Philadelphia based Kohn, Swift & Graf, P.C. has scored two seismic victories in its decade-long battle against international banks accused of providing material support to Hamas, in violation of the U.S. Anti-Terrorism Act.
In Linde v. Arab Bank, PLC, CV 04 2799, pending in the United States District Court for the Eastern District of New York, a unanimous jury found Arab Bank liable for providing material support to Hamas concerning 24 attacks in Israel and the Palestinian territories between 2000-2004, during the period known as the Second Intifada. This was the first case ever brought to trial seeking to hold a bank liable for knowingly providing financial services to a terrorist organization, and the verdict is expected to produce enormous ripples in international banking circles. The trial lasted five weeks, during which the Bank continually argued that it followed blacklists, like all other banks, and could not be held responsible for knowing who was a terrorist absent one of its regulators listing the name. The jury was unconvinced, persuaded by arguments that the Hamas terrorists were so well known in the Territories that Bank employees knew exactly who they were. Additionally, the jury saw evidence of payments processed by the Bank on behalf of a Saudi so-called charity, which routinely sent large payments to the families of suicide bombers. The case will now proceed to a second trial solely on the issue of damages for the 297 American citizens who are plaintiffs in the action. The statute provides mandatory trebling of such damages.
Just a few hours earlier, the Kohn Swift firm also received a long-awaited opinion from the United States Court of Appeals for the Second Circuit reversing a grant of summary judgment in Weiss v. National Westminster Bank, CV 13-1618, a case alleging that the Bank knowingly provided material support to Interpal, the US designated faux charity which serves as a conduit to Hamas for funds collected in Europe. The District Court found that Plaintiffs had failed to show that the Bank knew that Interpal provided material support to Hamas’ “terrorist activities”, but the Appeals Court decided that the statute was “less exacting”, requiring a showing only that the Bank knew that Interpal supported a terrorist organization, and that under that standard, plaintiffs had demonstrated “a triable issue of fact as to whether NatWest possessed the requisite scienter.”
The cases are being prosecuted by Kohn Swift partners Steven M. Steingard and Stephen H. Schwartz, in association with the law firms of Osen & Associates, Hackensack, NJ; Zuckerman Spaeder, Washington, D.C. and Turner & Associates, Little Rock, AR.