15‐1580
Licci et al. v. Lebanese Canadian Bank, SAL
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
______________
August Term 2015
(Argued: April 18, 2016 Decided: August 24, 2016)
Docket No. 15‐1580
______________
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, MAʹAYAN 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 JUMAʹA, as personal representative of the
estate of Fadya Jumaʹa, MIRIAM JUMAʹA, individually, SALAH
JUMAʹA, as personal representative of the estate of Samira
Jumaʹa, SALAH JUMAʹA, individually, SAID JUMAʹA,
individually, ABD EL‐RAHMAN JUMAʹA, as personal
representative of the estate of Samira Jumaʹa, ABD EL‐
RAHMAN JUMAʹA, individually, RAHMA ABU‐SHAHIN,
ABDEL GAHNI, as personal representative of the estate of
Soltana Jumaʹa and individually, SHADI SALMAN AZZAM, as
the personal representative of the estate of Manal Camal Azam,
KANAR SHAʹADI AZZAM, a minor, by his father and natural
guardian, Shadi Salman Azzam, ADEN SHAʹADI 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.
______________
Before:
SACK, WESLEY, and LYNCH, Circuit Judges.
______________
Plaintiffs‐Appellants (“Plaintiffs”) are foreign civilians
residing in Israel who were injured or whose family members
were killed in a series of Hezbollah rocket attacks in Israel.
Plaintiffs brought suit under the Alien Tort Statute against
Defendant‐Appellee Lebanese Canadian Bank, SAL (the “bank”),
alleging that the bank facilitated the terrorist rocket attacks by
using a correspondent banking account at a New York bank to
effectuate wire transfers totaling several million dollars on
behalf of Hezbollah. The United States District Court for the
Southern District of New York (Daniels, J.), granted a motion to
dismiss in favor of the bank based on the presumption against
extraterritorial application of the Alien Tort Statute, see Kiobel v.
Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013) (“Kiobel II”).
Though we conclude that Plaintiffs have displaced the
presumption against extraterritoriality, see Kiobel II, 133 S. Ct. at
1669, we also conclude that customary international law does
not recognize liability for the bank, a corporation, see Kiobel v.
Royal Dutch Petroleum Co., 621 F.3d 111, 145 (2d Cir. 2010).
Accordingly, we AFFIRM IN PART the District Court’s
dismissal.
______________
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.
__________
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
An accompanying summary order addresses Plaintiffs’ Anti–
1
Terrorism Act and Israeli tort law claims.
2 Four Israeli and Canadian Plaintiffs do not assert Alien Tort Statute
claims against LCB: Sarah Yefet, Shoshana Sappir, Rochelle Shalmoni,
and Oz Shalmoni. App. 110. Except in reviewing procedural history,
in which case the term “Plaintiffs” refers to all plaintiffs in this action,
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 (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., 133 S. Ct. 1659 (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”).
we use the term “Plaintiffs” to refer only to those Israeli and Canadian
Plaintiffs‐Appellants bringing Alien Tort Statute claims against LCB.
3
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
3 The facts set forth below are drawn from the record, Plaintiffs’ First
Amended Complaint (the “complaint”), see App. 48–120, and this
Court’s previous opinions in this case, see Licci IV, 732 F.3d at 165–67;
Licci II, 673 F.3d at 55–59. We accept as true all non‐conclusory factual
allegations relevant to this decision. See Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009); see also Kiobel I, 621 F.3d at 124.
“Hezbollah” may also be spelled “Hizbollah,” as in the complaint, see
4
App. 58, or “Hizballah,” as in Licci II, 673 F.3d at 54–55.
5 Defendant AmEx is not a party to this appeal.
4
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
6 “LCB notes that at all relevant times, Shahid itself was not designated
as a terrorist organization on official U.S. government lists. Shahid
was, however, added to the U.S. Treasury Departmentʹs ‘Specially
Designated Nationals’ list in July 2007.” Licci II, 673 F.3d at 56 n.4.
Shahid today remains on that list of “individuals, groups, and entities,
such as terrorists . . . that are not country‐specific.” See generally U.S.
Dep’t of Treasury, Specially Designated Nationals and Blocked Persons List
(SDN) 741, https://www.treasury.gov/ofac/downloads/sdnlist.pdf (last
visited Aug. 22, 2016).
5
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 and supported [Hezbollah] and its anti‐
Israel program, goals[,] and activities.” App. 88. In particular,
Plaintiffs allege that LCB carried out the wire transfers at issue
“with the specific purpose and intention of enabling and
assisting [Hezbollah] [in] carry[ing] out terrorist attacks against
Jewish civilians in Israel,” App. 109, and “to assist and advance
[Hezbollah’s] goal of using terrorism to destroy the State of
Israel.” 7 App. 88.
II. Shaya Declaration
Plaintiffs submitted an expert declaration from former
Israeli intelligence officer Uzi Shaya (the “Shaya declaration”) in
support of the allegations set forth in their complaint. App. 125–
28. Shaya has served in various roles in the Israeli intelligence
7 At another point in the complaint, Plaintiffs allege that LCB carried
out the wire transfers at issue “with the specific purpose and intention
of enabling and assisting [Hezbollah] to carry out its goal of physically
exterminating or expelling the Jewish residents of Israel, and its goal of
intentionally and systematically using violence against Jewish civilians
in Israel.” App. 111. They further allege that LCB supports
Hezbollah’s “terrorist activities against Jews in Israel” and Hezbollah’s
“goal of using terrorism to coerce, intimidate and influence the Israeli
government and public.” App. 88.
6
services since 1984. App. 125. From 2004 to 2008, Shaya served
as the Deputy Chief of the Israeli National Security Council’s
Interagency Unit for Combating Terrorist Financing and
Financing of State Sponsors of Terrorism. App. 126. After 2008,
Shaya maintained a working relationship with Israel’s National
Security Council, providing assistance to counterterrorism staff
on the matters he dealt with as Deputy Chief. App. 126. In this
capacity, Plaintiffs requested that Shaya “examine documents in
possession of the State of Israel relating to fund[] transfers
carried out by [Hezbollah] via [AmEx and LCB].” App. 126.
Shaya stated that, with one exception identified below, “all” of
his testimony was “based upon [his] examination” of these
documents. App. 126.
Shaya stated that “[f]or many years,” “including the
period between 2004 and July 12, 2006,” Hezbollah “maintained
bank accounts at various LCB branches,” and that some of the
accounts Hezbollah maintained were “titled to” Shahid. App.
126–27. He stated that Shahid was integral to Hezbollah, and
that it “serves as an important component of [Hezbollah’s]
financial apparatus.” App. 127. He further specified that
Hezbollah uses Shahid funds to prepare for and carry out “a
wide range of terrorist and other violent activities, including
rocket and missile attacks on Israel.” App. 127.
Shaya stated that leading up to and following the July
2006 attacks, Hezbollah made “dozens” of wire transfers from
one Shahid account at LCB in Lebanon, “total[ing] several
million dollars,” and LCB executed the transfers “through
Am[E]x Bank in New York, which acted as LCB’s correspondent
bank for these dollar transfers.” App. 127. “In other words,”
Shaya explained, “LCB specifically requested Am[E]x Bank in
New York to carry out all these dollar wire transfers, and
Am[E]x Bank processed all these dollar wire transfers by and
7
through its New York branch.” App. 127. Shaya further stated
that AmEx knew that it was executing wire transfers on behalf of
Shahid. App. 128. In the sole statement not based on his review
of Israel’s documents related to the funds Hezbollah allegedly
transferred through LCB and its correspondent bank, Shaya
declared that, based on his experience in counterterrorism and
familiarity with Hezbollah’s operations, he had “no doubt that
the millions of dollars of wire transfers carried out by Am[E]x
Bank and LCB for [Hezbollah]” significantly enhanced
Hezbollah’s “ability to plan and carry out . . . the rocket attacks”
that injured Plaintiffs. App. 128.
III. U.S. Government Actions Against LCB
The U.S. government has taken two actions that reinforce
many of Plaintiffs’ allegations against LCB. First, in October
2012, the U.S. government initiated a civil forfeiture action
against LCB properties. App. 323–95. In its complaint, the
government asserted that there is “reason to believe that LCB
has been routinely used by drug traffickers and money
launderers,” including at least one “who provides financial
support to [Hezbollah].” App. 328.8 It also asserted “that there
was reason to believe that LCB managers are complicit in the
8 The government’s complaint in its civil forfeiture action against LCB
includes allegations of an elaborate scheme involving used car sales as
proxies for narcotics trafficking and money laundering. Specifically,
the government alleged that LCB “provided funds, goods, and
services to or for the benefit of [Hezbollah] . . . by causing funds to be
wired from Lebanon to U.S. persons in the United States for purchase
of used cars to be shipped by U.S. persons to West Africa in order to
create a channel for laundering proceeds of narcotics trafficking and
other unlawful activities, [and] to generate fees and commissions to be
paid to [Hezbollah] members and supporters who were involved at
various points in the money laundering scheme.” App. 340.
8
network’s money laundering activities.” App. 328. The
government alleged that between approximately January 2007
and 2011, “at least $329 million was transferred by wire from
accounts held in Lebanon at LCB [and various other banks] to
the United States through their correspondent bank accounts
with U.S. financial institutions located in the Southern District of
New York and elsewhere.” App. 329.
Second, we note that the U.S. Department of Treasury
(“Treasury”) has designated LCB as “a financial institution of
primary money laundering concern.” Finding That the Lebanese
Canadian Bank SAL Is a Financial Institution of Primary Money
Laundering Concern, 76 Fed. Reg. 9403‐01, 9404 (Feb. 17, 2011).
In identifying LCB as a potential conduit for money laundering,
Treasury noted that while LCB is based in Lebanon, it
“maintains extensive correspondent accounts with banks
worldwide, including several U.S. financial institutions.” Id.
Treasury explained that it identified LCB as a cause for concern
because the government “has information through law
enforcement and other sources indicating that LCB—through
management complicity, failure of internal controls, and lack of
application of prudent banking standards—has been used
extensively by persons associated with . . . money laundering.”
Id. at 9405. Treasury also found that Hezbollah—a U.S.
government‐designated foreign terrorist organization—“derived
financial support from the criminal activities” of the network of
drug traffickers and money launderers that rely on LCB, noting
that “LCB managers are complicit in the network’s money
laundering activities.” Id. at 9404–05; see also App. 327–28, 402,
407.
II. Procedural History
Because our previous opinions recite much of the
procedural history in this case, Licci IV, 732 F.3d at 165–67; Licci
9
II, 673 F.3d at 55–59, we provide a truncated version of events
here. In July 2008, Plaintiffs initiated this action against LCB and
AmEx in state court; the action was removed to federal court
soon thereafter. Licci II, 673 F.3d at 57. In January 2009,
Plaintiffs filed the amended complaint that is at issue on this
appeal. See id. Plaintiffs brought five claims against LCB: (1)
commission of international terrorism in violation of the Anti–
Terrorism Act, 18 U.S.C. § 2333; (2) aiding and abetting
international terrorism in violation of the Anti–Terrorism Act;
(3) aiding and abetting genocide, war crimes, and crimes against
humanity in violation of international law, under the ATS; (4)
negligence in violation of Israeli Civil Wrongs Ordinance § 35;
and (5) breach of statutory duty in violation of Israeli Civil
Wrongs Ordinance § 63. LCB moved to dismiss all five claims
for lack of personal jurisdiction under Fed. R. Civ. P. 12(b)(2) and
for failure to state a claim under Fed. R. Civ. P. 12(b)(6). Id.
A. Licci I
On March 31, 2010, the District Court granted LCB’s
motion to dismiss for lack of personal jurisdiction. Licci v. Am.
Express Bank Ltd., 704 F. Supp. 2d 403, 408 (S.D.N.Y. 2010) (“Licci
I”). The District Court correctly noted that a defendant may be
subject to personal jurisdiction in New York under N.Y. C.P.L.R.
§ 302(a)(1) if (1) the defendant “transacted business within the
state; and (2) the claim asserted . . . arise[s] from that business
activity,” id. at 406 (internal quotation marks omitted), but
determined that the allegations in the amended complaint were
insufficient to satisfy either prong, id. at 406–08.
Although Licci I’s Rule 12(b)(2) dismissal rested entirely
on Plaintiffs’ failure to make a prima facie showing of long‐arm
jurisdiction under New York law, the District Court also offered
its view—without further explanation—that “[t]he exercise of
personal jurisdiction over LCB on the basis alleged by plaintiffs
10
would not comport with constitutional principles of due
process.” Id. at 408. The court did not reach LCB’s alternative
argument that the claims against it should be dismissed for
failure to plead a cause of action under Rule 12(b)(6). See id.
B. Licci II
In our initial consideration of Plaintiffs’ appeal, we found
the scope and application of the long‐arm statute’s “transaction
of business” and “arising from” tests to be uncertain. We
determined that we could not “confidently say whether the New
York Court of Appeals would conclude that the plaintiffs” have
made a prima facie showing of jurisdiction under N.Y. C.P.L.R.
§ 302(a)(1). Licci II, 673 F.3d at 73. We therefore certified the
following questions to the New York Court of Appeals:
(1) Does a foreign bank’s maintenance of a
correspondent bank account at a financial
institution in New York, and use of that account to
effect “dozens” of wire transfers on behalf of a
foreign client, constitute a “transact[ion]” of
business in New York within the meaning of N.Y.
C.P.L.R. § 302(a)(1)?
(2) If so, do the plaintiffs’ claims under the Anti–
Terrorism Act, the ATS, or for negligence or breach
of statutory duty in violation of Israeli law, “aris[e]
from” LCB’s transaction of business in New York
within the meaning of N.Y. C.P.L.R. § 302(a)(1)?
Id. at 74–75 (alterations in original).
In the time between Licci I and Licci II, our Circuit decided
Kiobel I, in which we held that the ATS does not provide subject
matter jurisdiction for civil actions against corporations for
violations of customary international law. Kiobel I, 621 F.3d at
145; see Licci II, 673 F.3d at 73. In Licci II, we predicted that
11
should the Supreme Court affirm Kiobel I, and hold that ATS
does not allow for corporate liability, “we will likely be required
to affirm the dismissal of the ATS claims.” Licci II, 673 F.3d at 73.
Accordingly, we decided to “await” the decision of the Supreme
Court “as to the ATS claims against LCB,” in addition to the
New York Court of Appeals’ response to our certified questions.
Id.
C. Licci III
On March 29, 2012, the New York Court of Appeals
accepted the certified questions. Licci v. Lebanese Canadian Bank,
SAL, 18 N.Y.3d 952 (2012). The Court answered the certified
questions in the affirmative. Licci III, 20 N.Y.3d at 341.
D. Licci IV
Following the guidance from the New York Court of
Appeals, we held that (1) Plaintiffs made a prima facie showing
that the District Court had personal jurisdiction over LCB, Licci
IV, 732 F.3d at 168–69, and (2) subjecting LCB, as a foreign bank,
“to personal jurisdiction in New York comports with due
process protections provided by the United States Constitution,”
id. at 165; see also 169–74. Accordingly, we vacated and
remanded the portion of the District Court’s judgment in Licci I
dismissing claims against defendant LCB for lack of personal
jurisdiction. Id. at 174.
In Licci IV, we did not reach the question of whether the
ATS provides subject matter jurisdiction over this case. We
noted that while the Supreme Court did in fact affirm Kiobel I on
appeal, it did so on different grounds than those upon which we
decided Kiobel I. Id. (citing Kiobel II, 133 S. Ct. at 1669 (deciding
that the presumption against extraterritoriality constrains federal
courts from hearing causes of action under the ATS “seeking
relief for violations of the law of nations occurring outside the
12
United States”)).9 We decided, therefore, that because Kiobel II
“did not directly address the question of corporate liability
under the ATS,” and because “the question of subject matter
jurisdiction was not briefed on appeal,” it was best that the
District Court “address this issue in the first instance.” Id.
E. Licci V
On remand, the District Court dismissed Plaintiffs’ case
once more. In relevant part, the District Court held that it lacked
subject matter jurisdiction over Plaintiffs’ ATS claims under
Kiobel II. Specifically, the court held that Plaintiffs failed to rebut
the presumption against the extraterritorial application of the
ATS because their complaint’s allegations regarding LCB’s
provision of banking services failed to state a claim for aiding
and abetting another’s violation of the law of nations. The court
concluded that Plaintiffs failed to allege adequately that LCB
had the required mens rea for aiding and abetting liability,
reasoning that the complaint lacked sufficiently detailed
allegations as to LCB’s intent. Plaintiffs timely appealed.
DISCUSSION
We review de novo a district court’s dismissal for failure to
state a claim pursuant to Federal Rule of Civil Procedure
12(b)(6), accepting all well‐pleaded factual allegations in the
complaint as true and drawing all inferences in favor of the
plaintiffs. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555–56
9 Kiobel I and Kiobel II’s separate grounds for dismissing the plaintiffs’
Alien Tort Statute claims are distinct and, as we have previously
observed, “not logically inconsistent.” In re Arab Bank, PLC Alien Tort
Statute Litig., 808 F.3d 144, 153 (2d Cir. 2015), as amended (Dec. 17, 2015)
(“The two decisions adopted different bases for dismissal for lack of
subject‐matter jurisdiction. Whatever the tension between them, the
decisions are not logically inconsistent.”).
13
(2007); City of Pontiac Policemenʹs & Firemenʹs Ret. Sys. v. UBS
AG, 752 F.3d 173, 179 (2d Cir. 2014). Although courts are
generally limited to examining the sufficiency of the pleadings
on a motion to dismiss, on a challenge to a district court’s subject
matter jurisdiction, the court may also resolve disputed
jurisdictional fact issues by reference to evidence outside the
pleadings. Flores v. S. Peru Copper Corp., 414 F.3d 233, 255 n.30
(2d Cir. 2003) (consulting evidence outside the pleadings to
resolve disputed jurisdictional fact issues); see also Cargill Intʹl
S.A. v. M/T Pavel Dybenko, 991 F.2d 1012, 1019 (2d Cir. 1993) (“In
resolving the jurisdictional dispute, the district court must
review the pleadings and any evidence before it, such as
affidavits.”).
I. The Alien Tort Statute
In full, the ATS states: “The district courts shall have
original jurisdiction of any civil action by an alien for a tort only,
committed in violation of the law of nations or a treaty of the
United States.” 28 U.S.C. § 1350. Enacted as part of the Judiciary
Act of 1789, the ATS received little or no judicial attention until
1980, when this Court decided Filártiga v. Peña‐Irala, 630 F.2d 876
(2d Cir. 1980). The years that followed Filártiga witnessed a
dramatic increase in ATS litigation, as the ATS came to be
viewed as a means to help victims of human rights violations.10
In its history, the Supreme Court has decided two cases
directly addressing the ATS: Sosa v. Alvarez–Machain, 542 U.S.
10 See, e.g., Beth Stephens, Judicial Deference and the Unreasonable Views of
the Bush Administration, 33 BROOK. J. INT’L L. 773, 777 & n.18, 810–11
(2008) (estimating in 2008, that approximately 185 human rights
lawsuits were filed after Filártiga, as compared to 21 total suits before
Filártiga) (citing BETH STEPHENS ET AL., INTERNATIONAL HUMAN
RIGHTS LITIGATION IN U.S. COURTS 12–25 (2d ed. 2008)).
14
692 (2004), and Kiobel II.11 The Supreme Court clarified that the
ATS is a “jurisdictional” statute in the sense that it “address[es]
the power of the courts to entertain cases concerned with a
certain subject.” Sosa, 542 U.S. at 714. Though the “statute
provides district courts with jurisdiction to hear certain claims,
[it] does not expressly provide any causes of action.” Kiobel II,
133 S. Ct. at 1663. The ATS’s grant of jurisdiction is “best read as
having been enacted on the understanding that the common law
would provide a cause of action for a modest number of
international law violations.” Id. (alteration and internal
quotation marks omitted) (quoting Sosa, 542 U.S. at 724).
The Plaintiffs here—Israeli and Canadian citizens—assert
a civil tort action, and thus satisfy the first clause of the ATS. In
determining whether the tort was “committed in violation of the
law of nations or a treaty of the United States,” we look to
Supreme Court and Second Circuit precedent, mindful that there
are “numerous jurisdictional predicates, all of which must be
met before a court may properly assume jurisdiction over an
ATS claim.” Mastafa v. Chevron Corp., 770 F.3d 170, 179 (2d Cir.
2014). These include, “but may not be limited to,” id., the
following:
(1) [T]he complaint pleads a violation of the law of
nations, see Sosa, 542 U.S. at 732; Kadic v. Karadzĭć,
70 F.3d 232, 238 (2d Cir. 1995);
11 In one other case, Argentine Republic v. Amerada Hess Shipping Corp.,
488 U.S. 428 (1989), the Supreme Court briefly discussed the ATS in
the context of foreign state immunity, holding that it did not permit
jurisdiction over a foreign sovereign.
15
(2) [T]he presumption against the extraterritorial
application of the ATS, announced by the Supreme
Court in Kiobel [II] does not bar the claim;
(3) [C]ustomary international law recognizes liability
for the defendant, see Kiobel [I], 621 F.3d at 145 ;
and
(4) [T]he theory of liability alleged by plaintiffs (i.e.,
aiding and abetting, conspiracy) is recognized by
customary international law, see Khulumani v.
Barclay National Bank Ltd., 504 F.3d 254, 264 (2d Cir.
2007) (Katzmann, J., concurring).
Id. (citation omitted).
The District Court found that the complaint failed to rebut
the presumption against extraterritoriality. On appeal, the
parties focus on that inquiry, as well as whether customary
international law recognizes liability for LCB in its capacity as a
corporation. See Appellants Br. 18–40; Appellees Br. 36–48.
Nevertheless, we consider all four inquiries, as each “requires an
affirmative determination before a court properly has
jurisdiction over an ATS claim.” Mastafa, 770 F.3d at 179. As set
forth below, we conclude that Plaintiffs have satisfied all of the
jurisdictional predicates but one. Because this Circuit has ruled
that customary international law does not recognize liability for
corporations, see Kiobel I, 621 F.3d at 145, we must conclude that
the District Court does not have jurisdiction over Plaintiffs’ ATS
claims against LCB, a corporation.
II. Pleading a Violation of the Law of Nations
The ATS confers jurisdiction over only two varieties of
torts: (1) violations of treaties ratified by the United States and
16
(2) violations of the law of nations, i.e., customary international
law. 28 U.S.C. § 1350; see also Flores, 414 F.3d at 247. “There is no
federal subject‐matter jurisdiction under the [ATS] unless the
complaint adequately pleads a violation of the law of nations (or
treaty of the United States).” Kadic, 70 F.3d at 238; see also
Mastafa, 770 F.3d at 179–81. “Because the [ATS] requires that
plaintiffs plead a violation of the law of nations at the
jurisdictional threshold, this statute requires a more searching
review of the merits to establish jurisdiction than is required
under the more flexible ‘arising under’ formula of [28 U.S.C.
§] 1331.” Kadic, 70 F.3d at 238 (other internal quotations marks
omitted). Therefore, “it is not a sufficient basis for jurisdiction to
plead merely a colorable violation of the law of nations.” Id.
This inquiry has a definitive historical dimension, as “federal
courts should not recognize private claims under federal
common law for violations of any international law norm with
less definite content and acceptance among civilized nations
than the historical paradigms familiar when [the ATS] was
enacted.” Sosa, 542 U.S. at 732.
Plaintiffs assert that Hezbollah’s actions, including “its
attempts to physically exterminate or expel the Jewish residents
of Israel and its intentional and systematic use of violence
against civilians, constitute genocide, crimes against humanity[,]
and war crimes under customary international law, and
therefore constitute violations of ‘the law of nations’ within the
meaning of [the ATS].” App. 110. They allege that LCB’s actions
“constitute[] aiding and abetting [Hezbollah’s] acts of genocide,
crimes against humanity[,] and war crimes.” App. 111.
Genocide, crimes against humanity, and war crimes
certainly constitute violations of the law of nations under
customary international law. See Kadic, 70 F.3d at 236 (observing
that a defendant “may be found liable for genocide, war crimes,
17
and crimes against humanity” under the ATS); Sosa, 542 U.S. at
762 (Breyer, J., concurring in part and concurring in judgment)
(describing a “subset” of “universally condemned behavior” for
which “universal jurisdiction exists,” including “torture,
genocide, crimes against humanity, and war crimes”). Plaintiffs
have alleged systematic rocket attacks against the Jewish civilian
population in Israel, committed with the intent to exterminate or
expel them from the territory. These allegations adequately
plead acts of genocide and crimes against humanity. Therefore,
Plaintiffs have satisfied their burden to assert a cause of action
grounded in actions recognized as violations of the law of
nations. See Mastafa, 770 F.3d at 181 (finding that “plaintiffs have
satisfied their burden of asserting some causes of actions
grounded in actions recognized as violations of customary
international law” where they asserted that the principal
committed genocide, war crimes, and crimes against humanity).
III. Theory of Liability
Plaintiffs assert that the “actions of defendant LCB . . .
constituted aiding and abetting [Hezbollah’s] acts of genocide,
crimes against humanity[,] and war crimes under the law of
nations.” App. 111 (emphasis added). Aiding and abetting is a
theory of liability recognized by customary international law.
Khulumani, 504 F.3d at 260 (Opinion of the Court); see id. at 270
(Katzmann, J., concurring); see also Mastafa, 770 F.3d at 181
(recognizing that, in this Circuit, a plaintiff may plead a theory
of aiding and abetting liability under the ATS). Accordingly,
Plaintiffs have pleaded a theory of liability over which we have
subject matter jurisdiction.
IV. Displacing the Presumption against Extraterritoriality
The presumption against extraterritoriality provides that
“when a statute gives no clear indication of an extraterritorial
18
application, it has none, and reflects the presumption that
United States law governs domestically but does not rule the
world.” Kiobel II, 133 S. Ct. at 1664 (alteration, citations, and
internal quotation marks omitted). The presumption typically
applies when a court is discerning “whether an Act of Congress
regulating conduct applies abroad.” Id.
In Kiobel II, the Supreme Court held that the presumption
against extraterritoriality constrains courts exercising their
power under the ATS. Id. at 1664–65. Kiobel II’s extension of the
presumption against extraterritoriality to the ATS in its capacity
as a “strictly jurisdictional” statute was principally based on
foreign policy considerations. Id. at 1664 (quoting Sosa, 542 U.S.
at 713). The Court observed that the “danger of unwarranted
judicial interference in the conduct of foreign policy is magnified
in the context of the ATS, because the question is not what
Congress has done but instead what courts may do.” Id. It
underscored, therefore, “the need for judicial caution in
considering which claims could be brought under the ATS, in
light of foreign policy concerns.” Id. The Court was careful,
however, to provide that a plaintiff could “displace” the
presumption:
[E]ven where the claims touch and concern the
territory of the United States, they must do so with
sufficient force to displace the presumption against
extraterritorial application. Corporations are often
present in many countries, and it would reach too
far to say that mere corporate presence suffices.
Id. at 1669 (citation omitted).
To determine whether Plaintiffs have displaced the
presumption against extraterritoriality, we first consider the
threshold inquiry of whether the presumption is “self‐evidently
19
dispositive” or whether “its application requires further
analysis.” Morrison v. Natʹl Australia Bank Ltd., 561 U.S. 247, 266
(2010); see also Mastafa, 770 F.3d at 182. That is, when a
complaint alleges no contact “between the injuries alleged and
the territory of the United States,” the presumption against
extraterritoriality is not displaced and the inquiry, in all
likelihood, ends there. Mastafa, 770 F.3d at 182–83; Balintulo v.
Daimler AG, 727 F.3d 174, 189 (2d Cir. 2013) (holding plaintiffs’
claims did not rebut the presumption against extraterritoriality
set forth in Kiobel II “because the plaintiffs have failed to allege
that any relevant conduct occurred in the United States”
(emphasis added)).
The Kiobel complaint, which contained no averment of
contact between the conduct alleged and U.S. territory, was self‐
evidently dispositive. See Kiobel II, 133 S. Ct. at 1669. The Kiobel
plaintiffs were Nigerian nationals alleging that certain Dutch,
British, and Nigerian corporations aided and abetted Nigerian
military and police forces in “attack[ing] [plaintiffs’] villages,
beating, raping, killing, and arresting residents and destroying
or looting property” by “among other things, providing the
Nigerian forces with food, transportation, and compensation, as
well as by allowing the Nigerian military to use respondents’
property as a staging ground for attacks.” Id. at 1662–63. The
Supreme Court held that because “all the relevant conduct took
place outside the United States,” the plaintiffs’ claims did not
displace the presumption against extraterritorial application. Id.
at 1669.
Kiobel is not this case. Unlike the Kiobel plaintiffs, who
only alleged extraterritorial conduct, Plaintiffs allege, inter alia,
that LCB used its correspondent banking account in New York
to facilitate dozens of international wire transfers for the Shahid,
an entity alleged to be an “integral part” of Hezbollah. App. 65.
20
Thus, Plaintiffs allege sufficient connections with the United
States to require “further analysis.” Mastafa, 770 F.3d at 182
(internal quotation mark omitted). Applying Kiobel II and
Morrison, we have previously set forth exactly what that “further
analysis” entails. See Mastafa, 770 F.3d at 185–87. As a
preliminary matter, the court must isolate the “relevant conduct”
in the complaint—here, “the conduct of the defendant . . . that
constitutes aiding and abetting another’s violation of the law of
nations.” Id.
In isolating the relevant conduct of the defendant, a court
must evaluate the “territorial events” or “relationships” that
were the “focus” of the ATS. Id. at 184 (alterations omitted)
(quoting Morrison, 561 U.S. at 266). Then, in “determining
whether this conduct displaces the presumption, the district
court must engage in a two‐step jurisdictional analysis of this
conduct.” Id. Step one is a determination of whether the
relevant conduct—i.e., conduct aiding and abetting a violation of
the law of nations—“sufficiently ‘touches and concerns’ the
territory of the United States so as to displace the presumption
against extraterritoriality.” Id. at 186 (quoting Kiobel II, 133 S. Ct.
at 1669). Step two is a determination of whether “the same
conduct, upon preliminary examination, states a claim for a
violation of the law of nations or aiding and abetting another’s
violation of the law of nations.” Id. at 187.
Applying this framework, the District Court appears to
have found that step one was satisfied; it dismissed the
complaint on its conclusion that Plaintiffs failed to meet the
requirements of step two. Special App. 9–10. On appeal, the
parties dispute whether either step is met. See Appellants Br. 21–
23; Appellee Br. 37–39. We consider each in turn.
21
A. Conduct that Touches and Concerns the United States
The “relevant conduct” in the complaint is LCB’s
provision of wire transfers between Hezbollah accounts through
its correspondent bank in New York. Specifically, Plaintiffs
allege (1) LCB “provided extensive banking services to
[Hezbollah]” that “caused, enabled[,] and facilitated the terrorist
rocket attacks in which the plaintiffs and their decedents were
harmed and killed” and (2) those banking services “were carried
out by LCB in and through the State of New York.” App. 58
(emphasis added). Plaintiffs further allege that “between 2004
and July 12, 2006 (and subsequently), [Hezbollah] made and
received dozens of dollar wire transfers . . . totaling several
million dollars,” and that “[a]ll” of those wire transfers “were
made to, from, and/or between” Hezbollah’s bank accounts at
various LCB branches through AmEx in New York. App. 66.
Plaintiffs allege that LCB worked “in concert with” AmEx to
carry out the wire transfers, and that AmEx acted “on behalf of”
LCB in carrying out the transfers. App. 66. Plaintiffs offer
additional allegations that the New York State Banking
Department investigated LCB’s correspondent bank in New
York when the wire transfers took place, and that the bank
violated various terrorist financing and money laundering laws
in carrying out the transfers. App. 104–05.
We have previously concluded that a claim similar to the
Plaintiffs’ sufficiently touched and concerned the United States
to displace the presumption against extraterritorial application.
Specifically, in Mastafa, we considered an ATS claim brought by
five Iraqi nationals against an oil company and a French bank.
See 770 F.3d at 174. The Mastafa plaintiffs alleged that the oil
company and the bank aided and abetted the Saddam Hussein
regime in its torture, imprisonment, and execution of the
plaintiffs or their family members “by paying the regime
22
kickbacks and other unlawful payments, which enabled the
regime to survive and perpetrate the abuses suffered by
plaintiffs or their husbands.” Id. at 175. The allegations
stemmed from the United Nations’ Oil for Food Programme
(“OFP”), a program that “permitted the export of oil from Iraq in
exchange for food, medicine, and other basic civilian necessities
by allowing the purchase of Iraqi oil to proceed through an
escrow account, into which purchasers submitted payments and
from which providers of civilian necessities received payment.”
Id. (internal quotation marks omitted). In essence, the Mastafa
plaintiffs alleged “that the Saddam Hussein regime—then
subject to United Nations economic sanctions—misused the OFP
in order to elicit income outside the United Nations’ oversight
and fund its regime and to fund its campaign of human rights
abuses against its people.” Id. (alterations and internal quotation
marks omitted).
Three of the four allegations in the Mastafa plaintiffs’
complaint came up short. The allegations were insufficient to
satisfy the touch and concern inquiry because they were either
(1) too tangential to the conduct alleged to aid and abet a
violation of the law of nations or (2) inadequately pleaded. See
id. at 189–90. First, we determined that “the fact that the United
Nations is located in New York, and that the OFP’s inception
and administration occurred in New York, [was] irrelevant” to
the touch and concern inquiry, as “[s]uch allegations, by
themselves, are not facts related to defendants at all, let alone
alleged conduct taken by defendants to aid and abet violations
of the law of nations.” Id. at 190. Second, we considered the fact
that the oil company is headquartered in the United States to be
“immaterial” because “the relevant inquiry is on conduct
constituting a violation of customary international law or of
aiding and abetting such violations, not on where defendants are
23
present.” Id. Third, we rejected the plaintiffs’ allegation that
because the defendant oil company is headquartered in the
United States, “its profits reaped from the transactions were
recouped in the United States” as a mere conclusory statement
that “d[id] not satisfy basic pleading requirements.” Id. (internal
quotation marks omitted).
However, we found that the Mastafa plaintiffs’ fourth
allegation—that the French bank “entered into a Banking
Agreement with the United Nations in New York pursuant to
which it maintained an escrow account in New York City
through which all OFP funds moved, including the illicit
surcharge payments”—sufficiently touched and concerned the
United States to surpass the first step of displacing the
presumption against extraterritoriality. Id. at 190–91.
Specifically, the Mastafa plaintiffs alleged that both the bank and
the oil company made “U.S.‐based attempts to skirt the sanctions
regime.” Id. at 190. As to the bank, plaintiffs alleged that it
“maintained [an] escrow account in New York City through
which all [relevant] payments were transmitted.” Id. (internal
quotation marks omitted). The plaintiffs alleged that the bank
“allowed payments” through the New York City account that
included kickbacks to the Saddam Hussein regime, and that the
bank’s financing arrangements “allowed the oil purchasers to
conceal the true nature of the oil purchase.” Id. (internal
quotation mark omitted). As to the oil company, plaintiffs
alleged, inter alia, that it facilitated surcharge payments to the
Hussein regime as part of particular transactions. Id. Assessing
this allegation, we concluded that the relevant conduct was
sufficiently “specific and domestic” to (1) be non‐conclusory and
(2) touch and concern the United States. Id. at 191. We held that
the plaintiffs’ fourth allegation touched and concerned the
United States with sufficient force to displace the presumption
24
against extraterritoriality and establish ATS jurisdiction—so long
as it also “satisfie[d] a preliminary determination that such
conduct aided and abetted a violation of the law of nations.” Id.
Like the Mastafa plaintiffs’ allegations against the French
bank, Plaintiffs here assert that LCB, a Lebanese Bank, used a
correspondent banking account at a New York bank to facilitate
wire transfers between Hezbollah’s bank accounts in the months
leading up to the rocket attacks. Plaintiffs specifically allege that
LCB carried out the specific “banking services which harmed the
plaintiffs and their decedents . . . in and through the State of New
York.” App. 58 (emphasis added). Plaintiffs here have alleged
that LCB engaged in “numerous New York‐based payments and
‘financing arrangements’ conducted exclusively through a New
York bank account.” See Mastafa, 770 F.3d at 191. As in Mastafa,
we find these allegations to be both specific and domestic. See id.
Plaintiffs’ allegations “touch and concern” the United States with
sufficient force to displace the presumption, so long as such
conduct also meets the second prong of our extraterritoriality
analysis.12
12 As the above analysis indicates, the fact that LCB’s correspondent
bank in New York, AmEx, is no longer a party to this appeal, is
immaterial to our conclusion that the allegations against defendant
LCB sufficiently touch and concern the United States. Plaintiffs’ only
allegations against AmEx that did not also involve LCB’s domestic
contacts include (1) AmEx is headquartered in New York and
incorporated in Connecticut, and (2) AmEx “does extensive business
and holds significant assets in New York.” App. 57. Because the
relevant inquiry is whether the defendant’s conduct touches and
concerns the United States, not where the defendant or particular
assets are located, AmEx’s absence as a party does not affect that
inquiry. See Mastafa, 770 F.3d at 190.
25
B. States a Claim for Violation of the Law of Nations
To displace the presumption against extraterritoriality,
the conduct “which the court has determined sufficiently
‘touches and concerns’ the United States” must also, upon
preliminary examination, state a claim for a violation of the law
of nations or aiding and abetting another’s violation of the law of
nations. Mastafa, 770 F.3d at 186–87. “This second step of the
extraterritoriality analysis ensures . . . that ‘the statute’s
jurisdictional reach will match the statute’s underlying
substantive grasp.’” Id. at 186 (alteration omitted) (quoting
Kiobel II, 133 S. Ct. at 1673 (Breyer, J., concurring in the
judgment)). A defendant may be held liable under an aiding
and abetting theory of liability under international law if the
defendant “(1) provide[d] practical assistance to the principal
which has a substantial effect on the perpetration of the crime,
and (2) d[id] so with the purpose of facilitating the commission
of that crime.” Presbyterian Church of Sudan v. Talisman Energy,
Inc., 582 F.3d 244, 259 (quoting Khulumani, 504 F.3d at 277
(Katzmann, J., concurring)). As to the latter requirement, we
have underscored that the mens rea standard for accessorial
liability in ATS actions is “purpose rather than knowledge
alone.” Id.
The District Court here did not address whether Plaintiffs
adequately alleged that LCB provided practical assistance to
LCB that had a substantial effect on the perpetration of the
crime. It concluded only that Plaintiffs have “insufficiently
allege[d] that the wire transfers aided and abetted a violation of
the law of nations.” Special App. 9. The court reasoned that
Plaintiffs failed to surpass its preliminary mens rea determination
because the complaint’s allegations of LCB’s intent are merely
“conclusory.” Id. It further noted that the complaint is “devoid
of any factual allegations supporting LCB’s specific intent, in
26
executing the wire transfers, to promote or engage in
Hezbollah’s coercive actions against the Israeli government and
public.” Id. “Because the [complaint] inadequately pleads that
the wire transfers at issue were made with the intent to aid and
abet the alleged terrorist activities,” it concluded, “Plaintiffs have
not established that there is subject matter jurisdiction under the
ATS.” Special App. 10.
The relevant conduct alleged here—i.e., LCB’s alleged act
of carrying out wire transfer services on Hezbollah’s behalf
through the state of New York, see App. 58, 65–66—satisfies a
preliminary determination that such conduct provided practical
assistance to Hezbollah that substantially affected Hezbollah’s
perpetration of the underlying violations of the law of nations.
Plaintiffs adequately allege that these wire transfer services had
a substantial effect on Hezbollah’s actions insofar as they
“enabled” and “facilitated” terrorist rocket attacks harming or
killing Plaintiffs and their decedents. App. 54. Plaintiffs further
allege that LCB’s wire transfers “substantially increased and
facilitated [Hezbollah’s] ability to plan, to prepare for[,] and to
carry out rocket attacks on civilians,” including the rocket
attacks injuring or killing Plaintiffs and their family members.
App. 86. In addition, Plaintiffs particularly allege that
“[Hezbollah] planned, made the preparations necessary for and
carried out” the rocket attacks by “utilizing funds” received as
part of the wire transfers. Id. Plaintiffs’ allegations are bolstered
by evidence in the record that LCB’s wire transfers “significantly
enhanced [Hezbollah]’s ability to plan and carry out terrorist
and other violent actions, including the rocket attacks in which
[Plaintiffs] were harmed.” App. 128.
LCB does not dispute whether Plaintiffs have adequately
shown that it provided practical assistance to Hezbollah that has
had a substantial effect on the perpetration of the underlying
27
crimes. Rather, it argues only that the District Court correctly
held that Plaintiffs have failed to meet the required mens rea for
accessorial liability. We disagree. Plaintiffs’ complaint,
considered in conjunction with the Shaya declaration and the
government’s actions against LCB, satisfies our preliminary
review of the mens rea requirement for aiding and abetting
violations of the law of nations. See Presbyterian Church, 582 F.3d
at 259. In essence, Plaintiffs allege that (1) LCB acted
intentionally, and pursuant to its official policy, in assisting
Hezbollah in carrying out the rocket attacks by carrying out the
wire transfers, and (2) LCB knew that the bank accounts between
which it facilitated transfers were owned and controlled by
Shahid, an integral part of Hezbollah.
As an initial matter, Plaintiffs allege that “as a matter of
official LCB policy” LCB “continuously supports and supported
[Hezbollah] and its anti‐Israel program, goals[,] and activities.”
App. 88. They also allege that LCB had “actual knowledge” that
(1) “[Hezbollah] is a violent terrorist organization [that] carried
out numerous terrorist attacks against Israeli civilians and
American targets and which planned and intended to carry out
additional such terrorist attacks,” App. 88–89; (2) “Shahid is an
integral part of [Hezbollah] and constitutes part of [Hezbollah’s]
financial arm,” App. 90; (3) Hezbollah’s bank accounts at various
LCB branches and the funds therein “were owned and
controlled by [Hezbollah],” Id.; (4) the wire transfers made and
received by Hezbollah leading up to the 2006 rocket attacks
“were being carried out by and at the direction of [Hezbollah],”
Id.; see also App. 65—66; and (5) Hezbollah “require[d] wire
transfer services . . . in order to plan, to prepare for and to carry
out terrorist attacks.” App. 89. Plaintiffs then allege that LCB,
equipped with this actual knowledge, carried out the wire
transfers at issue “with the specific purpose and intention of
28
enabling and assisting [Hezbollah] to carry out terrorist attacks
against Jewish civilians in Israel.” App. 109. Indeed, the
complaint states that LCB carried out the wire transfers “as a
matter of official LCB policy, in order to assist and advance
[Hezbollah’s] terrorist activities against Jews in Israel, in order to
assist and advance [Hezbollah’s] goal of using terrorism to
destroy the State of Israel and murder or expel its Jewish
inhabitants and in order to assist and advance [Hezbollah’s] goal
of coercing, intimidating and influencing the Israeli government
and public.” App. 88.
As set forth above, in determining this disputed
jurisdictional fact, we may also consider evidence in the record
outside the pleadings. See Flores, 414 F.3d at 255 n.30. The Shaya
declaration provides context to Plaintiffs’ allegations that LCB
aided and abetted Hezbollah’s alleged violations of the law of
nations. Specifically, the Shaya declaration states that between
“2004 and July 12, 2006 (and later),” Hezbollah “made dozens of
dollar wire transfers in and out of” a specific account number at
LCB’s headquarters. App. 127. Shaya stated that LCB requested
that its correspondent bank in New York carry out the wire
transfers and identified Shahid as the account‐holder, and thus
“there is no question” that Amex Bank knew that it was
executing wire transfers on behalf of Shahid. App. 127–28. In
addition, the government forfeiture action against LCB lends
support to Plaintiffs’ allegations. See App. 323–95. Specifically,
the government alleged that LCB engaged in activity “intended
to conceal and disguise the true source, nature, ownership, and
control of” proceeds of illegal activities in a scheme that
“benefitted [Hezbollah].” App. 358.
We conclude that Plaintiffs’ complaint alleges conduct by
LCB that touched and concerned the United States, and that
the same conduct, upon preliminary examination, states a claim
29
for aiding and abetting Hezbollah’s violation of the law of
nations, with sufficient force to displace the presumption against
extraterritoriality. Accordingly, Plaintiffs have surpassed the
jurisdictional hurdle set forth in Kiobel II, 133 S. Ct. at 1669.
V. Corporate Liability
Nevertheless, Kiobel I forecloses Plaintiffs’ claims against
LCB. In Kiobel I, we established that the law of nations, while
imposing civil liability on individuals for torts that qualify under
the ATS, immunizes corporations from liability. Kiobel I, 621
F.3d at 120. Specifically, Kiobel I held that “insofar as plaintiffs
bring claims under the ATS against corporations, plaintiffs fail to
allege violations of the law of nations, and plaintiffs’ claims fall
outside the limited jurisdiction provided by the ATS.” Id.
Neither party disputes that LCB is a corporation. Accordingly,
we cannot exercise subject matter jurisdiction over Plaintiffs’
ATS claims pursuant to that statute.
To the extent Plaintiffs submit that Kiobel I was wrongly
decided, we reaffirm Arab Bank’s conclusion—we are not free to
consider that argument. In re Arab Bank, 808 F.3d at 157. “[I]t is
axiomatic that a panel of this court is bound by the decisions of
prior panels until such time as they are overruled either by an en
banc panel of our Court or by the Supreme Court.” See NML
Capital v. Republic of Argentina, 621 F.3d 230, 243 (2d Cir. 2010)
(internal quotation marks omitted); accord In re Arab Bank, 808
F.3d at 157. Indeed, this Court has previously declined similar
attempts by ATS plaintiffs to overturn Kiobel I. See In re Arab
Bank, PLC Alien Tort Statute Litig., 822 F.3d 34, 35 (2d Cir. 2016)
(denying rehearing en banc). Accordingly, we faithfully apply
30
Kiobel I and affirm the District Court’s dismissal of this case on
that basis.13
CONCLUSION
For the foregoing reasons, we AFFIRM IN PART14 the
judgment of the District Court.
13 In voting against reconsideration of Kiobel I’s holding that the ATS
does not regulate corporate conduct, four judges of our Court
reasoned that “the population of cases dismissible under Kiobel I is
largely coextensive with those dismissible under Kiobel II.” In re Arab
Bank, 822 F.3d at 35 (Jacobs, J., concurring in the denial of rehearing en
banc) (emphasis added). The concurring judges concluded that “[t]he
principle of Kiobel I has been largely overtaken, and its importance for
outcomes has been sharply eroded.” Id. But as is often the case in the
law, no sooner is a certainty expressed than an exception presents
itself. This case, in which defendants are accused of domestic acts that
aided and abetted torts committed abroad, may illustrate a category of
cases that surpass Kiobel II’s extraterritoriality inquiry but do not
survive Kiobel I’s bar on corporate liability. At present, how large a
class of cases that may be is difficult to know.
14
This opinion affirms the District Court’s judgment with regard to
Plaintiffs’ ATS claims. This opinion and the accompanying summary
order, which addresses the balance of Plaintiffs’ claims, combine to
affirm the District Court’s judgment in toto.
31