Yaakov v. Lebanese Canadian Bank

• Decision Date: 24 August 2016
• Docket Number: Docket No. 15-1580,August Term 2015
• Citation: 834 F.3d 201
• Parties: Yaakov Licci, a minor, by his father and natural guardian Elihav Licci and by his mother and natural guardian Yehudit Licci, et al., Elihav Licci, Yehudit Licci, Tzvi Hirsh, Arkady Graipel, Tatiana Kremer, Yosef Zarona, Tal Shani, Shlomo Cohen, Nitzan Goldenberg, Rina Dahan, Raphael Weiss, Agat Klein, Tatiana Kovleyov, Valentina Demesh, Rivka Epon, Joseph Maria, Immanuel Penker, Esther Pinto, Avishai Reuvance, Elisheva Aron, Chayim Kumer, Sarah Yefet, Shoshana Sappir, Rahmi Guhad Ghanam, a minor, by his father and natural guardian Fuad Shchiv Ghanam and by his mother and natural guardian Suha Shchiv Ghanam, Fuad Shchiv Ghanam, individually, Suha Shchiv Ghanam, individually, Ma'ayan Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Noa Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Netiya Yeshua Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Ariel Chaim Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian Keren Ardstein, Brian Ardstein, individually, Keren Ardstein, individually, Margalit Rappeport, a minor, by her mother and natural guardian, Laurie Rappeport, Laurie Rappeport, individually, Orna Mor, Yair Mor, Michael Fuchs, Esq., Mushka Kaplan, a minor, by her father and natural guardian Chaim Kaplan, and by her mother and natural guardian Rivka Kaplan, Arye Leib Kaplan, a minor, by his father and natural guardian Chaim Kaplan, and by his mother and natural guardian Rivka Kaplan, Menachem Kaplan, a minor, by his father and natural guardian Chaim Kaplan, and by his mother and natural guardian Rivka Kaplan, Chana Kaplan, a minor, by her father and natural guardian Chaim Kaplan, and by her mother and natural guardian Rivka Kaplan, Efraim Leib Kaplan, a minor, by his father and natural guardian Chaim Kaplan and by his mother and natural guardian Rivka Kaplan, Chaim Kaplan, individually, Rivka Kaplan, individually, Rochelle Shalmoni, Oz Shalmoni, David Ochayon, Yaakov Maimon, Mimi Biton, Miriam Juma'a, as personal representative of the estate of Fadya Juma'a, Miriam Juma'a, individually, Salah Juma'a, as personal representative of the estate of Samira Juma'a, Salah Juma'a, individually, Said Juma'a, individually, Abd El-Rahman Juma'a, as personal representative of the estate of Samira Juma'a, Abd El-Rahman Juma'a, individually, Rahma Abu-Shahin, Abdel Gahni, as personal representative of the estate of Soltana Juma'a and individually, Shadi Salman Azzam, as the personal representative of the estate of Manal Camal Azam, Kanar Sha'adi Azzam, a minor, by his father and natural guardian, Shadi Salman Azzam, Aden Sha'adi Azzam, a minor, by his father and natural guardian, Shadi Salman Azzam, Shadi Salman Azzam, individually, Adina Machassan Dagesh, Arkady Spektor, Yori Zovrev, Maurine Greenberg, Jacob Katzmacher, Deborah Chana Katzmacher, Chaya Katzmacher, Mikimi Steinberg, Jared Sauter, Danielle Sauter, Yaakov Abutbul, Abraham Nathan Mor, a minor, by his father and natural guardian, Zion Mor, and by his mother and natural guardian, Revital Mor, Bat Zion Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Michal Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Oded Chana Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Zion Mor, individually, Revital Mor, individually, Adham Mahane Tarrabashi, Jihan Kamud Aslan, Zohara Louie Sa'ad, Iyah Zaid Ganam, a minor, by his father and natural guardian Ziad Shchiv Ghanam, and by his mother and natural guardian Gourov Tisir Ghanam, Ziad Shchiv Ghanam, individually, Gourov Tisir Ghanam, individually, Theodore Greenberg, Emilla Salman Aslan, Plaintiffs-Appellants, v. Lebanese Canadian Bank, SAL, Defendant-Appellee, American Express Bank, Ltd., Defendant.
• Court: U.S. Court of Appeals — Second Circuit

834 F.3d 201

Yaakov Licci, a minor, by his father and natural guardian Elihav Licci and by his mother and natural guardian Yehudit Licci, et al., Elihav Licci, Yehudit Licci, Tzvi Hirsh, Arkady Graipel, Tatiana Kremer, Yosef Zarona, Tal Shani, Shlomo Cohen, Nitzan Goldenberg, Rina Dahan, Raphael Weiss, Agat Klein, Tatiana Kovleyov, Valentina Demesh, Rivka Epon, Joseph Maria, Immanuel Penker, Esther Pinto, Avishai Reuvance, Elisheva Aron, Chayim Kumer, Sarah Yefet, Shoshana Sappir, Rahmi Guhad Ghanam, a minor, by his father and natural guardian Fuad Shchiv Ghanam and by his mother and natural guardian Suha Shchiv Ghanam, Fuad Shchiv Ghanam, individually, Suha Shchiv Ghanam, individually, Ma'ayan Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Noa Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Netiya Yeshua Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian, Keren Ardstein, Ariel Chaim Ardstein, a minor, by her father and natural guardian, Brian Ardstein, and by her mother and natural guardian Keren Ardstein, Brian Ardstein, individually, Keren Ardstein, individually, Margalit Rappeport, a minor, by her mother and natural guardian, Laurie Rappeport, Laurie Rappeport, individually, Orna Mor, Yair Mor, Michael Fuchs, Esq., Mushka Kaplan, a minor, by her father and natural guardian Chaim Kaplan, and by her mother and natural guardian Rivka Kaplan, Arye Leib Kaplan, a minor, by his father and natural guardian Chaim Kaplan, and by his mother and natural guardian Rivka Kaplan, Menachem Kaplan, a minor, by his father and natural guardian Chaim Kaplan, and by his mother and natural guardian Rivka Kaplan, Chana Kaplan, a minor, by her father and natural guardian Chaim Kaplan, and by her mother and natural guardian Rivka Kaplan, Efraim Leib Kaplan, a minor, by his father and natural guardian Chaim Kaplan and by his mother and natural guardian Rivka Kaplan, Chaim Kaplan, individually, Rivka Kaplan, individually, Rochelle Shalmoni, Oz Shalmoni, David Ochayon, Yaakov Maimon, Mimi Biton, Miriam Juma'a, as personal representative of the estate of Fadya Juma'a, Miriam Juma'a, individually, Salah Juma'a, as personal representative of the estate of Samira Juma'a, Salah Juma'a, individually, Said Juma'a, individually, Abd El-Rahman Juma'a, as personal representative of the estate of Samira Juma'a, Abd El-Rahman Juma'a, individually, Rahma Abu-Shahin, Abdel Gahni, as personal representative of the estate of Soltana Juma'a and individually, Shadi Salman Azzam, as the personal representative of the estate of Manal Camal Azam, Kanar Sha'adi Azzam, a minor, by his father and natural guardian, Shadi Salman Azzam, Aden Sha'adi Azzam, a minor, by his father and natural guardian, Shadi Salman Azzam, Shadi Salman Azzam, individually, Adina Machassan Dagesh, Arkady Spektor, Yori Zovrev, Maurine Greenberg, Jacob Katzmacher, Deborah Chana Katzmacher, Chaya Katzmacher, Mikimi Steinberg, Jared Sauter, Danielle Sauter, Yaakov Abutbul, Abraham Nathan Mor, a minor, by his father and natural guardian, Zion Mor, and by his mother and natural guardian, Revital Mor, Bat Zion Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Michal Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Oded Chana Mor, a minor, by her father and natural guardian, Zion Mor, and by her mother and natural guardian, Revital Mor, Zion Mor, individually, Revital Mor, individually, Adham Mahane Tarrabashi, Jihan Kamud Aslan, Zohara Louie Sa'ad, Iyah Zaid Ganam, a minor, by his father and natural guardian Ziad Shchiv Ghanam, and by his mother and natural guardian Gourov Tisir Ghanam, Ziad Shchiv Ghanam, individually, Gourov Tisir Ghanam, individually, Theodore Greenberg, Emilla Salman Aslan, Plaintiffs-Appellants,

v.Lebanese Canadian Bank, SAL, Defendant-Appellee,American Express Bank, Ltd., Defendant.

Docket No. 15-1580

August Term 2015

United States Court of Appeals, Second Circuit.

Argued: April 18, 2016

Decided: August 24, 2016

Meir Katz (Robert J. Tolchin, on the brief), The Berkman, Law Office, LLC, Brooklyn, NY, for Plaintiffs-Appellants.

Jonathan D. Siegfried (Douglas W. Mateyaschuk & Peter J. Couto, on the brief), DLA Piper LLP (US), New York, NY, for Defendant-Appellee.

Before: Sack, Wesley, and Lynch, Circuit Judges.

WESLEY

, Circuit Judge:

In July and August 2006, Hezbollah carried out a series of terrorist rocket attacks on civilians in Israel. Several dozen United States, Israeli, and Canadian civilians seek to hold Defendant-Appellee Lebanese Canadian Bank, SAL (“LCB”), a Lebanese bank headquartered in Beirut, liable for providing international financial services to Hezbollah that they claim facilitated Hezbollah's attacks that injured them or killed family members. These civilians assert claims against LCB under the Anti–Terrorism Act and Israeli tort law.¹ In addition, some of the Israeli and Canadian plaintiffs (collectively, “Plaintiffs”) assert claims under the Alien Tort Statute, 28 U.S.C. § 1350

(the “ATS”)—these claims are the subject of the present opinion.²

This case is not new to our Court. In fact, this appeal is in its third appearance before us in the last five years. In our prior opinions, we determined (with an assist from the New York Court of Appeals, see Licci v. Lebanese Canadian Bank, SAL , 20 N.Y.3d 327, 339, 960 N.Y.S.2d 695, 984 N.E.2d 893 (2012)

(“Licci III ”)) that the District Court had personal jurisdiction over defendant LCB, and that subjecting the foreign bank to personal jurisdiction in New York comports with due process protections provided by the United States Constitution. See Licci ex rel. Licci v. Lebanese Canadian Bank, SAL , 732 F.3d 161, 165 (2d Cir. 2013)

(“Licci IV ”); Licci v. Lebanese Canadian Bank, SAL , 673 F.3d 50, 73–74 (2d Cir. 2012) (“Licci II ”). This case presents a different question: Whether the District Court has subject matter jurisdiction over Plaintiffs' ATS claims. The District Court dismissed the ATS claims under Kiobel v. Royal Dutch Petroleum Co. , –––U.S. ––––, 133 S.Ct. 1659, 185 L.Ed.2d 671 (2013) (“Kiobel II ”), reasoning that Plaintiffs failed to displace the presumption against extraterritorial application of the ATS. Though we disagree with the District Court's basis for dismissal, we affirm because the ATS claims seek to impose corporate liability in contravention of our decision in Kiobel v. Royal Dutch Petroleum Co. , 621 F.3d 111, 145 (2d Cir. 2010) (“Kiobel I ”).

BACKGROUND³

I. Plaintiffs' Complaint

According to Plaintiffs' complaint, Hezbollah,⁴ a terrorist organization, fired thousands of rockets into northern Israel between July 12, 2006 and August 14, 2006. App. 58, 66. Plaintiffs or their family members were injured or killed by these attacks. See App. 54.

LCB is a Lebanese bank with no branches, offices, or employees in the United States. Licci IV , 732 F.3d at 165

; Licci II , 673 F.3d at 56. To effectuate U.S.-dollar-denominated transactions, LCB maintained a correspondent bank account with defendant American Express Bank Ltd. (“AmEx”) in New York.⁵

Licci IV , 732 F.3d at 165 ; Licci II , 673 F.3d at 56. Plaintiffs allege that LCB used this account to conduct dozens of international wire transfers on behalf of the Shahid (Martyrs) Foundation (“Shahid”), an entity that maintained bank accounts with LCB and that Plaintiffs allege to be an “integral part” of Hezbollah and “part of [its] financial arm.” App. 65; see also id. (alleging that the Shahid-titled bank accounts “belonged to [Hezbollah] and were under the control of [Hezbollah]”). These wire transfers, which totaled several million dollars, “substantially increased and facilitated [Hezbollah's] ability to plan, to prepare for[,] and to carry out” the rocket attacks that injured Plaintiffs. App. 66, 86. Plaintiffs further allege that LCB carried out the wire transfer services from 2004 until the rocket attacks began on July 12, 2006, and “subsequently” continued to carry out those transfers. App. 66.

As relevant here, Plaintiffs contend that LCB's role in conducting those wire transfers on Shahid's behalf amounted to aiding and abetting genocide, war crimes, and crimes against humanity in violation of international law, and is actionable under the Alien Tort Statute. App. 110. They allege that LCB had “actual knowledge” that Hezbollah was a violent terrorist organization, as reflected on official U.S. government lists,⁶ and that Shahid was “part of [Hezbollah's] financial arm.” App. 88–90. They assert that the bank accounts held by LCB “were owned and controlled by [Hezbollah],” and that the wire transfers carried out by the bank were “by and at the direction of [Hezbollah].” App. 90. According to Plaintiffs' complaint, LCB carried out various wire transfer services between Hezbollah accounts “via Am[E]x Bank in New York,” and all of the wire transfers at issue “were carried out in and through the State of New York.” App. 66; see also App. 58.

Plaintiffs contend, moreover, that LCB knew that Hezbollah required “transfer services in order to operate and in order to plan, to prepare for[,] and to carry out terrorist attacks.” App. 89. They similarly allege that LCB knew that providing wire transfer services to Hezbollah would enable Hezbollah “to plan, to prepare for[,] and to carry out terrorist attacks and/or enhance” its ability to do so, in part because LCB was aware that the U.S. sanction regime “is and was intended to prevent [Hezbollah] from conducting banking activities, including wire transfers, and thereby limit its ability to operate and to carry out terrorist attacks.” App. 89. Plaintiffs allege that LCB, equipped with this knowledge, “as a matter of official LCB policy,” “continuously supports...