Re Terrorist Attacks on September 11, 2001

• Judge: Daniels
• Court: U.S. District Court — Southern District of New York
• Date: 29 September 2015

United States District Court, Southern District of New York.

(Daniels, District Judge)

In re Terrorist Attacks on September 11, 20011

State immunity — Jurisdictional immunity — Foreign Sovereign Immunities Act 1976 — Application — Non-commercial tort exception — Whether applicable — Entire tort rule — Attribution — Whether defendants immune from suit for damages and losses resulting from terrorist attack

Terrorism — Terrorist attack in United States on September 11, 2001 — Plaintiffs incurring damages and losses — Whether defendants immune from suit — Foreign Sovereign Immunities Act 1976 — Whether non-commercial tort exception applicable — The law of the United States

Summary:2The facts:—The plaintiffs were family members and the estates of persons who were killed, individuals who suffered non-fatal injury, and various commercial entities that suffered damage due to the terrorist attacks on the United States of America on 11 September 2001. They alleged that agents and employees of the Government of the Kingdom of Saudi Arabia (“Saudi Arabia”) directly and knowingly provided material assistance to the al Qaeda hijackers, and that al Qaeda was more generally provided crucial financial and operational support by charitable organizations of the Saudi Government, including the Saudi High Commission for Relief of Bosnia & Herzegovina (“the SHC”).

The defendants, Saudi Arabia and the SHC, moved to dismiss the complaint for lack of subject matter jurisdiction. They claimed that they were immune from suit under the Foreign Sovereign Immunities Act 1976 (“the FSIA”), which protected foreign States and their instrumentalities from suit in the United States unless one of the Act's enumerated exceptions applied.

The plaintiffs did not challenge the finding that Saudi Arabia was a foreign sovereign and the SHC its instrumentality but opposed the motion on the grounds that the non-commercial tort exception was applicable. This exception applied when money damages were sought for losses which both occurred

in the United States and were caused by a tort attributable to a foreign State or an official or employee thereof who was acting within the scope of his office or employment

Held:—The non-commercial tort exception to the FSIA did not apply. The defendants' motion to dismiss was granted.

(1) For the non-commercial tort exception to apply, the entire tort must have been committed in the United States (the entire tort rule). The allegations made in the complaint, however, predominantly concerned torts committed abroad (para. 19).

(2) Cursory allegations made against a Saudi intelligence official, said to have provided direct assistance to two of the September 11th hijackers, were insufficient to meet the plaintiffs' burden of proof (para. 20).

(3) In seeking to attribute the acts of third parties, charitable organizations acting within the United States, to Saudi Arabia, the plaintiffs had failed to show proof that Saudi Arabia controlled the day-to-day operations of these charities. The plaintiffs therefore failed to implicate Saudi Arabia under an alter-ego theory (para. 21).

(4) The actions allegedly taken by the SHC, to fund entities that in turn allegedly funded al Qaeda, took place outside the United States. The SHC was therefore dismissed (para. 24).

(5) The plaintiffs alleged that the actions of four “agents” of Saudi Arabia resulted in the commission of tortious acts within the United States. To invoke the non-commercial tort exception, the plaintiffs were required to show that the individuals were officials or employees of Saudi Arabia who, while acting within the scope of their office or employment, engaged in non-discretionary tortious conduct in the United States. The plaintiffs were unable to meet this burden in relation to any of the individuals implicated (paras. 25–34).

The following is the text of the opinion of the Court:3

[1] This case involves claims by families and estates of the victims of the September 11, 2001 terrorist attacks, individuals injured by the attacks, and various commercial entities that incurred damages and losses as a result of the attacks. The moving defendants are the Kingdom of Saudi Arabia (“Saudi Arabia”) and the Saudi High Commission for Relief of Bosnia & Herzegovina (“SHC”) (collectively, “Defendants”). Plaintiffs allege that agents and employees of the Saudi government bear responsibility for the September 11, 2001 attacks because they directly and knowingly assisted the hijackers and plotters

who carried out the attacks. They allege further that al Qaeda's development into a terrorist organization was fueled principally by financial and operational support from Saudi government “da'awa organizations” (described by Defendants as “charities”), including the SHC.

[2] Defendants move this Court to dismiss Plaintiffs' Complaint for lack of subject matter jurisdiction, pursuant to Federal Rule of Civil Procedure 12(b)(1), on the basis that Defendants are immune from suit under the Foreign Sovereign Immunities Act (“FSIA”), 28 USC § 1602 et seq. (See Defendants' Motion, (ECF No 2893); Defendants' Memorandum in Support (“Defs.' Mem.”), (ECF No 2894).) Plaintiffs oppose Defendants' motion to dismiss and separately move to file a 587-paragraph consolidated amended pleading of facts and evidence in support of their claims against Defendants (the “Averment of Facts”).1 (See Plaintiffs' Motion (“Pls.' Mot.”), (ECF 2891).) The issue before this Court is whether the noncommercial tort exception to the FSIA strips Defendants of their sovereign immunity. The noncommercial tort exception provides an exception to FSIA immunity when money damages are sought against a foreign state or its instrumentalities “for personal injury or death, or damage to or loss of property, occurring in the United States and caused by the tortious act or omission of that foreign state or of any official or employee of that foreign state while acting within the scope of his office or employment.” 28 USC § 1605(a)(5).

[3] Defendants' motion to dismiss is GRANTED. Plaintiffs' motion to file the Averment of Facts is DENIED as futile.

I. PROCEDURAL HISTORY

[4] Saudi Arabia and the SHC previously filed motions to dismiss this action in 2004, claiming, inter alia, immunity from the jurisdiction of the United States pursuant to the FSIA. Plaintiffs argued that the

FSIA's noncommercial tort exception, 28 USC § 1605(a)(5), applied to the actions of Defendants, and that, therefore, Defendants lacked jurisdictional immunity. In response, Defendants argued that the noncommercial tort exception was inapplicable for at least three reasons: (1) “[P]laintiffs failed to allege that the ‘entire tort’ occurred in the United States”; (2) “the ‘discretionary function’ exclusion to the FSIA's noncommercial tort exception applied,” see id. § 1605(a)(5)(A); and (3) “[Plaintiffs did not plead the necessary causation.” In re Terrorist Attackson Sept. 11, 2001, 714 F.3d 109, 112 (2d Cir.2013) (“In re Terrorist Attacks (SJRC)”).

[5] In 2005, Judge Casey held that Defendants were foreign sovereigns immune from suit. SeeIn re Terrorist Attackson Sept. 11, 2001, 349 F.Supp.2d 765, 802–4 (SDNY 2005) (“In re Terrorist Attacks I”) (Casey J) (dismissing claims against Saudi Arabia); In re Terrorist Attackson Sept. 11, 2001, 392 F.Supp.2d 539, 553 (SDNY 2005) (“In re Terrorist Attacks II”) (Casey J) (dismissing claims against the SHC).2 Specifically, Judge Casey held that the discretionary function exclusion to the noncommercial tort exception applied. “[T]he ‘discretionary function’ exclusion provides that a foreign sovereign retains immunity under the FSIA even if its act or omission is deemed to be tortious if the act is ‘based upon the exercise or performance or the failure to exercise or perform a discretionary function regardless of whether the discretion [is] abused.’” In re Terrorist Attacks (SJRC), 714 F.3d at 112 (citing 28 USC § 1605(a)(5)(A)). An order of partial final judgment was entered as to those decisions on January 10, 2006. (See Clerk's Judgment (ECF No 1594).)

[6] The Second Circuit affirmed the dismissal of the claims asserted against Saudi Arabia and the SHC, but on an alternative basis. In re Terrorist Attackson September 11, 2001, 538 F.3d 71, 90 (2d Cir.2008) (“In re Terrorist Attacks III”). The Second Circuit “held that the FSIA's noncommercial tort exception cannot apply to claims based on alleged involvement in terrorist activities, because ‘claims based on terrorism must be brought under the Terrorism Exception, and not under any other FSIA exception.’” In re Terrorist Attacks (SJRC), 714 F.3d at 113 (quoting In re Terrorist Attacks III, 538 F.3d at 90).3 In 2011, however,

the Second Circuit decided Doe v. Bin Laden, 663 F.3d 64 (2d Cir.2011),4 which—through use of the Circuit's “mini-en banc” procedure—partially overruled the judgment in In re Terrorist Attacks III. Id. at 70 n. 10. The Second Circuit in Doe held that “the terrorism exception, rather than limiting the jurisdiction conferred by the noncommercial tort exception, provides an additional basis for jurisdiction.” Id. at 70.

[7] Plaintiffs therefore moved this Court for relief from judgment under Federal Rule of Civil Procedure 60(b). This Court denied that motion with the view that the Second Circuit “would be able to consider that unreviewed issue[, application of the discretionary function exclusion,] on appeal from the denial.” SeeIn re Terrorist Attackson Sept. 11, 2001, 741 F.3d 353, 354–5 (2d Cir.2013) (“In re Terrorist Attacks V”). In 2013, the Second Circuit reversed the order denying the Rule 60(b) motion and remanded this action to this Court for further proceedings consistent with its opinion. Id. at 355, 357 (“We conclude that the circumstances here are ‘extraordinary’ and warrant relief under Rule 60(b)(6).”). The Second Circuit specifically noted that Defendants raised before Judge Casey three independent grounds for dismissal under the FSIA...