176 F. Supp. 3d 264
E.D.N.Y2016Background
- Plaintiffs (≈200 U.S. nationals and estates) sued NatWest PLC under the Anti‑Terrorism Act (ATA), alleging it aided Hamas by maintaining Interpal’s accounts and transferring funds to charities that were allegedly Hamas fronts.
- NatWest had a New York branch/correspondent relationships and executed 196 U.S.‑dollar transfers routed through New York (the “New York Transfers”), among ~496 total transfers to those charities.
- This action consolidated Weiss and Applebaum; extensive merits discovery occurred; the district court previously granted summary judgment for NatWest, which the Second Circuit vacated and remanded for triable issues on scienter.
- After Daimler, NatWest for the first time moved to dismiss for lack of personal jurisdiction, or alternatively for summary judgment limited to the New York Transfers.
- Plaintiffs argued NatWest waived the jurisdiction defense and, in any event, New York has specific jurisdiction under CPLR §302(a)(1) (and nationwide jurisdiction under the ATA service provision).
- The court denied dismissal and summary judgment, finding no waiver and that specific jurisdiction exists based on NatWest’s deliberate, repeated use of New York’s banking system for transfers that are part of the alleged ATA violations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Waiver of personal jurisdiction defense | NatWest waived by not raising jurisdiction earlier and litigating for years | Daimler changed law; defense only became available after Daimler; timely asserted | No waiver — Daimler created a new viable defense; NatWest promptly asserted it after Daimler |
| General jurisdiction (New York) | N/A — Plaintiffs relied on specific jurisdiction | NatWest is not "at home" in NY; contacts insufficient under Daimler | No general jurisdiction — not an exceptional Perkins‑type case; NY is neither place of incorporation nor principal place of business |
| Specific jurisdiction under NY long‑arm CPLR §302(a)(1) | Repeated, deliberate routing of 196 transfers through NY shows purposeful availment and nexus to plaintiffs’ ATA claims | Transfers through NY were a subset; claims arise from many transfers (most not through NY), so §302 nexus insufficient | §302(a)(1) satisfied: purposeful availment via branch/correspondent use and a permissive relatedness/nexus between NY transfers and plaintiffs’ claims; jurisdiction covers claims tied to the overall course of conduct |
| Jurisdiction via federal service (Rule 4(k)(1)(C)/ATA) & due process | Nationwide service under ATA supports jurisdiction; minimum contacts with U.S. exist by use of NY banking system | Even if served, due process limits jurisdiction to only claims tied to NY transfers; challenging reasonableness | Nationwide service provides supplemental basis; due process satisfied — NatWest had minimum contacts with U.S. via deliberate NY use, and asserting jurisdiction is reasonable |
| Summary judgment (limit to NY transfers) | Plaintiffs need not limit proof to state at time of last NY transfer; liability arises from overall conduct including NY transfers | If jurisdiction limited to NY transfers, plaintiffs cannot prove scienter/proximate cause by August 15, 2003 | Denied — court rejects limiting jurisdiction to only NY transfers and declines summary judgment on scienter grounds at this stage |
Key Cases Cited
- Daimler AG v. Bauman, 134 S. Ct. 746 (U.S. 2014) (general jurisdiction limited to a corporation’s place of incorporation or principal place of business except in exceptional cases)
- Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (U.S. 2011) (framework for general jurisdiction prior to Daimler)
- Gucci America, Inc. v. Weixing Li, 768 F.3d 122 (2d Cir. 2014) (Daimler’s effect on waiver and general jurisdiction analysis in this Circuit)
- Licci v. Lebanese Canadian Bank, SAL, 20 N.Y.3d 327 (N.Y. 2012) (foreign bank’s repeated use of NY correspondent accounts can constitute transacting business under CPLR §302(a)(1))
- Licci v. Lebanese Canadian Bank, SAL, 732 F.3d 161 (2d Cir. 2013) (exercise of jurisdiction under §302(a)(1) in ATA‑style banking transfer context and due process analysis)
- International Shoe Co. v. Washington, 326 U.S. 310 (U.S. 1945) (minimum contacts/due process standard for personal jurisdiction)
- Weiss v. Nat’l Westminster Bank PLC, 768 F.3d 202 (2d Cir. 2014) (Second Circuit vacating district court summary judgment and remanding on scienter issues)