Ashton v. Al Qaeda Islamic Army (In re Terrorist Attacks On Sept. 11, 2001)

298 F.Supp.3d 631

IN RE: TERRORIST ATTACKS ON SEPTEMBER 11, 2001

This document relates to:

Ashton, et al. v. Al Qaeda Islamic Army, et al., No. 02–cv–6977

Fed. Ins, Co., et al. v. Al Qaida, et al., No. 03–cv–6978

Vigilant Ins. Co., et al. v. Kingdom of Saudi Arabia, et al., No. 03–cv–8591

Thomas Burnett, Sr., et al. v. Al Bar aka Inv. & Dev. Corp., et al., No. 03–cv–9849

Estate of John P. O'Neill, Sr., et al. v. Kingdom of Saudi Arabia, et al., No. 04–cv–1922

Cont'l Cas. Co., et al. v. Al Qaeda Islamic Army, et al., No. 04–cv–5970

Cantor Fitzgerald Assocs. L.P., et al. v. Akida Inv. Co., et al., No. 04–cv–7065

Pac. Emp'rs Ins. Co., et al. v. Kingdom of Saudi Arabia, et al., No. 04–cv–7216

Euro Brokers Inc., et al. v. Al Bar aka Inv. & Dev. Corp., et al., No. 04–cv–7279

Beazley Furlonge Ltd. v. Saudi Binladin Grp., Inc., et al., No. 16–cv–7456

Bowrosen, et al. v. Kingdom of Saudi Arabia, No. 16–cv–8070

McCarthy, et al. v. Kingdom of Saudi Arabia, No . 16–cv–8884

Aguilar, et al. v. Kingdom of Saudi Arabia, et al., No. 16–CV–9663

Addesso, et al. v. Kingdom of Saudi Arabia, et al., No. 16–cv–9937

Hodges, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–117

DeSimone v. Kingdom of Saudi Arabia, No. 17–cv–348

Aiken, et al. v. Kingdom of Saudi Arabia, et al., No. 17–CV–450

Ashton, et al. v. Kingdom of Saudi Arabia, No. 17–cv–2003

The Underwriting Members of Lloyd's Syndicate 55, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–2129

The Charter Oak Fire Ins. Co., et al. v. Al Rajhi Bank, et al., No. 17–cv–2651

Gen. Reinsurance Corp., et al. v. Kingdom of Saudi Arabia, No. 17–cv–3810

Abarca, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–3887

Arrowood Indem. Co. v. Kingdom of Saudi Arabia, et al., No . 17–cv–3908

Abrams, et al. v. Kingdom of Saudi Arabia, et al., No. 17–CV–4201

Abtello, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–5174

Aasheim, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–5471

Abedhajajreh, et al. v. Kingdom of Saudi Arabia, et al., No. 17–CV–6123

Allianz Versicherungs–Aktiengese Uschaft, et al v. Kingdom of Saudi Arabia, No. 17–cv–6519

Fraser, et al. v. Al Qaeda Islamic Army, et al., No. 17–cv–7317

Muenchener Rueckversicherungs–Gesellschaft Aktiengesellschaft in Muenchen, et al. v. Kingdom of Saudi Arabia, et al., No. 17–cv–7914

Abbate, et al v. Kingdom of Saudi Arabia, et al, No 17–cv–8617

Behette, et al. v. Kingdom of Saudi Arabia, et al., No. 18–CV–538

Abarca, et al. v. Kingdom of Saudi Arabia, et al, No. 18–cv–947

03–MDL–1570(GBD)

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

Filed March 28, 2018

Litigation Case: Attorney Not Added.

MEMORANDUM DECISION AND ORDER

GEORGE B. DANIELS, United States District Judge:

Plaintiffs in this multidistrict litigation seek to hold multiple defendants liable for allegedly financing, sponsoring, conspiring to sponsor, aiding and abetting, or otherwise providing material support to Osama bin Laden and the terrorist organization known as al Qaeda, for the physical destruction, deaths, and injuries suffered as a result of the terrorist attacks on September 11, 2001 (the "9/11 Attacks").¹ Plaintiffs allege here that Defendant Kingdom of Saudi Arabia ("Saudi Arabia") bears responsibility for the 9/11 Attacks because its agents and employees directly and knowingly assisted the hijackers and plotters who carried out the attacks. Plaintiffs allege further that al Qaeda's development into a terrorist organization and its ability to carry out the 9/11 Attacks was made possible through the financial and operational support it received from charity organizations established and controlled by the Saudi government, including Defendant Saudi High Commission for Relief in Bosnia and Herzegovina ("SHC"). (See generally Consolidated Amended Complaint ("CAC"), ECF No. 3463;² Complaint, Kathleen Ashton, et al v. Kingdom of Saudi Arabia, No. 17–cv–2003 (S.D.N.Y Mar. 20, 2017) ("Ashton Compl."), ECF No. 1.)³

Defendants Saudi Arabia and the SHC (the "Moving Defendants") previously moved to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) of the Federal Rules of Civil Procedure on grounds that they were immune from suit by virtue of the Foreign Sovereign Immunities Act ("FSIA"), 28 U.S.C. § 1602 et seq. (See ECF No. 2893.) They argued, among other things, that the noncommercial tort exception and its "entire tort" rule did not apply because Plaintiffs had failed to allege or present evidence that any official or employee of Saudi Arabia or the SHC committed a tortious act entirely within the United States within the scope of their office or employment. See In re Terrorist Attacks on September 11, 2001 ("Terrorist Attacks XI "), 134 F.Supp.3d 774, 779–80 (S.D.N.Y. 2015). This Court granted their motions to dismiss. See id. at 782–87. Plaintiffs appealed to the United States Court of Appeals for the Second Circuit. (See Notice of Appeal, ECF No. 3075.)

During the pendency of Plaintiffs' appeal, Congress enacted the Justice Against Sponsors of Terrorism Act ("JASTA"), Pub. L. No. 114–222, 130 Stat. 852 (2016) (codified at 28 U.S.C. § 1605B ). As described more fully below, JASTA created, among other things, a new exception to the FSIA which does not incorporate the noncommercial tort exception's entire tort rule and, unlike the FSIA's terrorism exception, does not require that the defendant be designated a state sponsor of terrorism by the Secretary of State. See 28 U.S.C. § 1605B(b). In addition, JASTA now permits United States nationals to bring claims against foreign sovereigns under the Antiterrorism Act ("ATA"), 18 U.S.C. § 2333, provided that JASTA's requirements for withholding sovereign immunity are otherwise met. See 28 U.S.C, § 1605B(c).

Recognizing that "JASTA was intended to apply to this case[,]" and that its enactment "raise[d] numerous questions that have not yet been addressed by the district court[,]" the parties jointly requested that the Second Circuit vacate this Court's September 29, 2015 Opinion and Order dismissing, under the FSIA, all claims against Saudi Arabia and the SHC and remand the case to this Court for further proceedings in light of JASTA. See Joint Mot. to Vacate and Remand at 2, In re Terrorist Attacks on September 11, 2001, No. 15–3426 (2d Cir. Oct. 21, 2016), ECF No. 255–1. The Second Circuit granted that motion and remanded the case to this Court to consider how, if at all, JASTA affects the Moving Defendants' claim for immunity under the FSIA. (See Mandate dated March 9, 2017 ("3/9/17 Mandate"), ECF No. 3457, at 1.) On remand, Defendants Saudi Arabia and the SHC have renewed their motions to dismiss pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure, arguing that their immunity under the FSIA remains intact even after JASTA's enactment.⁴ (See Kingdom of Saudi Arabia Mot. to Dismiss ("KSA Mot."), ECF No. 3667, at 1–2; Saudi High Commission for Relief of Bosnia and Herzegovina Mot. to Dismiss ("SHC Mot."), ECF No. 3670, at 1–2.) Saudi Arabia also contends that JASTA is unconstitutional since it infringes on the powers of the courts to decide cases and controversies free from congressional control. (KSA Mem. at 70–74.) Plaintiffs oppose the motions to dismiss and seek leave to conduct jurisdictional discovery, claiming that many of the relevant facts necessary to establish jurisdiction are uniquely within Saudi Arabia's knowledge and control. (CAC Plaintiffs Mem. in Opp'n ("CAC Opp'n"), ECF No. 3782, at 72–73; Ashton Plaintiffs Mem. in Opp'n ("Ashton Opp'n"), ECF No, 3781, at 4–6.) This Court heard oral argument on the Moving Defendants' renewed motions to dismiss on January 18, 2018.

Because Plaintiffs' allegations, accepted as true for purposes of resolving the instant motions, narrowly articulate a reasonable basis for this Court to assume jurisdiction under JASTA over Plaintiffs' claims against Saudi Arabia, this Court will exercise its discretion to allow Plaintiffs limited jurisdictional discovery. Such discovery is be to be conducted under Magistrate Judge Sarah Netburn's supervision and shall proceed in a prompt and expeditious manner by focusing only on those allegations of specific facts described below relevant to the FSIA immunity determination. Accordingly, Defendant Saudi Arabia's motion to dismiss is DENIED. Plaintiffs' recycled allegations as to the SHC, by contrast, remain insufficient to overcome the presumption of immunity afforded to it by the FSIA. Defendant SHC's motion to dismiss is therefore GRANTED.

I. LEGAL STANDARDS

A. The Foreign Sovereign Immunities Act

Federal district courts are courts of limited jurisdiction; "[t]hey possess only that power authorized by [the] Constitution and [by] statute." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552, 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005) (internal quotation marks and citation omitted). It is well settled that "[t]he FSIA 'provides the sole basis for obtaining jurisdiction over a foreign state in federal court.' " Chettri v. Nepal Rastra Bank, 834 F.3d 50, 55 (2d Cir. 2016) (quoting Argentine Republic v. Amerada Hess Shipping Corp. , 488 U.S. 428, 439, 109 S.Ct. 683, 102 L.Ed.2d 818 (1989) ). The FSIA renders foreign states, as well as their agencies and instrumentalities, 28 U.S.C. § 1603(a), "presumptively immune from the jurisdiction of United States courts[,]" unless a specific exception applies. Saudi Arabia v. Nelson , 507 U.S. 349, 355, 113 S.Ct. 1471, 123 L.Ed.2d 47 (1993) ; see also First Fid. Bank, N.A. v. Gov't of Antigua & Barbuda—Permanent Mission, 877 F.2d 189, 195 (2d Cir. 1989) ("The FSIA begins with a presumption of immunity which the plaintiff must overcome by showing that the defendant sovereign's activity falls under one of the statutory exceptions.").⁵ Accordingly, "[o]nce the defendant presents a prima facie case that it is a foreign sovereign [or an instrumentality of a foreign sovereign], the plaintiff has the burden of going forward with evidence showing that, under exceptions to the FSIA, immunity should not be...