In Re Terrorist Attacks on
September 11, 2001: Dismissals of
Claims Against Saudi Defendants Under
the Foreign Sovereign Immunities Act (FSIA)
Jennifer K. Elsea
Legislative Attorney
December 20, 201227, 2013
Congressional Research Service
7-5700
www.crs.gov
RL34726
CRS Report for Congress
Prepared for Members and Committees of Congress
In Re Terrorist Attacks on September 11, 2001
Summary
Practical and legal hurdles, including the difficulty of locating hidden al Qaeda members and the
infeasibility of enforcing judgments in terrorism cases, hinder victims’ attempts to establish
liability in U.S. courts against, and recover financially from, those they argue are directly
responsible for the September 11 terrorist attacks. Instead, victims have sued numerous
individuals and entities with only indirect ties to the attacks, including defendants who allegedly
provided monetary support to al Qaeda prior to September 11, 2001. Within the consolidated case
In Rere Terrorist Attacks of September 11, 2001, one such group of defendants was the Kingdom of
Saudi Arabia, several Saudi princes, a Saudi banker, and a Saudi charity. Plaintiffs argued that
these Saudi defendants funded groups that, in turn, assisted the attackers.
A threshold question in In Rere Terrorist Attacks was whether U.S. courts have the power to try
these Saudi defendants. In August 2008, the U.S. Court of Appeals for the Second Circuit
affirmed dismissals of all claims against the Saudi defendants, holding that U.S. courts lack
jurisdiction over the claims. Specifically, the court of appeals held that in this case, U.S. courts
lack: 1) subject matter jurisdiction over the Kingdom of Saudi Arabia, because the Kingdom is
entitled to immunity under the Foreign Sovereign Immunities Act (the FSIA) and no statutory
exception to immunity applies; 2) subject matter jurisdiction over the Saudi charity and Saudi
princes acting in their official capacities, because they are “agents or instrumentalities” of the
Kingdom and thus, under the FSIA, are entitled to immunity to the same extent as the Kingdom
itself; and 3) personal jurisdiction over Saudi princes sued in their personal capacities, because
the princes had insufficient interactions with the forum to satisfy the “minimum contacts”
standard for personal jurisdiction under the Fifth Amendment due process clause.
In 2011, the Second Circuit reversed itself with respect to the immunity of non-terrorist states,
finding that the tort exception under the FSIA does not exclude terrorist acts that take place within
the United States. In 2013, the court ordered these claims against Saudi Arabia and its agencies or
instrumentalities be reinstated in the interest of justice to determine whether the tort exception
applies.
This report summarizes the FSIA and jurisdiction in cases against foreign defendants and
analyzes the recent court of appeals decision. It also discusses legislative efforts to address these issues
(S. 1535 and H.R. 3143).
Congressional Research Service
In Re Terrorist Attacks on September 11, 2001
Contents
Overview of the Foreign Sovereign Immunities Act ....................................................................... 1
Jurisdiction in Cases Against Foreign Defendants........................................................................... 2
Subject Matter Jurisdiction ........................................................................................................ 3
Personal Jurisdiction .................................................................................................................. 3
U.S. Court of Appeals Decision in In Re Terrorist Attacks on September 11, 2001
(“Terrorist Attacks III”) ................................................................................................................ 4
Background................................................................................................................................ 5
Charity and Princes as “Agencies and Instrumentalities” of the Kingdom ............................... 56
The SHC “Charity” Charity ................................................................................................................. 6
Officials ............................................................................................................................... 6
Relevant FSIA Exceptions ......................................................................................................... 7
Commercial Activities Exception........................................................................................ 7
Torts Exception 8
Tort exception...................................................................................................................... 8
Princes Sued in Their Personal Capacities ................................................................................ 8
Recent Developments ..9
Legislative Developments.................................................................................................................... 9
Contacts
Author Contact Information........................................................................................................... 1011
Acknowledgments ......................................................................................................................... 1011
Congressional Research Service
In Re Terrorist Attacks on September 11, 2001
N
umerous legal and practical obstacles, such as the infeasibility of locating al Qaeda
operatives, stand in the way of victims seeking to establish liability in U.S. courts against,
and recover damages from, the terrorists who planned and carried out the September 11,
2001, attacks. Victims, however, have sued numerous individuals and groups with only indirect
ties to the attackers, including defendants who allegedly provided monetary support to al Qaeda
prior to September 11, 2001.
In Rere Terrorist Attacks on September 11, 2001, is a consolidated case that includes, among other
claims, claims against the Kingdom of Saudi Arabia, several Saudi princes, a Saudi banker, and a
Saudi charity.1 Plaintiffs argued that these Saudi defendants played a “critical role” in the
September 11 attacks by giving money to Muslim groups, which in turn funded al Qaeda.2
However, in In
August 2008, the U.S. Court of Appeals for the Second Circuit affirmed dismissals
of the claims against the Saudi defendants.3 This report examines the legal bases for those
dismissals
against the Saudi defendants.3 However, part of the reasoning for the dismissals was later
overturned, and the plaintiffs may now get a second chance to bring their suit against the Saudi
government and government-owned charity. This report explains the legal bases for the initial
dismissals and provides an update to the status of the case.
Overview of the Foreign Sovereign Immunities Act
The Foreign Sovereign Immunities Act (the FSIA) applies to all foreign states and their “agents
and instrumentalities.”4 Immunity for sovereign nations against suits in U.S. courts has a long
history and is based on the principle that conflicts with foreign nations are more effectively
addressed through diplomatic efforts than through judicial proceedings.5 Congress passed the
FSIA to codify these long-standing principles and to clarify limitations on the scope of immunity
that had emerged in international practice.6
The FSIA contains both a general, presumptive rule against litigation in U.S. courts and a number
of exceptions permitting suits. As a general rule, foreign states, together with their agents and
instrumentalities, are “immune from the jurisdiction of the courts of the United States and from
the states.”7 However, the FSIA authorizes jurisdiction over foreign nations in several
exceptions.8 Namely, a foreign state is not immune from U.S. courts’ jurisdiction where: 1) the
foreign state has waived its immunity;9 2) the claim is a specific type of admiralty claim;10 3) the
claim involves commercial activities;11 4) the claim implicates property rights connected with the
1
In Re1
In re Terrorist Attacks on September 11, 2001, 538 F.3d 71 (2d Cir. 2008), cert. denied sub nom.., Federal Ins. Co. v.
Kingdom of Saudi Arabia, 129 S. Ct. 2859 (2009557 U.S. 935 (2009) (“Terrorist Attacks III”).
2
538 F.3d at 76.
3
Id. at 75-76.
4
Foreign Sovereign Immunities Act of 1976, P.L. 94-583; codified at 28 U.S.C. §1602 et seq.
5
For more on the history of foreign sovereign immunity and the FSIA, see CRS Report RL31258, Suits Against
Terrorist States by Victims of Terrorism, by Jennifer K. Elsea. See also Elizabeth L. Barh. Is the Gavel Mightier Than
the Sword? Fighting Terrorism in American Courts. 15 Geo. Mason L. RevGEO. MASON L. REV. 1115, 1125 (2008).
6
See Permanent Mission of India to United Nations v. City of New York, 127 S.Ct. 2352, 2356551 U.S. 193, 199 (discussing Congress’s
intention to codify an understanding of immunity as restricted to public acts and to codify the real property exception
existing in international practice at the time).
7
28 U.S.C. §1604.
8
28 U.S.C. §1605.
9
28 U.S.C. §1605(a).
10
28 U.S.C. §1605(b).
11
The commercial activities exception applies if a foreign state: 1) conducts the relevant commercial activity in the
(continued...)
Congressional Research Service
1
In Re Terrorist Attacks on September 11, 2001
Congressional Research Service
1
In Re Terrorist Attacks on September 11, 2001
claim involves commercial activities;11 4) the claim implicates property rights connected with the
United States;12 5) the claim arises from tortious conduct that occurred in the United States;13 6)
the claim is made pursuant to an arbitration agreement;14 or 7) the claim seeks money damages
against a designated state sponsor of terrorism for injuries arising from a terrorist act.15
The exception for designated state sponsors of terrorism provides jurisdiction over cases
involving designated “state sponsor[s] of terrorism” in suits involving “personal injury or death
that was caused by an act of torture, extrajudicial killing, aircraft sabotage, hostage taking, or the
provision of material support or resources for such an act if such act or provision of material
support or resources is engaged in by an official, employee, or agent of such foreign state while
acting within the scope of his or her office, employment, or agency.”16 However, the exception
seems to apply only to countries designated by the U.S. Department of State as state sponsors of
terrorism.17 This list currently includes Cuba, Iran, Sudan, and Syria.18 At the time suit was
brought in the In re Terrorist Attacks litigation, the previous terrorism exception remained in
force.
Jurisdiction in Cases Against Foreign Defendants
Before asserting jurisdiction to accept a case, a federal court19 must establish its authority over the
dispute involved and the parties to the litigation. In other words, courts must assert both subject
matter jurisdiction over each claim and personal jurisdiction over each defendant in a case. For
cases involving foreign defendants, the analyses for subject matter and personal jurisdiction differ
according to whether the FSIA applies.
(...continued)
11
The commercial activities exception applies if a foreign state: 1) conducts the relevant commercial activity in the
U.S.; 2) performs an act in the U.S. related to the commercial activity in question; or 3) conducts commercial activity
that causes a “direct effect” in the U.S. 28 U.S.C. §1605(a)(2).
12
The property rights exception applies if: 1) rights in property have been taken in violation of international law and
the property at issue (or property exchanged for the property at issue) is located in the U.S.; 2) the property at issue (or
property exchanged for the property at issue) is owned or operated by the foreign state or its agent or instrumentality
and the foreign state or its agent or instrumentality is engaged in commercial activity in the U.S.; or 3) “the property
rights in property in the United States acquired by succession or gift or rights in immovable property situated in the
United States are in issue.” 28 U.S.C. §1605(a)(3),(4).
13
28 U.S.C. §1605(a)(5).
14
28 U.S.C. §1605(a)(6).
15
28 U.S.C. §1605A.
16
Id. Previously codified at 28 U.S.C. §1605(a)(7), the terrorist state exception has served as the basis for significant
litigation since Congress added it to the FSIA in 1996. The exception has also spurred legal disputes over attachment of
assets. As a result, it has been amended several times, most recently by Section 1083 of the National Defense
Authorization Act for FY2008, which provided a new federal cause of action for lawsuits that rely on the exception and
added provisions regarding attachment of foreign assets to facilitate satisfaction of money damages awards. P.L. 110181. For information on suits against terrorist states, generally, see CRS Report RL31258, Suits Against Terrorist
States by Victims of Terrorism, by Jennifer K. Elsea.
17
28 U.S.C. §1605A(a)(2)(i)(I) provides that a “claim under this section” shall be heard if “the foreign state was
designated as a state sponsor of terrorism” at the relevant time. 28 U.S.C. §1605A(a)(1) seems to remove immunity
more broadly.
18
22 CFRC.F.R. §126.1(d).
19
Although state courts occasionally hear cases involving foreign defendants, cases involving foreign states or foreign
officials are usually removed to federal courts under 28 U.S.C. §1441(d). For this reason, this discussion focuses on
jurisdiction in federal courts.
Congressional Research Service
2
In Re Terrorist Attacks on September 11, 2001
Subject Matter Jurisdiction
For claims by U.S. plaintiffs against foreign non-state defendants to whom the FSIA does not
apply—for example, claims against individuals or corporations—federal law authorizes subject
matter jurisdiction as long as the “amount in controversy” exceeds $75,000.20
In contrast, for claims against foreign states and their instrumentalities, the FSIA is a
jurisdictional gatekeeper. The FSIA denies subject matter jurisdiction over claims against foreign
defendants entitled to immunity.21 Conversely, the FSIA authorizes subject matter jurisdiction
over claims in which a foreign state would be entitled to immunity under the FSIA but for the
application of an exception.22 Individual foreign officials are not covered by the FSIA if they are
sued in their capacity as individuals, but may be immune from suit under the common law of
foreign sovereign immunity.23
Personal Jurisdiction
Personal jurisdiction is the second threshold hurdle for assertion of judicial authority in cases
involving foreign defendants. Whereas subject matter jurisdiction governs courts’ power over
particular claims, personal jurisdiction governs courts’ power over particular defendants. Thus,
even if a court establishes jurisdiction over the subject matter of a claim, it cannot exercise its
authority over a defendant for whom it lacks personal jurisdiction.2324
Personal jurisdiction requires both statutory authority and satisfaction of Fifth Amendment due
process standards. As with subject matter jurisdiction, statutory authority for personal jurisdiction
over foreign defendants follows one of two distinct routes according to the FSIA’s application. If
the defendant is a foreign state or its agent or instrumentality, personal jurisdiction is statutorily
authorized under the FSIA if subject matter jurisdiction is established.2425 Alternatively, for a
defendant who is not a foreign state or its agency or instrumentality, the ordinary procedure for
obtaining statutory authority for personal jurisdiction applies; typically, a federal court must find
statutory authority for personal jurisdiction in the laws of the state in which it sits.25
However, constitutional limits apply regardless of a statutory basis for personal jurisdiction.
Under the due process clause, personal jurisdiction is constitutional if: 1) defendants have had
“certain minimum contacts with” the judicial forum attempting to assert jurisdiction, and 2)26
20
28 U.S.C. §1332(a).
28 U.S.C. §1330(a).
22
See Republic of Austria v. Altmann, 541 U.S. 677, 691 (2004) (“‘At the threshold of every action in a district court
against a foreign state, ... the court must satisfy itself that one of the [the FSIA] exceptions applies,’ as ‘subject-matter
jurisdiction in any such action depends’ on that application” (quoting Verlinden v. Cent. Bank of Nigeria, 461 U.S. 480,
493-94 (1962)).
23
Yousef v. Samantar, 560 U.S. 305 (2010). For more information about foreign official immunity, see CRS Report
R41379, Samantar v. Yousef: The Foreign Sovereign Immunities Act (FSIA) and Foreign Officials, by Jennifer K.
Elsea.
24
In rem jurisdiction is an alternative jurisdictional basis permitting suits in some admiralty cases and in cases in
involving immovable property. In rem jurisdiction does not authorize judicial power over particular defendants; rather,
it provides jurisdiction over property located in the United States. As a practical matter, in rem jurisdiction is unlikely
to serve as a basis for a defendant to which the FSIA applies, because the FSIA’s exceptions effectively cover in rem
jurisdiction. For this reason, in Permanent Mission of India to the United Nations v. City of New York, a case involving
real property located in the United States, the Supreme Court essentially ignored any potential analysis of in rem
jurisdiction and focused instead on the interpretation of the property exception under the FSIA. 127 S.Ct. 2352551 U.S. 193 (2007).
2425
28 U.S.C. §§1330(b), 1608.
2526
Fed. R. Civ. P. 4(k). However, most U.S. states’ so-called “long-arm” statutes extend personal jurisdiction to the
extent authorized under the U.S. Constitution. Thus, in many cases, identical statutory and constitutional analyses apply
to personal jurisdiction questions.(continued...)
21
Congressional Research Service
3
In Re Terrorist Attacks on September 11, 2001
However, constitutional limits apply regardless of a statutory basis for personal jurisdiction.
Under the due process clause, personal jurisdiction is constitutional if: 1) defendants have had
“certain minimum contacts with” the judicial forum attempting to assert jurisdiction, and 2)
asserting such jurisdiction “does not offend traditional notions of fair play and substantial
justice.”2627 The type and quantity of contacts necessary to constitute “minimum contacts” differ
according to the type of personal jurisdiction—general or specific—that applies. General
jurisdiction, which allows a court to exercise jurisdiction over a foreign defendant for any claim,
does not require contacts related to the specific claim in the case but instead requires “continuous
and systematic” contacts with a forum.2728 Conversely, specific jurisdiction, which limits a court’s
jurisdiction over a defendant to claims in a particular case, involves no “continuous and
systematic” requirement; instead, it requires that a defendant’s contacts with the forum “relate to”
or “arise out of” the claim at issue in the case.2829
U.S. Court of Appeals Decision in In Re Terrorist
Attacks on September 11, 2001 (“Terrorist Attacks
III”)
In August 2008, the U.S. Court of Appeals for the Second Circuit affirmed dismissals of claims
against the Kingdom of Saudi Arabia, a Saudi charity, Saudi princes, and a Saudi banker in In Rere
Terrorist Attacks on September 11, 2001.2930 Plaintiffs in the case are victims of the September 11
terrorist attacks. They alleged that the Saudi defendants had supported al Qaeda’s financial
backers prior to the attacks and were therefore civilly liable for plaintiffs’ injuries. However, the
court of appeals did not reach the merits of these allegations.
Instead, the court held that U.S. courts lack jurisdiction over the claims against the Saudi
defendants.3031 The legal bases for this holding were lack of subject matter jurisdiction under the
FSIA and lack of personal jurisdiction. The most significant aspects of the court of appeals’
opinion were interpretations of the FSIA, namely: 1) its interpretation of “agency or
instrumentality” under the FSIA as extending both to the Saudi charity and to individuals sued in
their official capacities,31 and 2) its interpretation of the commercial activities and tortstort exceptions
under the FSIA as having a narrower scope than plaintiffs had advocated.
26
The Supreme Court later abrogated the first of these holdings,32 and the Second Circuit reversed
its own position with respect to the tort exception to foreign sovereign immunity.33 In December
(...continued)
to personal jurisdiction questions.
27
Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (internal quotations omitted).
28
Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 416 (1984) (internal quotation marks omitted).
2829
Id. at 414 n.8.
29
538 F.3d 71.
30
Id. at 75-76.
31
This part of the holding has been abrogated by the30
Terrorist Attacks III, 538 F.3d 71 (2d Cir. 2008).
31
Id. at 75-76.
32
The Supreme Court’s 2010 decision in Yousef v. Samantar, 130 S. Ct.
2278560 U.S. 305 (2010), which rejected the majority position
among the judicial circuits holding that individual foreign officials
are “agencies or instrumentalities” of the foreign
government. Instead, foreign officials are not covered by the FSIA but
may be entitled to immunity under the common
law. For more information about foreign official immunity, see CRS
Report R41379, Samantar v. Yousef: The Foreign Sovereign Immunities Act (FSIA) and Foreign Officials, by Jennifer
K. Elsea.
27
Congressional Research Service
4
In Re Terrorist Attacks on September 11, 2001
Background
In Re
(continued...)
Congressional Research Service
4
In Re Terrorist Attacks on September 11, 2001
2013, the Second Circuit ordered these claims against Saudi Arabia and its agencies or
instrumentalities be reinstated in the interest of justice to determine whether the tort exception
applies.34 The plaintiffs now have a second chance to bring suit against the Kingdom of Saudi
Arabia and the Saudi charity.
Background
In re Terrorist Attacks is a case consolidated for pre-trial purposes in the U.S. District Court for
the Southern District of New York.3235 The Second Circuit Court of Appeals opinion reviewed
dismissals of only a subset of the claims at issue in the case.
Plaintiffs in In Rere Terrorist Attacks are individuals and businesses injured by the September 11
terrorist attacks. They brought claims based on state and federal tort law and various federal laws,
including the Torture Victim Protection Act, for injuries suffered as a result of the attacks.3336
The dismissed claims fall into four categories: 1) claims against the Kingdom of Saudi Arabia; 2)
claims against four Saudi princes in their official capacities; 3) claims against the Saudi High
Commission for Relief to Bosnia and Herzegovina (the SHC), a charitable organization operated
in connection with the Saudi government; and 4) claims against a banker and Saudi princes in
their personal capacities.3437 Underlying all of the claims was the allegation that defendants had
“played a critical role in the September 11 attacks by funding Muslim charities that, in turn,
funded al Qaeda.”3538
The court in 2008 affirmed dismissals of the first three sets of claims for lack of subject matter
jurisdiction under the FSIA. Because the FSIA precludes courts from asserting jurisdiction over
claims against foreign states, one of the FSIA exceptions must apply before a U.S. court may
assert jurisdiction over the Kingdom of Saudi Arabia or any of its “agencies or instrumentalities.”
As discussed below, the Second Circuit held that none of the FSIA exceptions applied.
The fourth set of claims (those brought against princes in their personal capacities) fell outside of
the scope of the FSIA. Nonetheless, as discussed below, the court dismissed those claims for lack
of personal jurisdiction.
(...continued)
Sovereign Immunities Act (FSIA) and Foreign Officials, by Jennifer K. Elsea.
33
Doe v. Bin Laden, 663 F. 3d 64 (2d Cir. 2011) (per curiam).
34
In re Terrorist Attacks on September 11, 2001, __F.3d__, 2013 WL 6670979 (2d Cir. 2013). Before the court was the
district court’s denial of the plaintiffs’ motion for relief from judgment pursuant to Rule 60(b) of the Federal Rules of
Civil Procedure (Fed. R. Civ. Pro.). The appellate court found that relief was justified based on the fact that it had
permitted similarly situated plaintiffs in the same set of cases to bring suit against a non-terrorist state after overturning
its reasoning with respect to the tort exception to the FSIA. Issues to be decided on remand include whether the
discretionary function limitation to the tort exception applies and whether the “entire tort” rule applies.
35
Terrorist Attacks III, 538 F.3d at 78.
36
Id. at 75.
37
Id. at 76-78.
38
Id at 76.
Congressional Research Service
5
In Re Terrorist Attacks on September 11, 2001
Charity and Princes as “Agencies and Instrumentalities” of the
Kingdom
Because a foreign state’s “agency or instrumentality” is entitled to the same immunity to which
the state itself is entitled under the FSIA, a key threshold question was whether the SHC and the
princes sued in their official capacities qualified as agents or instrumentalities under the FSIA.
The FSIA defines “agency or instrumentality” as any entity which is: 1) a “separate legal person,
corporate or otherwise”; 2) “an organ of a foreign state or political subdivision thereof, or a
majority of whose shares or other ownership interest is owned by a foreign state or political
subdivision thereof”; and 3) not a U.S. citizen or created under the laws of a third country.36
32
Id. at 78.
Id. at 75.
34
Id. at 76-78.
35
In Re Terrorist Attacks, 538 F.3d at 76.
36
28 U.S.C. §1603(b).
33
Congressional Research Service
5
In Re Terrorist Attacks on September 11, 200139
The SHC “Charity”Charity
Whether the SHC was an agent or instrumentality turned on whether it was an “organ” of the
Kingdom of Saudi Arabia.3740 The court applied a multi-factor test, derived from a previous Second
Circuit decision and from decisions from other circuits, to determine whether SHC was such an
“organ.”3841 Specifically, the court applied the following five criteria: “1) whether the foreign state
created the entity for a national purpose; 2) whether the foreign state actively supervises the
entity, 3) whether the foreign state requires the hiring of public employees and pays their salaries,
4) whether the entity holds exclusive rights to some right in the [foreign] country; and 5) how the
entity is treated under foreign state law.”3942 Emphasizing that the Saudi government had formed
SHC and paid its employees, the court held that the SHC was an organ, and thus was an “agent or
instrumentality,” of the Kingdom.4043
Officials
The plaintiffs sued four Saudi princes for actions taken within their official capacities.4144 All four
princes hold positions of power in the SHC; three of the princes are members of the country’s
“Supreme Council of Islamic Affairs,” the body responsible for monitoring and approving
“Islamic charitable giving both within and outside the Kingdom”; and the fourth prince is the
SHC’s president, in addition to his roles as a provincial governor and crown prince.4245
Although several other federal courts of appeals have ruled on the extension of foreign sovereign
immunity to foreign officials, treatment of officials under the FSIA was a question of first
impression for the Second Circuit.4346 Raising a number of textual arguments and referencing the
FSIA’s legislative history, the court held that individuals acting within their official capacities are
were indeed “agents or instrumentalities” of their states and arewere therefore entitled to immunity under
the FSIA to the same extent as their states.44
39
28 U.S.C. §1603(b).
See definition, 28 U.S.C. §1603(b).
41
Terrorist Attacks III, 538 F.3d at 85-86 (citing Filler v. Hanvit Bank, 378 F.3d 213, 217 (2d Cir. 2004)).
42
Id.
43
Id.
44
The four princes named were Prince Salman bin Abdulaziz al-Saud, Prince Sultan bin Abdulaziz al Saud, Prince Naif
bin Abdulaziz al-Saud, and Prince Turki al-Faisal bin Abdulaziz al Saud. Id. at 77.
45
Id.
46
Id. at 80-81.
40
Congressional Research Service
6
In Re Terrorist Attacks on September 11, 2001
under the FSIA to the same extent as their states.47 The court noted that at the time the FSIA was
enacted, Congress expressed a desire to codify common law principles, one of which was that
immunity extends to a state’s officials.4548 The court also emphasized the potential erosion of
immunity for foreign states if immunity extended only to government actions distinct from the
actions of officials as individuals, noting that “the state cannot act except through individuals.”4649
The Second Circuit Court of Appeals’ holding was consistent with the conclusions of five of the
six other federal courts of appeals that had considered whether an individual may be protected as
an agent or instrumentality.47 Only the Court of Appeals for the Seventh Circuit had reached the
37
See definition, 28 U.S.C. §1603(b).
In Re Terrorist Attacks, 538 F.3d at 85-86 (citing Filler v. Hanvit Bank, 378 F.3d 213, 217 (2d Cir. 2004)).
39
Id.
40
Id.
41
The four princes named were Prince Salman bin Abdulaziz al-Saud, Prince Sultan bin Abdulaziz al Saud, Prince Naif
bin Abdulaziz al-Saud, and Prince Turki al-Faisal bin Abdulaziz al Saud. Id. at 77.
42
Id.
43
Id. at 80-81.
44
Id. at 81-85.
45
Id. at 81-83.
46
Id. at 84.
47
The Fourth, Fifth, Sixth, Ninth, and the D.C. Circuits have held that officials acting within their official capacities are
“agents or instrumentalities” of their countries for the purpose of the FSIA. See Velasco v. Gov’t of Indonesia, 370 F.3d
(continued...)
38
Congressional Research Service
6
In Re Terrorist Attacks on September 11, 2001
50 Only the Court of Appeals for the Seventh Circuit had reached the
opposite conclusion.48 In51 In Re Terrorist Attacks III, the Second Circuit characterized the Seventh
Circuit as an “outlier” on this issue.4952 However, after the Fourth Circuit also adopted the minority
position,5053 the Supreme Court granted review and established the minority position as the correct
one.5154 Consequently, jurisdiction over remaining Saudi officials is subject to the same inquiry that
applies to other individuals and possibly a determination as to whether common law immunity
applies. 5255 Because the officials dismissed from this case were not part of the motion to vacate,
plaintiffs will not have an opportunity to pursue their lawsuit against them on remand. Claims
against them in their official capacity would likely be deemed to be claims against the state or its
instrumentality in any event.
Relevant FSIA Exceptions
After holding that the FSIA applied not only to the Kingdom of Saudi Arabia but also to Saudi
officials and the SHC as an agency or instrumentality of the Kingdom, the court of appeals next
examined whether any FSIA exception applied. First, the court held that the terrorist state
exception did not apply because the U.S. State Department has not designated the Kingdom of
Saudi Arabia as a state sponsor of terrorism.53 Next, although the court found two other
exceptions—the commercial activity and torts exceptions—“potentially relevant,”54 neither
exception applied to the Saudi defendants.
Commercial Activities Exception
To support their argument that the commercial activities exception should apply to the Saudi
defendants, the In Re Terrorist Attacks plaintiffs characterized defendants’ charitable
contributions to Muslim groups as a form of money laundering.55 The court rejected this
characterization as incompatible with the Supreme Court’s interpretation of the commercial
activities exception.
The FSIA defines “commercial activity” as “a regular course of commercial conduct or a
particular commercial transaction or act.”56 The court noted the “circularity” of this definition and
(...continued)
56 Next, although the court found two other
47
Id. at 81-85.
Id. at 81-83.
49
Id. at 84.
50
The Fourth, Fifth, Sixth, Ninth, and the D.C. Circuits had held that officials acting within their official capacities are
“agents or instrumentalities” of their countries for the purpose of the FSIA. See Velasco v. Gov’t of Indonesia, 370
F.3d 392, 399 (4th Cir. 2004); Keller v. Cent. Bank of Nigeria, 277 F.3d 811, 815 (6th Cir. 2002); Byrd v. Corporacion
Forestal y Industrial de Olancho S.A., 182 F.3d 380, 388 (5th Cir. 1999); Jungquist v. Sheikh Sultan Bin Khalifa Al
Nahyan, 115 F.3d 1020, 1027 (D.C. Cir. 1997); Chuidian v. Philippine Nat’l Bank, 912 F.2d 1095, 1101-03 (9th Cir.
1990).
4851
In Enahoro v. Abubakar, the Seventh Circuit rejected a military junta general’s immunity claim. 408 F.3d 877 (7th
Cir. 2005). Focusing on the text of the FSIA, the Enahoro court held that the phrase “separate legal person, corporate or
otherwise” within the “agency or instrumentality” definition in the statute, together with a lack of statutory references
to individuals, suggested a lack of congressional intent to extend immunity to individuals. Id. at 881-82.
49
In Re 52
Terrorist Attacks III, 538 F.3d at 81.
5053
Yousef v. Samantar, 538 F.3d 71 (2nd2d Cir. 2008).
51
Yousef v. Samantar, 130 S. Ct. 2278 (2010). The Supreme Court denied certiorari with respect to the In re Terrorist
Attacks decision, however, so the Second Circuit decision as to the 12 parties named therein remains controlling as to
them.
5254
Yousef v. Samantar, 560 U.S. 305 (2010).
55
In re Terrorist Attacks on September 11, 2001, 718 F. Supp. 2d 456, 466-67 (S.D.N.Y. 2010). The district court
found, with respect to five foreign officials who were still defendants in the suit, that personal jurisdiction could not be
established and that, therefore, there was no need to analyze whether common law immunity should be granted.
53
Id. at 75.
54
Id. at 80.
55
Id. at 90-91.
56
28 U.S.C. §1603(d).
Congressional Research Service
7
In Re Terrorist Attacks on September 11, 2001
56
Id. at 75.
48
Congressional Research Service
7
In Re Terrorist Attacks on September 11, 2001
exceptions—the commercial activity and tort exceptions—“potentially relevant,”57 neither
exception applied to the Saudi defendants.
Commercial Activities Exception
To support their argument that the commercial activities exception should apply to the Saudi
defendants, the In re Terrorist Attacks plaintiffs characterized defendants’ charitable contributions
to Muslim groups as a form of money laundering.58 The court rejected this characterization as
incompatible with the Supreme Court’s interpretation of the commercial activities exception.
The FSIA defines “commercial activity” as “a regular course of commercial conduct or a
particular commercial transaction or act.”59 The court noted the “circularity” of this definition and
relied upon the U.S. Supreme Court’s definition of “commercial activity” (for the context of the
FSIA exception) as “the type of actions by which a private party engages in ‘trade and traffic or
commerce.’”5760 Under this definition, the court noted that the appropriate focus in determining
whether an action constitutes “commercial activity” is on an action’s nature rather than its
purpose. With this framework, the court upheld the district court’s finding that defendants’
“charitable contributions” fell outside the scope of the commercial activities exception by reason
of their non-commercial nature, regardless of the contributions’ alleged money laundering
purpose.58
Torts Exception61 This portion of the decision remains undisturbed.
Tort exception
Finally, the court of appeals rejected the tortstort exception as inapplicable to claims against the Saudi
defendants. Specifically, the court noted that Congress’s purpose in enacting the tortstort exception
was to create liability for incidents, such as traffic accidents, that occur in the United States.5962
Furthermore, the court was concerned about the effect that an expanded tortstort exception would
have on the other FSIA exceptions. It emphasized that if the exception were expanded to include
all conduct conceivably characterized as tortious, the tortstort exception would “vitiate” the terrorist
state exception’s limitation to designated terrorist states.6063 A later panel of the appellate court
disagreed with this aspect of the decision, however, effectively overturning it for the Second
Circuit.6164 In December 2013, the appellate court granted the plaintiffs relief from judgment65 in
the interests of justice, sending the case back to the district court to determine whether the tort
exception applies or whether the defendants are entitled to immunity based on the discretionary
57
Id. at 80.
Id. at 90-91.
59
28 U.S.C. §1603(d).
60
Terrorist Attacks III, 538 F.3d at 91 (citing Republic of Argentina v. Weltover, 504 U.S. 607 (1992)).
61
Because it determined that the contributions fell outside of the scope of “commercial activities,” the court did not
decide whether money laundering or other criminal acts could constitute “commercial activities” under the FSIA. Id. at
n.17.
62
Id. at 87.
63
Id. at 88.
64
Doe v. Bin Laden, 663 F. 3d 64 (2d Cir. 2011) (per curiam) (FSIA non-commercial tort exception could be a basis
for suit against Afghanistan arising from terrorist acts of September 11, 2001).
65
In re Terrorist Attacks on September 11, 2001, __F.3d__, 2013 WL 6670979 (2d Cir. 2013).
58
Congressional Research Service
8
In Re Terrorist Attacks on September 11, 2001
nature of their actions.66 The lower court will also be asked to determine whether the “entire tort”
rule applies, in which case the fact that the relevant Saudi government activity took place outside
the United States could make the tort exception inapplicable.67
Princes Sued in Their Personal Capacities
For claims made against a Saudi banker and against several Saudi princes for actions taken in
their personal capacities, subject matter jurisdiction was not precluded by the FSIA. However, the
court upheld the district court’s determination that it lacked personal jurisdiction over the Saudi
defendants sued in their personal capacities.6268
Specifically, the court concurred with the district court’s finding that the princes sued in their
personal capacities lacked sufficient contacts with the forum to permit personal jurisdiction under
the constitutional “minimum contacts” standard. Plaintiffs argued that the minimum contacts test
was satisfied because the defendants had purposefully directed activity at the judicial forum by
supporting the attacks. The court rejected this argument, acknowledging that it had been a
successful argument in cases where defendants were “primary participants” in the terrorist acts
but holding that the banker and princes’ activities were too attenuated from the actual attacks to
satisfy due process requirements.6369 Similarly, the court rejected the plaintiff’s argument that
potential foreseeability of the terrorist attacks was a sufficient basis for establishing minimum
57
In Re Terrorist Attacks, 538 F.3d at 91 (citing Republic of Argentina v. Weltover, 504 U.S. 607 (1992)).
Because it determined that the contributions fell outside of the scope of “commercial activities,” the court did not
decide whether money laundering or other criminal acts could constitute “commercial activities” under the FSIA. Id. at
n.17.
59
Id. at 87.
60
Id. at 88.
61
Doe v. Bin Laden, 663 F. 3d 64 (2d Cir. 2011) (per curiam) (FSIA non-commercial tort exception could be a basis
for suit against Afghanistan arising from terrorist acts of September 11, 2001).
62
Id. at 96
63
Id. at 93-95.
58
Congressional Research Service
8
In Re Terrorist Attacks on September 11, 2001
contacts.64 It noted that foreseeability alone is insufficient to pass constitutional muster for
personal jurisdiction; instead, the constitutional standard requires “intentional” conduct,
“expressly aimed” at residents in the forum.65
Recent Developments
In In Re Terrorist Attacks, the U.S. Court of Appeals for the Second Circuit adopted narrow
interpretations of the commercial activities and torts exceptions under the FSIA, restraining
efforts by September 11 victims and other plaintiffs seeking recovery in U.S. courts against
foreign officials and government-controlled entities like the Saudi charity. The 111th Congress
held a hearing to consider S. 2930, the Justice Against Sponsors of Terrorism Act,66 which, among
other contacts.70 It noted that foreseeability alone is insufficient to pass constitutional muster for
personal jurisdiction; instead, the constitutional standard requires “intentional” conduct,
“expressly aimed” at residents in the forum.71
Legislative Developments
In Terrorist Attacks III, the U.S. Court of Appeals for the Second Circuit adopted narrow
interpretations of the commercial activities and tort exceptions under the FSIA, restraining efforts
by September 11 victims and other plaintiffs seeking recovery in U.S. courts against foreign
officials and government-controlled entities like the Saudi charity. The 111th Congress held a
hearing to consider S. 2930, the Justice Against Sponsors of Terrorism Act,72 which, among other
66
28 U.S.C. §1605(a)(5)(A) provides an exception to the tort exception for “any claim based upon the exercise or
performance or the failure to exercise or perform a discretionary function regardless of whether the discretion be
abused.” The district court had earlier held in the alternative that the tort exception to immunity did not apply on the
basis of the discretionary function limitation, a finding the appellate court did not address because it held the tort
exception inapplicable at any rate.
67
The Second Circuit recently affirmed the dismissal of a related suit against two Saudi charities on the basis that the
alleged torts they committed had occurred outside the United States. In re Terrorist Attacks on September 11, 2001,
714 F.3d 109 (2d Cir. 2013). For a discussion of the territorial requirements of the tort exception, see generally VED P.
NANDA AND DAVID K. PANSIUS, 1 LITIGATION OF INTERNATIONAL DISPUTES IN U.S. COURTS § 3:21, available at
Westlaw LOID.
68
Doe v. Bin Laden, 663 F.3d at 96.
69
Id. at 93-95.
70
Id. at 94-95.
71
Id.
72
Evaluating the Justice Against Sponsors of Terrorism Act, S. 2930: Hearing of the Crime and Drugs Subcommittee of
The Senate Judiciary Committee, 111th Cong. (2010).
Congressional Research Service
9
In Re Terrorist Attacks on September 11, 2001
measures, would have amended the tort exception to the FSIA specifically to cover terrorist
attacks within the United States.
In the 112th Congress, new legislation was introduced to reduce some of the burdens faced by
victims of state-sponsored terrorism in the United States who seek to bring lawsuits against
foreign officials. S. 1894, the Justice Against Sponsors of Terrorism Act,67 which73 was ordered to
be be
reported favorably out of the Senate Judiciary Committee in September 2012, would amend
. A companion bill,
H.R. 5904, did not receive further action.
The Justice Against Sponsors of Terrorism Act was introduced in the 113th Congress as S. 1535
and H.R. 3143. It would amend the tort exception to the FSIA expressly to include “any statutory
or common law tort claim
arising out of an act of extrajudicial killing, aircraft sabotage, hostage
taking, terrorism, or the
provision of material support or resources for such an act.... ” Although
the aspect of the In re
Terrorist Attacks III decision interpreting the tort exception as inapplicable to
terrorist acts occurring
in the United States was effectively overruled by another panel of
judges,6874 it is possible that
other courts could read the terrorism exception as foreclosing suits
against states not designated
as sponsors of terrorism. S. 1894 would alsoThe tort exception would also be amended
to clarify that there is no rule holding that the “entire tort” must occur within the United States,
but rather that such claims are covered “regardless of where the underlying tortious act or
omission occurs.”
Additionally, the bills would expand liability for foreign government officials in
civil actions for
terrorist acts no matter where they occur by amending 18 U.S.C. Section §2337,
which currently exempts
all government officials. The amended version would exempt only U.S. officials. In an effort to
overcome difficulties in
exercising personal jurisdiction over foreign nationals, including foreign
officials, the billbills would
also codify Congress’s intent that “district courts shall have personal
jurisdiction, to the maximum
extent permissible under the Fifth Amendment of the United States
Constitution, over any person
who who commits, aids and abets an act of international terrorism, or
or who provides material support or
resources.”69
64
Id. at 94-95.
Id.
66
Evaluating the Justice Against Sponsors of Terrorism Act, S. 2930: Hearing of the Crime and Drugs Subcommittee of
The Senate Judiciary Committee, 111th Cong. (2010).
67
For more analysis of S. 1894 resources... for acts of international terrorism in which any national
of the United States suffers injury in his or her person, property, or business by reason of such an
act....”75
73
For more analysis of H.R. 3143 and S. 1535, see CRS Report R41379, Samantar v. Yousef: The Foreign Sovereign
Immunities Act
(FSIA) and Foreign Officials, by Jennifer K. Elsea.
6874
Doe v. Bin Laden, 663 F. 3d 64 & n. 10 (2d Cir. 2011) (“mini-en banc” procedure employed by circulating draft
opinion to other circuit judges, which did not draw objections from any of them).
69
S. 189475
S. 1535, §5. The bill also contains a finding that appears to counter the Second Circuit’s holding with respect to
personal jurisdiction. Section 2(a)(711) of the bill states:
Persons, entities, or countries or states that knowingly or recklessly contribute material support or resources, directly or
indirectly, to persons or organizations that pose a significant risk of committing acts of terrorism that threaten the
security of nationals of the United States nationals or the national security, foreign policy, or economy of the United States,
necessarily direct their conduct at the United States, and should reasonably anticipate being haled intobrought to court in the
United States to answer for such activities.
65
Congressional Research Service
910
In Re Terrorist Attacks on September 11, 2001
Author Contact Information
Jennifer K. Elsea
Legislative Attorney
jelsea@crs.loc.gov, 7-5466
Acknowledgments
An earlier version of this report was prepared by former Legislative Attorney Anna C. Henning.
Congressional Research Service
1011