Weiss v. Nat'l Westminster Bank PLC

• Decision Date: 31 March 2016
• Docket Number: 05-cv-4622 (DLI) (MDG),07-cv-916 (DLI) (MDG)
• Citation: 176 F.Supp.3d 264
• Parties: Tzvi Weiss, et al., Plaintiffs, v. National Westminster Bank PLC, Defendant. Natan Applebaum, et al., Plaintiffs, v. National Westminster Bank PLC, Defendant.
• Court: U.S. District Court — Eastern District of New York

176 F.Supp.3d 264

Tzvi Weiss, et al., Plaintiffs,

v.National Westminster Bank PLC, Defendant.

Natan Applebaum, et al., Plaintiffs,

v.National Westminster Bank PLC, Defendant.

05-cv-4622 (DLI) (MDG)

07-cv-916 (DLI) (MDG)

United States District Court, E.D. New York.

Signed March 31, 2016

James P. Bonner, Stone Bonner & Rocco LLP, New York, NY, Gary M. Osen, Osen LLC, Hackensack, NJ, Joel Lawrence Israel, Mark S. Werbner, Sayles

Werbner, Dallas, TX, Noel J. Nudelman, Tracy R. Kalik, Richard D. Heideman, Heideman Nudelman & Kalik, P.C., Washington, DC, for Plaintiffs.

OPINION AND ORDER

DORA L. IRIZARRY, United States District Judge:

This is a consolidated action pursuant to the civil liability provision of the Antiterrorism Act of 1992 (“ATA”), 18 U.S.C. § 2333(a) (“§ 2333(a) ”). Plaintiffs, approximately 200 individuals and estates of people who are deceased (collectively, “Plaintiffs”), seek to recover damages from Defendant National Westminster Bank PLC (“Defendant”) in connection with 15 attacks in Israel and Palestine allegedly perpetrated by Hamas. (See generally Fifth Am. Compl., (“Weiss FAC”), Weiss Dkt. Entry No. 141; Compl. (“Applebaum Compl.”), Applebaum Dkt. Entry No. 1).¹ Specifically, Plaintiffs allege that Defendant is civilly liable pursuant to the ATA's treble damages provision for: (1) aiding and abetting the murder, attempted murder, and serious physical injury of American nationals outside the United States in violation of 18 U.S.C. § 2332 ; (2) knowingly providing material support or resources to a Foreign Terrorist Organization (“FTO”) in violation of 18 U.S.C. § 2339B ; and (3) willfully and unlawfully collecting and transmitting funds with the knowledge that such funds would be used for terrorist purposes in violation of 18 U.S.C. § 2339C. (Weiss FAC ¶¶ 579-97; Applebaum Compl. ¶¶ 426-44.) Defendant moves for dismissal of this action for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure, or in the alternative, for summary judgment pursuant to Rule 56. (See Def.'s Mem. of Law in Supp. of Mot. to Dismiss (“Def.'s Mem.”), Weiss Dkt. Entry No. 327.) Plaintiffs oppose. (See Pls.' Mem. of Law in Opp'n to Mot. to Dismiss (“Pls.' Opp'n”), Weiss Dkt. Entry No. 329.) For the reasons set forth below, Defendant's motion is denied in its entirety.

BACKGROUND²

I. The Parties

Plaintiffs' claims arise from 15 attacks that occurred in Israel and Palestine between approximately 2002 and 2004, which allegedly were perpetrated by Hamas.³ See Weiss v. Nat'l Westminster Bank PLC (“Weiss II ”), 936 F.Supp.2d 100, 103 (E.D.N.Y.2013).

Plaintiffs comprise approximately 200 United States nationals who were injured in those attacks, the estates of persons killed in those attacks, and/or family members of persons killed or injured in those attacks. Id.

Defendant is a financial institution incorporated and headquartered in the United Kingdom. Id. At the time of the events giving rise to this action, Defendant allegedly conducted business in the United States through an office in Houston, Texas and certain “agencies” in Connecticut and New York, including a branch location in New York City. (Defendant's “New York Branch”).⁴ Id. Defendant purportedly used its New York Branch as an intermediary bank to execute U.S. Dollar denominated transactions requested by its customers. (See Dep. Tr. of Neil Trantum (“Trantum Dep.”) at 90:4-5, Ex. 97 to the Decl. of Valerie Schuster in Supp. of Def.'s Mot. for Summary Judgment, Weiss Dkt. Entry No. 267; see also Tr. of Oct. 8, 2015 Oral Argument (“Tr.”) at 4:19-7:8 (“When the customers asked for funds to be denominated in dollars, it was necessary to go through this correspondent banking track because [Defendant] didn't deal in dollars directly, it dealt in dollars through its New York [B]ranch.”))

Among other customers, Defendant maintained bank accounts in London for Interpal, a/k/a the Palestine Relief & Development Fund, a/k/a Palestinians Relief & Development Fund (“Interpal”), a non-profit organization registered in the United Kingdom and self-described as providing humanitarian aid to various charitable organizations throughout Jordan, Lebanon, and the Palestinian territories. See Weiss II , 936 F.Supp.2d at 104. During the time Interpal had accounts with Defendant, it transferred money to certain charitable organizations (each a “Charity,” and collectively the “Charities”) that Plaintiffs contend actually were front organizations for Hamas. See Id. at 104, 111. Plaintiffs allege that Defendant aided Hamas by maintaining Interpal's accounts and sending money to the Charities on Interpal's behalf, despite knowing that Interpal supported Hamas. See Id. at 111. While a number of the transfers Defendant made to the Charities on behalf of Interpal never went through the United States, the parties agree that Defendant executed 196 such transfers through its New York Branch (or otherwise through correspondent bank accounts that Defendant maintained in New York) (collectively, the “New York Transfers”), each in response to a specific request by Interpal to send funds in U.S. Dollars. (See Oct. 16, 2015 Osen Ltr., Weiss Dkt. Entry No. 335.) Each New York Transfer was initiated by Defendant and routed through a correspondent bank account in New York, then was directed for the benefit of the respective Charity to a separate correspondent account maintained by that Charity's bank in New York. (See Def.'s Mem. at 5-6; see also Tr. at 4:23-5:13.)

II. Procedural History

In September 2005 and March 2007, respectively, the Weiss and Applebaum Plaintiffs brought separate actions against Defendant in this Court. The initial complaints, and every amended complaint thereafter, alleged that Defendant is subject both to general personal jurisdiction (“general jurisdiction”) and specific personal jurisdiction (“specific jurisdiction”) in the United States. (See Weiss FAC ¶ 4; Applebaum Compl. ¶ 4.) The Weiss Plaintiffs served Defendant with process at its agencies and/or offices in New York, Texas, and Connecticut in September and October 2005. (Weiss Dkt Entries Nos. 3, 7, 8.) Thereafter, Defendant moved for dismissal of the Weiss action pursuant to Rule 12(b)(6), declining to contest personal jurisdiction at that time. (See Mot. to Dismiss, Weiss Dkt. Entry No. 38.) The late Honorable Charles P. Sifton, then presiding, denied the motion to dismiss with respect to Plaintiffs' claims that Defendant provided material support to an FTO and knowingly transmitted funds that financed terrorism, but dismissed Plaintiffs' aiding and abetting claim, with leave to amend. Weiss v. Nat'l Westminster Bank PLC (“Weiss I ”), 453 F.Supp.2d 609 (E.D.N.Y.2006). In the Applebaum action, Defendant voluntarily accepted service, (see Applebaum Dkt. Entry No. 6), and thereafter filed a motion to dismiss. (Applebaum Dkt. Entry No. 13.) The parties subsequently resolved that motion by stipulation, absent any objection by Defendant as to personal jurisdiction. (See Applebaum Dkt. Entry Nos. 26, 28.) By order dated December 27, 2007, the Court formally consolidated the Weiss and Applebaum actions.

Extensive merits discovery between the parties ensued. On March 22, 2012, Defendant moved for summary judgment dismissing the consolidated action, but again declined to raise a defense of lack of personal jurisdiction. (See Weiss Dkt. Entry No. 264.) By Opinion and Order dated March 28, 2013, the Court granted summary judgment in favor of Defendant on each claim and dismissed the action in its entirety, finding that Plaintiffs had failed to establish that a genuine issue of material fact existed as to the required scienter element of their claims. Weiss II , 936 F.Supp.2d at 120. Plaintiffs subsequently appealed the dismissal to the Second Circuit Court of Appeals. On September 22, 2014, the Second Circuit vacated this Court's decision and remanded the consolidated action for further proceedings, ruling that there were triable issues of fact as to whether Defendant's knowledge in transferring funds on behalf of Interpal satisfied the statutory scienter requirements under § 2333(a). Weiss v. Nat'l Westminster Bank PLC (“Weiss III ”), 768 F.3d 202 (2d Cir.2014.)

Upon remand, Defendant notified the Court that, in light of the Supreme Court's decision in Daimler AG v. Bauman , ––– U.S. ––––, 134 S.Ct. 746, 187 L.Ed.2d 624 (2014), it intended to assert a personal jurisdiction defense for the first time in these proceedings. (See Oct. 17, 2014 Friedman Ltr., Weiss Dkt. Entry No. 316.) Decided in January 2014, Daimler addressed the extent to which a forum State may exercise general jurisdiction over a foreign corporation. Revisiting its past personal jurisdiction jurisprudence, the Supreme Court clarified that a corporation is subject to general jurisdiction in a forum State only where its contacts are “so continuous and systematic,” judged against the corporation's nationwide and worldwide activities, that it is “essentially at home” in that State. Daimler , 134 S.Ct. at 761 & n. 20 (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown , 564 U.S. 915, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011) ) (internal quotation marks omitted). Aside from the “exceptional case,” the Supreme Court explained, a corporation is at home and subject to general jurisdiction only in a State that represents its formal place of incorporation or principal place of business. See Id. at 761 & nn. 19–20. The Supreme Court emphasized that the “exceptional case” exists only in rare and compelling circumstances like those in Perkins v. Benguet Consol. Mining Co. , 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952), where a foreign corporation maintained a surrogate headquarters in Ohio during a period of wartime occupation in its native Philippines. See Id. at 755–56 & nn. 8, 19.

Citing Daimler, (see Feb. 6, 2014 Friedman Ltr.), Defendant filed the instant motion to dismiss this action pursuant to Rule 12(b)(2) of the Federal Rules...