February 18, 2009, NY Law Journal: A state appeals court yesterday ordered a Manhattan judge to take a second look at whether the estate of Yaron Ungar, a U.S. citizen gunned down in a 1996 Mideast terrorist attack, is entitled to $30 million in fund transfers involving the Palestine Monetary Authority and a U.S. bank.

The money was frozen by the Bank of New York following a $116 million judgment obtained in 2004 against the Palestinian Authority and the Palestinian Liberation Organization by heirs of Mr. Ungar and his wife. In April 2007, Justice Shirley Werner Kornreich (See Profile) ordered the Bank of New York to release the $30 million, after concluding that UCC 4-A-503 precluded the bank, an intermediary in the Palestine Monetary Authority (PMA) wire transfers, from freezing the funds (NYLJ, April 13, 2007). However, in a unanimous ruling, the Appellate Division, First Department, held that the Bank of New York's voluntary decision to obey the court order and restrain the $30 million did not violate the statute. In an opinion by Justice James M. Catterson (See Profile), the panel also reversed Justice Kornreich's grant of summary judgment to the PMA, holding that the central bank has the burden of proving it is not an alter ego or agent of the Palestinian Authority or the Palestinian Liberation Organization. Justices Angela M. Mazzarelli (See Profile), David B. Saxe (See Profile) and John T. Buckley (See Profile) joined the panel in Palestine Monetary Authority v. Strachman, 3199-3199A. The decision will be published Monday.