No Personal Jurisdiction Over Saudi, UAE, and British Banks that had No Contacts with the US

The World in U.S. Courts: Fall 2017 - Personal Jurisdiction/Forum Non Conveniens

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Siegel v. HSBC Holdings, plc, US District Court for the Northern District of Illinois, August 14, 2017

Victims of an ISIS terrorist attack in Jordan sued financial institutions from Saudi Arabia, the UAE, the UK, and the US, alleging that the banks aided and abetted ISIS by facilitating the terrorists’ access to American financial markets.

The Court first addressed the question whether it could exercise personal jurisdiction over the Saudi, Emirati, and British defendants. It applied a special provision of the US procedural rules (Rule 4(k)(2)) applicable to claims under federal law where a defendant’s contacts with the US as a whole establish "minimum contacts" to support personal jurisdiction, but where those contacts are insufficient to support jurisdiction in any one particular state. The Court found that the first part of this test had not been satisfied. Unrebutted evidence showed that the banks did not conduct business in the US and did not direct their business activities to the US. Additionally, the plaintiffs could not satisfy the second requirement of Rule 4(k)(2) that a claim arise out of the contacts with the US. Indeed, the Complaint alleged that the banks were culpable for conduct having nothing to do with any US activities. The only potential exception was the Saudi bank, which was alleged to have engaged in a scheme outside the US to make it "possible" for the bank to transfer US dollars through the US in a way that "circumvented" monitoring by US regulators. The Court found this alleged connection with the US too indirect to support jurisdiction.

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