10‐1306‐cv Licci, et al. v. Lebanese Canadian Bank, SAL

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

August Term, 2010

(Argued: February 25, 2011; Questions Certified: March 5, 2012; Certified Questions Answered: November 20, 2012; Final Submission: February 8, 2013; Decided: October 18, 2013)

Docket No. 10‐1306‐cv

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐

YAAKOV LICCI, a minor, by his father and natural guardian, ELIHAV LICCI, and by his mother and natural guardian, YEHUDIT LICCI, et al.,

Plaintiffs‐Appellants,

‐ v ‐

LEBANESE CANADIAN BANK, SAL; AMERICAN EXPRESS BANK LTD.,

Defendants‐Appellees.

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐

Before: KATZMANN, Chief Judge, and KEARSE and SACK, Circuit Judges.

Appeal by the plaintiffs from an order of the United States District

Court for the Southern District of New York (George B. Daniels, Judge) dismissing this action as to defendant Lebanese Canadian Bank, SAL, for want of

personal jurisdiction. In response to two questions we certified, the New York

Court of Appeals concluded that allegations of the defendantʹs repeated use of a

New York correspondent bank account to transfer substantial sums of money on

behalf of a Hizballah affiliate ʺshows not only transaction of business, but an

articulable nexus or substantial relationship between the transactionʺ and the

plaintiffsʹ Anti‐Terrorism Act, Alien Tort Statute, and Israeli law claims to

support personal jurisdiction under New Yorkʹs long‐arm statute, N.Y. C.P.L.R.

302(a)(1). Licci v. Lebanese Canadian Bank, SAL,

,

,

, 703 (2012). In light of that guidance and our conclusion

that such jurisdiction does not violate due process protections afforded to the

defendant by the United States Constitution, we vacate the judgment of the

district court with respect to personal jurisdiction over Lebanese Canadian Bank,

and remand for further proceedings.

Vacated and remanded.

ROBERT J. TOLCHIN, The Berkman Law Office, LLC, Brooklyn, NY, for Plaintiffs‐Appellants.

JONATHAN D. SIEGFRIED, DLA Piper LLP (Lawrence S. Hirsh, Dewey & LeBoeuf LLP, of counsel), New York, NY, for Defendant‐Appellee Lebanese Canadian Bank, SAL.

2 SACK, Circuit Judge:

When this case first came to us on appeal, we certified to the New

York Court of Appeals two questions concerning the scope of New Yorkʹs long‐

arm statute, as set forth in N.Y. C.P.L.R. 302(a)(1), in our effort to determine

whether the district court had personal jurisdiction over defendant Lebanese

Canadian Bank, SAL (ʺLCBʺ). The Court of Appeals accepted our certified

questions, and, in response, explained that a foreign bankʹs use of a New York

correspondent account to execute dozens of wire transfers is sufficiently

purposeful conduct to constitute a ʺtransaction of businessʺ within the meaning

of that section. Licci v. Lebanese Canadian Bank, SAL,

,

,

, 702 (2012) (ʺLicci IIIʺ). The Court of Appeals

also concluded that the allegations contained in the complaint, taken as true for

these purposes, establish the requisite ʺnexusʺ or ʺrelationshipʺ between the

foreign bankʹs New York business activity and the plaintiffsʹ claims to support

the district courtʹs exercise of personal jurisdiction under the long‐arm statute.

Id. at 340,

, 960 N.Y.S.2d at 703.

Now that the New York Court of Appeals has answered the state‐

law portion of the jurisdictional inquiry, we must ensure that subjecting the

3 foreign bank to personal jurisdiction in New York comports with due process

protections provided by the United States Constitution. We conclude that it

does. We therefore vacate that part of the district courtʹs judgment dismissing

the complaint against defendant LCB for lack of personal jurisdiction and

remand for further proceedings.

BACKGROUND

Because our previous opinion extensively recites the facts and

procedural history of this case, see Licci v. Lebanese Canadian Bank, SAL,

, 55‐59 (2d Cir. 2012) (ʺLicci IIʺ), we reiterate here only those facts we think

necessary to understand our disposition of this appeal following the New York

Court of Appealsʹ answers to our certified questions.

Plaintiffs are American, Canadian, and Israeli citizens who were

injured, or whose family members were injured or killed, in rocket attacks

allegedly carried out by Hizballah1 in July and August 2006 in Israel.

at 54‐55.

Defendant LCB is a Lebanese bank with no operations, branches, or employees in

1 We continue to adopt the spelling used by the United States Department of State, which has designated Hizballah a Foreign Terrorist Organization since 1997. See U.S. Depʹt of State, Bureau of Counterterrorism, Foreign Terrorist Organizations (Oct. 16, 2013), http://www.state.gov/j/ct/rls/other/des/ 123085.htm.

4 the United States.2

. To effectuate U.S.‐dollar‐denominated transactions,

LCB maintains a correspondent bank account3 with defendant American Express

Bank Ltd. (ʺAmExʺ) in New York.

The plaintiffs allege that LCB used this

correspondent account to wire millions of dollars on behalf of Hizballah,

knowing that such wire transfers would enable Hizballah ʺto plan, to prepare for

and to carry out terrorist attacks,ʺ including the rocket attacks in which the

plaintiffs or their family members were injured. Am. Compl. ¶ 131. Specifically,

the plaintiffs allege that LCB executed wire transfers using its correspondent

2 The New York Court of Appeals reported that, during the pendency of this appeal, privately owned LCB merged with the Lebanese subsidiary of Société Générale SA, a French bank. Licci III,

n.1,

n.1, 960 N.Y.S.2d at 696 n.1 (2012). Nothing in the record on appeal indicates that the entity we refer to as LCB has ceased to be the proper defendant‐appellee in these proceedings. 3 A correspondent bank account is a domestic bank account held by a foreign bank, ʺsimilar to a personal checking account used for deposits, payments and transfers of funds.ʺ Intʹl Hous. Ltd. v. Rafidain Bank Iraq,

(2d Cir. 1989). Correspondent accounts ʺfacilitate the flow of money worldwide, often for transactions that otherwise have no other connection to New York, or indeed the United States.ʺ Licci III,

,

, 960 N.Y.S.2d at 702; see also Tamam v. Fransabank SAL,

, 724‐25 (S.D.N.Y. 2010) (noting that U.S. dollars are widely used in Lebanon, and that ʺLebanese banks generally acquire U.S. currency either through the Central Bank of Lebanon clearinghouse or through correspondent banking relationships in other countriesʺ).

5 account in New York, for an account held by the Shahid (Martyrs) Foundation

(ʺShahidʺ), which is a ʺfinancial armʺ of Hizballah.

¶¶ 45‐53. Shahid was the

account holder in name only. The plaintiffs allege that funds held in Shahidʹs

LCB account ʺbelonged to Hizbollah and were under the control of Hizbollah,ʺ id.

¶ 50, and that LCB carried out wire transfers for the Shahid account ʺin order to

assist and advance Hizbollahʹs goal of using terrorism to destroy the State of

Israel,ʺ id. ¶ 129.

Proceedings in the District Court

The plaintiffs brought five claims against LCB: (1) commission of

international terrorism in violation of the Anti‐Terrorism Act,

;

(2) aiding and abetting international terrorism in violation of the Anti‐Terrorism

Act; (3) aiding and abetting genocide, war crimes, and crimes against humanity

in violation of international law, under the Alien Tort Statute,

(the ʺATSʺ); (4) negligence in violation of Israeli Civil Wrongs Ordinance § 35;

and (5) breach of statutory duty in violation of Israeli Civil Wrongs Ordinance

§ 63.4 LCB moved to dismiss all five claims for lack of personal jurisdiction under

4 The plaintiffs also brought a single cause of action against AmEx for negligence under Israeli law. The district court dismissed the claim with prejudice pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, Licci

6 Rule 12(b)(2) of the Federal Rules of Civil Procedure, and for failure to state a

claim under Rule 12(b)(6).

In a memorandum decision and order dated March 31, 2010, the

district court granted LCBʹs Rule 12(b)(2) motion to dismiss for want of personal

jurisdiction. Licci v. Am. Express Bank Ltd.,

(S.D.N.Y. 2010)

(ʺLicci Iʺ). The district court correctly noted that a defendant may be subject to

personal jurisdiction in New York under N.Y. C.P.L.R. 302(a)(1) if (1) the

defendant ʺʹtransacted business within the state; and (2) the claim asserted . . .

arise[s] from that business activity,ʹʺ

at 406 (quoting Solé Resort, S.A. de C.V. v.

Allure Resorts Mgmt., LLC,

(2d Cir. 2006)), but decided that the

allegations in the amended complaint were insufficient to satisfy either such

prong,

at 406‐08.

With respect to section 302(a)(1)ʹs transaction of business

requirement, the district court concluded that LCBʹs ʺexecution of wire transfers

is not a ʹuseʹ of a correspondent account which alone is sufficient to confer

jurisdiction over a foreign bankʺ because one of the primary functions of a

v. Am. Express Bank Ltd.,

(S.D.N.Y. 2010), and we affirmed, Licci v. Lebanese Canadian Bank, SAL,

(2d Cir. 2012) (per curiam). This aspect of the matter is thus no longer before us.

7 correspondent account is to facilitate cross‐border wire transfers. Id. at 407. It

could perceive ʺno meaningful distinctionʺ between ʺuseʺ of a correspondent

account and the ʺmaintenanceʺ of such an account, which some decisions had

found to be insufficient, standing alone, to establish personal jurisdiction. Id. at

407‐08.

With respect to section 302(a)(1)ʹs requirement that a plaintiffʹs claim

ʺarise fromʺ New York business activity, the district court apparently interpreted

New Yorkʹs long‐arm statute to require that the defendantʹs in‐state transaction

of business proximately caused the plaintiffʹs injury. Id. at 408. It found no such

proximate causation because ʺ[t]he injuries and death suffered by plaintiffs and

their family members were caused by the rockets launched by Hizbollah, not by

the banking services provided by LCB through its correspondent account or wire

transfers with Amex Bank via New York.ʺ Id.

Although the Rule 12(b)(2) dismissal rested entirely on the plaintiffsʹ

failure to make a prima facie showing of long‐arm jurisdiction under New York

law, the district court also offered its view ‐‐ without further explication ‐‐ that

ʺ[t]he exercise of personal jurisdiction over LCB on the basis alleged by plaintiffs

would not comport with constitutional principles of due process.ʺ Id. The court

8 did not reach LCBʹs alternative argument that the complaint should be dismissed

for failure adequately to plead a cause of action under Rule 12(b)(6).

Proceedings in This Court

In our initial consideration of the plaintiffsʹ appeal, we found the

scope and application of the long‐arm statuteʹs ʺtransaction of businessʺ and

ʺarising fromʺ tests to be uncertain. We determined that we could not

ʺconfidently say whether the New York Court of Appeals would conclude that

the plaintiffsʺ have made a prima facie showing of jurisdiction under N.Y. C.P.L.R.

302(a)(1). Licci II,

. We therefore certified the following questions to

the New York Court of Appeals:

(1) Does a foreign bankʹs maintenance of a correspondent bank account at a financial institution in New York, and use of that account to effect ʺdozensʺ of wire transfers on behalf of a foreign client, constitute a ʺtransact[ion]ʺ of business in New York within the meaning of

(a)(1)?

(2) If so, do the plaintiffsʹ claims under the Anti‐ Terrorism Act, the ATS, or for negligence or breach of statutory duty in violation of Israeli law, ʺaris[e] fromʺ LCBʹs transaction of business in New York within the meaning of

(a)(1)?

at 74‐75 (alterations in original).

9 On March 29, 2012, the Court of Appeals accepted our certified

questions. Licci v. Lebanese Canadian Bank, SAL,

,

,

(2012). Having heard argument on the case, the Court

answered the certified questions in the affirmative. Licci III,

,

, 960 N.Y.S.2d at 703. Equipped with this guidance, we now return

to the jurisdictional questions presented.5

DISCUSSION

I. Personal Jurisdiction

We review de novo the district courtʹs Rule 12(b)(2) dismissal for lack

of personal jurisdiction over the defendant. Chloé v. Queen Bee of Beverly Hills,

LLC,

(2d Cir. 2010). ʺIn order to survive a motion to dismiss for

lack of personal jurisdiction, a plaintiff must make a prima facie showing that

jurisdiction exists.ʺ Thomas v. Ashcroft,

(2d Cir. 2006). In

evaluating whether the requisite showing has been made, we construe the

5 We deny the plaintiffsʹ February 8, 2013, request to supplement the record on appeal with jurisdictional allegations drawn from the complaint in a 2011 civil forfeiture action brought by the United States against LCB in the Southern District of New York because we are of the view that it is unnecessary and would be unhelpful.

10 pleadings and any supporting materials in the light most favorable to the

plaintiffs. Chloé,

.

Determining personal jurisdiction over a foreign defendant in a

federal‐question case such as this requires a two‐step inquiry. First, we look to

the law of the forum state to determine whether personal jurisdiction will lie. See

Best Van Lines, Inc. v. Walker,

(2d Cir. 2007). If jurisdiction lies,

we consider whether the district courtʹs exercise of personal jurisdiction over a

foreign defendant comports with due process protections established under the

United States Constitution. Id.; see also Intʹl Shoe Co. v. Washington,

(1945).

A. State Law

New Yorkʹs long‐arm statute provides in relevant part that ʺa court

may exercise personal jurisdiction over any non‐domiciliary . . . who in person or

through an agent . . . transacts any business within the state or contracts

anywhere to supply goods or services in the state.ʺ N.Y. C.P.L.R. 302(a)(1). ʺTo

establish personal jurisdiction under section 302(a)(1), two requirements must be

met: (1) The defendant must have transacted business within the state; and (2) the

claim asserted must arise from that business activity.ʺ Solé Resort,

.

11 1. Transacting Business. In its response to our certified questions,

the Court of Appeals confirmed that Amigo Foods Corp. v. Marine Midland

Bank‐N.Y.,

,

,

(1976), stands for the

proposition that the use of a New York correspondent bank account, standing

alone, may be considered a ʺtransaction of businessʺ under the long‐arm statute if

the defendantʹs use of the correspondent account was purposeful. Licci III, 20

N.Y.3d at 338‐39, 984 N.E.2d at 899‐900, 960 N.Y.S.2d at 701‐02. The Court

concluded that whether a defendant has purposefully availed itself of the New

York forum is a fact‐intensive inquiry inasmuch as it requires the trial court, in

the first instance, to ʺclosely examine the defendantʹs contacts for their quality.ʺ

Id. at 338, 984 N.E.2d at 899‐900, 960 N.Y.S.2d at 701‐02. As a general matter,

however,

complaints alleging a foreign bankʹs repeated use of a correspondent account in New York on behalf of a client ‐‐ in effect, a ʺcourse of dealingʺ ‐‐ show purposeful availment of New Yorkʹs dependable and transparent banking system, the dollar as a stable and fungible currency, and the predictable jurisdictional and commercial law of New York and the United States.

Id. at 339,

, 960 N.Y.S.2d at 702 (citation omitted).

12 With respect to LCBʹs contacts with New York, the Court of Appeals

found both the frequency and deliberate nature of LCBʹs use of its correspondent

account to be determinative. The Court focused on the allegations that LCB used

its New York correspondent account ʺdozensʺ of times ʺto effect its support of

Shahid and shared terrorist goals,ʺ not ʺonce or twice by mistake.ʺ Id. at 340,

, 960 N.Y.S.2d at 703. The Court confirmed that this conduct

ʺindicates desirability and a lack of coincidence,ʺ id.,

, 960

N.Y.S.2d at 703; that is, it reflects LCBʹs purposeful availment of the privilege of

doing business in the New York forum.

2. Claims ʺArising Fromʺ a Transaction of Business. The Court of

Appeals made clear that the ʺarising fromʺ prong of section 302(a)(1) does not

require a causal link between the defendantʹs New York business activity and a

plaintiffʹs injury. Instead, it requires ʺa relatedness between the transaction and

the legal claim such that the latter is not completely unmoored from the former,

regardless of the ultimate merits of the claim.ʺ Id. at 339,

, 960

N.Y.S.2d at 702. According to the Court, whether a plaintiffʹs claim arises from a

defendantʹs New York contacts depends upon ʺthe nature and elements of the

particular causes of action pleaded.ʺ Id. at 340,

, 960 N.Y.S.2d at

13 703. However, section 302(a)(1) ʺdoes not require that every element of the cause

of action pleaded must be related to the New York contacts; rather, where at least

one element arises from the New York contacts, the relationship between the

business transaction and the claim asserted supports specific jurisdiction under

the statute.ʺ Id. at 341,

, 960 N.Y.S.2d at 703.

With respect to the plaintiffsʹ claims against LCB, which the Court of

Appeals characterized as claims for breach of various statutory duties, the Court

acknowledged that ʺ[n]ot all elements of the causes of action pleaded are related

to LCBʹs use of the correspondent account,ʺ inasmuch as ʺthe specific harms

suffered by plaintiffs flowed not from LCBʹs alleged support of a terrorist

organization, but rather from rockets.ʺ Id.,

, 960 N.Y.S.2d at 703.

But, the Court pointed out, the plaintiffsʹ claims are also grounded in the

allegation that LCB violated various statutory duties by using its correspondent

account to funnel money to Shahid and Hizballah. Id. at 340,

,

960 N.Y.S.2d at 703. Because the defendantʹs allegedly culpable conduct stems

from this use of the New York correspondent account, the Court of Appeals

concluded, the plaintiffsʹ claims are sufficiently related to LCBʹs New York

14 business activity to satisfy the second prong of section 302(a)(1). See id.,

, 960 N.Y.S.2d at 703.

The plaintiffs have therefore made a prima facie showing that the

district court may exercise personal jurisdiction over LCB with respect to their

Anti‐Terrorism Act, ATS, and Israeli law claims pursuant to the state long‐arm

statute.

B. Constitutional Due Process

Now that the state‐law jurisdictional questions have been resolved,

we must determine whether the district courtʹs exercise of personal jurisdiction

over LCB is consistent with the due process protections provided by the United

States Constitution. Ehrenfeld v. Mahfouz,

(2d Cir. 2007) (ʺ[E]ven

if the New York Court of Appeals concludes that personal jurisdiction is proper

under § 302(a)(1) of the New York long‐arm statute, this Court must make the

ultimate determination whether this jurisdiction satisfies constitutional due

process.ʺ).

Due process considerations require that the defendant ʺhave certain

minimum contacts [with the forum state] such that the maintenance of the suit

does not offend traditional notions of fair play and substantial justice.ʺ Intʹl Shoe,

15

(internal quotation marks omitted). Where, as in this case, the

plaintiffs ask the district court to assert specific jurisdiction6 over the defendants,

the jurisdictional inquiry focuses on the ʺaffiliation between the forum and the

underlying controversy.ʺ Goodyear Dunlop Tires Operations S.A. v. Brown, ___ U.S.

___,

(2011) (internal quotation marks and brackets omitted).

Our analysis typically proceeds in two steps. First, we ʺevaluate the

quality and nature of the defendantʹs contacts with the forum state under a

totality of the circumstances test.ʺ Best Van Lines,

(citations and

6

A court may assert general jurisdiction over foreign (sister‐state or foreign‐country) corporations to hear any and all claims against them when their affiliations with the State are so ʺcontinuous and systematicʺ as to render them essentially at home in the forum State. Specific jurisdiction, on the other hand, depends on an ʺaffiliation between the forum and the underlying controversy,ʺ principally, activity or an occurrence that takes place in the forum State and is therefore subject to the Stateʹs regulation. In contrast to general, all‐purpose jurisdiction, specific jurisdiction is confined to adjudication of ʺissues deriving from, or connected with, the very controversy that establishes jurisdiction.ʺ

Goodyear Dunlop Tires Operations S.A. v. Brown, ___ U.S. ___,

(2011) (citations and brackets omitted). There is no contention that LCB is subject to general jurisdiction in New York.

16 internal quotation marks omitted). ʺWhere the claim arises out of, or relates to,

the defendantʹs contacts with the forum ‐‐ i.e., specific jurisdiction [is asserted] ‐‐

minimum contacts [necessary to support such jurisdiction] exist where the

defendant purposefully availed itself of the privilege of doing business in the

forum and could foresee being haled into court there.ʺ Bank Brussels Lambert v.

Fiddler Gonzalez & Rodriguez,

(2d Cir. 2002) (internal quotation

marks omitted).

ʺOnce it has been decided that a defendant purposefully established

minimum contacts within the forum State, these contacts may be considered in

light of other factors to determine whether the assertion of personal jurisdiction

would comport with fair play and substantial justice.ʺ Burger King Corp. v.

Rudzewicz,

(1985) (internal quotation marks omitted). Relevant

factors at this second step of the analysis may include: ʺ(1) the burden that the

exercise of jurisdiction will impose on the defendant; (2) the interests of the

forum state in adjudicating the case; [and] (3) the plaintiffʹs interest in obtaining

convenient and effective relief . . . .ʺ Metro. Life Ins. Co. v. Robertson‐Ceco Corp.,

(2d Cir. 1996).

17 We pause to note that, despite the fact that section 302(a)(1) of New

Yorkʹs long‐arm statute and constitutional due process are not coextensive, and

that personal jurisdiction permitted under the long‐arm statute may theoretically

be prohibited under due process analysis, we would expect such cases to be rare.

It would be unusual, indeed, if a defendant transacted business in New York and

the claim asserted arose from that business activity within the meaning of section

302(a)(1), and yet, in connection with the same transaction of business, the

defendant cannot be found to have ʺpurposefully availed itself of the privilege of

doing business in the forum and [to have been able to] foresee being haled into

court there,ʺ Bank Brussels Lambert,

(internal quotation marks

omitted), or the assertion of specific jurisdiction would somehow otherwise

ʺoffend traditional notions of fair play and substantial justice,ʺ Intʹl Shoe,

(internal quotation marks omitted). Indeed, we have been pointed to no

such decisions in this Circuit. That observation does not, however, spare us from

a separate constitutional analysis in each such case.

1. Minimum Contacts. The jurisdictional basis for the plaintiffsʹ

claims is LCBʹs execution of dozens of dollar‐denominated wire transfers through

its AmEx correspondent account in New York. These wire transfers are a part of

18 the principal wrong at which the plaintiffsʹ lawsuit is directed inasmuch as they

allege that ʺLCB carried out the . . . [t]ransfers as a matter of official LCB policy,

in order to assist and advance Hizbollahʹs terrorist activities against Jews in

Israelʺ in violation of various statutory duties. Am. Compl. ¶ 129.

We conclude that the selection and repeated use of New Yorkʹs

banking system, as an instrument for accomplishing the alleged wrongs for

which the plaintiffs seek redress, constitutes ʺpurposeful[] avail[ment] . . . of the

privilege of doing business in [New York],ʺ Bank Brussels Lambert,

(internal quotation marks omitted), so as to permit the subjecting of LCB to

specific jurisdiction within the Southern District of New York consistent with due

process requirements.

In light of the widespread acceptance and availability of U.S.

currency, LCB could have, as it acknowledges, processed U.S.‐dollar‐

denominated wire transfers for the Shahid account through correspondent

accounts anywhere in the world. Appelleeʹs Post‐Argument Letter Brief at 10; see

also Tamam v. Fransabank SAL,

(S.D.N.Y. 2010) (noting

that foreign bank defendants maintained U.S. dollar correspondent relationships

with banks located in Cairo, Sri Lanka, London, Paris, Jordan, the Philippines,

19 and Saudi Arabia, any of which they could have used to execute U.S.‐dollar‐

denominated wire transfers on behalf of Hizballah front groups). But LCB

deliberately chose to process the many Shahid wire transfers through AmEx in

New York.

Moreover, LCBʹs use of a correspondent account in New York to

accomplish its dollar‐denominated wire transfers was recurring. Indeed, the

plaintiffs allege wire transfers through AmEx that numbered in the dozens and

totaled several million dollars, so it cannot be said that LCBʹs contacts with New

York were ʺrandom, isolated, or fortuitous.ʺ Keeton v. Hustler Magazine, Inc.,

(1984). This deliberate and recurring activity constitutes, as the

Court of Appeals put it in analyzing the applicability of New Yorkʹs long‐arm

statute, LCBʹs ʺpurposeful availment of New Yorkʹs dependable and transparent

banking system, the dollar as a stable and fungible currency, and the predictable

jurisdictional and commercial law of New York and the United States.ʺ Licci III,

,

, 960 N.Y.S.2d at 702; see also id. at 340,

, 960 N.Y.S.2d at 703 (speculating that, although LCB could have

routed the Shahid wire transfers through any correspondent account, cost

20 savings or other conveniences associated with the AmEx account in New York

enabled LCB to retain Shahid as a customer).

In reaching this conclusion, we by no means suggest that a foreign

defendantʹs ʺmere maintenanceʺ of a correspondent account in the United States

is sufficient to support the constitutional exercise of personal jurisdiction over the

account‐holder in connection with any controversy. In this case, the

correspondent account at issue is alleged to have been used as an instrument to

achieve the very wrong alleged. We conclude that in connection with this

particular jurisdictional controversy ‐‐ a lawsuit seeking redress for the allegedly

unlawful provision of banking services of which the wire transfers are a part ‐‐

allegations of LCBʹs repeated, intentional execution of U.S.‐dollar‐denominated

wire transfers on behalf of Shahid, in order to further Hizballahʹs terrorist goals,

are sufficient. It should hardly be unforseeable to a bank that selects and makes

use of a particular forumʹs banking system that it might be subject to the burden

of a lawsuit in that forum for wrongs related to, and arising from, that use.7

7 There is authority ‐‐ albeit not concerning correspondent accounts, and arising in varied contexts ‐‐ that stands for the general proposition that use of a forumʹs banking system as part of an allegedly wrongful course of conduct may expose the user to suits seeking redress in that forum when that use is an integral part of the wrongful conduct. See, e.g., U.S. Securities and Exchange Commission v.

21 LCB argues that the exercise of personal jurisdiction in this case

cannot be squared with our decisions in the multidistrict litigation stemming

from the September 11, 2001 terrorist attacks. In In re Terrorist Attacks on

September 11, 2001,

(2d Cir. 2008), abrogated on other grounds, Samantar

v. Yousuf,

(2010), the plaintiffs, who suffered personal injuries and

financial losses as a result of the attacks, filed suit against hundreds of parties,

including four Saudi princes who allegedly gave money to Muslim charities with

the knowledge that such charities would transfer the funds to the terrorist

organization al Qaeda. Id. at 77. We decided that minimum contacts with the

United States would exist if the plaintiffs ʺshow[ed] that the Four Princes

engaged in ʹintentional, and allegedly tortious, actions . . . expressly aimedʹ at

residents of the United States.ʺ Id. at 95 (quoting Calder v. Jones,

, 789

Carrillo,

, 1545‐47 (11th Cir. 1997) (resting personal jurisdiction in part on the ʺuse of . . . bank accounts to carry out the sale of unregistered securitiesʺ because the use was ʺmanifestly related to, and gave rise to, the causes of action,ʺ ʺconstitute[d] purposeful availment and invocation of the benefits of the forumʹs laws,ʺ and contributed to the expectation that the account‐user might be subject to suit in the forum (emphasis in original)); Application to Enforce Administrative Subpoenas Duces Tecum of S.E.C. v. Knowles,

(10th Cir. 1996) (resting jurisdiction in securities fraud investigation in part on the use of brokerage accounts in the forum).

22 (1984)) (ellipsis in original). But we could find no basis for the constitutional

exercise of personal jurisdiction over the Saudi princes, explaining:

[The plaintiffsʹ] burden is not satisfied by the allegation that the Four Princes intended to fund al Qaeda through their donations to Muslim charities. . . . It may be the case that acts of violence committed against residents of the United States were a foreseeable consequence of the princesʹ alleged indirect funding of al Qaeda, but foreseeability is not the standard for recognizing personal jurisdiction. Rather, the plaintiffs must establish that the Four Princes ʺexpressly aimedʺ intentional tortious acts at residents of the United States. Providing indirect funding to an organization that was openly hostile to the United States does not constitute this type of intentional conduct. In the absence of such a showing, American courts lacked personal jurisdiction over the Four Princes.

Id. at 95 (citation omitted).

Similarly, in another case related to the September 11th attacks, we

affirmed the dismissal for lack of personal jurisdiction over several foreign

financial institutions and individuals associated therewith who were alleged to

have ʺknowingly maintained bank accounts for individuals associated with al

Qaeda as well as for purported front charities that aided al Qaeda,ʺ where ʺthose

accounts were used for al Qaeda operations.ʺ In re Terrorist Attacks on Sept. 11,

2001,

(2d Cir. 2013). As with the Saudi princes, the Court

23 rejected the exercise of personal jurisdiction over those banking defendants

because they did not expressly aim their conduct at the United States.

But LCB fails to recognize that the In re Terrorist Attacks cases, as well

as Calder, the Supreme Court case on which they rely, speak to the requirements

for personal jurisdiction under the so‐called ʺeffects test.ʺ The effects test is a

theory of personal jurisdiction typically invoked where (unlike here8) the conduct

that forms the basis for the controversy occurs entirely out‐of‐forum, and the

only relevant jurisdictional contacts with the forum are therefore in‐forum effects

harmful to the plaintiff. In such circumstances, the exercise of personal

jurisdiction may be constitutionally permissible if the defendant expressly aimed

8 Whereas LCB purportedly supplied Shahid and Hizballah with U.S. dollars obtained from AmEx in New York by executing dozens of dollar‐ denominated wire transfers through its correspondent account, nothing in the September 11th cases suggests that the Sudanese, Saudi Arabian, and Liechtenstein‐based banks which allegedly provided financial services to al Qaeda and its affiliates did so by way of the United States. This factual difference may well explain the application of the ʺeffects testʺ in the In re Terrorist Attacks cases. The only explicit mention of bank accounts held in New York in either case appears to be that in In re Terrorist Attacks on September 11, 2001,

, during a discussion of whether the existence of correspondent bank accounts in New York could give rise to general jurisdiction. And, indeed, in finding that they could not give rise to such all‐purpose jurisdiction, we expressly distinguished the Court of Appealsʹ response to our certified questions in this case as not implicating that issue.

at 680 n.16.

24 its conduct at the forum. See Calder,

(finding the exercise of

personal jurisdiction over Florida defendants in California state court ʺbased on

the ʹeffectsʹ of their Florida conduct in Californiaʺ to be consistent with due

process because ʺtheir intentional, and allegedly tortious, actions were expressly

aimed at Californiaʺ).

We do not, however, understand the existence of in‐state effects

sufficient to satisfy the ʺeffects testʺ to be a prerequisite to the constitutional

exercise of personal jurisdiction over a foreign defendant in cases where the

conduct on which the alleged personal jurisdiction is based occurs within the

forum. So long as this in‐forum activity sufficiently reflects the defendantʹs

ʺpurposeful availmentʺ of the privilege of carrying on its activities here,

minimum contacts are established, even if the effects of the defendantʹs entire

course of conduct are felt elsewhere. See Chloé,

(ʺBecause we have

concluded that [the defendant] has purposefully availed himself of the benefits of

the New York forum, we need not decide whether [his] act . . . represented

conduct ʹexpressly aimed atʹ New York under the Calder effects test.ʺ); Best Van

Lines,

(ʺAlthough Calder and Keeton were handed down

simultaneously on similar subjects, they relied on independent, if conceptually

25 overlapping, methods of demonstrating minimum contacts ‐‐ Keeton on the

defendantʹs overall activity within the forum state; Calder on the in‐state effects of

out‐of‐state activity.ʺ).

As we have explained, LCBʹs repeated use of the correspondent

account ‐‐ and hence New Yorkʹs banking system ‐‐ as an instrument to achieve

the wrong complained of in this suit satisfies the minimum contacts component

of the due process inquiry.

2. Reasonableness. Where a defendant has purposefully directed its

activities at the forum state, it may still defeat jurisdiction on due process

grounds. To do so, however, it ʺmust present a compelling case that the presence

of some other considerations would render jurisdiction unreasonable.ʺ Burger

King Corp.,

; see also Metro Life Ins. Co.,

(instructing

that ʺdismissals resulting from the application of the reasonableness test should

be few and far betweenʺ). In conducting this part of the due process inquiry, we

focus on the factors we identified in Part I.B of this discussion, above.

We recognize, of course, that LCB is based in Lebanon and that all of

the plaintiffs, including those who are American citizens, reside in Israel;

accordingly, many of the documents and witnesses relevant to this litigation are

26 located abroad. But ʺthe conveniences of modern communication and

transportation easeʺ any burden the defense of this case in New York might

impose on LCB. Metro. Life Ins.,

.

It is true, moreover, that the injuries and deaths for which

compensation is sought occurred in Israel. The claims, which are premised on

LCBʹs use of a correspondent account to support a terrorist organization,

however, involve acts by banks in New York. And although not controlling,

weighed in the balance is the United Statesʹ and New Yorkʹs interest in

monitoring banks and banking activity to ensure that its system is not used as an

instrument in support of terrorism, money laundering, or other nefarious ends.

Considering these factors together, and in conjunction with the

plaintiffsʹ showing of minimum contacts, we conclude that the exercise of

personal jurisdiction over LCB would not offend principles of fair play and

substantial justice. LCB has identified no important interests that outweigh those

of the plaintiffs and the forum state such that New Yorkʹs assertion of jurisdiction

would be unconstitutional. Thus, the district courtʹs exercise of personal

jurisdiction over LCB is consistent with due process protections.

27 II. Subject Matter Jurisdiction

Because our remand may revive LCBʹs Rule 12(b)(6) motion to

dismiss, we note the issue of subject matter jurisdiction with respect to the

plaintiffsʹ ATS claim. In our prior treatment of this appeal, we predicted that

should the Supreme Court affirm this Courtʹs opinion in Kiobel v. Royal Dutch

Petroleum Co.,

(2d Cir. 2010), ʺwe will likely be required to affirm the

dismissal of the ATS claimsʺ based on our conclusion in Kiobel that the ATS does

not provide subject matter jurisdiction over corporate defendants for violations of

customary international law. Licci II,

. The Supreme Court has

indeed affirmed, but on different grounds from those upon which we decided the

appeal. See Kiobel v. Royal Dutch Petroleum Co., ___ U.S. ___,

(2013) (deciding that the presumption against extraterritoriality constrains federal

courts from hearing causes of action under the ATS ʺseeking relief for violations

of the law of nations occurring outside the United Statesʺ); see also Balintulo v.

Daimler AG,

(2d Cir. 2013) (applying Kiobel to find the plaintiffsʹ ATS

claims barred).

Because the question of subject matter jurisdiction was not briefed

on appeal, because the Supreme Courtʹs opinion did not directly address the

28 question of corporate liability under the ATS, and in light of the other claims

brought by the plaintiffs, we now think it best for the district court to address this

issue in the first instance.

CONCLUSION

For the foregoing reasons, that portion of the district courtʹs

judgment dismissing claims against defendant LCB for lack of personal

jurisdiction is vacated and the case is remanded for further proceedings.

29