Licci Ex Rel. Licci v. Lebanese Canadian Bank SAL
2012 U.S. App. LEXIS 4557
2d Cir.2012Background
- Plaintiffs are Israeli residents injured or whose family members were killed or injured by Hizballah rocket attacks in northern Israel (July–August 2006).
- Plaintiffs allege LCB maintained accounts for Shahid Foundation and used LCB’s AmEx NY correspondent account to wire millions on Shahid’s behalf.
- District court dismissed plaintiffs’ negligence claim against AmEx under New York law.
- Choice-of-law question: Israeli law vs. New York law; court applies New York choice-of-law rules in a diversity-like context.
- Court holds New York law applies to the negligence claim; affirming dismissal against AmEx on this basis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Conflict of laws present? | Plaintiffs contend Israeli law conflicts with NY law. | AmEx asserts no meaningful conflict or that NY law governs. | There is an actual or potential conflict; NY conflict rules apply. |
| Which law governs the negligence claim if a conflict exists? | Israeli law governs their negligence claim. | New York law should govern under choice-of-law analysis. | If conflict exists, NY law governs under interest-analysis analysis. |
| Does New York conduct-regulating rule govern bank duty to protect third parties? | Israeli law would impose different duties. | NY law governs the duty analysis for NY-based banks. | NY has the greater interest; NY law applies to the duty issue. |
| Is the negligence claim under NY law viable? | AmEx breached a duty by facilitating transfers. | No duty or proximate-causation under NY law. | Claim fails under New York law; district court correctly dismissed. |
Key Cases Cited
- Wall v. CSX Transp., Inc., 471 F.3d 410 (2d Cir. 2006) (conflict-analysis requires actual conflict for choice-of-law to apply)
- Finance One Pub. Co. v. Lehman Bros. Special Fin., Inc., 414 F.3d 325 (2d Cir. 2005) (forum-state choice-of-law rules apply; conflicts analysis governed by NY rules)
- GlobalNet Fin. Corp. v. Frank Crystal & Co., 449 F.3d 377 (2d Cir. 2006) (interest-analysis distinguishes conduct-regulating vs. loss-allocating rules; NY has greater interest when conduct occurs where tort occurred)
- Schultz v. Boy Scouts of Am., Inc., 65 N.Y.2d 189 (1985) (locus jurisdiction’s interest in regulating conduct)
- Cooney v. Osgood Mach., Inc., 81 N.Y.2d 66 (1993) (conduct-regulating rules; where tort occurred matters for conflicts)
- Lerner v. Fleet Bank, N.A., 459 F.3d 273 (2d Cir. 2006) (duty/foreseeability considerations for banks toward non-customers)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards for plausibility)
- Famous Horse Inc. v. 5th Ave. Photo Inc., 624 F.3d 106 (2d Cir. 2010) (pleading standard and plausibility in neg. claims)
- Int’l Bus. Machs. Corp. v. Liberty Mut. Ins. Co., 363 F.3d 137 (2d Cir. 2004) (conflict of laws and choice-of-law framework)