United States Court of Appeals, District of Columbia Circuit
Chaim Kaplan, individually and as natural guardian of plaintiffs M.K. (1), A.L.K., M.K. (2), C.K. and E.K., et al., Appellants
Central Bank of the Islamic Republic of Iran, also known as Bank Markazi Jomhouri Islami Iran, et al., Appellees Chaim Kaplan, et al., Appellants
Hezbollah, also known as Hizbullah, also known as Hizbollah, also known as Hezballah, also known as Hizballah and Democratic People's Republic of Korea, also known as North Korea, Appellees
September 12, 2017
from the United States District Court for the District of
Columbia (Nos. 1:10-cv-00483, 1:09-cv-00646)
Katz argued the cause for appellants. With him on the briefs
was Robert J. Tolchin.
D. Frey argued the cause for appellees. With him on the brief
was Matthew D. Foster.
Anthony F. Shelley, appointed by the court, argued the cause
as amicus curiae in support of the portions of the District
Court's judgment at issue on appeal. With him on the
brief were Ian A. Herbert and Adam W. Braskich.
Before: Kavanaugh [*] and Srinivasan, Circuit Judges, and
Edwards, Senior Circuit Judge.
SRINIVASAN, CIRCUIT JUDGE
cases arise from a barrage of rocket attacks launched by
Hezbollah into northern Israel in the summer of 2006.
Plaintiffs are a group of American, Israeli, and Canadian
citizens who sued Hezbollah and two foreign banks for
injuries sustained during the attacks. In one action, the
American plaintiffs allege that Hezbollah's rocket
attacks amounted to acts of international terrorism, in
violation of the Anti-Terrorism Act (ATA). In a second
action, all of the plaintiffs accuse the banks of funding
Hezbollah's attacks, in violation of both the ATA and the
Alien Tort Statute (ATS).
district court dismissed both complaints. The court concluded
that the ATA's so-called act-of-war exception precluded
the claims under that statute, and that the presumption
against extraterritoriality barred the ATS claims.
vacate the district court's dismissal with respect to the
ATA claims and remand for further proceedings. We conclude
that the district court must first determine that it has
personal jurisdiction over the defendants before applying the
statute's act-of-war exception. We affirm the district
court's dismissal of the claims under the ATS based on
the Supreme Court's recent decision in Jesner v. Arab
Bank, PLC, 138 S.Ct. 1386 (2018), which holds that
foreign corporations (like the bank defendants here) are not
subject to liability under that statute.
complaints in these cases contain the following allegations,
which we assume are true given that the claims before us on
appeal were dismissed based on the alleged facts. See
English v. District of Columbia, 717 F.3d 968, 971 (D.C.
12, 2006, Hezbollah militants left Lebanon, crossed the
Israeli border, and kidnapped and killed several Israeli
soldiers. Israel responded by mounting a ground offensive in
Lebanon and deploying a bombing campaign against Hezbollah.
Hezbollah then initiated a campaign of rocket attacks, firing
thousands of unguided rockets into civilian populations in
northern Israel, striking cities, towns, and villages. The
conflict ended on August 14, 2006, when the United Nations
brokered a cease-fire between Hezbollah, Israel, and Lebanon.
Over the course of the 34-day conflict, numerous persons lost
their lives, including more than 1, 000 Lebanese civilians,
between 250 and 500 members of Hezbollah, 119 Israeli
soldiers, and 43 Israeli civilians.
and 2010, plaintiffs filed two separate actions to recover
for their injuries from Hezbollah's rocket attacks. In
the first action, a group of American plaintiffs brought
Anti-Terrorism Act claims against Hezbollah, Foreign
Sovereign Immunities Act claims against North Korea for
funding the rocket attacks, and common law tort claims
against both defendants. In the second action, the same
American plaintiffs brought ATA claims against Bank Saderat
PLC for transferring funds from Iran to Hezbollah, and
Foreign Sovereign Immunities Act claims against Iran, the
Central Bank of Iran, and Bank Saderat Iran for supporting
the rocket attacks. The second action also included claims by
a group of non-American plaintiffs against Bank Saderat Iran
and Bank Saderat PLC under the Alien Tort Statute. In
addition, all plaintiffs in the second action raised claims
under Israeli tort law against Bank Saderat Iran and Bank
district court largely addressed the two cases together.
Because Hezbollah and North Korea failed to appear after
being served, the plaintiffs moved for a default judgment
against those defendants. Bank Saderat Iran and Bank Saderat
PLC both appeared and moved to dismiss the claims against
them for lack of subject-matter jurisdiction or personal
jurisdiction, and for failure to state a claim.
August 20, 2013, the district court dismissed the
Anti-Terrorism Act claims (which had been brought against
Hezbollah and Bank Saderat PLC), holding that the ATA's
act-of-war exception precluded liability. The court also
dismissed the Alien Tort Statute claims (which had been
brought against Bank Saderat PLC and Bank Saderat Iran),
based on the presumption against extraterritoriality.
Kaplan v. Cent. Bank of Islamic Republic of Iran,
961 F.Supp.2d 185, 204-05 (D.D.C. 2013). And the court
dismissed the Foreign Sovereign Immunities Act claims against
Bank Saderat Iran, because the bank was not the "agency
or instrumentality of a foreign state." Id. at
24, 2014, the district court issued an opinion concluding
that Iran and North Korea, but not the Central Bank of Iran,
had materially supported Hezbollah's attacks in violation
of the Foreign Sovereign Immunities Act. On September 30,
2016, after further proceedings on the claims against Iran
and North Korea, the district court entered a default
judgment against those defendants, awarding the plaintiffs
more than $169 million in compensatory and punitive damages.
plaintiffs now appeal the dismissal of their Anti-Terrorism
Act claims against Hezbollah and Bank Saderat PLC, as well as
the dismissal of their Alien Tort Statute claims against Bank
Saderat PLC and Bank Saderat Iran. Because Hezbollah had not
entered an appearance, we appointed an amicus curiae to
present arguments supporting the portions of the district
court's judgment at issue on appeal.
initially consider two challenges to our appellate
jurisdiction. Under 28 U.S.C. § 1291, we may review
"final decisions" of the district courts in civil
cases if an appeal is taken within thirty days of entry of
the judgment or order being challenged. See Fed. R.
App. P. 4(a)(1)(A). Bank Saderat PLC and Bank Saderat Iran
(the Banks) argue that plaintiffs' appeal is untimely
because the district court entered its order dismissing the
claims against the Banks on August 20, 2013, more than three
years before the plaintiffs (on November 27, 2016) filed
their notice of appeal concerning those claims. Amicus, for
its part, argues that plaintiffs' appeal of the dismissal
of the claims against Hezbollah is premature because the
district court's September 30, 2016, order was not a
"final" decision within the meaning of Section
1291. We disagree on both counts.
first address the timeliness of the plaintiffs' appeal of
the August 2013 dismissal of their claims against the Banks.
Federal Rule of Civil Procedure 54(b) governs the entry of
final judgment in a case involving multiple claims and
parties. In order to enter "a final judgment as to one
or more, but fewer than all, claims or parties," a
district court must "expressly determine that there is
no just reason for delay." Fed.R.Civ.P. 54(b).
Otherwise, any decision "that adjudicates . . . the
rights and liabilities of fewer than all the parties" is
not a final, appealable judgment. Id.
our court has determined that unserved defendants "are
not 'parties' within the meaning of Rule 54(b)."
Cambridge Holdings Grp., Inc. v. Fed. Ins. Co., 489
F.3d 1356, 1360 (D.C. Cir. 2007). Therefore, "a district
court order disposing of all claims against all properly
served defendants" generally constitutes a final
judgment "even if claims against those not properly
served remain unresolved." Id. at 1360-61.
on that aspect of our decision in Cambridge, the
Banks contend that the plaintiffs' appeal is untimely.
The Banks observe that, at the time of the district
court's August 2013 dismissal of the claims against them,
the remaining defendants in the case involving the Banks-Iran
and Central Bank of Iran (CBI)-had not yet been properly
served. Thus, in the Banks' view, Iran and CBI were not
"parties" for purposes of Rule 54(b), meaning that
the August 2013 order constituted a final judgment
"disposing of all claims against all properly served
defendants." Cambridge, 489 F.3d at 1361. That
order, the Banks submit, thus needed to be appealed within 30
days. See Fed. R. App. P. 4(a)(1)(A).
Banks are correct that, under Cambridge, the
existence of unresolved claims against unserved defendants
generally will not preclude treatment of an order disposing
of all other claims as a final, appealable judgment. But
Cambridge also recognized the possibility of a
different result when the district court affirmatively
contemplates further proceedings on the claims against the
unserved defendants. We observed that, in the Ninth Circuit,
"an order disposing of all claims only against served
parties is not final if 'it is clear from the course of
proceedings that further adjudication is contemplated' by
the district court." Cambridge, 489 F.3d at
1360 n.2 (quoting Disabled Rights Action Comm. v. Las
Vegas Events, Inc., 375 F.3d 861, 872 (9th Cir. 2004)).
we had no occasion in Cambridge to consider whether
to adopt the same approach, we do so today. We conclude that,
when a district court makes plain that it foresees further
proceedings on unresolved claims against defendants who have
yet to be properly served, a decision resolving all the
claims against the properly served defendants is not a final,
appealable judgment. In that situation, any appeal should
await resolution of the contemplated further proceedings on
the claims against the as-yet-unserved defendants.
approach vindicates Rule 54(b)'s central purpose of
avoiding the "piecemeal disposition of litigation."
Cambridge, 489 F.3d at 1361. It also ensures that
Rule 54(b) continues to enable district courts to lend
"welcome certainty to the appellate procedure."
Sears, Roebuck & Co. v. Mackey, 351 U.S. 427,
435 (1956). That is because, if a district court wishes to
allow the immediate appeal of its disposition of claims
against the properly served defendants even though it
affirmatively contemplates further proceedings on the
remaining claims, it can do so by expressly determining
"that there is no just reason for delay."
the anomalous implications of a contrary approach, under
which the resolution of claims against properly served
defendants would be considered a final judgment even though
the district court intends further proceedings against
as-yet-unserved defendants. In such a regime, the district
court would be unable to dispose of the claims against
properly served defendants without entering a final judgment,
even if it fully expects other defendants to be imminently
served. The court might then opt to delay announcing its
resolution of the claims against the already served
defendants so as to avoid fracturing the case, contravening
the Rules' general preference for the swift resolution of
claims. See Fed. R. Civ. P. 1. The better course is
to recognize that, when a district court plainly contemplates
further proceedings on remaining claims against
as-yet-unserved defendants, the resolution of the claims
against properly served defendants is not a final, appealable
judgment (absent an express and reasonable determination of
"no just reason for delay" under Rule 54(b)).
See Bldg. Indus. Ass'n of Superior California v.
Babbitt, 161 F.3d 740, 741 (D.C. Cir. 1998).
that approach here, it is clear that, when the district court
dismissed the claims against the Banks in August 2013, it
contemplated further proceedings on the claims against the
unserved defendants, Iran and CBI. In its memorandum opinion
dismissing the claims against the Banks, the court repeatedly
referred to Iran and CBI as "the remaining
defendants," and the FSIA claims against them as the
"remaining claims." Kaplan, 961 F.Supp.2d
at 206. The court also discussed the failed previous attempts
at service and ordered the plaintiffs to serve Iran and CBI
through diplomatic channels within twenty-one days.
Id. Indeed, in its order accompanying the opinion,
the court dismissed the claims against the Banks in two lines
and then devoted a full page to describing how the plaintiffs
should "commence service of process via diplomatic
channels" for their "remaining claims." Order,
Kaplan v. Cent. Bank of Islamic Republic of Iran,
No. 10-cv-483 (D.D.C. Aug. 20, 2013), ECF No. 41. In short,
both the opinion and order make clear the district
court's expectation that the remaining defendants could
be properly served and the claims against them would then
proceed to resolution (which in fact happened).
those circumstances, we hold that the district court's
August 20, 2013, order, dismissing the claims against the
Banks, was not a final, appealable judgment. Rather, the
court's October 28, 2016, order denying plaintiffs'
motion for reconsideration (and for alteration or amendment
of the judgment) was the operative appealable judgment.
See Fed. R. App. P. 4(a)(4)(A)(iv). Plaintiffs
timely filed their notice of appeal within 30 days of that
the Banks contend that the appeal of the dismissal of the
claims against them was too late, Amicus suggests that the
appeal of the dismissal of the claims against Hezbollah may
have been too early. The district court initially dismissed
the ATA claims against Hezbollah on August 20, 2013. And on
August 20, 2015, plaintiffs voluntarily dismissed the tort
claims against Hezbollah. After further proceedings on claims
involving other defendants, the district court, on September
30, 2016, entered an "Order and Judgment" that it
characterized as a "final judgment." Order &
Judgment, Kaplan v. Hezbollah, No. 09-cv-646 (D.D.C.
Sept. 30, 2016), ECF No. 84. One week later, on October 7,
the plaintiffs filed a notice of appeal concerning the
dismissal of the claims against Hezbollah.
have seen, an order resolving fewer than all claims against
all defendants generally is not a final, appealable order.
See Fed. R. Civ. P. 54(b). Amicus argues that we may
lack jurisdiction over the appeal concerning the claims
against Hezbollah insofar as the district court's
September 30, 2016, order left unresolved certain of the
claims in the case involving Hezbollah. In particular,
although the plaintiffs' complaint in that case alleged
both Foreign Sovereign Immunities Act (FSIA) claims and tort
claims against North Korea, the district court expressly
referenced only the FSIA claims in its opinion ...