Commerzbank Wins Dismissal of Anti-Terrorism Act Lawsuit

September 16, 2019

Cleary Gottlieb successfully represented Commerzbank AG (Commerzbank) in securing dismissal of an Anti-Terrorism Act lawsuit.

On September 16, 2019, Judge Pamela K. Chen of the United States District Court for the Eastern District of New York dismissed all claims in a lawsuit brought against Commerzbank and six other banks in Freeman, et al. v. HSBC Holdings PLC, et al.

Plaintiffs, U.S. military personnel, and their families, alleged under the Anti-Terrorism Act—as modified by the Justice Against Sponsors of Terrorism Act (JASTA)—that, as a result of the bank defendants’ provision of funds to Iranian entities in violation of U.S. sanctions, the banks are liable for injuries sustained by the plaintiffs in terrorist attacks in Iraq between 2004 and 2011.

In dismissing all of plaintiffs’ claims, Judge Chen rejected a report and recommendation issued by Magistrate Judge Cheryl L. Pollak in July 2018, which recommended that the defendants’ motion to dismiss be denied in its entirety. Judge Chen instead accepted the defendants’ arguments that plaintiffs failed to state a claim for primary liability or secondary liability under the Anti-Terrorism Act or JASTA because they failed to plead that the banks themselves committed an act of international terrorism and proximately caused plaintiffs’ injuries, as the statutes require. Judge Chen also dismissed a separate claim against Commerzbank alone for lack of personal jurisdiction, precisely as Commerzbank had argued. This ruling marks the end of Cleary’s five-year effort in the district court in this case.