316 F. Supp. 3d 770
S.D. Ill.2018Background
- Plaintiffs are Sudanese victims of atrocities (1997–2009) who allege BNP Paribas (BNPP) funded and helped the Sudanese government evade U.S. sanctions, enabling human-rights abuses.
- BNPP pled guilty in 2014 to conspiracy to violate U.S. sanctions (and related New York offenses) for conduct involving Sudan, Iran, and Cuba.
- Plaintiffs filed a putative class action in 2016 (Second Amended Complaint: 20 state-law claims under New York law, including aiding-and-abetting, conspiracy, torts (battery, assault, false imprisonment, wrongful taking/death), negligence-based claims, commercial bad faith, and unjust enrichment).
- Defendants moved to dismiss for (inter alia) act of state doctrine, statute-of-limitations, and failure to state claims.
- Court dismissed all claims: most under the act of state doctrine; several intentional-tort claims as time-barred for adult plaintiffs; and the remaining claims (commercial bad faith and unjust enrichment) for failure to state a claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of act of state doctrine | Plaintiffs: claims target private parties, not state acts; court can award damages without invalidating Sudan’s acts | Defendants: adjudication would require the court to pass judgment on sovereign acts committed in Sudan | Court: act of state bars adjudication of most claims because resolving them would require judging Sudan’s acts; Counts 1–16 and 19–20 dismissed |
| Timeliness/statute of limitations | Plaintiffs: CPLR 213‑b (7‑year victims’ statute) applies; alternatively equitable tolling applies because BNPP concealed conduct | Defendants: CPLR 213‑b inapplicable (BNPP’s guilty plea was to offenses against the U.S., not crimes against plaintiffs); normal NY statutes apply and many claims are time‑barred | Court: CPLR 213‑b inapplicable; equitable tolling applies until June 2014 (public revelations then); one‑year intentional‑tort claims expired before filing for adult plaintiffs, so Counts 3–10 and 15 dismissed as untimely for adults (minor plaintiffs preserved) |
| Viability of commercial bad faith claim (Count 17) | Plaintiffs: BNPP knowingly participated in widespread illegal transactions and should be liable under NY commercial bad faith doctrine | Defendants: doctrine limited historically to fraudulent check/closely related schemes and cannot be extended here | Court: decline to extend commercial bad faith to these facts; claim dismissed for failure to state a claim |
| Viability of unjust enrichment claim (Count 18) | Plaintiffs: BNPP was enriched by fees from transactions at plaintiffs’ expense; equity supports restitution | Defendants: no direct transfer from plaintiffs; plaintiffs lack a cognizable property right to the funds | Court: plaintiffs failed to show the funds belonged to them or a sufficiently direct relationship; unjust enrichment dismissed |
Key Cases Cited
- Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (doctrine bars U.S. courts from examining validity of foreign sovereign acts within its territory)
- Underhill v. Hernandez, 168 U.S. 250 (U.S. courts will not question acts by foreign military/government within its own territory)
- W.S. Kirkpatrick & Co. v. Envtl. Tectonics Corp., Int'l, 493 U.S. 400 (act of state is a binding principle of decision; narrow exceptions)
- Konowaloff v. Metro. Museum of Art, 702 F.3d 140 (2d Cir. 2012) (explaining limits of judicial review when foreign sovereign acts are established)
- ATSI Commc'ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87 (2d Cir. 2007) (pleading standard at motion to dismiss)
- Bell Atlantic v. Twombly, 550 U.S. 544 (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading must permit reasonable inference of liability)