The case of the day is Sokolow v. Palestine Liberation Organization (2d Cir. 2016). I wrote about a similar case, Safra v. Palestinian Authority, back in 2015. The gist of the earlier case, which was decided in Washington, was that the Palestinian Authority could not be sued for damages under the Anti-Terrorism Act because it was not subject to the court’s personal jurisdiction. The irony in Safra was that in order to prevail, the PA had to argue that it wasn’t a state, since states are always subject to the personal jurisdiction of the district courts in cases where an exception to FSIA immunity applies. That’s not a legal argument the supporters of unilateral declarations of Palestinian statehood are likely to want to trumpet, but it carried the day.
It carried the day in today’s case of the day, too, this time in a court of appeals. The Second Circuit vacated a judgment on a jury verdict for more than $600 million against Palestinian governmental defendants, remanding with instructions to dismiss for want of jurisdiction. The court turned away an interesting but not very persuasive argument that the Supreme Court’s recent precedents restricting the test for general personal jurisdiction should apply only to cases under the Fourteenth Amendment (i.e., cases in state court or maybe cases in federal court arising under non-federal law), not to cases arising under the Fifth Amendment.
I suppose the PA has a very strong financial motive for ensuring that the United States continues to refuse to recognize Palestine as a state. If it is recognized, the door is opened to large judgments for damages arising from PA-sponsored terrorism that the PA could ill-afford to pay. Indeed, as today’s case notes, the US government had to intervene to persuade the court to reduce the supersedeas bond amount to a fraction of the ordinary amount so that the defendants would be able to pay.