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Burnett v. Al Baraka Investment and Development Corp.

July 25, 2003

THOMAS BURNETT, SR., ET AL., PLAINTIFFS,
v.
AL BARAKA INVESTMENT AND DEVELOPMENT CORPORATION, ET AL., DEFENDANTS.



The opinion of the court was delivered by: James Robertson United States District Judge

MEMORANDUM OPINION

In this action, more than two thousand victims, family members of victims or representatives of victims of the terrorist attacks of September 11, 2001, seek to hold accountable the persons and entities that funded and supported the international terrorist organization known as al Qaeda, which is now generally understood to have carried out the attacks. Plaintiffs have sued nearly two hundred entities or persons -- governments, government agencies, banks, charitable foundations, and individuals, including members of the Saudi royal family -- broadly alleging that each of them, in one way or another, directly or indirectly, provided material support, aided and abetted, or conspired with the terrorists who perpetrated the attacks. The Third Amended Complaint ("3AC") asserts claims under the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. § 1602 et seq., the Torture Victim Protection Act (TVPA), 28 U.S.C. § 1350 note, the Antiterrorism Act (ATA), 18 U.S.C. § 2331 et seq., the Alien Tort Claims Act (ATCA), 28 U.S.C. § 1350, the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1961 et seq., and the common law theories of aiding and abetting, conspiracy, wrongful death, survival, intentional infliction of emotional distress, negligence, and negligent infliction of emotional distress. Plaintiffs demand damages, including punitive damages, in excess of one trillion dollars.

As of the date of this decision, twenty-seven defendants have entered appearances in this court, and nineteen have filed motions to dismiss.*fn1 On June 24, 2003, I heard oral arguments on the first five dispositive motions that were fully briefed and ripe for decision. One of those five motions is moot, because the movant has been dismissed from this action. The other four raise issues applicable to many, if not most, of the defendants: Al Rajhi Banking & Investment Corporation (Al Rajhi) asserts that the Southern District of New York has exclusive subject matter jurisdiction over claims arising from the September 11 attacks, that plaintiffs lack standing to bring their civil RICO claim, and that the claims against it present a non-justiciable political question. Al-Haramain Islamic Foundation (AHIF), Muslim World League (MWL), and Soliman J. Khudeira (Khudeira) assert that venue has been improperly laid in the District of Columbia. MWL moves to dismiss for insufficient process and insufficient service of process. All four defendants challenge this court's personal jurisdiction over them. And three of the four assert, in varying ways, that the complaint fails to state any cause of action against them upon which relief can be granted.

This memorandum opinion sets forth my reasons for concluding: that this Court does have subject matter jurisdiction of plaintiffs' claims; that this Court has personal jurisdiction of MWL, Khudeira, and AHIF; that personal jurisdiction of Al Rajhi is uncertain, and plaintiffs may take limited jurisdictional discovery with respect to that party; that venue is properly laid in the District of Columbia; that plaintiffs' civil RICO claims must be dismissed for want of standing; that the complaint adequately states ATA, ATCA, and common law intentional tort claims against AHIF; that plaintiffs' negligence and negligent infliction of emotional distress claims against AHIF must be dismissed for failure to state a claim; and that Al Rajhi and Khudeira may move for more definite statements of plaintiffs' claims against them before they will be required to answer the complaint or respond to discovery.

SUBJECT MATTER JURISDICTION

Plaintiffs invoke the jurisdiction of this court under the ATA for the claims of the plaintiffs who are United States nationals and the ATCA for the claims of those 198 plaintiffs who are foreign nationals. Subject matter jurisdiction is challenged only by Al Rajhi, which argues that the Air Transportation Safety and System Stabilization Act (ATSSSA), Pub. L. No. 107-42, 115 Stat. 230 (Sept. 22, 2001) (reprinted, as amended, at 49 U.S.C.A. § 40101 note (Supp. 2003)), vests exclusive jurisdiction over the claims of these plaintiffs in the United States District Court for the Southern District of New York.

The ATSSSA was enacted by Congress eleven days after the September 11 terrorist attacks "[t]o preserve the continued viability of the United States air transportation system," Pub. L. No. 107-42, 115 Stat. 230, 230, and "to provide compensation to any individual (or relatives of a deceased individual) who was physically injured or killed as a result of the terrorist-related aircraft crashes of September 11, 2001." ATSSSA § 403. The Act is organized into six titles: Title I, Airline Stabilization; Title II, Domestic Insurance and Reimbursement of Insurance Costs; Title III, Tax Provisions; Title IV, Victim Compensation; Title V, Air Transportation Safety; and Title VI, Separability. The purpose of Title IV, which established the September 11th Victim Compensation Fund, see ATSSSA §§ 404-407, was to "protect the airline industry and other potentially liable entities from financially fatal liabilities while ensuring that those injured or killed in the terrorist attacks receive adequate compensation." Canada Life Assurance Co. v. Converium Ruckversicherung (Deutschland) AG, -- F.3d --, No. 02-7590, 2003 WL 21524845, at *2 (2d Cir. July 8, 2003) (citation omitted).

Al Rajhi's motion focuses on Section 408, which is found within Title IV. Before its amendment in November 2001, that section was entitled "Limitation on Air Carrier Liability." It now reads, in pertinent part:

Sec. 408. Limitation on liability.

(a) In general.--(1) Liability limited to insurance coverage.--Notwithstanding any other provision of law, liability for all claims, whether for compensatory or punitive damages or for contribution or indemnity, arising from the terrorist-related aircraft crashes of September 11, 2001, against an air carrier, aircraft manufacturer, airport sponsor, or person with a property interest in the World Trade Center, on September 11, 2001, whether fee simple, leasehold or easement, direct or indirect, or their directors, officers, employees, or agents, shall not be in an amount greater than the limits of liability insurance coverage maintained by that air carrier, aircraft manufacturer, airport sponsor, or person....

(b) Federal cause of action.

(1) Availability of action.--There shall exist a Federal cause of action for damages arising out of the hijacking and subsequent crashes of American Airlines flights 11 and 77, and United Airlines flights 93 and 175, on September 11, 2001. Notwithstanding section 40120(c) of title 49, United States Code [49 U.S.C.A. § 40120(c)], this cause of action shall be the exclusive remedy for damages arising out of the hijacking and subsequent crashes of such flights.

(2) Substantive law.--The substantive law for decision in any such suit shall be derived from the law, including choice of law principles, of the State in which the crash occurred unless such law is inconsistent with or preempted by Federal law.

(3) Jurisdiction.--The United States District Court for the Southern District of New York shall have original and exclusive jurisdiction over all actions brought for any claim (including any claim for loss of property, personal injury, or death) resulting from or relating to the terrorist-related aircraft crashes of September 11, 2001.

(c) Exclusion.--Nothing in this section shall in any way limit any liability of any person who is a knowing participant in any conspiracy to hijack any aircraft or commit any terrorist act. Subsections (a) and (b) do not apply to civil actions to recover collateral source obligations.

ATSSSA § 408 (emphasis supplied).

A court presented with a dispute about the meaning of a statute must first look at the language. If the language has a "plain and unambiguous meaning," the court's inquiry ends -- "so long as the resulting statutory scheme is coherent and consistent. Whether statutory language is plain depends on the language itself, the specific context in which the language is used, and the broader context of the statute as a whole." United States v. Barnes, 295 F.3d 1354, 1359 (D.C. Cir. 2002) (quoting United States v. Wilson, 290 F.3d 347, 352 (D.C. Cir. 2002) (quoting Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997))). It is the entire statute that must be reviewed, however, and not specific clauses or provisions in isolation. See Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26, 36 (1998) (a "central tenet of interpretation [is] that a statute is to be considered in all its parts when construing any one of them"); United States Nat'l Bank of Or. v. Indep. Ins. Agents of America, Inc., 508 U.S. 439, 455 (1993) ("[W]e have stressed that in expounding a statute, we must not be guided by a single sentence or member of a sentence, but look to the provisions of the whole law, and to its object and policy") (internal quotation and citations omitted). If the language of the statute is ambiguous, then the court should "look to 'the intent of Congress as revealed in the history and purposes of the statutory scheme.'" Penn Allegh Coal Co., Inc. v. Holland, 183 F.3d 860, 864 (D.C. Cir. 1999) (quoting Adams Fruit Co. v. Barrett, 494 U.S. 638, 642 (1990)).

Read in isolation, § 408(b)(3) is unambiguous and appears to require that plaintiffs' claims be heard in the Southern District of New York. When the statute is "considered in all its parts," however, the picture is less clear. Considering the "specific context in which the language is used," Barnes, 295 F.3d at 1359, it is arguable that § 408(b)(3)'s "exclusive jurisdiction" provision applies only to the federal cause of action created by § 408(b)(1), and one district court has so construed it. See Goodrich Corp. v. Winterthur Int'l Am. Ins. Co., No. 02CV367, 2002 WL 31833646, at *4 (N.D. Ohio June 17, 2002); see also In re World Trade Ctr. Disaster Site Litig., -- F. Supp. 2d --, 2003 WL 21419613, at *3 (S.D.N.Y. June 20, 2003) ("Section 408(b)(1) of Title IV provides for a federal cause of action.... Section 408(b)(3) provides that such actions are to be brought in the United States District Court for the Southern District of New York") (emphasis supplied).

Ambiguity requires that we turn to legislative history, but in this case the legislative history is meager.*fn2 There is no Senate or House Report. It is easy to discern, from the hurried enactment of the statute and from comments made on the floors of the House and the Senate, that the driving force behind ATSSSA was Congress's concern for the financial survival of the airline industry. See 147 Cong. Rec. S9589-9603 (Sept. 21, 2001); 147 Cong. Rec. H5894-5918 (Sept. 21, 2001). One court has found that Congress included Title IV in the ATSSSA "intend[ing] that [it] would promote the efficiency and rationality of litigation for those victims who chose to sue rather than to file a claim with the Victim Compensation Fund, and would limit the aggregate exposure of the non-terrorist defendants...." In re World Trade Ctr. Disaster Site Litig., –- F. Supp. 2d at --, 2003 WL 21419613, at *10.*fn3 Whatever the impetus for the enactment of ATSSSA, however, the sum total of what passes for its "legislative history" does not definitively resolve any ambiguity that emerges from the context of Section 408(b)(3).

Instead what compels my decision to deny Al Rajhi's motion to dismiss for lack of subject matter jurisdiction is another canon of statutory construction: that "when two statutes are capable of co-existence, it is the duty of the courts, absent a clearly expressed congressional intention to the contrary, to regard each as effective." Morton v. Mancari, 417 U.S. 535, 551 (1974); Detweiler v. Pena, 38 F.3d 591, 594 (D.C. Cir. 1994). The ATA, which is invoked in Count Three of the 3AC, states that "[a]ny national of the United States injured in his or her person, property, or business by reason of an act of international terrorism, or his or her estate, survivors, or heirs, may sue therefor in any appropriate district court of the United States," 18 U.S.C. § 2333. It further provides that suit may be brought "in the district court of the United States for any district where any plaintiff resides or where any defendant resides or is served, or has an agent." 18 U.S.C. § 2334.

Construing the ATSSSA's exclusive jurisdiction language to encompass claims against the September 11 terrorists and their conspirators would bring the ATSSSA irreconcilably into conflict with the ATA. Congress did not "clearly express" an intention that Section 408(b)(3) was to render the ATA's jurisdictional provision ineffective, although it is "normally expected to be aware of its previous enactments and to provide clear statement of repeal if it intends to do so." Navegar, Inc. v. United States, 192 F.3d 1050, 1063 n.8 (D.C. Cir. 1999) (citing Samuels v. District of Columbia, 770 F.2d 184, 194 n. 7 (D.C. Cir. 1985) (citing TVA v. Hill, 437 U.S. 153, 189-93 (1978))), cert. denied, 531 U.S. 816 (2000). Indeed, Congress was careful to acknowledge another potentially conflicting statute when it enacted Section 408(b), making the new cause of action it had created an exclusive remedy "[n]otwithstanding section 40120(c) of title 49...."*fn4

There is no conflict between the ATSSSA and the ATA if both statutes are given effect. That is accomplished here by giving a narrow construction to the "exclusive jurisdiction" language of Section 408(b)(3). See Hudson News Co. v. Fed. Ins. Co., 258 F. Supp. 2d 382, 387-88 (D.N.J. 2003) ("[M]ost, if not all courts addressing the jurisdictional effect of the Air Safety Act have narrowly construed the scope of § 408(b)(1) and (3) .... [T]his Court is, like its sister courts, reluctant to attribute expansive effect to those provisions") (internal citations omitted).

PERSONAL JURISDICTION

The venue provision of the ATA provides that: [a]ny civil action under section 2333 of this title against any person may be instituted in the district court of the United States for any district where any plaintiff resides or where any defendant resides or is served, or has an agent. Process in such a civil action may be served in any district where the defendant resides, is found, or has an agent.

18 U.S.C. § 2334(a). Because the statute provides for nationwide service of process, the relevant Due Process inquiry for personal jurisdiction purposes, assuming that the defendant has been properly served, "is whether the defendant has had minimum contacts with the United States." Busch v. Buchman, Buchman & O'Brien, Law Firm, 11 F.3d 1255, 1258 (5th Cir. 1994) (citations omitted); see, e.g., SEC v. Carrillo, 115 F.3d 1540, 1543 (11th Cir. 1997); Estates of Ungar ex rel. Strachman v. Palestinian Auth., 153 F. Supp. 2d 76, 88 (D.R.I. 2001) (personal jurisdiction proper in ATA case when defendants have minimum contacts with United States as a ...


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