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Federal court dismisses appeal in terrorism funding case

US Court of Appeals for the Second Circuit [official website] on Friday dismissed [opinion, PDF] an appeal by Arab Bank, PLC from an order imposing discovery sanction for lack of jurisdiction in a lawsuit brought against the bank under Anti-Terrorist Act [18 U.S.C. § 2333, LII backgrounder] and Alien Tort Claims Act [28 U.S.C. § 1350, LII backgrounder]. The lawsuit was brought by US and foreign victims and families of victims of terrorist attacks in Israel during the period between 1995 and 2004, who allege that the bank, which had branches in New York, provided financial support to terrorists during the period at issue. The plaintiffs demanded documents pertaining to the case, including bank accounts held by terrorist organizations and individuals affiliated with such groups. The bank has denied plaintiffs' requests, arguing that the documents were protected by foreign bank secrecy laws. The US District Court for the Eastern District of New York [official website] imposed a sanction pursuant to Federal Rule of Civil Procedure 37 [Cornall LII backgrounder] allowing the jury to infer that Arab Bank (1) provided financial services to terrorists and terrorist organizations and (2) did so knowingly and purposefully. Basing its reasoning on the three-prong test established in Cohen v. Beneficial Industrial Loan Corp., the appeals court determined that it cannot review the defendant's appeal. First, although the district court's sanction order is "conclusive," it is both "intertwined with the merits" of the case and is "effectively reviewable after final judgment." Second, the sanction was "inextricably intertwined with the merits of the action" because it directly affects the resolution of the merits of the case. Lastly, the jury verdict may be reversed if there is finding that the jury instruction in fact had prejudicial effect on the defendant. Thus, there would be an effective remedy available for the defendant. In addition, the court held that the bank is not entitled to a writ of mandamus because it failed to prove its right to such is "clear and indisputable" and because it has alternative means to obtain relief.

Authorities around the world have been tracking down members and supporters of the al Qaeda [JURIST news archive] and other terrorists groups. Last month, the US Senate [official website] passed [JURIST report] the Reauthorization Act of 2012 [text, PDF] to extend the Foreign Intelligence Surveillance Amendments Act of 2008 (FISA) [text, PDF] for five years. FISA grants the National Security Agency (NSA) [official website] the authority to conduct surveillance of Americans’ phone calls and emails in attempts to protect against terrorism and other foreign threats. During the same month, Canada's controversial Anti-Terrorism Act [text; CBC backgrounder] was deemed constitutional [JURIST report] by the country's Supreme Court [official website]. In August a judge in Spain charged [JURIST report] two Russian nationals with possession of explosives and membership in a terrorist organization, after they were arrested last week on suspicion of plotting an attack. A month earlier, French authorities announced [JURIST report] that they arrested a suspected terrorist who was born in Tunisia in 1977 and resided in the French city of Toulon and allegedly has ties to al Qaeda. In June a New York native and terrorism suspect pleaded guilty [JURIST report] to charges that he provided the al Qaeda with money and computer assistance.

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