New Federal Pleading Standards Infringe on Terrorism Victims Ability to Sue Terrorists Financiers

For over 50 years, people wishing to file a lawsuit in federal court could simply submit a short and plain statement of facts in a complaint, in accordance with the Federal Rules of Civil Procedure. The Conley v. Gibson Supreme Court ruling in 1957 ensured that cases that might be difficlut to win, but meritorious nonetheless, could proceed to discovery (“a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief”). But the 2009 Ashcroft v. Iqbal and 2007 Bell Atlantic v. Twombly decisions by the Supreme Court made federal complaint standards much more restrictive. Now parties have to plead specific and concrete facts, often without having access to any of the information they need, or see their cases thrown out due to “implausibility.” The Court’s decision to implement the new standards without pursuing the usual course of action in amending the Federal Rules by requesting a change through the Judicial Conference of the United States.

The battleground for the impact of the Iqbal and Twombly cases includes an area overlooked and ignored by the proponents of the new standards, namely lawsuits filed by American terrorism victims against the terrorists and their financiers. Veteran attorney Steven R. Perles of Washington, who has represented thousands of terrorism victims over the past thirty years and is one of my clients, wrote to the U.S. Congress this past February, criticizing the Iqbal-Twombly standards and warning of its impact on the access to justice by terrorism victims. See the following excerpts and download the entire letter:

The practical effect on anti-terrorism litigation will be that state sponsors of terrorism, such as Iran, will now be able to enter and win litigation against those U.S. citizens seeking redress for their injuries, unless the U.S. citizens have been lucky enough to discover the critical facts that explain Iran’s support for a particular terrorism attack prior to the expiration of the statute of limitations for their claims…

I was counsel for plaintiffs in two cases called Buonocore v. Libya and Baker v. Libya. In Baker, we filed a complaint against Libya for its support of the Abu Nidal Organization’s hijacking of an airliner in November 1985, which left one American dead and two Americans severely injured. In Buonocore, we filed a complaint against Libya for its support of the Abu Nidal Organization’s machine gun and grenade attack on the Rome and Vienna airports in December 1985, which resulted in numerous American dead and injured. Libya filed a motion to dismiss the complaint in both cases, but the court found the complaints sufficient under the Conley standard. It was only later in each case that we were able to locate the surviving terrorists in Austria, Italy and the United States in their respective prisons, who provided critical details in sworn statements regarding Libya’s role in the attacks. This information contributed to the eventual settlement of both cases. Had the Twombly and Iqbal standards been applicable in those cases, Libya’s chances of winning at the motion to dismiss stage–prior to our uncovering of critical evidence in our post-filing of the complaint investigation–would have been dramatically greater.

I would also cite two other victorious terrorism civil actions which might have been dramatically altered or lost if the Iqbal-Twombly standards had been in effect. In the first, the family of David Boim, an American killed by Hamas terrorists in Israel, successfully won a $156 million judgment against the Dallas-based Holy Land Foundation for its role as the biggest Hamas fundraiser in the U.S. The victory came only after extensive challenges to the introduction of evidence under the Conley standard, and those challenges might have been successful under the Iqbal-Twombly standard. You can read more about that suit on the Counterterrorism Blog. In the second, attorneys from the Motley Rice law firm (another client of mine) who are pursuing the Arab Bank in a civil suit for its alleged role as a conduit for terrorist funds were able to access information gathered by Israeli intelligence, as summarized in this post on the Counterterrorism Blog. I cannot imagine that the introduction of that evidence would have been so easily introduced under the Iqbal-Twombly standard.

Tomorrow I’ll address, in more detail, the critics of legislation designed to repeal the Iqbal-Twombly pleading standard. But at the outset, they ignore the beneficial impact of the Conley pleading standard on terrorism victims’ lawsuits, which often require the introduction of evidence obtained from overseas sources. Federal judges are far more likely to dismiss such suits prior to discovery for failure to meet the “plausibility” standard.