Abu Nahl v. Abou Jaoude

Summary

The Second Circuit held that even assuming the prohibition against financing terrorism is a universal, specific, and obligatory norm of international law under the Alien Tort Statute (ATS), the plaintiffs' shareholder derivative suit was futile because their alleged harm—economic loss from bank mismanagement and asset forfeiture—fell outside the scope of that norm, which protects victims of terrorist acts, not shareholders of banks used to finance terrorism. The court emphasized that the ATS does not confer jurisdiction over corporate mismanagement claims that are matters of several, not mutual, concern among nations. The concurrence argued separately that the prohibition against financing terrorism does not bind individuals under international law and thus cannot support an ATS claim.

Holdings

1. Assuming arguendo that the prohibition against financing terrorism is a sufficiently universal, specific, and obligatory norm of international law to support an ATS claim in some circumstances, the plaintiffs' claim is nevertheless futile because the harm they suffered (economic loss to the bank's shareholders from forfeiture) is not the harm that the norm is intended to address. The norm protects victims of terrorism, not shareholders of a bank that was penalized for facilitating terrorism.

Questions Presented

1. Whether the prohibition against financing terrorism is a sufficiently universal, specific, and obligatory norm of international law to support a cause of action under the Alien Tort Statute.
2. Whether the plaintiffs' claim, based on financial harm to the bank from forfeiture, falls within the scope of any such norm.

Disposition

reversed