Wultz v. Islamic Republic of Iran

755 F.Supp.2d 1

Sheryl WULTZ, et al., Plaintiffs,

v.ISLAMIC REPUBLIC OF IRAN, et al., Defendants.

No. 08–cv–1460(RCL).

United States District Court, District of Columbia.

Oct. 20, 2010.

Robert Joseph Tolchin, Brooklyn, NY, for Plaintiffs.Ramsey Clark, Clark & Schilling, New York, NY, David Taylor Case, Sarah P. Kenney, Siubhan J.E. Magee, Walter P. Loughlin, K & L Gates LLP, Mitchell R. Berger, Patton Boggs LLP, Washington, DC, for Defendants.

MEMORANDUM OPINION

ROYCE C. LAMBERTH, Chief Judge.

I. Introduction

17

II. Background

18

A.

A PIJ Suicide Bomber Allegedly Blew Up a Restaurant in Tel Aviv

18

B.

Plaintiffs Make Five Claims Against BOC Related to the Tel Aviv Bombing

19

III. Discussion

19

A.

Justiciability

20

1. Standing

20

a.

Standing Requires Injury in Fact, Causation, and Redressability

20

b.

Plaintiffs Have Standing

21

2.

Political–Question Doctrine

24

a.

Political Questions Are Those Issues Reserved for the Political Branches and Unsatisfactory for Judicial Determination

24

b.

Plaintiffs' Claims Do Not Raise Political Questions

25

i.

Adjudication of Plaintiffs' Claims Does Not Intrude Upon Foreign Relations of the Executive Branch

25

ii.

The Issue of Whether Adjudication of Plaintiffs' Claims Depends on Criteria Unsatisfactory for Judicial Determination Is Unripe

27

B.

Subject–Matter Jurisdiction

28

1.

Subject–Matter Jurisdiction Over a Case to Which a Foreign Sovereign Is a Party Turns on Sovereign Immunity

28

2.

Instrumentalities of Foreign States Are Presumptively Immune

29

3.

BOC Is Not an Instrumentality of China

29

C.

Personal Jurisdiction

30

1.

Plaintiffs Have the Burden of Alleging Jurisdictional Facts

30

2.

Plaintiffs Have Met Their Burden

31

a.

The Court Has Personal Jurisdiction Under the ATA

31

b.

The Court Has Personal Jurisdiction Under the Fifth Amendment

32

i.

BOC Must Have Sufficient Minimum Contacts With the United States

32

ii.

BOC Has Sufficient Minimum Contacts With the United States

33

c.

The Court Has Pendent Personal Jurisdiction as to Claims Under Israeli Law

36

D.

Venue

36

1.

BOC Waived its Objection to Improper Venue

37

2.

Regardless, Venue Is Proper Under the Doctrine of Pendent Venue

37

E.

Sufficiency of Plaintiffs' Pleadings

38

1.

Plaintiffs Must Plead a Short and Plain Statement Showing That They Are Entitled to Relief

39

2.

Plaintiffs Have Sufficiently Pled Count Two: Primary Liability

40

a.

Primary Liability Under the ATA Requires a Chain of Incorporations

41

b.

Plaintiffs Adequately Plead Eligibility

43

c.

Plaintiffs Adequately Plead Injury

43

d.

Plaintiffs Adequately Plead an Act of International Terrorism

43

i.

Plaintiffs Adequately Plead Acts Dangerous to Human Life

43

ii.

Plaintiffs Adequately Plead Violations of U.S. Criminal Law

44

I.

Plaintiffs Adequately Plead Violations of 18 U.S.C. § 2339A

44

II.

Plaintiffs Adequately Plead a Violation of 18 U.S.C. § 2339B

46

III.

Plaintiffs Adequately Plead a Violation of 18 U.S.C. § 2339C

47

iii.

Plaintiffs Adequately Plead Appearance of Intention to Intimidate Civilians, Influence Government Policy, or Affect Government Conduct

48

iv.

Plaintiffs Adequately Plead Transcendence of National Boundaries

49

e.

Plaintiffs Adequately Plead Ordinary Tort Requirements

50

i.

Plaintiffs Adequately Plead Intentional Misconduct

50

ii.

Plaintiffs Adequately Plead Proximate Causation

53

f.

Conclusions Concerning Count Two

53

3.

Plaintiffs Have Sufficiently Pled Count Three: Secondary Liability

54

a.

Secondary Liability Exists Under the ATA

54

b.

Plaintiffs Adequately Plead a Claim for Secondary Liability

57

4.

Plaintiffs Have Sufficiently Pled Count Four: Negligence

57

a.

Liability for Negligence Requires Duty, Breach, Injury, and Causation

57

b.

Plaintiffs Adequately Plead Duty

58

i.

Duties Arise When Injury Is Foreseeable

58

ii.

Plaintiffs Have Adequately Pled That BOC Was Under a Duty

59

c.

Plaintiffs Adequately Plead Breach

62

i.

Breach Occurs When a Person Under a Duty Acts Unreasonably With Respect to the Duty

62

ii.

Plaintiffs Have Adequately Pled that BOC Breached its Duty

62

d.

Plaintiffs Adequately Plead Injury

62

e.

Plaintiffs Adequately Plead Causation

62

i.

Factual Causation Exists Where, But For a Defendant's Act or Omission, a Plaintiff's Injury Would Not Have Occurred

63

ii.

Plaintiffs Adequately Plead That BOC Factually Caused Their Injury

64

iii.

Legal Causation Exists Where Injury Is Foreseeable, Within the Field of Risk, and Causation Fits Common Sense

65

iv.

Plaintiffs Adequately Plead That BOC Legally Caused Their Injury

65

5.

Plaintiffs Have Sufficiently Pled Count Five: Breach of Statutory Duty

67

a.

Breach of Statutory Duty Operates as a General Private Cause of Action for Violation of Israeli Law

67

b.

Plaintiffs Adequately Plead That BOC Was Under A Duty Imposed by Three Israeli Penal Laws

68

c.

Plaintiffs Adequately Plead That the Relevant Penal Laws Were Intended for the Benefit of the Public

70

d.

Plaintiffs Adequately Plead That BOC Breached its Duties

73

i.

Plaintiffs Adequately Plead a Violation of Israel's Prevention of Terrorism Ordinance

73

ii.

Plaintiffs Adequately Plead a Violation of Israel's Penal Law

74

iii.

Plaintiffs Adequately Plead a Violation of Israel's Defense (Emergency) Regulations

75

iv.

The Court Will Not Consider Whether Plaintiffs Have Pled a Violation of Israel's Prohibition on Terrorist Financing Law

76

e.

Plaintiffs Adequately Plead That Their Injuries Were Caused by BOC's Breach

77

f.

Plaintiffs Adequately Plead That They Suffered Injuries of the Sort Intended to Have Been Prevented by the Relevant Penal Statutes

78

g.

The Double–Actionability Rule Has Been Replaced, and Its Replacement Does Not Apply

78

6.

Plaintiffs Have Sufficiently Pled Count Six: Vicarious Liability

80

F.

Duplicity of Plaintiffs' Claims

81

1.

Claims Duplicative of Others Should Be Dismissed

81

2.

Plaintiffs' Secondary–Liability Claim Is Not Duplicative of Their Primary–Liability Claim

82

IV. Conclusion

82

I. Introduction.

The Bank of China, Ltd. (“Bank of China,” “Bank,” or BOC) has moved the Court to dismiss all claims against it. Def. BOC's Mot. to Dismiss the 1st Am. Compl., Mar. 5, 2009, ECF No. 15 [hereinafter BOC's Mot.]. The Bank has advanced several arguments in favor of its motion: that the case is nonjusticiable because plaintiffs lack standing, id. at 4–5, and because plaintiffs' claims raise political questions, id. at 5–12; that the Court lacks personal jurisdiction over the Bank, id. at 12–18; that venue is improper, Reply Mem. of P. & A. in Support of BOC's Mot. 4–9, July 24, 2009, ECF No. 42 [hereinafter BOC's Reply]; that plaintiffs fail to state any claim upon which relief can be granted, BOC's Mot. at 18–28, 29–44; and that plaintiffs make duplicative claims, id. at 28–29. To this list, the Court will sua sponte add consideration of whether the Bank is entitled to immunity from suit as an instrumentality of China. Plaintiffs oppose all arguments. Pls.' Mem. in Opp'n to BOC's Mot., May 26, 2009, ECF No. 31. [hereinafter Pls.' Opp'n]; Pls.' Surreply, Oct. 20, 2010, ECF No. 80.

In this memorandum opinion, the Court will first provide an overview of plaintiffs claims against BOC and will second discuss why the Court will reach the merits of those claims: plaintiffs have standing, plaintiffs' claims do not raise nonjusticiable political questions, the Bank is not entitled to sovereign immunity, the Court has personal jurisdiction over the Bank, venue is proper, plaintiffs have adequately pled claims upon which relief may be granted, and plaintiffs have not pled duplicative claims. The Court will thus deny the Bank's motion.

II. Background.

Plaintiffs make five claims against BOC: that BOC committed an act of international terrorism in violation of U.S. law, that BOC aided and abetted acts of international terrorism committed by others in violation of U.S. law, that BOC is liable for negligence under Israeli law, that BOC is liable for a breach of a statutory duty under Israeli law, and that BOC is vicariously liable for acts of the Palestinian Islamic Jihad (PIJ) under Israeli law. All five claims arise under the same set of alleged facts. This part of the opinion summarizes those facts and claims.

A. A PIJ Suicide Bomber Allegedly Blew Up a Restaurant in Tel Aviv.

On April 17, 2006, a Palestinian suicide bomber allegedly attacked a restaurant in Tel Aviv, State of Israel (“Israel”) (“Tel Aviv bombing” or, as referred to by plaintiffs, the “Terrorist Bombing”). 1st Am. Compl. ¶ 1, Jan. 13, 2009, ECF No. 12 [hereinafter FAC]. Daniel Wultz allegedly suffered severe physical injuries, resulting in his death, further resulting in economic injuries to his estate. Id. ¶¶ 87, 100. Daniel's father also allegedly suffered physical injuries in the attack. Id. ¶¶ 88, 101. Finally, several of Daniel's family members allegedly also suffered emotional and financial injuries. Id. ¶¶ 101–02.

In the wake of the bombing, Mr. Wultz's estate and family members (“plaintiffs”) have brought suit against several defendants, including BOC. See FAC. Concerning BOC, plaintiffs specifically allege that between 2003 and the date of the attack, “BOC executed dozens of dollar wire transfers for the PIJ, totaling several million dollars.” Id. ¶ 69. These transfers allegedly “were initiated by the PIJ leadership in Iran, Syria[,] and elsewhere in the Middle East, and were executed by and through BOC's branches in the United States.” Id. Transferred moneys were allegedly received into accounts owned by officers and agents of the PIJ and used “for the purpose of planning, preparing for[,] and executing terrorist attacks” in general. Id. ¶¶ 69–70. These transfers, therefore, allegedly “substantially increased and facilitated PIJ's ability to plan, to prepare for[,] and to carry out” the particular bombing at issue in this case. Id. ¶¶ 74, 92.

During the years when the alleged transfers were made, the PIJ was designated by the U.S. Department of State as a “foreign terrorist organization.” Review of...