The U.S. Supreme Court on Tuesday ruled that foreign corporations cannot be sued in American courts for human rights abuses overseas, refusing to revive a lawsuit claiming Jordan-based Arab Bank Plc helped finance terror attacks in Israel and the Palestinian territories.
The 5-4 decision left in place a lower court ruling that had thrown out a lawsuit brought by some 6,000 plaintiffs, including survivors and relatives of non-U.S. citizens killed in attacks, filed under a 1789 U.S. law called the Alien Tort Statute that accused Arab Bank of being the “paymaster” to terror groups.
Only in recent years have plaintiffs sought to bring human rights claims under that obscure law.
The plaintiffs accused Arab Bank of deliberately financing terrorism, including suicide bombings and other attacks. They said Arab Bank used its New York branch to transfer money that helped Hamas and other Islamist militant groups fund attacks and reward families of the perpetrators between 1995 and 2005.
The lead plaintiff in the Arab Bank case was Joseph Jesner, whose British citizen son was killed at age 19 in a 2002 suicide bombing of a bus in Tel Aviv. The bank said in court papers that the U.S. government has called it a constructive partner in the fight against terrorism financing.
In a 2013 ruling, the Supreme Court did not resolve the corporate liability question when it ruled in favor of Royal Dutch Shell Plc over a lawsuit claiming the company was complicit in a crackdown on protesters in Nigeria.
That 2013 ruling narrowed the Alien Tort Statute’s reach, saying claims must sufficiently “touch and concern” the United States to overcome the presumption that the law does not cover foreign conduct.
In a separate case involving U.S. citizens and brought under a different law, a New York jury in 2014 found Arab Bank liable for facilitating two dozen terror attacks in Israel.