigants with the broadest possible
29 Statement by President George Bush Upon Signing S. 1569,
28 Weekly Comp. Pres. Docs. 2112 (Oct. 29, 1992) (“Bush ATA
Signing Statement”).
18
basis . . . to seek relief.” JASTA, § 2(b) (emphasis
added). It authorizes civil damages against foreign
actors who carry out, facilitate, and support “terrorist
activities against the United States.” 18 U.S.C.
§ 2333(a). The law provides terror victims with a
cause of action for extraterritorial acts against
individuals and organizations “wherever acting and
wherever they may be found.” Id. Furthermore, the
ATA imposes liability on anyone that “knowingly or
recklessly contribut[ed] material support or
resources” to terrorist organizations that threaten
American citizens. JASTA, § 2(a)(6), 2(b).
Congress also recently passed terror financing
initiatives directly targeting Hezbollah. For example,
in 2015, President Obama approved the Hezbollah
International Financing Prevention Act, which
sanctions banks that “knowingly facilitat[ed]” one or
more “significant transaction[s]” for Hezbollah or
another designated terrorist group. H.R. 2297, 114th
Cong. (2015).
The Executive Branch also has utilized SDGT
designations to prevent terrorists’ private financiers
from continuing to support foreign terrorist activities.
Relevant here, in 2019, the U.S. Treasury designated
JTB as an SDGT, ending JTB’s usefulness to
Hezbollah and Iran and impairing the Iran-Hezbollah
terror apparatus. 30
Recent events have further highlighted the
centrality of these policies to U.S. anti-terror strategy.
Following the October 7th Massacre, the U.S.
30 JTB SDGT Designation.
19
Treasury issued new sanctions against Hamas 31 and
the White House reiterated the importance of policies
that target terrorists’ financial resources.
Critically, statutes like JASTA not only provide a
vital compensation for victims, but also are key U.S.
government weapons for deterring terror financing.
Civil suits are particularly important because, with
one recent exception, 32 the United States has been
reluctant to invoke the ATA’s criminal sanction
provision to punish foreign corporations that aid and
abet terrorist organizations and facilitate terror
activities. And even in that case, the DOJ only acted
after French authorities had already done so. 33
The Second Circuit’s opinion undermines
Congress’s carefully-crafted statutory scheme. By
permitting foreign states to exempt their private
corporations from U.S. jurisdiction, the Second Circuit
is paving the way for terror financiers to use strategic
gamesmanship to evade accountability. Determining
31 U.S. DEP’T OF THE TREASURY, Following Terrorist Attack on
Israel, Treasury Sanctions Hamas Operatives and Financial
Facilitators (Oct. 18, 2023), available at https://home.treasury
.gov/news/press-releases/jy1816.
32 U.S. DEPT. OF JUSTICE, Lafarge Pleads Guilty to Conspiring
to Provide Material Support to Foreign Terrorist Organizations
(Oct. 18, 2022), available at https://www.justice.gov/opa/pr/
lafarge-pleads-guilty-conspiring-provide-material-supportforeign-terrorist-organizations.
News Wires, French court upholds Syria ‘complicity in
crimes against humanity’ charge against Lafarge, FRANCE 24
(May 18, 2022 14:42), https://www.france24.com/en/livenews/20220518-paris-court-upholds-charges-of-complicity-incrimes-against-humanity-linked-to-lafarge-s-cement-plant-insyria.
33
20
immunity status based on “how a state acts after
learning
that
its actions
surrounding
an
instrumentality are under scrutiny”—invites “fraud
and injustice.” OI Eur. Grp. B.V. v. Bolivarian Rep. of
Venezuela Petroleos de Venezuela, 73 F.4th 157, 171
(3d Cir. 2023). 34
Given these stakes, this petition raises a vitally
“important question of federal law,” which—
according to the Second Circuit’s erroneous reading of
Dole—“has not been, but should be, settled by this
Court.” SUP. CT. R. 10(c).
34 Courts have acknowledged the risk of foreign governments
using similar tactics to gain a litigation advantage. E.g., First
Nat. Bank v. Banco Para El Comercio Exterior de Cuba, 462 U.S.
611, 633 (1983) (allowing foreign government to avoid setoff on a
counterclaim by “retransferring . . . assets to separate juridical
entities” would be unjust); see also Federal Repub. of Germany v.
Elicofon, 358 F. Supp. 747, 757 (E.D.N.Y. 1970) (noting risk of
acknowledging
“juridical
entities” created by foreign
governments for purposes of litigation).
21
II.
The Second Circuit’s decision defies
precedent, undercuts the anti-terrorism
legislative framework, and raises grave
constitutional concerns.
The Court also should grant certiorari because the
Second Circuit’s interpretation of the FSIA,
disregards this Court’s precedent, defies the text and
structure of the FSIA and the broader anti-terrorism
statutory scheme, and misunderstands the FSIA’s
purpose and historical foundations.
A. The
Second
Circuit’s
decision
misinterprets this Court’s binding
precedent.
In Dole, this Court unambiguously held that a
defendant’s instrumentality status under the FSIA is
determined at the time a lawsuit is filed—not during
its pendency. 538 U.S. at 478. The Second Circuit’s
contrary conclusion is erroneous and should be
reversed.
The Dole court held, without qualification, that
because the “plain text of [§ 1603(b)(2)] is expressed in
the present tense,” the FSIA “requires that
instrumentality status be determined at the time suit
is filed.” Id. In so holding, the Court rejected
arguments that immunity ought to attach at a time
other than “at the time of the action brought.” Id. Yet,
the Second Circuit jettisoned this Court’s unequivocal
holding in favor of a flawed, overexpansive approach
that treats this Court’s time-of-filing rule to mean
that instrumentality status is determined “at the time
of filing or anytime thereafter.”
22
This refusal to apply binding precedent flouts
longstanding principles of vertical stare decisis.
Lower courts must follow this Court’s precedents that
“ha[ve] direct application in a case.” Rodriguez de
Quijas v. Shearson/Am. Exp., Inc., 490 U.S. 477, 484
(1989). Accordingly, the Second Circuit was not free to
disregard Dole based on speculation that this Court
inadvertently stated its holding too broadly. Such
“defiance of vertical stare decisis, if allowed to stand,
substantially erodes confidence in the functioning of
the legal system.” Andrus v. Texas, 142 S. Ct. 1866,
1879 (2022) (Sotomayor, J., dissenting from denial of
certiorari).
The Second Circuit attempted to justify its
deviation from Dole by reasoning that mirror-image
facts (JTB claimed instrumentality status after filing,
whereas the Dole defendants lost instrumentality
status before filing) supported a “mirror-image”
outcome, in which JTB’s status could be assessed after
filing. Id.
However, the facts here are hardly a mirror image
of those in Dole. Both cases ask the same question—
when is instrumentality status determined under the
FSIA? There is no reason for differing answers. Just
as this Court held that it was inappropriate to extend
immunity to foreign defendants who no longer had
sovereign status at the time of filing, so too is it
inappropriate to extend immunity to foreign
defendants who never had sovereign status until long
after filing. The “longstanding principle that the
jurisdiction of the Court depends upon the state of
things at the time of the action brought” conclusively
23
resolves the question against JTB. Dole, 538 U.S. at
478.
Moreover,
the
Second
Circuit’s
flawed
interpretation contradicts well-reasoned FSIA
interpretations by the Seventh and D.C. Circuits
affirming that post-filing changes in instrumentality
status do not strip a court of jurisdiction. TIG Ins. Co.
v. Rep. of Argentina, 967 F.3d 778, 785 (D.C. Cir.
2020); Olympia Express, Inc. v. Linee Aeree Italiane,
S.P.A., 509 F.3d 347, 349 (7th Cir. 2007).
In TIG, the D.C. Circuit concluded that the “timeof-filing approach best accords with the text and
purpose of FSIA.” 967 F.3d at 782, 783. It reasoned
that “[a] statute’s use of the present tense ordinarily
refers to the time the suit is filed, not the time the
court rules.” Id. at 785. Moreover, “[a] time-of-filing
rule avoids such gamesmanship by ensuring that
post-filing maneuvering by foreign sovereigns will not
affect the result.” Id.
In Olympia, the Seventh Circuit similarly
concluded that Dole’s time-of-filing rule controls.
Judge Posner wrote: “[i]t would be a big surprise to
discover that the Court has changed its mind and now
thinks that jurisdiction under the [FSIA] is
determined . . . years after the suit was first removed
to federal district court under section 1441(d).” 509
F.3d at 349.
In rejecting these holdings, the Second Circuit
relied on flawed reasoning that unsettles this Court’s
established principles governing FSIA interpretation.
The resulting, untenable circuit split over application
24
of a crucial federal law is sufficient reason in itself for
this Court to grant review. SUP. CT. R. 10(a).
B. The Second Circuit’s interpretation
of the FSIA defies its text and
structure, as well as the broader
anti-terrorism statutory scheme.
The Second Circuit’s decision not only contravenes
Court precedent, but is also unsupported by the
FSIA’s text and structure. The broader statutory
scheme and purpose of the FSIA, the ATA, and JASTA
further bolster this conclusion.
First, unlike Dole and the other circuits, the
Second Circuit refused to recognize the established
link between foreign sovereign immunity and
jurisdiction. Dole, TIG, and Olympia explicitly root
the time-of-filing rule in the “longstanding principle
that the jurisdiction of the Court depends upon the
state of things at the time of the action brought.” Dole,
538 U.S. at 469 (quotation omitted); see also Olympia
Express, 509 F.3d at 350; TIG, 967 F.3d at 783.
This Court later explained that this connection
derives from the statute’s structure: “[T]he public law
containing the FSIA begins with” the jurisdictional
provision “and then later follows with” the immunity
provision. Turkiye Halk Bankasi A.S., 598 U.S. at 276.
Therefore, these sections must be read “together” and
“sequentially.” Id.; see also Argentine Rep. v. Amerada
Hess Shipping Corp., 488 U.S. 428, 434 (1989)
(“Sections 1604 and 1330(a) work in tandem.”). The
Second Circuit, however, divorced FSIA immunity
from jurisdiction without explanation.
25
Second, by declining to harmonize its
interpretation of the FSIA with the larger body of
related anti-terror legislation, the Second Circuit
disregarded this Court’s admonition to read statutory
language in “context and with a view to their place in
the overall statutory scheme.” Brown & Williamson,
529 U.S. at 133.
Most problematically, the Second Circuit’s
interpretation directly undermines the ATA. As
discussed, the ATA explicitly aims to ensure
American victims of foreign terrorist attacks may
obtain relief in U.S. courts. 35 See 18 U.S.C. § 2334(a),
(d). To make this right “to seek relief” meaningful,
Congress instructed courts to extend jurisdiction over
ATA suits on the “broadest possible basis.” JASTA,
§ 2(b). By allowing foreign sponsors of terror to
strategically invoke FSIA immunity post-suit, the
decision below contradicts this clearly-stated
Congressional objective.
The Second Circuit’s decision also widens a gaping
loophole in the FSIA’s terror exception, 28 U.S.C
§1607(a), which was added in 1996 to reinforce the
ATA by abrogating FSIA immunity for designated
foreign terrorist-supporting states. While Lebanon
does not fall within the exception, 36 many of the most
notorious supporters of global terror do. See, e.g.,
Owens v. Rep. of Sudan, 531 F.3d 884, 894–95 (D.C.
35 Bush ATA Signing Statement.
U.S. DEP’T OF STATE, STATE SPONSORS OF TERRORISM,
available at https://www.state.gov/state-sponsors-of-terrorism/
(last visited, Dec. 24, 2023) (listing Iran, Syria, North Korea, and
Cuba as the currently-designated state sponsors of terror).
36
26
Cir. 2008) (FSIA “terrorism exception” prevented
Sudan from invoking immunity); Kilburn v. Socialist
People’s Libyan Arab Jamahiriya, 376 F.3d 1123,
1136 (D.C. Cir. 2004) (FSIA “terrorism exception”
stripped Libya of sovereign immunity shield).
Under the Second Circuit’s decision, countries
designated as “State Sponsors of Terrorism”—like
Iran—can evade the exception by funneling terror
funds through private institutions in non-designated
states, like JTB in Lebanon. If and when terror
victims attempt to sue these private financiers, Iran
can rely on the non-terror sponsoring state to
nationalize and thus immunize them. Accordingly, the
Second Circuit’s decision provides a roadmap for
terror sponsoring states—which Congress explicitly
wanted to exclude from the FSIA’s reach—to
indirectly obtain the statute’s benefits.
C. The
Second
Circuit’s
decision
misunderstands the FSIA’s historical
context and contradicts legislative
intent.
Finally,
the
Second
Circuit’s
decision
misunderstands the FSIA’s purpose and historical
foundations. The court reasoned that its post-filing
rule must govern because the FSIA “codified the preexisting common law,” which afforded immunity to
foreign sovereigns as a gesture of comity. Bartlett v.
Baasiri, 81 F.4th 28, 34 (2nd Cir. 2023). But as even
the Second Circuit’s own account of the FSIA’s history
acknowledges, the statute was intended to replace the
chaotic, ad hoc scheme that predated it—not further
entrench it. Id. at 31–32; see Verlinden B.V. v. Center
Bank of Nigeria, 461 U.S. 480, 488 (1983) (noting
27
Congress passed the FSIA “to free the Government
from the case-by-case diplomatic pressures, to clarify
the governing standards, and to assure litigants that
decisions are made on purely legal grounds” (cleaned
up)). By rejecting an interpretation that would fix
immunity determinations at the start of litigation, the
Second Circuit placed the FSIA’s applicability in the
hands of foreign governments—directly undermining
these objectives.
But even if Congress had attempted to codify the
preexisting state of affairs, the Second Circuit’s
approach still would contradict congressional intent.
Before the FSIA was enacted, courts “deferred to the
decisions of the political branches—in particular,
those of the Executive Branch.” Verlinden, 461 U.S. at
486 (emphasis added). In other words, when comity
and political considerations collided, courts prioritized
the latter and denied foreign sovereign immunity. But
the Second Circuit’s opinion hamstrings the
Executive’s capacity to implement its anti-terrorism
agenda.
First, by allowing post-filing events to bestow
immunity, the Second Circuit gives foreign
governments “every incentive” to change an
instrumentality’s status “as soon as” suit is filed “and
to draw out proceedings to delay the [case] . . . until it
had been able to do so.” TIG, 967 F.3d at 785. This
effectively subverts the Executive Branch’s policy
prerogatives to a foreign sovereign’s interests—which
contradicts any interpretation of the FSIA’s purpose
and historical context.
28
Second, the decision below impairs the U.S.
Treasury’s ability to use SDGT designations to
address terror financing. The Second Circuit
suggested that JTB’s immunity is consistent with the
FSIA’s purpose because “[i]t was the U.S. designation
of JTB as a terrorist organization, not any attempt by
Lebanon to avoid this lawsuit, that forced the bank
into liquidation and public receivership.” 81 F.4th at
37. But this statement implies that under the FSIA,
the United States must choose between either
(1) declining to classify terror financiers as terrorist
organizations to keep the courthouse doors open, or
(2) issuing
terrorist
designations
that wholly
immunize financiers from suit by their victims.
Such a result is not only practically concerning—
but it is plainly at odds with any interpretation of the
FSIA that aims to balance comity and Executive
branch policy prerogatives. And because this interpretation directly impedes the Executive’s capacity to
combat terror financing, it further underscores the necessity of this Court’s review. See Holder v. Humanitarian Law Project, 561 U.S. 1, 28 (2010) (“the Government’s interest in combating terrorism is an urgent objective of the highest order”).
Thus, regardless whether the FSIA attempted to
codify the pre-statutory state of affairs, the Second
Circuit’s decision contradicts congressional intent and
poses alarming practical implications that merit this
Court’s review.
*
*
*
In sum, the Second Circuit’s decision not only
unsettles the previously established “time-of-filing” rule,
29
departing from other circuits, but it also abrogates this
Court’s clear instructions as to the FSIA’s
interpretation. If unaddressed, these errors have the
potential to infect other FSIA provisions—posing grave
practical and constitutional concerns. SUP. CT. R. 10(a).
CONCLUSION
For the above reasons, the petition for certiorari
should be granted.
Respectfully submitted,
MARK TRACHTENBERG
Counsel of Record
KAYLEN STRENCH
HAYNES AND BOONE, LLP
1221 McKinney Street
Suite 4000
Houston, TX 77010
713-547-2528
mark.trachtenberg
@haynesboone.com
LUCAS B. DRILL
HAYNES AND BOONE, LLP
8000 Towers Crescent Drive
Suite 900
Tysons, VA 22182
SCOTT E. WHITMAN
HAYNES AND BOONE, LLP
800 17th Street NW
Suite 500
Washington, DC 20006
DANIEL R. PALUCH
GIPSON HOFFMAN & PANCIONE
1901 Avenue of the Stars
Suite 1100
Los Angeles, CA 90067
JONATHAN M. ROTTER
GLANCY PRONGAY &
MURRAY LLP
1925 Century Park East,
Suite 2100
Los Angeles, CA 90067
STEVEN C. SHEINBERG
STEVEN M. FREEMAN
Anti-Defamation League
605 Third Avenue
New York, NY 10158
RYAN PAULSEN
HAYNES AND BOONE, LLP
2801 N. Harwood Street
Dallas, TX 75201
30
DANIEL KAMINETSKY
AGUDATH ISRAEL OF
AMERICA
42 Broadway, 14th Floor
New York, NY 10004
ABBA COHEN
AGUDATH ISRAEL OF
AMERICA
1730 Rhode Island Avenue
NW Suite 1004
Washington, DC 20036
NATHAN J. DIAMENT
UNION OF ORTHODOX JEWISH
CONGREGATIONS OF AMERICA
1730 Rhode Island Avenue NW
Suite 509
Washington DC 20036
JONATHAN L. SHERMAN
STEVEN ORLOW
ONE ISRAEL FUND, LTD.
445 Central Ave #210,
Cedarhurst, NY 11516
Counsel for Amici Curiae
DECEMBER 28, 2023
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