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Rachel Rothstein was at an outdoor shopping mall in Jerusalem with her friends and was injured in a triple suicide bomb attack.
She suffered chest and shoulder injuries, and post-traumatic stress disorder. Rothstein and 55 other American citizens who were victims or families of victims of Hamas or Hezbollah bombings that occurred in various parts of Israel in 1997, 2001, and 2006 filed suit in May 2008 at Southern District Court of New York. The defendant, Swiss Bank UBS AG, had provided financial services and sent dollars to Cuba, Libya, Iran and Yugoslavia in violation of U.S. sanctions against those countries. As a result, the Rothstein plaintiffs’ filed suit against UBS under US criminal law, international law, and the Antiterrorism Act (ATA).
Pursuant to the ATA, the plaintiffs alleged that UBS had knowingly facilitated terrorist attacks in Israel by furnishing United States currency to Iran – a designated state supplier of terrorism. Thus, UBS would be liable to the injured US citizens for the actions of the Iranian government. In August 2009, the Federal District Court dismissed the plaintiffs’ claim due to lack of causal link between UBS and the terror organizations supported by Iran. The court stated that a requirement under the ATA is that UBS not only must have known about the causal link between the funds it provided to Iran and Iranian support for terror organizations, but also must have intended that the funds were to be used for that purpose. Such intent was not proven by the Plaintiffs. Upon appeal, the Appellate Court held that the parties should account for US Supreme Court Case Holder v. Humanitarian Law Project, because in that case, the Supreme Court lessened the required proximate cause that must exist between terrorist activities and those supporting terrorists. The new interpretation of the ATA under Holder is that mere knowledge of an organization’s connection to terrorism can suffice to create liability. While the court found that the plaintiffs had standing to assert their claims under the ATA, they failed to state a claim on which relief can be granted.