Filed: Dec. 17, 2015
Latest Update: Mar. 02, 2020
Summary: 13-3605 (L) Jesner v. Arab Bank 1 UNITED STATES COURT OF APPEALS 2 FOR THE SECOND CIRCUIT 3 August Term, 2014 4 (Argued: December 2, 2014 Decided: December 8, 2015 5 Amended: December 17, 2015) 6 Docket No. 13-3605; 13-3620; 13-3635; 13-4650; 13-4652 7 8 9 In Re: Arab Bank, PLC Alien Tort Statute Litigation1 10 11 12 13 Before: Sack, Chin, and Carney, Circuit Judges. 14 The plaintiffs seek compensation for damages allegedly incurred as a 15 result of armed attacks that took place in Israel, the
Summary: 13-3605 (L) Jesner v. Arab Bank 1 UNITED STATES COURT OF APPEALS 2 FOR THE SECOND CIRCUIT 3 August Term, 2014 4 (Argued: December 2, 2014 Decided: December 8, 2015 5 Amended: December 17, 2015) 6 Docket No. 13-3605; 13-3620; 13-3635; 13-4650; 13-4652 7 8 9 In Re: Arab Bank, PLC Alien Tort Statute Litigation1 10 11 12 13 Before: Sack, Chin, and Carney, Circuit Judges. 14 The plaintiffs seek compensation for damages allegedly incurred as a 15 result of armed attacks that took place in Israel, the W..
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13‐3605 (L)
Jesner v. Arab Bank
1 UNITED STATES COURT OF APPEALS
2 FOR THE SECOND CIRCUIT
3 August Term, 2014
4 (Argued: December 2, 2014 Decided: December 8, 2015
5 Amended: December 17, 2015)
6 Docket No. 13‐3605; 13‐3620; 13‐3635; 13‐4650; 13‐4652
7
8
9 In Re: Arab Bank, PLC Alien Tort Statute Litigation1
10
11
12
13 Before: Sack, Chin, and Carney, Circuit Judges.
14 The plaintiffs seek compensation for damages allegedly incurred as a
15 result of armed attacks that took place in Israel, the West Bank, and the Gaza
16 Strip between January 1995 and July 2005. They appeal from the dismissal of
17 claims they made under the Alien Tort Statute (the ʺATSʺ), 28 U.S.C. § 1350, by
18 the United States District Court for the Eastern District of New York (Brian M.
19 Cogan, Judge). The basis for the dismissal was this Courtʹs decision in Kiobel v.
20 Royal Dutch Petroleum Co., 621 F.3d 111 (2d Cir. 2010) (ʺKiobel Iʺ), affʹd on other
The Clerk of Court is respectfully directed to change the caption as shown above
1
pursuant to this Courtʹs January 6, 2014 order. This concise caption refers to the five
appeals described in the following notes.
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Jesner v. Arab Bank
1 grounds, Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013) (ʺKiobel IIʺ),
2 which construed the ATS as not permitting suits against corporate entities. We
3 conclude that Kiobel II did not overrule Kiobel I on the issue of corporate liability
4 under the ATS. We note nonetheless that Kiobel II appears to suggest that the
5 ATS may indeed allow for corporate liability—a reading of the statute that
6 several of our sister circuits have adopted. Even were we to agree with that
7 view, however, as a three‐judge panel, we would not be free to overrule the law
8 established by the previous decision of the Kiobel I panel. The order of the
9 district court is therefore:
10 AFFIRMED.
11 MICHAEL E. ELSNER (John M. Eubanks,
12 on the brief), Motley Rice LLC,
13 Mount Pleasant, South Carolina, for
14 Plaintiffs–Appellants.
15 Mark Werbner and Joel Israel, Sayles
16 Werbner, PC, Dallas, Texas, (on the brief), for
17 Plaintiffs–Appellants.
18 KEVIN WALSH (Douglas W.
19 Mateyaschuk, II, Steven J. Young, on the
20 brief), DLA Piper LLP, New York, New
21 York, for Defendant–Appellee.
22 Stephen M. Shapiro, Timothy S. Bishop,
23 Chad M. Clamage, Mayer Brown LLP,
24 Chicago, Illinois, (on the brief), for
25 Defendant–Appellee.
2
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1 Richard L. Herz, EarthRights International,
2 Washington, D.C., for Amici Curiae–Human
3 Rights Organizations.
4 Tyler R. Giannini, Harvard Law School,
5 International Human Rights Clinic,
6 Cambridge, Massachusetts, for Amici
7 Curiae–Professors of Legal History Barbara
8 Aronstein Black, William R. Casto, Martin S.
9 Flaherty, Nasser Hussain, Stanley N. Katz,
10 John V. Orth, and Anne‐Marie Slaughter.
11 Neal Kumar Katyal and Jessica L.
12 Ellsworth, Hogan Lovells US LLP,
13 Washington, D.C., for Amicus Curiae–The
14 Hashemite Kingdom of Jordan.
15 Douglas Hallward‐Driemeier, Ropes &
16 Gray LLP, Washington, D.C., for Amicus
17 Curiae–Union of Arab Banks.
18 Jeffrey B. Wall, Sullivan & Cromwell LLP,
19 Washington D.C., for Amicus Curiae–
20 Institute of International Bankers.
21
22 SACK, Circuit Judge:
23 The plaintiffs in this case filed five separate lawsuits between 2004 and
24 2010 in the United States District Court for the Eastern District of New York
25 against the defendant, Arab Bank, PLC. Oran Almog, et al. v. Arab Bank, PLC, No.
26 04‐CV‐5564 (E.D.N.Y. filed Dec. 21, 2004)2; Gila Afriat‐Kurtzer, et al., v. Arab Bank,
On appeal, this case has been docketed as Joseph Zur, et al. v. Arab Bank, PLC
2
inasmuch as Zur is an alien who has a claim arising under the Alien Tort Statute, 28
U.S.C. § 1350 (the ʺATSʺ), which provides relief exclusively for ʺaliens.ʺ The lead
3
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Jesner v. Arab Bank
1 PLC, No. 05‐CV‐0388 (E.D.N.Y. filed Jan. 21, 2005)3; Joseph Jesner, et al. v. Arab
2 Bank, PLC, No. 06‐CV‐3869 (E.D.N.Y. filed Aug. 9, 2006); Yaffa Lev, et al. v. Arab
3 Bank, PLC, No. 08‐CV‐3251 (E.D.N.Y. filed Aug. 11, 2008); Viktoria Agurenko, et al.
4 v. Arab Bank, PLC, No. 10‐CV‐0626 (E.D.N.Y. filed Feb. 11, 2010).
5 The plaintiffs are aliens who were injured or captured by terrorists
6 overseas, or family members and estate representatives of those who were
7 injured, captured, or killed. The plaintiffs seek judgments against Arab Bank,
8 PLC—a bank headquartered in Jordan with branches in various places around
9 the world—for allegedly financing and facilitating the activities of organizations
10 that committed the attacks that caused the plaintiffsʹ injuries. It is undisputed
11 that, as a PLC,4 Arab Bank is a corporation for purposes of this appeal.
12 The plaintiffs allege violations by Arab Bank of the Anti‐Terrorism Act (the
13 ʺATAʺ), 18 U.S.C. § 2333(a) (providing that ʺ[a]ny national of the United States
plaintiff in the district court, Oran Almog, is an American citizen and does not make a
claim under the ATS. Because Almog has no claim at issue on this appeal, the case has
been docketed under the name of a plaintiff who does.
3 On appeal, this case has been docketed as Oded Avrlingi, et al. v. Arab Bank, PLC
because the lead plaintiff in the district court, Gila Afriat‐Kurtzer, is an American
citizen and does not make a claim under the ATS. The case has been docketed under
the name of a plaintiff who does bring an ATS claim.
4 ʺPLC,ʺ sometimes written in the lower‐case, ʺplc,ʺ is the abbreviation for ʺpublic
limited company.ʺ See, e.g., Maxwell Commcʹn Corp. plc by Homan v. Societe Generale, 93
F.3d 1036, 1040 (2d Cir. 1996).
4
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Jesner v. Arab Bank
1 injured in his or her person, property, or business by reason of an act of
2 international terrorism, or his or her estate, survivors, or heirs, may sue therefor
3 in any appropriate district court of the United Statesʺ), the Alien Tort Statute, 28
4 U.S.C. § 1350 (the ʺATSʺ)5 (providing that ʺ[t]he district courts shall have original
5 jurisdiction of any civil action by an alien for a tort only, committed in violation
6 of the law of nations or a treaty of the United Statesʺ), and federal common law.6
7 The ATS differs from the ATA in that, among other things, it provides
8 jurisdiction only with respect to suits by ʺaliens,ʺ while the ATA provides
9 jurisdiction only for suits by ʺnational[s] of the United States.ʺ7
10 Between 2007 and 2010, the plaintiffsʹ federal common‐law claims were
11 dismissed as redundant and lacking what the district court called a ʺsound
The ATS is sometimes referred to as the Alien Tort Claims Act, or ATCA. See, e.g.,
5
Linde v. Arab Bank, PLC, 706 F.3d 92, 95 (2d Cir. 2013); Barclays Capital Inc. v.
Theflyonthewall.com, Inc., 650 F.3d 876, 899 n.32 (2d Cir. 2011) (referring to ʺthe Alien
Tort Claims Act (also commonly called the Alien Tort Statute)ʺ).
6 More precisely: Almog, No. 04‐CV‐5564, Dkt. Nos. 7 ¶ 4, 1250 ¶ 101 (bringing ATA,
ATS, and ʺgeneral federal common lawʺ claims); Afriat–Kurtzer, No. 05‐CV‐0388, Dkt.
No. 3 ¶ 4 (bringing ATA, ATS, and ʺgeneral federal common lawʺ claims); Jesner, No.
06‐CV‐3869, Dkt. No. 336 ¶ 4 (bringing only ATS claims); Lev, No. 08‐CV‐3251, Dkt. No.
1 ¶ 4 (bringing ATS claims and ʺgeneral federal common lawʺ claims); Agurenko, No. 10‐
CV‐0626, Dkt. No. 1 (bringing only ATS claims).
7 Non‐nationals can recover under the ATA only if they are survivors or heirs of a U.S.
national injured by international terrorism. 18 U.S.C. § 2333(a).
5
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1 basis.ʺ8 On May 24, 2013, the defendant also moved to dismiss the plaintiffsʹ ATS
2 claims, arguing that the law of this Circuit prohibits ATS suits against corporate
3 entities. In their briefing in the district court, the plaintiffs responded to the
4 defendantʹs arguments on their merits but also argued, in the alternative, that if
5 the district court granted the defendantʹs motion, it should also reinstate the
6 plaintiffsʹ federal common‐law claims or permit the plaintiffs to plead related
7 non‐federal common‐law claims.
8 On August 23, 2013, the district court issued the following order:
9 The law of this Circuit is that plaintiffs cannot bring claims against
10 corporations under the ATS. See Kiobel v. Royal Dutch Petroleum Co.,
11 621 F.3d 111 (2d Cir. 2010), affʹd, Kiobel v. Royal Dutch Petroleum Co.,
12 133 S.Ct. 1659 (2013). A decision by a panel of the Second Circuit ʺis
13 binding unless and until it is overruled by the Court en banc or by
14 the Supreme Court.ʺ Baraket v. Holder, 632 F.3d 56, 59 (2d Cir. 2011).
15 Because the Supreme Court affirmed [this Circuitʹs Kiobel decision]
16 on other grounds, the Second Circuitʹs holding on corporate liability
17 under the ATS remains intact. Nothing in the Supreme Courtʹs
18 affirmance undercuts the authority of the Second Circuitʹs decision.
19 Plaintiffsʹ request to reinstate their federal common law claims or, in
20 the alternative, assert non‐federal common law claims is denied.
21 The federal common law claims were dismissed not only as
See Almog v. Arab Bank, PLC, 471 F. Supp. 2d 257, 294 (E.D.N.Y. 2007) (dismissing the
8
plaintiffsʹ common law claims in Almog (now Zur) and Afriat–Kurtzer (now Avrlingi)
because the ʺ[p]laintiffs have offered no sound basis for these . . . claims,ʺ and because
ʺplaintiffs agreed that such claims would be ʹredundantʹ of the ATS claimsʺ); see also Lev,
No. 08‐CV‐3251, Dkt. No. 30 (E.D.N.Y. Jan. 29, 2010) (dismissing the plaintiffsʹ common‐
law claims for the same reasons).
6
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Jesner v. Arab Bank
1 redundant, but also because Plaintiffs offered ʺno sound basisʺ for
2 them. Almog v. Arab Bank, PLC, 471 F. Supp. 2d 257 (E.D.N.Y. 2007).
3 Plaintiffs also offer no sound basis for repackaging these claims
4 under unidentified ʺnon‐federal common lawʺ theories.
5 Jesner v. Arab Bank, 06‐CV‐3869, Unnumbered Dkt. Entry on Aug. 23, 2013. Soon
6 thereafter, judgments on the pleadings were entered in each of the individual
7 cases as to the ATS claims. The plaintiffs filed timely appeals as to these claims.9
8 On appeal, the plaintiffs argue principally that this Circuitʹs opinion in
9 Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111 (2d Cir. 2010) (ʺKiobel Iʺ), affʹd on
10 other grounds, Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013) (ʺKiobel
11 IIʺ), when analyzed in light of the Supreme Courtʹs decision in Kiobel II, is no
12 longer ʺgood law,ʺ or at least, does not control this case. The plaintiffs also
13 contend that the facts alleged sufficiently touch and concern the territory of the
14 United States as required under Kiobel II to support jurisdiction, although they
15 request that we remand to the district court for an initial decision on this issue.
16 Finally, and in the alternative, the plaintiffs request the opportunity either to
The ATS and ATA claims were bifurcated in the district court. The ATA claims are
9
not at issue on this appeal, but we note that in 2014, a jury rendered a verdict on
liability in favor of the plaintiffs in those cases. See, e.g., Stephanie Clifford, Jury Finds
Arab Bank Liable for Aiding Terror, N.Y. Times, Sept. 23, 2014, at A1, online version available
at http://www.nytimes.com/2014/09/23/nyregion/arab‐bank‐found‐guilty‐of‐supporting‐
terrorist.html. The verdict was upheld in large part by the district court in response to
the defendantʹs post‐trial motions. Linde v. Arab Bank, PLC, 97 F. Supp. 3d 287 (E.D.N.Y.
2015).
7
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Jesner v. Arab Bank
1 reinstate their federal common‐law claims or to amend their pleadings in order
2 to plead non‐federal common‐law claims.
3 BACKGROUND
4 I. The Plaintiffsʹ Claims
5 The plaintiffs in the underlying cases are U.S. and foreign nationals who
6 have brought suit against Arab Bank for its alleged role in facilitating terrorist
7 operations that harmed the plaintiffs. While the underlying cases contain
8 differing factual allegations, they are, as the plaintiffs assert, ʺbased on the same
9 nucleus of [purported] material facts.ʺ Appellantsʹ Br. at 1 n.1. In recounting
10 those facts to this Court, the plaintiffsʹ briefing relies heavily on the operative,
11 amended complaint in Zur v. Arab Bank, PLC. In providing a summary of the
12 facts of this case, we therefore draw, at times verbatim, from the district courtʹs
13 thorough opinion addressing a previous motion to dismiss by Arab Bank in Zur
14 (sub nom. Almog v. Arab Bank, PLC, 471 F. Supp. 2d 257 (E.D.N.Y. 2007)).10
15 According to the plaintiffs, over the past two decades, four prominent
16 Palestinian terrorist organizations—the Islamic Resistance Movement
In deciding the motion to dismiss in Zur, the district court assumed the truth of, and
10
drew all favorable inferences from, the operative complaintʹs factual allegations. We
apply the same standard (and so adopt the district courtʹs factual analysis) in this
appeal from a subsequent grant of the defendantʹs motion for judgment on the
pleadings. See Bank of N.Y. v. First Millennium, Inc., 607 F.3d 905, 922 (2d Cir. 2010).
8
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Jesner v. Arab Bank
1 (ʺHAMASʺ), the Palestinian Islamic Jihad (ʺPIJʺ), the Al Aqsa Martyrsʹ Brigade
2 (ʺAAMBʺ), and the Popular Front for the Liberation of Palestine (ʺPFLPʺ)
3 (collectively ʺthe terrorist organizationsʺ)11—have conducted widespread
4 murderous attacks, including suicide bombings, against citizens of Israel—
5 mostly Jews. The terrorist organizations allegedly arranged those attacks in part
6 by promising, and later delivering, financial payments to the relatives of
7 ʺmartyrsʺ who were killed—along with those who were injured or captured—
8 while perpetrating the attacks. See Almog, 471 F. Supp. 2d at 260‐61.
9 The plaintiffs assert that the terrorist organizations funded these attacks in
10 two ways. The organizations solicited public and private donations directly and
11 deposited them in bank accounts throughout the Middle East. The organizations
12 also raised funds through affiliated, purportedly charitable proxy organizations,
13 including two entities created in Saudi Arabia: the Popular Committee for
14 Assisting the Palestinian Mujahideen and the Saudi Committee for Aid to the Al–
15 Quds Intifada (the ʺSaudi Committeeʺ). These two organizations allegedly set up
HAMAS, the PIJ, and the PFLP were each named a Specially Designated Terrorist
11
entity (ʺSDTʺ) by the U.S. government in 1995 and designated a Foreign Terrorist
Organization (ʺFTOʺ) by the U.S. Secretary of State in 1997. And HAMAS, the PIJ, and
the AAMB have each been named a Specially Designated Global Terrorist Entity by the
U.S. government.
9
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1 their own bank accounts, under the shared label ʺAccount 98,ʺ at various banks
2 in Saudi Arabia in order to hold funds collected for the families of ʺmartyrs.ʺ See
3 id. at 261‐62.
4 According to the amended complaint, Arab Bank—one of the largest
5 financial institutions in the Middle East, with branches and subsidiaries in more
6 than twenty‐five countries, including a New York branch that provides clearing
7 and correspondent banking services to foreign financial institutions—
8 deliberately helped the terrorist organizations and their proxies to raise funds for
9 attacks and make payments to the families of ʺmartyrs.ʺ The plaintiffs further
10 allege that Arab Bank used some of those facilities—the New York branch among
11 them—to support the terrorist organizations in three ways. See id. at 261‐62.
12 First, Arab Bank allegedly maintained accounts that the terrorist
13 organizations used to solicit funds directly. The plaintiffs allege, with respect to
14 HAMAS specifically, that Arab Bank ʺcollectedʺ funds into HAMAS accounts in
15 its Beirut, Lebanon, and Gaza Strip branches. Supporters knew to donate to
16 HAMAS directly through Arab Bank because the HAMAS website directed
17 supporters to make contributions to Arab Bankʹs Gaza Strip branch, and because
18 there were various advertisements publicized throughout the Middle East calling
10
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1 for donations to Arab Bank accounts. According to the plaintiffs, Arab Bank
2 knew that the donations were being collected for terrorist attacks. See id. at 262.
3 Second, Arab Bank allegedly maintained accounts that proxy
4 organizations and individuals used to raise funds for the terrorist organizations.
5 For example, according to the amended complaint, Arab Bank maintained
6 accounts, solicited and collected donations, and laundered funds for some of the
7 purported charitable organizations that acted as fronts for the terrorist
8 organizations. Arab Bank also maintained accounts for individual supporters of
9 terrorist organizations such as HAMAS and al Qaeda. Again, responsible
10 officials at Arab Bank purportedly knew that the accounts of these various
11 organizations and individuals were being used to fund the suicide bombings and
12 other attacks sponsored by the terrorist organizations. See id.
13 Third, Arab Bank allegedly played an active role in identifying the families
14 of ʺmartyrsʺ and facilitating payments to them from the Saudi Committeeʹs
15 ʺAccount 98ʺ funds, on behalf of the terrorist organizations. According to the
16 plaintiffs, Arab Bank first worked with the Saudi Committee and HAMAS to
17 finalize lists of eligible beneficiaries. Arab Bank then created individual bank
18 accounts for the beneficiaries and facilitated transfers of ʺAccount 98ʺ funds into
11
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1 those accounts, often routing the transfers through its New York branch in order
2 to convert Saudi currency into Israeli currency. Once the accounts were filled,
3 Arab Bank provided instructions to the public on how to qualify for and collect
4 the money, and made payments to beneficiaries with appropriate
5 documentation. See id. at 262‐63.
6 The plaintiffs allege that Arab Bankʹs involvement with the terrorist
7 organizations—particularly its facilitation of payments to the families of
8 ʺmartyrsʺ—incentivized and encouraged suicide bombings and other murderous
9 acts that harmed the plaintiffs. See id. at 263.
10 II. Procedural History
11 The plaintiffs in the consolidated cases filed five separate lawsuits between
12 2004 and 2010 in the United States District Court for the Eastern District of New
13 York against Arab Bank alleging variations on the theme of the foregoing facts.
14 See Almog, 04‐CV‐5564 (E.D.N.Y. filed Dec. 21, 2004); Afriat‐Kurtzer, 05‐CV‐0388
15 (E.D.N.Y. filed Jan. 21, 2005); Jesner, 06‐CV‐3869 (E.D.N.Y. filed Aug. 9, 2006); Lev,
16 08‐CV‐3251 (E.D.N.Y. filed Aug. 11, 2008); Agurenko, PLC, 10‐CV‐0626 (E.D.N.Y.
17 filed Feb. 11, 2010). All five lawsuits included tort claims under the ATS. At the
12
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Jesner v. Arab Bank
1 district court level, these cases were consolidated, along with six others, for
2 discovery and pre‐trial proceedings.12
3 On August 23, 2013, the district court dismissed the plaintiffsʹ ATS claims
4 on the basis of Kiobel I. Jesner v. Arab Bank, 06‐CV‐3869, Unnumbered Dkt. Entry
5 on Aug. 23, 2013. At the time, ATS claims were the only ones remaining in three
6 of the five cases before the district court: Jesner, Lev, and Agurenko. Final
7 judgments were therefore filed in each of those cases on August 28, 2013. The
8 two remaining actions, Almog and Afriat‐Kurtzer, involved both ATS claims and
9 ATA claims, the latter of which remained intact after the district courtʹs August
10 23, 2013 order. As a result, partial final judgments as to the ATS claims were
11 issued in those cases on October 16, 2013.
12 The plaintiffs in all five cases appealed to this Court from the judgments
13 on the pleadings regarding their ATS claims. On December 10, 2013, the
14 plaintiffs collectively moved to consolidate the appeals. We granted that motion
15 on January 6, 2014.
The six other cases were Linde v. Arab Bank, PLC, No. 04‐CV‐2799 (E.D.N.Y. filed July
12
2, 2004); Litle v. Arab Bank, PLC, No. 04‐CV‐5449 (E.D.N.Y. filed Dec. 15, 2004); Coulter v.
Arab Bank, PLC, No. 05‐CV‐365 (E.D.N.Y. filed Jan. 21, 2005); Bennett v. Arab Bank, PLC,
No. 05‐CV‐3183 (E.D.N.Y. filed July 1, 2005); Roth v. Arab Bank, PLC, No. 05‐CV‐3738
(E.D.N.Y. filed Aug. 5, 2005); and Weiss v. Arab Bank, PLC, No. 06‐Cv‐1623 (E.D.N.Y.
filed Apr. 7, 2006).
13
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1 For the following reasons, we affirm the judgments of the district court.
2 DISCUSSION
3 I. Standard of Review
4 ʺWe review de novo a district courtʹs decision to grant a motion for
5 judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c).ʺ
6 Hayden v. Paterson, 594 F.3d 150, 160 (2d Cir. 2010). In doing so, we ʺemploy[] the
7 same . . . standard applicable to dismissals pursuant to [Federal Rule of Civil
8 Procedure] 12(b)(6).ʺ Johnson v. Rowley, 569 F.3d 40, 43 (2d Cir. 2009) (quotation
9 marks omitted). Thus, we ʺaccept[] as true factual allegations made in the
10 complaint, and draw[] all reasonable inferences in favor of the plaintiffs.ʺ Town
11 of Babylon v. Fed. Hous. Fin. Agency, 699 F.3d 221, 227 (2d Cir. 2012). ʺTo survive a
12 motion to dismiss, a complaint must contain sufficient factual matter, accepted as
13 true, to ʹstate a claim to relief that is plausible on its face.ʹʺ Ashcroft v. Iqbal, 556
14 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
15 II. Corporate Liability Under the Alien Tort Statute
16 We conclude that Kiobel I is and remains the law of this Circuit,
17 notwithstanding the Supreme Courtʹs decision in Kiobel II affirming this Courtʹs
18 judgment on other grounds. We affirm the decision of the district court on that
19 basis. We do so despite our view that Kiobel II suggests that the ATS may allow
14
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1 for corporate liability and our observation that there is a growing consensus
2 among our sister circuits to that effect. Indeed, on the issue of corporate liability
3 under the ATS, Kiobel I now appears to swim alone against the tide.
4 A. The Decisions in Kiobel I and Kiobel II
5 To repeat: The ATS provides, in full, that ʺ[t]he district courts shall have
6 original jurisdiction of any civil action by an alien for a tort only, committed in
7 violation of the law of nations or a treaty of the United States.ʺ 28 U.S.C. § 1350.
8 In Kiobel I, the panel divided over the breadth of liability recognized by the ʺlaw
9 of nationsʺ—and, consequently, on whether corporations may be held liable
10 under the ATS.
11 The majority opinion, written by Judge Cabranes and joined by then‐Chief
12 Judge Jacobs, concluded that the ATS does not permit claims against
13 corporations because ʺ[n]o corporation has ever been subject to any form of
14 liability (whether civil, criminal, or otherwise) under the customary international
15 law of human rights.ʺ 621 F.3d at 148 (emphasis in original). This conclusion
16 was based on the majorityʹs view that the law of nations must affirmatively
17 extend liability to ʺa particular class of defendant, such as corporations,ʺ before
18 that class of defendant may be held liable for conduct that violates a substantive
19 norm of customary international law. Id. at 127. As precedential support for that
15
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1 view, the majority cited footnote 20 in Sosa v. Alvarez‐Machain, 542 U.S. 692
2 (2004). In Sosa, commenting on the portion of the opinion that instructed ʺfederal
3 courts . . . not [to] recognize private claims under federal common law for
4 violations of any international law norm with less definite content and
5 acceptance among civilized nations than the historical paradigms familiar when
6 § 1350 was enacted,ʺ id. at 732, the Supreme Court stated that ʺ[a] related
7 consideration is whether international law extends the scope of liability for a
8 violation of a given norm to the perpetrator being sued, if the defendant is a
9 private actor such as a corporation or individual,ʺ id. at 732 n.20.
10 Judge Leval, Kiobel Iʹs third panel member, filed an opinion concurring in
11 the judgment for the defendant, but sharply contesting the majorityʹs conception
12 of liability under the law of nations. He described ʺ[i]nternational law, at least as
13 it pertains to human rights,ʺ as ʺa sparse body of norms . . . prohibiting conduct,ʺ
14 which lacks comprehensive rules regarding liability and so ʺleaves the manner of
15 enforcement . . . almost entirely to individual nations.ʺ 621 F.3d at 152 (Leval, J.,
16 concurring). Judge Leval argued that Sosaʹs footnote 20 is consistent with that
17 view inasmuch as it does no more than caution courts to defer to the law of
16
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1 nations on the scope of liability in those exceptional cases where customary
2 international law affirmatively bars recovery against private actors:
3 If the violated norm is one that international law applies only
4 against States, then a private actor, such as a corporation or an
5 individual, who acts independently of a State, can have no liability
6 for violation of the law of nations because there has been no
7 violation of the law of nations. On the other hand, if the conduct is
8 of the type classified as a violation of the norms of international law
9 regardless of whether done by a State or a private actor, then a
10 private actor, such as a corporation or an individual, has violated the
11 law of nations and is subject to liability in a suit under the ATS. The
12 majorityʹs partial quotation out of context, interpreting the Supreme
13 Court as distinguishing between individuals and corporations,
14 misunderstands the meaning of the passage.
15 Id. at 165 (quotation marks and emphases omitted). Under that view, the ATS
16 does not prohibit corporate liability per se. Instead, if unspecified by the
17 international law in question, the scope of liability under the ATS is
18 appropriately classified as a question of remedy to be settled under domestic
19 law. See id. at 152.
20 The plaintiffs in Kiobel I obtained a writ of certiorari from the United States
21 Supreme Court. In its eventual opinion on the merits, the Supreme Court
22 described the caseʹs rather arduous path to and before it:
23 The [United States District Court for the Southern District of New
24 York] dismissed [several ATS] claims, reasoning that the facts
25 alleged to support those claims did not give rise to a violation of the
17
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1 law of nations. The court denied respondents’ motion to dismiss
2 with respect to the remaining claims, but certified its order for
3 interlocutory appeal [to the Second Circuit] pursuant to § 1292(b).
4 The Second Circuit dismissed the entire complaint, reasoning that
5 the law of nations does not recognize corporate liability. 621 F.3d
6 111 (2010). We granted certiorari to consider that question. 565 U.S.
7 ___, 132 S. Ct. 472 (2011). After oral argument, we directed the
8 parties to file supplemental briefs addressing an additional question:
9 “Whether and under what circumstances the [ATS] allows courts to
10 recognize a cause of action for violations of the law of nations
11 occurring within the territory of a sovereign other than the United
12 States.” 565 U.S. ___, 132 S. Ct. 1738 (2012). We heard oral argument
13 again and now affirm the judgment below, based on our answer to
14 the second question.
15 Kiobel II, 133 S. Ct. at 1663 (citations omitted in part).13
16 Thus, the Supreme Court first agreed to review the judgment of this Court.
17 After being supplied with briefing and conducting oral argument directed to the
18 analysis we had employed in Kiobel I, the Court decided to address a different
19 issue. The Court concluded not that Kiobel I was right on the law, but that it was
20 right in its conclusion because of the presumption against extraterritoriality. The
21 Court observed that ʺall the relevant conduct took place outside the United
22 States,ʺ which justified dismissal of the plaintiffsʹ ATS claims. Id. at 1669.
The nature of the plaintiffsʹ several ATS claims that the district court dismissed is
13
not relevant to this appeal.
18
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1 B. The Impact of Kiobel II on Kiobel I
2 Although the route the Supreme Court took to its decision in Kiobel II
3 seems to suggest that the Court was less than satisfied with our approach to
4 jurisdiction over the cases on appeal under the ATS, it neither said as much nor
5 purported to overrule Kiobel I. The two decisions adopted different bases for
6 dismissal for lack of subject‐matter jurisdiction. Whatever the tension between
7 them, the decisions are not logically inconsistent.
8 The Supreme Court chose to affirm Kiobel I on extraterritoriality grounds
9 without reaching the corporate liability question. Id. at 1663. But because both of
10 these questions concern the proper interpretation of the ATS itself, and because
11 the ATS is strictly jurisdictional,14 it follows that both of these questions are
12 jurisdictional. Regarding corporate liability, Kiobel I held that federal courts lack
13 jurisdiction over ATS suits against corporations; as to extraterritoriality, Kiobel II
14 held that federal courts lack jurisdiction over ATS suits based solely on
15 extraterritorial conduct unless that conduct sufficiently touches and concerns the
The ATS is a ʺstrictly jurisdictionalʺ statute. Kiobel II, 133 S. Ct. at 1664 (quoting Sosa,
14
542 U.S. at 713). It ʺdoes not directly regulate conduct or afford relief. It instead allows
federal courts to recognize certain causes of action based on sufficiently definite norms
of international law.ʺ Id.
19
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Jesner v. Arab Bank
1 territory of the United States.15 Taken together, they require that if either the
2 defendant in an ATS suit is a corporation, or the ATS suit is premised on conduct
3 outside the United States that does not sufficiently touch and concern the
4 territory of the United States, or both, the federal court in which the suit was
5 brought lacks jurisdiction.16
The plaintiffs argue that by reaching the issue of extraterritoriality in Kiobel II, the
15
Supreme Court implicitly acknowledged that it ʺpossessed subject matter jurisdiction
over an ATS claim against a corporate defendant.ʺ Plaintiffsʹ Br. at 23. That is, the
plaintiffs contend that corporate liability is a jurisdictional question, whereas
extraterritoriality is a merits question. Therefore, they argue, because ʺsubject‐matter
jurisdiction necessarily precedes a ruling on the merits,ʺ Ruhrgas AG v. Marathon Oil Co.,
526 U.S. 574, 584 (1999), by reaching the issue of extraterritoriality, the Supreme Court
implied that federal courts have jurisdiction over ATS claims against corporate
defendants. In support of this position, the plaintiffs cite the Supreme Courtʹs decision
in Morrison v. Natʹl Australia Bank Ltd., 561 U.S. 247 (2010), which held that in a § 10(b)
action under the Securities Exchange Act of 1934, the question of the extraterritorial
application of the provision is ʺa merits question,ʺ id. at 254. But this conclusion rests on
an interpretation of § 10(b), which is not a jurisdictional statute, as is the ATS. In Kiobel
II, the Supreme Court specifically stated that the ʺprinciples underlying the
presumption against extraterritoriality . . . constrain courts exercising their power under
the ATS.ʺ 133 S. Ct. at 1665 (emphasis added). ʺSubject‐matter jurisdiction . . . refers to
a tribunalʹs power to hear a case.ʺ Morrison, 561 U.S. at 254 (quotation marks omitted).
Kiobel II thus addressed a jurisdictional question, and did not reach the merits of
plaintiffsʹ ATS claim.
16 In Daimler AG v. Bauman, 134 S. Ct. 746 (2014), the Supreme Court held that due
process does not permit the exercise of general personal jurisdiction under Californiaʹs
long‐arm statute over a German corporation that the plaintiffs had sued under the ATS,
the Torture Victim Protection Act of 1991, California law, and Argentina law, id. at 758‐
63. The Court also noted that the plaintiffsʹ ATS claims were ʺinfirmʺ in light of Kiobel
IIʹs holding that the presumption against extraterritorial application controls claims
under the ATS. Id. at 762‐63. Neither the Supreme Courtʹs holding as to personal
jurisdiction nor its statement about the viability of the plaintiffsʹ ATS claims implies that
20
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Jesner v. Arab Bank
1 Generally speaking, ʺthis panel is bound by prior decisions of this court
2 unless and until the precedents established therein are reversed en banc or by the
3 Supreme Court.ʺ United States v. Jass, 569 F.3d 47, 58 (2d Cir. 2009); see also, e.g.,
4 Jones v. Coughlin, 45 F.3d 677, 679 (2d Cir. 1995) (similar). We have recognized,
5 though, that there is an exception to this general rule when an ʺintervening
6 Supreme Court decision . . . casts doubt on our controlling precedent.ʺ
7 Wojchowski v. Daines, 498 F.3d 99, 106 (2d Cir. 2007) (quotation marks omitted).17
corporate liability is or is not possible under the ATS. As to the former, the Supreme
Court need not have asserted subject‐matter jurisdiction over the plaintiffsʹ ATS claims
before reaching the issue of personal jurisdiction, as the plaintiffsʹ ATS claims were
ʺinfirm,ʺ meaning that the court lacked subject matter jurisdiction over them, and there
were several non‐ATS claims at issue over which the court could properly exercise
subject matter jurisdiction. As to the latter, as explained above, extraterritoriality and a
defendantʹs corporate nature are (in the Second Circuit) distinct, if often overlapping,
bases for dismissal under the ATS.
17 The full quotation reads:
While as a general rule, one panel of this Court cannot overrule a prior
decision of another panel[,] . . . an exception to this general rule arises
where there has been an intervening Supreme Court decision that casts
doubt on our controlling precedent. Moreover, the intervening decision
need not address the precise issue already decided by our Court. We
agree with the District Court that our holding in [our earlier case] was
based on an interpretation of the Social Security Actʹs antiattachment
provision that is inconsistent with the Supreme Courtʹs reading of [the
statutory provision at issue in a later case]. We therefore conclude that (1)
[our prior opinion]ʹs holding concerning the scope of [the statutory
provision at issue] is no longer good law and (2) under [the Supreme
Courtʹs opinion], New Yorkʹs income‐first policy as applied to Social
Security benefits does not violate [the provision].
21
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1 ʺ[F]or this exception to apply, the intervening decision need not address the
2 precise issue already decided by our Court.ʺ Union of Needletrades, Indus. &
3 Textile Empls., AFL‐CIO, CLC v. U.S. I.N.S., 336 F.3d 200, 210 (2d Cir. 2003).
4 Instead, there must be a conflict, incompatibility, or ʺinconsisten[cy]ʺ between
5 this Circuitʹs precedent and the intervening Supreme Court decision. Wojchowski,
6 498 F.3d at 109. The effect of intervening precedent may be ʺsubtle,ʺ but if the
7 impact is nonetheless ʺfundamental,ʺ it requires this Court to conclude that a
8 decision of a panel of this Court is ʺno longer good law.ʺ Id. (quotation marks
9 and alteration omitted).
10 Kiobel II does cast a shadow on Kiobel I in several ways.18
11 First, in Kiobel II, the Supreme Court stated that ʺ[c]orporations are often
12 present in many countries, and it would reach too far to say that mere corporate
13 presence sufficesʺ to displace the presumption against extraterritorial
14 application. 133 S. Ct. at 1669. The implication of a statement that mere corporate
15 presence is insufficient would seem to be that corporate presence may, in
Wojchowski, 498 F.3d at 106 (citations and quotation marks omitted).
18 As noted above, the route the Supreme Court took to its decision in Kiobel II itself
seems to suggest that the Court was less than satisfied with our approach to jurisdiction
under the ATS in Kiobel I.
22
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Jesner v. Arab Bank
1 combination with some other factual allegations, be sufficient—so jurisdiction
2 over ATS suits against corporations is sometimes proper. Indeed, if corporate
3 liability under the ATS were not possible as a general matter, the Supreme
4 Courtʹs statement about ʺmere corporate presenceʺ would seem meaningless.
5 Accordingly, Kiobel II appears to suggest that the ATS allows for some degree of
6 corporate liability.
7 Second, Kiobel II embraced an interpretation of Sosa that seems to us to be
8 more consistent with Judge Levalʹs Kiobel I concurrence than the majority
9 opinion. According to the Supreme Court, ʺ[t]he question under Sosaʺ
10 is ʺwhether [a federal] court has authority to recognize a cause of action under
11 U.S. law to enforce a norm of international law.ʺ Kiobel II, 133 S. Ct. at 1666
12 (emphasis added). The Supreme Court further stated that the ATS empowers
13 federal courts to recognize such a cause of action ʺunder federal common lawʺ to
14 enable litigants to bring ʺprivate claimsʺ based on ʺinternational law violations.ʺ
15 Id. at 1663 (quoting Sosa, 542 U.S. at 724, 732). Kiobel II thus appears to reinforce
16 Judge Levalʹs reading of Sosa, which derives from international law only the
17 conduct proscribed, leaving domestic law to govern the available remedy and,
23
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Jesner v. Arab Bank
1 presumably, the nature of the party against whom it may be obtained.19 If that is
2 so, Kiobel II suggests that Kiobel I relies in part on a misreading of Sosa.20
3 Third, Kiobel I and Kiobel II may work in tandem to narrow federal courtsʹ
4 jurisdiction under the ATS more than what we understand Congress may have
5 intended in passing the statute. As Justice Breyer noted in his Kiobel II
6 concurrence, the basic purpose of the ATS is to provide compensation to foreign
7 plaintiffs injured by ʺpirates,ʺ ʺtorturers,ʺ ʺperpetrators of genocide,ʺ and similar
8 actors. Kiobel II, 133 S. Ct. at 1672‐75 (Breyer, J., concurring in the judgment).
9 Together, Kiobel I and Kiobel II put such aggrieved potential plaintiffs in a very
10 small box: The two decisions read cumulatively provide that plaintiffs can bring
11 ATS suits against only natural persons, and perhaps non‐corporate entities,
12 based on conduct that occurs at least in part within (or otherwise sufficiently
13 touches and concerns) the territory of the United States. At a time when large
We acknowledge that in some instances the conduct proscribed may also specifically
19
identify the entities or individuals so proscribed.
20 Lending further support to this conclusion, the Kiobel I majorityʹs interpretation of
Sosa relied in part on Judge Katzmannʹs concurrence in Khulumani v. Barclay National
Bank Ltd., 504 F.3d 254 (2d Cir. 2007). Kiobel I, 621 F.3d at 129‐31. Judge Katzmann,
however, saw ʺno inconsistency between the reasoning of [his] opinion in Khulumani
and Judge Levalʹs well‐articulated conclusion . . . that corporations, like natural persons,
may be liable for violations of the law of nations under the AT[S].ʺ Kiobel v. Royal Dutch
Petroleum Co., 642 F.3d 379, 380‐81 (2d Cir. 2011) (Katzmann, J., dissenting from denial
of rehearing en banc).
24
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Jesner v. Arab Bank
1 corporations are often among the more important actors on the world stage,21
2 and where actions and their effects frequently cross international frontiers, Kiobel
3 I and Kiobel II may work together to prevent foreign plaintiffs from having their
4 day in court in a far greater proportion of tort cases than Congress envisioned
5 when, centuries ago, it passed the ATS.
6 Our reading of Kiobel II is bolstered by what appears to be a growing
7 consensus among our sister circuits that the ATS allows for corporate liability.
8 To date, the other circuits to have considered the issue have all determined that
9 corporate liability is possible under the ATS. See Doe I v. Nestle USA, Inc., 766
10 F.3d 1013, 1022 (9th Cir. 2014); Doe VIII v. Exxon Mobil Corp., 654 F.3d 11, 57 (D.C.
11 Cir. 2011), vacated on other grounds, 527 F. Appʹx 7 (D.C. Cir. 2013); Flomo v.
Indeed, some corporations, such as the defendant Arab Bank, are important enough
21
that their home countriesʹ governments are acutely concerned about their financial well‐
being and exposure to lawsuits. In this regard, we acknowledge the Kingdom of
Jordanʹs argument in its amicus brief that ʺ[t]he ATS was enacted to enhance respect for
foreign nationsʹ sovereign dignity,ʺ and that foreign nations may have a strong
ʺsovereign interest in protecting [their] corporations from being improperly haled into
U.S. courts.ʺ Amicus Curiae Brief of the Hashemite Kingdom of Jordan at 7 (emphasis
removed). But while the imposition of liability on certain foreign corporations under
the ATS could of course raise foreign policy concerns, these concerns are substantially
mitigated by the presumption against the extraterritorial application of the ATS, the
doctrine of sovereign immunity (under which foreign corporations may be held to be
organs of a foreign state), and the possibility of action by the executive or legislative
branches, each of which may serve as a counterweight to the imposition of corporate
liability in ATS suits.
25
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1 Firestone Nat. Rubber Co., 643 F.3d 1013, 1021 (7th Cir. 2011); Romero v. Drummond
2 Co., 552 F.3d 1303, 1315 (11th Cir. 2008); see also Al Shimari v. CACI Premier Tech.,
3 Inc., 758 F.3d 516, 530‐31 (4th Cir. 2014) (holding that the district court erred in
4 concluding that it lacked subject matter jurisdiction over an ATS claim against a
5 corporate defendant on extraterritoriality grounds, and finding that the plaintiffsʹ
6 ATS claims sufficiently ʺʹtouch[ed] and concern[ed]ʹ the territory of the United
7 Statesʺ based on, inter alia, the corporate defendantʹs ʺstatus as a United States
8 corporationʺ); Beanal v. Freeport–McMoran, Inc., 197 F.3d 161, 163 (5th Cir. 1999)
9 (dismissing ATS claims against corporate defendants under Rule 12(b)(6), and to
10 that extent appearing to implicitly assume jurisdiction over ATS claims against
11 corporate defendants).
12 For those reasons, Kiobel II may be viewed as an ʺintervening Supreme
13 Court decision that casts doubt on [Kiobel I],ʺ Wojchowski, 498 F.3d at 106
14 (quotation marks omitted), even though it does not ʺaddress the precise issueʺ of
15 corporate liability, Union of Needletrades, 336 F.3d at 210. Kiobel II suggests a
16 reading of the ATS that is at best ʺinconsistentʺ with Kiobel Iʹs core holding,
17 which along with the views of our sister circuits indicates that something may be
18 wrong with Kiobel I.
26
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Jesner v. Arab Bank
1 We nonetheless decline to conclude that Kiobel II overruled Kiobel I. We
2 think that one panelʹs overruling of the holding of a case decided by a previous
3 panel is perilous. It tends, in our view, to degrade the expectation of litigants,
4 who routinely rely on the authoritative stature of the Courtʹs panel opinions. It
5 also diminishes respect for the authority of three‐judge panel decisions and
6 opinions by which the overwhelming majority of our work, and that of other
7 circuits, is accomplished. See 13 Charles Alan Wright & Arthur R. Miller et al.,
8 Federal Practice and Procedure § 3506 (3d ed. 1998) (noting that ʺ[t]he courts of
9 appeals generally follow the practice that one panel is bound by the previous
10 decision of another panel of that court,ʺ and collecting cases).22 We will leave it
11 to either an en banc sitting of this Court or an eventual Supreme Court review to
12 overrule Kiobel I if, indeed, it is no longer viable. Cf. Ark. Carpenters Health &
13 Welfare Fund v. Bayer AG, 604 F.3d 98, 108‐10 (2d Cir. 2010) (applying a prior
We also note post‐Kiobel II comments in dicta of this Court that Kiobel I remains
22
authoritative in this Circuit. See Balintulo v. Ford Motor Co., 796 F.3d 160, 166 n.28 (2d
Cir. 2015); Mastafa v. Chevron Corp., 770 F.3d 170, 179 n.5 (2d Cir. 2014); Chowdhury v.
Worldtel Bangl. Holding, Ltd., 746 F.3d 42, 49 n.6 (2d Cir. 2014); Balintulo v. Daimler AG,
727 F.3d 174, 191 n.26 (2d Cir. 2013); but see Chowdhury, 746 F.3d at 55 (Pooler, J.,
concurring) (writing separately ʺfor the sole purpose of emphasizing the narrowness of
this Courtʹs disposition with respect to the implications of [Kiobel II],ʺ which is ʺtied to
considerations regarding which claims do not ʹtouch and concern the territory of the
United States,ʹʺ and not whether the ATS permits corporate liability (quoting Kiobel II,
133 S. Ct. at 1669)).
27
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Jesner v. Arab Bank
1 panelʹs decision while explicitly disagreeing with it and proffering ʺseveral
2 reasons why this case might be appropriate for reexamination by our full
3 Courtʺ).23
4 If this Court declines to overrule Kiobel I (either on the merits or by
5 refusing to proceed en banc), the Supreme Court would, of course, be able to do
6 so should it choose to hear the case. The Supreme Court granted certiorari on
7 this issue in 2011 when it first decided to hear an appeal from Kiobel I. Kiobel v.
8 Royal Dutch Petroleum Co., 132 S. Ct. 472 (2011). Having nonetheless avoided
9 addressing the issue directly in Kiobel II, perhaps it would decide to grant
10 certiorari on this issue again—especially in light of the divergence of federal case
11 law since.
12 Finally, the district court dismissed the plaintiffsʹ ATS claims solely on
13 corporate liability grounds under Kiobel I. It is well settled that ʺwe may affirm
14 on any grounds for which there is a record sufficient to permit conclusions of
15 law, including grounds not relied upon by the district court.ʺ Olsen v. Pratt &
This Court declined to rehear the matter en banc, but the Arkansas Carpenters panelʹs
23
position was later largely vindicated by the Supreme Court. See FTC v. Actavis, Inc., 133
S. Ct. 2223 (2013) (abrogating the holding of this Court that the Arkansas Carpenters
panel had criticized, as stated in Louisiana Wholesale Drug Co. v. Shire LLC (In re Adderall
XR Antitrust Litigation), 754 F.3d 128, 132‐33 (2d Cir. 2014)).
28
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Jesner v. Arab Bank
1 Whitney Aircraft Div. of United Techs. Corp., 136 F.3d 273, 275 (2d Cir. 1998)
2 (quoting Chesley v. Union Carbide Corp., 927 F.2d 60, 68 (2d Cir. 1991)); see also N.Y.
3 State Elec. & Gas Corp. v. FirstEnergy Corp., 766 F.3d 212, 222 n.4 (2d Cir. 2014)
4 (same, citing Olsen). However, we have discretion to choose not to do so based
5 on prudential factors and concerns. See Bacolitsas v. 86th & 3rd Owner, LLC, 702
6 F.3d 673, 681 (2d Cir. 2012) (ʺWhile generally we decline considering arguments
7 not addressed by the district court, this is a prudential rule we apply at our
8 discretion. In determining whether to consider such issues, we rely on a number
9 of factors, including the interests of judicial economy, and whether the
10 unaddressed issues present pure questions of law.ʺ (citations omitted)).
11 It is tempting to seek to avoid grappling with issues requiring an analysis
12 of the relationship between Kiobel I and Kiobel II and the continuing viability of
13 Kiobel I simply by affirming the district courtʹs judgments on the basis of Kiobel II
14 alone. We nevertheless decline to do so for several reasons. First, inasmuch as
15 the district court did decide the case based solely on a mechanical application of
16 Kiobel I, if it is ʺgood law,ʺ an affirmance on the basis of Kiobel I is the simplest,
17 most direct route to that result. By contrast, in order to affirm on the grounds
18 that law established by Kiobel II prohibits the assumption of jurisdiction in this
29
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Jesner v. Arab Bank
1 case, we would have to decide in the first instance that the alleged activities
2 underlying the plaintiffsʹ claims do not touch and concern the United States
3 sufficiently to justify a conclusion that the district court had subject matter
4 jurisdiction under Kiobel IIʹs extraterritoriality test. It seems to us to be unwise to
5 decide the difficult and sensitive issue of whether the clearing of foreign dollar‐
6 denominated payments through a branch in New York could, under these
7 circumstances, displace the presumption against the extraterritorial application
8 of the ATS, when it was not the focus of either the district courtʹs decision or the
9 briefing on appeal. See, e.g., Amicus Curiae Brief of the Institute of International
10 Bankers at 5‐20 (discussing several concerns regarding whether the clearing of
11 foreign dollar‐denominated transfers through the United States would be
12 sufficient domestic conduct to allow suit under the ATS).
13 Moreover, deciding this appeal solely on the basis of Kiobel I may well
14 further the development of the law of this Circuit in this regard. If Kiobel I
15 remains authoritative, litigants would benefit from the settling of expectations
16 that clarification would bring. And if the rule of Kiobel I does not prevail, then
17 leaving it unnecessarily ʺon the booksʺ is worrisome—it may result in the
18 dismissal of cases that are meritorious, including possibly multidistrict litigations
30
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Jesner v. Arab Bank
1 that are randomly assigned to the district courts in this Circuit. Perhaps more
2 insidiously, plaintiffs with ATS claims against corporations that turn out to be
3 permissible might well be dissuaded from asserting them in this Circuit despite
4 their ultimate merit.
5 We therefore affirm on the basis of the holding of Kiobel I.
6 III. Common Law Claims
7 The plaintiffs request that if we affirm the dismissal of their ATS claims—
8 as indeed we do—we reinstate the ʺgeneral federal common lawʺ claims asserted
9 in their complaints (to which they refer on appeal as their ʺgeneral common‐law
10 tortʺ claims), which the district court dismissed as redundant and lacking a
11 ʺsound basis.ʺ Almog, 471 F. Supp. 2d at 294. Alternatively, the plaintiffs request
12 leave to amend their complaints in order to re‐plead under state or foreign law
13 the claims that they originally pleaded under federal common law. We decline
14 both requests.
15 First, we will not reinstate the plaintiffsʹ federal24 common‐law causes of
16 action because we discern no basis for such nebulous, non‐statutory claims under
The plaintiffs clearly asserted their non‐statutory claims under federal law, not state
24
law. Indeed, their complaints allege that they were injured in violation of ʺgeneral
federal common law.ʺ Almog, No. 04‐CV‐5564 Dkt. Nos. 7 ¶ 4, 1250 ¶ 101; Afriat‐
31
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Jesner v. Arab Bank
1 federal law.25 See Republic of Iraq v. ABB AG, 768 F.3d 145, 172 (2d Cir. 2014)
2 (concluding that if a plaintiffʹs ʺassertion of nonstatutory wrongs describes
3 traditional types of torts by private entities,ʺ the plaintiffʹs claims arise ʺunder
4 state law rather than federal common law,ʺ unless the plaintiff can identify a
5 ʺuniquely federal interest in the rules of decision to be applied,ʺ or a ʺconflict
6 between a federal policy or interest and the use of state lawʺ).
7 As for leave to amend the complaints, ʺwe review [the district courtʹs
8 refusal to allow such amendment] only for abuse of discretion which ordinarily
9 we will not identify absent an error of law, a clearly erroneous assessment of the
10 facts, or a decision outside the available range of permitted choices.ʺ Knife Rights,
Kurtzer, No. 05‐CV‐0388 Dkt. No. 3 ¶ 4; Jesner, No. 06‐CV‐3869, Dkt. No. 336 ¶ 4; Lev,
No. 08‐CV‐3251, Dkt No. 1 ¶ 4. (The complaint in Agurenko does not assert general
federal common‐law claims. See No. 10‐CV‐0626, Dkt. No. 1.) And in their briefing on
the motion to dismiss at issue on this appeal, they specifically requested the
opportunity to ʺconvertʺ their common‐law claims ʺto non‐federal law claimsʺ in order
to assert ʺcorollary non‐federal theories based on the same facts.ʺ Jesner, No. 06‐CV‐
3869, Dkt No. 735 at 24‐25.
25 The defendant argues that the plaintiffsʹ general federal common‐law claims are
barred by Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). This argument rests on a
common misunderstanding of Erie, which merely stands for the proposition that when
an issue is governed by state law, federal courts must look to the decisions of that stateʹs
courts, not to federal court decisions purporting either to interpret the state law or
provide better answers. See id. at 78‐80. ʺErie did not in any way involve the question
of whether the federal courts possess common law powers to use in other areas of law
whose interpretation was entrusted primarily to them.ʺ Pierre N. Leval, Distant
Genocides, 38 Yale J. Intʹl L. 231, 243 (2013); see also generally Henry J. Friendly, In Praise of
Erie—And of the New Federal Common Law, 39 N.Y.U. L. Rev. 383, 405‐22 (1964).
32
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Jesner v. Arab Bank
1 Inc. v. Vance, 802 F.3d 377, 389 (2d Cir. 2015) (citations omitted). While ʺ[l]eave to
2 amend should be freely granted, . . . the district court has the discretion to deny
3 leave if there [was] a good reason for it, such as futility, bad faith, undue delay,
4 or undue prejudice to the opposing party.ʺ Jin v. Metro. Life Ins. Co., 310 F.3d 84,
5 101 (2d Cir. 2002).
6 The plaintiffs have spent more than ten years litigating the matters before
7 us but have not specified any particular state or foreign common‐law theory on
8 which they seek to recover. To be sure, they have in their complaints and in their
9 briefing on appeal asserted that they may recover under general principles of
10 joint‐venture liability, agency, reckless disregard, intentional injury of others by a
11 third party, reckless disregard, wrongful death, survival, and negligent or
12 intentional infliction of emotional distress. But their short and conclusory
13 statements to this effect, untethered to the law of any particular jurisdiction or
14 any serious attempt at explanation, did not put the defendant on notice of
15 specific state or foreign common‐law claims that it might be called upon to
16 defend against in this litigation.26 The plaintiffs have had ample time to develop
The complaint in Almog sets forth five counts for ʺassisting in the intentional injury
26
of others by a third partyʺ (Count Six), ʺreckless disregardʺ (Count Seven), ʺwrongful
deathʺ (Count Eight), ʺsurvivalʺ (Count Nine), and ʺnegligent and/or intentional
33
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Jesner v. Arab Bank
1 and assert such theories. The district court did not abuse its discretion in
2 denying leave to amend because permitting the plaintiffs to repackage their
3 federal common‐law claims as state or foreign common‐law claims at such a late
4 stage would, we think, do a disservice both to the courts in which they chose to
5 litigate their claims, and to the defendant, which must prepare itself to defend
6 against them.
7 Permitting the plaintiffs in Jesner, Lev, and Agurenko to amend their
8 complaints would, moreover, have been futile. Following the dismissal of the
9 plaintiffsʹ ATS claims, the only basis on which the district court might exercise
10 jurisdiction over these actions would be diversity of citizenship. But ʺdiversity is
11 lacking . . . where the only parties are foreign entities, or where on one side there
12 are citizens and aliens and on the opposite side there are only aliens.ʺ Universal
13 Licensing Corp. v. Paola del Lungo S.P.A., 293 F.3d 579, 581 (2d Cir. 2002). Here,
14 there are aliens on both sides of the litigation—plaintiffs are aliens (only aliens
15 can bring ATS claims), and so is the defendant, a citizen of Jordan—and the
infliction of emotional distressʺ (Count Ten). Almog, No. 04‐CV‐5564, Dkt. Nos. 7
¶¶ 329‐54, 1250 ¶ 101. It is unclear whether these claims are among the Almog plaintiffsʹ
general federal common‐law claims. Their complaint asserted causes of action based
only on ʺthe laws of nations, United Statesʹ [sic] statutes, and general federal common
law,ʺ Almog, No. 04‐CV‐5564, Dkt. No. 7 ¶ 4, and the counts do not specify under which
jurisdictionʹs law they seek to recover.
34
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1 Jesner, Lev, and Agurenko plaintiffs do not seek to assert any other federal claims
2 that might provide a basis for federal‐question jurisdiction. For these reasons,
3 permitting the Jesner, Lev, and Agurenko plaintiffs to amend their complaints to
4 assert non‐federal common‐law claims would be fruitless.
5 The district court therefore acted within its discretion in declining to
6 permit the plaintiffs to amend their complaints.
7 CONCLUSION
8 For the foregoing reasons, we AFFIRM the judgments of the district court.
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