Rothstein v. UBS AG
2010 U.S. Dist. LEXIS 139104
S.D.N.Y.2011Background
- Plaintiffs are 45 victims and/or families of victims of six Hamas/Hezbollah attacks in Israel (1997-2006).
- Complaint alleged UBS indirectly assisted Iran in funding Hamas/Hezbollah; sought damages under ATA §2333(a) and customary international law.
- Initial dismissal held lack of Article III standing due to an attenuated causal chain and failure to plead proximate causation; also failed to plead aiding-and-abetting and preemption of international-law claim.
- Remand followed the Supreme Court’s Humanitarian Law Project decision; Second Circuit instructed reconsideration in light of that decision.
- On remand, court reaffirmed dismissal, found Humanitarian Law Project does not alter Rothstein’s conclusions, and denied plaintiffs’ motion to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing and proximate causation under ATA | Rothstein contends Humanitarian Law Project broadens causation standing. | UBS argues standing/proximate causation remain deficient. | Standing and proximate causation remain insufficient. |
| Impact of Humanitarian Law Project on Rothstein | Humanitarian Law Project broadens implied liability for funding terrorism. | HL Project does not alter Rothstein’s standing/causation findings in civil ATA context. | HL Project does not change outcome; original dismissal reaffirmed. |
| Aiding-and-abetting theory under ATA | Knowledge of terrorism connection supports liability even without specific intent. | Aiding-and-abetting requires specific intent to further acts; not alleged. | Aiding-and-abetting theory not viable without specific intent allegations. |
| Preemption of customary international-law claim | Customary international law claim independent of ATA counts should survive. | Preempted by ATA Count One damages theory. | Preemption rejected; but claim still dismissed for other reasons. |
| Motion to amend on remand | Plaintiffs seeking to amend after remand should be allowed to address defects. | Remand did not disturb final judgment; amendments improper. | Motion to amend denied; judgment reaffirmed. |
Key Cases Cited
- Rothstein v. UBS AG, 647 F. Supp. 2d 292 (S.D.N.Y. 2009) (initial dismissal; standing and causation defects)
- Humanitarian Law Project, 130 S. Ct. 2705 (U.S. Supreme Court 2010) (knowledge standard for §2339B; no need for specific intent; vagueness and First Amendment analysis)
- Boim v. Holy Land Foundation for Relief and Development (Boim I), 291 F.3d 1000 (7th Cir. 2002) (aiding-and-abetting standard; intent required)
- Boim v. Holy Land Foundation for Relief and Development (Boim II), 549 F.3d 685 (7th Cir. 2007) (expanded discussion of secondary liability)
- Boim v. Holy Land Foundation for Relief and Development (Boim III), 549 F.3d 685 (7th Cir. 2007) (statutory silence on secondary liability)
- Huddy v. FCC, 236 F.3d 720 (D.C. Cir. 2001) (standing concept discussed in context of federal communications)
- Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574 (U.S. 1999) (Article III standing requirements)
- Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91 (U.S. 1979) (standing minima in federal courts)
- McBrearty v. Vanguard Group, Inc., 353 Fed. Appx. 640 (2d Cir. 2009) (standing/causation discussion in circuit context)