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Case can proceed against terror-funding bank

January 22, 2013

Progress made as court rejects bank’s appeal

Arab Bank’s refusal to turn over records has been a major obstacle in the Linde v. Arab Bank terrorist financing case.  To move beyond the legal stalemate, the presiding judge said the jury could infer what it wants to about Arab Bank’s secrecy.  The bank appealed the judge’s jury instruction to the U.S. Second Circuit Court of Appeals.  The appellate court ruled Friday that it had no standing to review the case at this time (h/t @ChallahHuAkbar), and that there’s nothing drastic enough about the judge’s instruction to cause the circuit court to intervene.

From Bloomberg:

Arab Bank Sanctions Order Appeal Dismissed by U.S. Court

Arab Bank Plc (ARBK)’s appeal of sanctions for not obeying discovery orders in a lawsuit brought by victims of terrorist attacks was dismissed by a federal appeals court in New York.

The U.S. Court of Appeals in Manhattan ruled today that it couldn’t hear the bank’s appeal of a sanctions order imposed by U.S. District Judge Nina Gershon in Brooklyn until after the consolidated suits pending before her have ended.

“We conclude that the sanctions order is not a reviewable collateral order, and we therefore dismiss the bank’s appeal for want of jurisdiction,” the panel of judges said.

“We conclude further, that this is not an appropriate case for issuance of the extraordinary writ,” the appeals court said, adding, “the bank has not established (among other factors) that it has a ‘clear and indisputable right’ to such drastic relief or that review after final judgment will not provide adequate relief.”

Courtney Linde, the widow of John Linde Jr., who was killed Oct. 15, 2003, while guarding diplomats traveling in the Gaza Strip, sued in federal court in Brooklyn in 2004. She is the lead plaintiff for a half-dozen families suing the Amman, Jordan-based lender in cases that allege it “knowingly and purposefully supported” foreign terrorist organizations between 1995 and 2004 by providing financial support. The bank has denied wrongdoing.

Sanctions Imposed

The judge imposed sanctions upon the bank for not complying with several court orders to produce documents the plaintiffs said were relevant to their case. Gershon’s sanctions took the form of a jury instruction that would permit — but not require — the jury to infer from the bank’s failure to produce the documents that it provided financial services to foreign terrorist groups and did so knowingly.

Gershon also precluded the bank from introducing for the jury’s consideration certain evidence related to undisclosed materials.

The bank argued that the sanctions were “unduly harsh,” that jury instructions would predetermine the outcome of the case, and that the documents are covered by foreign bank secrecy laws, so that their disclosure would subject the bank to criminal prosecution.

Ten similar suits brought against the bank by the families of dozens of victims of other attacks in Israel were consolidated and are pending before Gershon. She hasn’t yet determined whether any of those cases will go to trial.

‘Substantially Right’

“We think they got it substantially right,” Gary Osen, a lawyer for some of the plaintiffs, said in a phone interview about the decision to dismiss the appeal. “It just means these cases can go forward. All we ask for is our day in court.”

Bob Chlopak, a spokesman for Arab Bank, said in an e-mail that the ruling is “not an endorsement of the district court’s sanctions.”

“The bank continues to believe that the district court’s sanctions order raises serious issues of international concern, and it is currently weighing its legal options,” he said.

The bank, Jordan’s largest, won dismissal in November of a separate case filed by former Israeli government official Mati Gill, which alleged that the lender supported the group Hamas. Gill, who was injured in a 2008 by a shot fired from Gaza, a territory bordering Israel, sought damages from the bank…

2 comments

  1. […] in the U.S. to force their bankers to disclose documents which will prove their culpability (see here, here, here, and […]


  2. […] intervention of the State Department represents a setback to progress that victims of Hamas terrorism appeared to be making last year in the case against Arab […]



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