432 F.Supp.3d 253
E.D.N.Y2020Background
- Plaintiffs are victims or relatives of victims of Hamas attacks (Dec 2001–Aug 2003) who sued BLOM Bank under the Anti‑Terrorism Act as amended by JASTA for aiding-and-abetting by providing banking services to three alleged Hamas-affiliated customers: Sanabil, Subul Al-Khair, and the Union of Good.
- Plaintiffs allege those three organizations functioned as Hamas’s daʿwa (civil/charitable) infrastructure that built support in Palestinian refugee camps; many cited connections derive from public reports and later U.S./foreign designations.
- Alleged transfers include payments from Holy Land Foundation, Al‑Aqsa Foundation, and KindHearts to the Three Customers, but most transfers processed by BLOM occurred before any U.S. Treasury SDGT designations and Plaintiffs do not plead transfers from BLOM directly to Hamas or to attackers.
- Plaintiffs relied on inferences from public reports and third‑party transactions to allege BLOM knew the Three Customers’ ties to Hamas and that BLOM’s services furthered Hamas’s violent activities.
- BLOM moved to dismiss under Rule 12(b)(6); the court applied the Halberstam framework (adopted in Linde) for JASTA aiding-and-abetting liability (wrongful act, general awareness, knowing substantial assistance).
- The court granted dismissal with prejudice, finding Plaintiffs failed plausibly to plead the Halberstam elements of general awareness and knowing substantial assistance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Plaintiffs plausibly allege the Halberstam “aiding party who causes injury” element | BLOM’s customers were alter egos of Hamas; indirect support suffices | JASTA requires more than indirect, routine banking to establish aiding the perpetrators | Court did not decide direct-vs-indirect question but found failure on other elements, so claim dismissed |
| Whether BLOM was "generally aware" it was assuming a role in Hamas’s violent or life-endangering activities | Public reports, designations, and transfers permit inference that BLOM knew the Three Customers were tied to Hamas and that terrorist acts were a foreseeable consequence | BLOM had no pleaded knowledge or reason to know of those public sources; mere provision of routine banking is insufficient | Plaintiffs failed to plausibly allege general awareness; element not met |
| Whether BLOM knowingly provided "substantial assistance" to Hamas | Processing millions in transfers to the Three Customers was integral and substantial support to Hamas | No non-conclusory allegation that funds reached Hamas or that BLOM intended or knew funds would fund violent acts; no presence, relationship, or state of mind alleged | Plaintiffs failed to plausibly plead knowing, substantial assistance; element not met |
| Whether plaintiff should be given leave to amend after pre‑motion offer | Plaintiffs declined the court’s offer to amend and identified no additional facts to cure defects | BLOM asked dismissal with prejudice | Court denied leave to amend and dismissed with prejudice (plaintiffs had declined prior opportunity) |
Key Cases Cited
- Halberstam v. Welch, 705 F.2d 472 (D.C. Cir. 1983) (establishes three-part civil aiding-and-abetting framework)
- Linde v. Arab Bank, PLC, 882 F.3d 314 (2d Cir. 2018) (applies Halberstam to JASTA and clarifies scienter needed beyond material-support knowledge)
- Siegel v. HSBC N. Am. Holdings, Inc., 933 F.3d 217 (2d Cir. 2019) (held plaintiffs failed to plead general awareness and substantial assistance under Halberstam)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (legal conclusions insufficient—must plead factual content supporting plausible claim)
- Kaplan v. Lebanese Canadian Bank, SAL, 405 F. Supp. 3d 525 (S.D.N.Y. 2019) (dismissal where plaintiffs failed to allege bank knew subordinate entities were playing roles in violent acts)
- Weiss v. National Westminster Bank PLC, 381 F. Supp. 3d 223 (E.D.N.Y. 2019) (routine banking to FTO insufficient for JASTA scienter)
- Strauss v. Credit Lyonnais, S.A., 379 F. Supp. 3d 148 (E.D.N.Y. 2019) (same principle applied)
- Miller v. Arab Bank, PLC, 372 F. Supp. 3d 33 (E.D.N.Y. 2019) (contrast: allegations of direct bank involvement in a specific payout scheme allowed claim to proceed)
- Boim v. Holy Land Found. for Relief & Dev., 549 F.3d 685 (7th Cir. 2008) (material-support doctrine: funds for nonviolent activities can still support terrorism—distinguished from higher JASTA scienter here)