Owens v. BNP Paribas, S.A., 17-7037

• Decision Date: 27 July 2018
• Docket Number: No. 17-7037,17-7037
• Citation: 897 F.3d 266
• Parties: James OWENS, et al., Appellants v. BNP PARIBAS, S.A., et al., Appellees
• Court: U.S. Court of Appeals — District of Columbia Circuit

897 F.3d 266

James OWENS, et al., Appellants

v.BNP PARIBAS, S.A., et al., Appellees

No. 17-7037

United States Court of Appeals, District of Columbia Circuit.

Argued November 14, 2017

Decided July 27, 2018

John Vail, Washington, DC, argued the cause for appellants. With him on the briefs were Thomas F. Fay and Jane C. Norman, Washington, DC.

Jeffrey R. White, Washington, DC, was on the brief for amicus curiae American Association for Justice in support of appellants.

Lawrence B. Friedman, New York, NY, argued the cause for appellees. With him on the brief were Jonathan I. Blackman, New York, NY, and Alexis Collins, Washington, DC.

David D. DiBari and Stephen M. Nickelsburg, Washington, DC, were on the brief for amicus curiae Institute of International Bankers in support of appellees.

Before: Griffith and Wilkins, Circuit Judges, and Randolph, Senior Circuit Judge.

Griffith, Circuit Judge:

In 1998, al Qaeda detonated truck bombs outside the U.S. embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania, killing over two hundred people and injuring several thousand more. Victims of these attacks sued the French bank BNP Paribas for damages under the Anti-Terrorism Act (ATA), alleging the bank provided financial assistance to Sudan, which in turn funded and otherwise supported al Qaeda’s attack. Because the victims fail to plausibly allege BNP Paribas caused their injuries, and because the ATA does not permit recovery for claims premised on aiding and abetting liability, the district court dismissed the suit for failure to state a claim. We affirm.

I

A

On August 7, 1998, truck bombs exploded outside the U.S. embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania. At least twelve of the more than two hundred deaths and many of the 4,000 injured individuals were U.S. nationals. See Owens v. Republic of Sudan , 412 F.Supp.2d 99, 102 (D.D.C. 2006). Osama bin Laden and al Qaeda claimed responsibility. The embassy bombings served as a prelude to subsequent al Qaeda attacks against the United States, culminating in the atrocities of September 11, 2001.

But al Qaeda didn’t act alone. The Republic of Sudan and the Islamic Republic of Iran helped facilitate the embassy bombings in several ways. For its part, Sudan provided safe harbor for al Qaeda’s operational and logistical supply network, as well as critical financial, military, and intelligence services. See Owens v. Republic of Sudan , 826 F.Supp.2d 128, 139-46 (D.D.C. 2011). In the early 1990s, Sudan invited al Qaeda to relocate from Afghanistan and promised the government’s support. Am. Compl. ¶ 104. Al Qaeda accepted the invitation and moved its operations to Sudan, purchasing real estate and agreeing to supply the Sudanese government with communications equipment, weapons, and labor for making chemical weapons. Id. In return, the Sudanese government provided al Qaeda with airplanes to bring their missiles from Afghanistan to Sudan, security, intelligence-gathering services, travel documents, economic aid, and uranium. Id.

In response to Sudan’s growing ties to terrorist organizations, the U.S. Secretary of State designated the country as a state sponsor of terrorism in 1993. Id. ¶¶ 47, 61. The Secretary noted that the Sudanese government harbored international terrorists, maintained close ties to Iran, and provided meeting locations, transit points, and safe havens for various radical extremist groups. Id. ¶ 61. The United States thereafter placed sanctions on Sudan, restricting U.S. foreign assistance to its government, banning defense exports and sales, and imposing various financial constraints. Id. ¶ 62.

By the late 1990s, the United States placed even greater restrictions on trade with Sudan. In 1997, President Clinton issued an executive order imposing a complete trade embargo that prohibited the exportation of all goods and services—including financial services—to Sudan unless the exporter received a license from the Office of Foreign Assets Control (OFAC). Id. ¶¶ 63-65. And in 1998, OFAC designated all of Sudan’s national and major commercial banks as "Specially Designated Nationals," id. ¶¶ 67-68, subjecting them to even more onerous trade restrictions and sanctions, see 31 C.F.R. § 515.306.

BNP Paribas, S.A. (BNPP), the largest bank in France, sought to evade U.S. sanctions on Sudan applicable to international institutions. Am. Compl. ¶¶ 30, 73. In 2014, BNPP admitted as much when it pleaded guilty in federal court to illegally conspiring with banks and other entities to evade the sanctions regime and unlawfully move nearly $9 billion through the U.S. financial system. Id. ¶ 73; see also id. ¶¶ 7-8, 95, 105-07, 109-15, 126-27; Statement of Facts, United States v. BNP Paribas, S.A ., No. 1:14-cr-00460 (S.D.N.Y. May 1, 2015), J.A. 90-125.

At least $6 billion of these illegally processed funds involved Sudanese banks and financial institutions. Statement of Facts ¶ 17, J.A. 95. BNPP pleaded guilty to circumventing sanctions on Sudan only from 2002 to 2007, well after the embassy bombings. Am. Compl. ¶ 76; see also Statement of Facts ¶ 17, J.A. 95. However, in support of its guilty plea, BNPP stipulated that by 1997 one of its subsidiaries had become the "correspondent bank" in Europe for a Sudanese government bank and all the major commercial banks in Sudan. Am. Compl. ¶ 82 (quoting Statement of Facts ¶ 19, J.A. 96-97). This meant that almost every Sudanese bank began to keep U.S. dollar accounts with BNPP. Id. (quoting Statement of Facts ¶ 19, J.A. 96-97). Moreover, BNPP admitted that it used various "satellite banks" outside the United States to facilitate U.S. dollar payments for Sudanese banks and evade the U.S. sanctions. Id. ¶¶ 87-88, 90-91 (quoting Statement of Facts ¶ 23-24, J.A. 99-100). Between 2002 and 2007, BNPP used this satellite-bank structure to process "thousands of U.S. dollar transactions, worth billions of dollars" for sanctioned Sudanese banks. Id. ¶ 92 (quoting Statement of Facts ¶ 24, J.A. 99-100).

B

The ATA creates a private cause of action for those harmed by international terrorism. Specifically, the ATA provides that "[a]ny national of the United States injured in his or her person ... by reason of an act of international terrorism ... may sue therefor ... and shall recover threefold ... damages." 18 U.S.C. § 2333(a). Therefore, on its face, the ATA has three essential elements. First, a U.S. national must have suffered an injury. Second, there must have been an act of international terrorism.¹ And third, the U.S. national’s injury must have occurred "by reason of" the act of international terrorism. That is, there must be some causal connection between the act of international terrorism and the U.S. national’s injury.²

Plaintiffs are U.S. nationals injured in the 1998 embassy bombings, or the estates, heirs, or survivors of U.S. nationals who died or were severely injured in the bombings. See Am. Compl. ¶¶ 22-26. They previously sued Sudan under the Foreign Sovereign Immunities Act, alleging that Sudan offered material support to al Qaeda’s bombing of the embassies, and in 2011 received default judgments against the country. Id. ¶¶ 24, 27.

Several months after BNPP’s 2014 federal plea, Plaintiffs filed their present complaint in district court.³ Based on BNPP’s stipulations in its guilty plea, Plaintiffs allege the bank provided material support to al Qaeda by processing financial transactions for Sudanese banks, converting Sudanese resources into U.S. banknotes, and circumventing U.S. sanctions on Sudan. Id. ¶¶ 6-8. Those Sudanese banks then sent that U.S. currency to al Qaeda, which used the funds to commit the embassy bombings. See id. ¶ 118.

On appeal, Plaintiffs claim BNPP’s role in processing financial transactions for Sudanese banks violated two federal laws prohibiting the provision of material aid and support to terrorists and terrorist groups, see id. ¶¶ 116-20,⁴ both of which may constitute acts of international terrorism under the ATA, see, e.g. , Linde v. Arab Bank, PLC , 882 F.3d 314, 325-26 (2d Cir. 2018) ; Boim v. Quranic Literacy Inst. ("Boim I "), 291 F.3d 1000, 1015 (7th Cir. 2002), overruled sub nom. Boim v. Holy Land Found. for Relief & Dev. ("Boim III "), 549 F.3d 685 (7th Cir. 2008) (en banc).⁵ First, Plaintiffs claim BNPP "provide[d] material support or resources [to terrorists] ... knowing or intending that they are to be used in preparation for, or in carrying out, a violation of" certain enumerated criminal laws. 18 U.S.C. § 2339A(a). Second, Plaintiffs claim BNPP "knowingly provide[d] material support or resources to a foreign terrorist organization." Id. § 2339B(a)(1).⁶

Plaintiffs allege that they were injured "by reason of" BNPP’s material aid and support to al Qaeda in violation of §§ 2339A and 2339B. In the alternative, Plaintiffs allege that BNPP’s conduct "constituted aiding and abetting" al Qaeda’s acts of international terrorism under the ATA. Am. Compl. ¶ 130.⁷

After Plaintiffs filed their complaint, BNPP moved to dismiss the suit, arguing that the complaint failed to state a claim for which relief may be granted under the ATA. The district court granted BNPP’s motion. See Owens v. BNP Paribas S.A. , 235 F.Supp.3d 85, 100 (D.D.C. 2017). Plaintiffs timely appealed.

II

The district court had jurisdiction under the ATA. See 18 U.S.C. § 2333(a) (granting any ATA claimant the right to sue "in any appropriate district court of the United States"). We have appellate jurisdiction under 28 U.S.C. § 1291.

We review de novo the district court’s order granting BNPP’s motion to dismiss. See Hurd v. District of Columbia , 864 F.3d 671, 678 (D.C. Cir. 2017).

III

We first address whether Plaintiffs sufficiently allege that BNPP is directly liable under the ATA. Recall that any ATA claim requires that a U.S. national be injured "by reason of" an act of international terrorism. Plaintiffs are all U.S. nationals and we assume here that BNPP’s conduct violated the material-support statutes and therefore constituted an act of...