[00:00:02] Speaker 00:
Face number 20-7077, Joshua Ashley Eddall at balance versus AstraZeneca UK Limited Eddall.

[00:00:10] Speaker 00:
Mr. Branson, Freddie at balance.

[00:00:11] Speaker 00:
Mr. Shanmugam, Freddie at police.

[00:00:16] Speaker 01:
Good afternoon, council.

[00:00:20] Speaker 01:
Mr. Branson, you may proceed when you are ready.

[00:00:25] Speaker 02:
Thank you, Judge Pillard.

[00:00:26] Speaker 02:
May it please the court.

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The defendants bribed J. Shalmadi terrorists, both in cash and in kind, and they knew their bribes were funding terrorist attacks in Iraq.

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That is more than enough to state a claim for primary and secondary liability under the Anti-Terrorism Act.

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In holding otherwise, the district court misapplied basic Rule 12 standards by ignoring or recasting large portions of the complaint.

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The defendants now continue the same theme on appeal, repeatedly asserting their version of the facts.

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But this is a motion to dismiss, and once our very detailed allegations are accepted as true, none of the district court's rulings can stand.

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The district court erred on four issues I'm hoping to cover this morning.

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approximate cause aiding abetting Hezbollah and personal jurisdiction.

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Now, the first two are quite similar, but aiding abetting is actually even easier than proximate cause because the statute contains no direct link or other causation requirement for secondary liability.

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And indeed, a recent trilogy of appellate decisions from the Second and Ninth Circuits, Kaplan, Honickman, and Gonzalez.

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have reversed district courts for misconstruing aiding and abetting principles in much the same way that Judge Leon did here.

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Are you saying that for aiding and abetting liability, the plaintiff doesn't have to prove that the principal who the defendant was aiding and abetting was a proximate cause of the injuries?

[00:02:01] Speaker 02:
No, Judge Wilkins, I'm not saying that I should have been more precise in my language when I said there's no causation requirement.

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I meant that there's no causation requirement that the defendants cause plaintiff's injury but you're absolutely correct for secondary liability here, Jay Shalmati must have proximately caused

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plaintiff's injuries and I don't view that element as being in dispute at this stage.

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All they have to do is show that they will provide a substantial assistance.

[00:02:27] Speaker 01:
So you're distinguishing substantial assistance from the kind of substantial factor that counts for direct liability.

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That's correct.

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Judge pillar to be clear, we've pleaded both.

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And I think that as we explained in our brief judge Leon made a very similar error in disposing of the proximate cause issue and the aiding abetting issue.

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And that he misconstrued our allegations about the Ministry of Health, but I do agree, Judge pillar that substantial assistance and you can just see this from the court's Halberstam opinion.

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I don't think

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Most people would say Linda Hamilton proxenately caused the murder and yet she was held liable for it.

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And so I do think the analysis is even easier for aiding a betting and I would submit that that is the most straightforward path to reversal here.

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That said, oh, I'm sorry, Judge Pillard, you can ask a question.

[00:03:18] Speaker 01:
You're getting there.

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So to move to approximate cause, as I said, I think that Judge Leon made a fundamental error in disposing of both our primary and secondary liability claims.

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And I really just have three points about that.

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First is the ministry was a known terrorist front, not an independent intermediary.

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It was, in the words of US Embassy Baghdad, quote, openly under the control of the Mahdi army of Muqtada al-Sadr.

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That's paragraph 169 of the complaint.

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Once that allegation is accepted as true, this decision should be reversed.

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Terrorist-controlled intermediaries do not defeat causation, and they certainly do not preclude aiding and abetting liability.

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So you're making a very important distinction between a state sponsor of terrorism and a terrorist controlled entity, even though in nomenclature, they may sound similar.

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A state sponsor of terrorism is a government, a nation state that harbors in some way terrorists or doesn't go after them.

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Whereas here you're saying, no, no, no, this this that Judge Leon made a false equation between a governmental agency

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and a nation state.

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Judge Piller, that's absolutely correct.

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And I think this court's Owens Four decision makes that plain in that nobody claimed that Al-Qaeda was running the government of Sudan.

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Sudan was not an instrument of Al-Qaeda.

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Did it support Al-Qaeda?

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It absolutely did.

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But I think the point of Owens Four was that because Sudan was an independent intermediary, and again, that was this court's words,

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It's severed the link between their the bank and Al Qaeda and we have pleaded the opposite of that we pleaded that the Ministry of Health was not an independent intermediary at all.

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I would also want to emphasize another key distinction with Owens Four on that front, which is there, BNP's money never got to al-Qaeda.

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And that's true of every intermediary case the defendant cite.

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Owens Four, Rothstein, Kemper, Brill, Siegel, all of them, the bank's money doesn't get to the terrorist group.

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It stops with the intermediary.

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Here, Judge Leon himself recognized that we have pleaded exactly what was missing in Owens for, in that the defendants' free goods payments financed J. Shalmadi, not any legitimate Iraqi health program.

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And that's most apparent at JA 835, where in Judge Leon's words, defendants were aware that their goods, quote, would be used by J. Shalmadi to support terrorist attacks, close quote.

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That is the sort of substantial connection to terrorism that owns four held would be sufficient.

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The plaintiffs and owns four did not meet that test.

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We do.

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The third point is the cash bribes.

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I want to pause here because these are very important.

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The defendants paid individual cash bribes to the terrorist operatives who were at the ministry.

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And no matter what this court thinks about the status of the ministry as a juridical institution,

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The point of a bribe is that it goes to the individual, not the institution.

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That's what makes it a bribe.

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And so I don't think anybody is disputing that if those bribes were paid, it would violate the statute.

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All that's disputed is whether we've properly pleaded them.

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And as we've explained in our papers, our many pages of allegations about these bribes more than satisfy our pleading burden under Twombly and Iqbal.

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I'm trying to understand

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how you think that the scope of the liability works.

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Let's suppose we send your case back and let's suppose that the fact finder does not believe that you proven the bribes and all that the fact finder finds is that

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that the defendants did business with Jayshal Ma or with the health ministry?

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Because with the health ministry, I'll say, is that sufficient in your view for liability?

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Because if they did business, even without paying bribes or

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providing, you know, extra goods that could be sold on the illegal market.

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That's material support because of the, I guess, the unity between J. Shalmadi and the Ministry of Health.

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Yes, Judge Wilkins, we do think that we've alleged that at paragraph 179 of the complaint.

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We don't think we need to prove the bribes in this case.

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I think you can see that most clearly.

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The analogy would be the Ninth Circuit's Gonzales case where Google didn't do anything special or illegal to support ISIS.

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It just had a commercial business relationship and the Ninth Circuit reversed the dismissal of aiding abetting claims.

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So yes, Judge Wilkins, the answer is yes.

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That said,

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I think this case involves quite a lot more than that.

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And the bribes are our lead theory, I would say.

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And the reason is the special inspector general for Iraq reconstruction called.

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So if you're right, then the US government provided substantial assistance under your reading of the statute, right?

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I don't think so, Judge Wilkins.

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I don't think the U.S.

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government did business with the ministry in the way that you're positing.

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Certainly, the U.S.

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government built infrastructure projects.

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It tried its best to clean up the ministry.

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It attempted to wrest control of the ministry back from J.Shalmadi through things like the arrest of Haqqam Zamali, who was the deputy health minister, who in General Petraeus' words had, quote, effectively hijacked.

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The ministry, General Odierno, ordered a military operation in June 2007 called Operation Black Crescent that was attempting to address this very problem, and that's at JA-794.

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So no, I know, Judge Wilkins, the defendants say that a lot in their brief.

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There's no question, but there's no evidence of that, and more importantly, we don't allege anything that would support that inference in our complaint.

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If you look at paragraph 76 and 113 of the complaint, we allege that the U.S.

[00:10:05] Speaker 02:
government did not support the J. Shalmadi-controlled ministry, did things like build hospitals while trying to clean the ministry up.

[00:10:13] Speaker 02:
And this goes to a very important point that even Judge Leon accepted at JA 824, where he acknowledged that taking our allegations is true, what the defendants did was counterproductive to the U.S.

[00:10:27] Speaker 02:
mission to improve the Iraqi health system.

[00:10:30] Speaker 02:
So this notion that the defendants are trying to argue on a motion to dismiss that they are hand in glove with the US government is just not true and it's certainly not alleged in the complaint.

[00:10:41] Speaker 01:
So on the direct liability, the district court only reached proximate cause and actually only reached the independent intermediary

[00:10:54] Speaker 01:
block to a showing approximate cause and didn't actually even go further and consider whether where I mean even if there is an independent intermediary, as we know there can nonetheless be liability if there's a sufficiently.

[00:11:08] Speaker 01:
i'm going to get the words wrong, but if there's sufficiently substantial showing of of.

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aid nonetheless.

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But the district court did not go on to look at the reasonable foreseeability aspect of the public causes information, nor did it consider the active international terrorism aspect.

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In the act of international terrorism, am I correct that here the allegations are that the acts of international terrorism are material support for terrorists and terrorist funding under 2339A and C?

[00:11:49] Speaker 02:
That's correct.

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And am I correct that the statute that 2333A requires such an act, but that additionally,

[00:12:05] Speaker 01:
the defendant have violated such law in a manner that appears to be intended to intimidate or coerce a civilian or influence policy of a government or da da da.

[00:12:26] Speaker 01:
That's an overlay on the incorporated act of terrorism.

[00:12:31] Speaker 01:
Is that correct?

[00:12:32] Speaker 02:
That's correct.

[00:12:33] Speaker 01:
OK, and is there precedent that recognizes 2339A and 2339C as qualifying acts of international terrorism?

[00:12:42] Speaker 02:
Yes, Judge Pillard, the Bowen case from the Seventh Circuit involved 2339A.

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So there is precedent for that.

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There are some district court cases that have recognized 2339C.

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I don't believe that particular issue has made its way to an appellate court.

[00:12:59] Speaker 01:
And in terms of the

[00:13:02] Speaker 01:
appears to be intended to.

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That is a legal question.

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There is a complaint before us.

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Are you asking us to reach that?

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Are you asking us to remand if we were to agree with you?

[00:13:18] Speaker 01:
I'm just trying to get the scope of your presentation.

[00:13:21] Speaker 01:
We were to agree with you that the dismissal based on a lack of probable cause might need further thought.

[00:13:31] Speaker 01:
Should we reach or should we not reach the act of international terrorism.

[00:13:36] Speaker 02:
I'm hesitant to give the course court advice about what it wants to reach I certainly don't think it has to reach the question.

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You know this was not because of the posture of how we brief this I would say the briefing is rather sparse before this court because it was an alternative argument.

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I think it would be a sensible course to to read and, of course, this this court does have discretion to decide it if it wants to, but I suppose if you were to ask my views, it would be to read and because Judge Leon did not reach this question.

[00:14:05] Speaker 02:
And it has not been, I would say briefed as thoroughly as the other issues in the case.

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That said, I do think the Bowen case that we cited provides some very good precedent for our theory, which is that courts typically presume that people intend the natural consequences of their actions.

[00:14:22] Speaker 01:
True enough, but when you're giving directly to, was it Holy Land Foundation, that looks a little bit more like the

[00:14:33] Speaker 01:
US donors possibly being on board with the mission of the ultimate terrorist group then contracting for medical goods with even a defunct and hollowed out Ministry of Health in Iraq.

[00:14:51] Speaker 02:
Well, I disagree, Judge Pillard.

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I don't think that inference you just drew was in the opinion.

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If you read the district court opinion in the Boehm case, which I would encourage you to do, this was not cash given directly to Hamas.

[00:15:05] Speaker 02:
The defendants claimed that it was, but that's not what happened.

[00:15:08] Speaker 02:
It went to a variety of charities that did legitimate charitable things like social welfare services.

[00:15:14] Speaker 01:
The Holy Land Foundation, I guess, is in the caption.

[00:15:19] Speaker 02:
That's right.

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Holy Land Foundation was the defendant.

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But if you read the district court case, they were not giving money directly to Hamas.

[00:15:26] Speaker 02:
They were funneling it through, I think, a list of about 10 charities.

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And not all of them were even controlled by Hamas.

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Some of them just were independently aligned with Hamas.

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So I would say that our allegations are stronger than the ones in Boehm.

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And the reason that that my friends cases are off point is they've cited cases like Kemper and Brill, where there was no proximate causation.

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So this theory that we're articulating didn't work for those plaintiffs because the natural consequence of their actions did not include terrorism.

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So if this court were to reach it, I think the comparison to Boehm is good.

[00:16:03] Speaker 02:
I would also encourage the court to look at Judge Lamberth's opinion in the Woltz versus Bank of China case, a very, I would say, somewhat comparable fact pattern where the defendant made all the same arguments that we're a reputable bank.

[00:16:18] Speaker 02:
We could never intend to cause terrorism.

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And Judge Lamberth applied the principles I just articulated and denied the motion to dismiss.

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And I think the same result should obtain here.

[00:16:29] Speaker 01:
On your aiding and abetting I'm sure you're getting there.

[00:16:31] Speaker 01:
I wonder if you could talk to us about designated terrorist organization Hezbollah's role in committing planning or

[00:16:48] Speaker 01:
Authorizing authorizing Thank you.

[00:16:51] Speaker 02:
I think it's an excellent question that's exactly where I was going next, and I think the important point was built into your question, which is that Congress did not limit secondary liability to terrorist acts.

[00:17:02] Speaker 02:
committed by a designated FTO.

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Instead, it extended liability to acts that are planned and authorized by an FTO.

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And the reason was to cover attacks committed by a terrorist proxy group of a designated organization like J. Shalmadi was for Hezbollah.

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J. Shalmadi was an instrument through which Hezbollah orchestrated terrorist attacks against Americans in Iraq.

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And on that issue I would encourage the court to read the amicus brief by the commanders, signed by General George Casey and many of the other top generals from Operation Iraqi Freedom, explaining how deeply Hezbollah was involved in J. Shalmadi's terrorist operations and why

[00:17:45] Speaker 02:
the district court's logic misapprehends the way these groups work in practice.

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So I don't view Hezbollah's role as really being disputed here.

[00:17:53] Speaker 02:
I think the only question is whether it was sufficiently linked to each individual attack.

[00:17:59] Speaker 01:
Right, the defendants really push you on.

[00:18:01] Speaker 01:
It's not enough to train.

[00:18:03] Speaker 01:
It's not enough to inspire.

[00:18:05] Speaker 01:
That's just very general.

[00:18:08] Speaker 01:
And the way they read the statute, and it's a natural enough reading,

[00:18:12] Speaker 01:
that planning and authorizing is a much more event-specific verb.

[00:18:21] Speaker 02:
Well, that may be true, Judge Pillard, but we have tied the training and the planning and the provision of munitions to our individual attacks.

[00:18:29] Speaker 02:
I think that's really not even contested.

[00:18:31] Speaker 02:
The easiest place to see this is for explosively formed penetrators.

[00:18:36] Speaker 02:
Paragraphs 395 and 96 the complaint, where this was a Hezbollah signature weapon and Hezbollah was involved in every single penetrator attack in Iraq.

[00:18:47] Speaker 02:
And so, you know, Judge Pillard I suppose one reading of the statute that I guess I understand my colleagues to be advocating for.

[00:18:54] Speaker 02:
is that you have to plead that a Hezbollah individual operative showed up to the scene at the street corner where the attack took place and have to point, hey, J. Shalmadi, plant this IED here, and I want you to blow up that Humvee.

[00:19:07] Speaker 02:
And anything less than that is not planning or authorizing.

[00:19:11] Speaker 02:
I think that's textually unfounded, as we've explained in our brief.

[00:19:14] Speaker 02:
Planning and authorizing does not require control of all of the details.

[00:19:19] Speaker 02:
But I think it's also inconsistent with the way these groups work.

[00:19:22] Speaker 02:
And again, I thought the amicus brief from the commanders was quite compelling on this, that that's not how Hezbollah orchestrates attacks.

[00:19:29] Speaker 02:
It doesn't send Ali Musa Dakduk, its commander in Iraq, to the street corner in Sadr City and plant an individual IED.

[00:19:37] Speaker 02:
It orchestrates the infrastructure.

[00:19:40] Speaker 02:
through which J. Shalmadi then commits these attacks.

[00:19:42] Speaker 02:
And for every attack alleged in the complaint, we have alleged a tactical and a geographic nexus tying Hezbollah to the individual attack.

[00:19:52] Speaker 02:
And on a motion to dismiss, that's- But you're kind of doing this backwards.

[00:19:56] Speaker 04:
You're saying that we have to interpret the statute so that it comports with how terrorist organizations work.

[00:20:04] Speaker 04:
No, we have to interpret the statute and we see

[00:20:10] Speaker 04:
whether the way that you have alleged that this works fits within the statute, right?

[00:20:19] Speaker 02:
That's true enough, Judge Wilkins, but I think we've done that.

[00:20:21] Speaker 02:
I mean, my colleagues, it's not like they define the word planning and authorizing that excludes the theory I've articulated.

[00:20:28] Speaker 02:
You're a person, just the ordinary meaning of the word planned.

[00:20:32] Speaker 02:
You plan an attack if you, for example, the example we gave in our opening brief, if a Hezbollah operative trains a room full of Jaysh al-Mahdi fighters how to use 107 millimeter rockets against Americans in Iraq.

[00:20:45] Speaker 02:
and does so with the specific intent to cause J.Shalmadi then to commit those attacks using those rockets.

[00:20:53] Speaker 02:
Hezbollah has planned those attacks, whether or not the Hezbollah operative then shows up to the street corner and says, now I want you to employ what I taught you and go blow up this particular target.

[00:21:06] Speaker 02:
Just the, sorry, Judge Wilkins.

[00:21:08] Speaker 04:
So if I, you know,

[00:21:12] Speaker 04:
train my law clerks on how to write briefs and how to make arguments?

[00:21:16] Speaker 04:
Am I planning their future briefs and arguments?

[00:21:22] Speaker 02:
I think arguably you are Judge Wilkins, but this case is even, I think, easier than that because there's specific intent.

[00:21:29] Speaker 02:
And that is a critical facet of our allegations.

[00:21:32] Speaker 02:
Hezbollah didn't just train Jaysh al-Mahdi because it wanted Jaysh al-Mahdi just to be good terrorists in the abstract.

[00:21:39] Speaker 02:
It did so for the particular purpose of orchestrating terrorist attacks against Americans in Iraq.

[00:21:46] Speaker 01:
The statute doesn't require that?

[00:21:49] Speaker 01:
Or are you reading plan?

[00:21:52] Speaker 01:
an authorized, I guess, authorized does.

[00:21:55] Speaker 01:
But what about plan?

[00:21:56] Speaker 01:
Are you reading plan in a manner that would require some proof of intent on the part of Hezbollah?

[00:22:04] Speaker 02:
I think I am, Judge Pillard.

[00:22:05] Speaker 02:
I think when you plan an act, you have to have intent for the act to take place.

[00:22:13] Speaker 02:
Our allegations that Hezbollah wanted these attacks to take place, that's not disputed here, and I'm not anticipating any difficulty proving that if the case were to be remanded.

[00:22:23] Speaker 02:
But I do think it distinguishes it from a lot of the hypotheticals you can think of, where if all Hezbollah had done was given a small cash donation to J. Shalmadi and said,

[00:22:34] Speaker 02:
I want you to have this because we support Muqtada al-Stadr's mission of allegedly providing care to Iraqi Shia.

[00:22:43] Speaker 02:
That wouldn't be enough.

[00:22:45] Speaker 02:
But I think that the tight nexus between what Hezbollah has done and each attack here really distinguishes it from the other hypotheticals that have been given.

[00:22:56] Speaker 02:
And in the commander's brief, they have cited

[00:23:00] Speaker 02:
district court cases from judges in this district that have made evidentiary findings about Hezbollah's role in an individual attack based on little more than the weapon type and the geography in which it was used.

[00:23:13] Speaker 02:
I actually think that we're going to have experts and we'll be able to prove that even without any other evidence beyond what's alleged in the complaint, if there was an EFP, that's the acronym for the penetrators, that went off in Sadr City, Hezbollah was involved in that.

[00:23:27] Speaker 02:
And a motion to dismiss to require us to plead more, you know, Judge Wilkins to your point about does the reality of terrorism, affect the statute, I think it does because Congress stated.

[00:23:40] Speaker 02:
that its purpose in enacting the Justice Against Sponsors of Terrorism Act was to provide the broadest possible basis to afford relief against companies that finance terrorists directly or indirectly.

[00:23:52] Speaker 02:
And under their view of the statute, I think this cramped FTO requirement that they're adopting would gut Congress's purpose.

[00:24:01] Speaker 02:
And that absolutely is something that this court should consider.

[00:24:03] Speaker 01:
So just to review on the aiding and abetting, the state of mind requirement is different from the requirement for direct liability.

[00:24:11] Speaker 01:
In your view, it's only knowingly providing substantial assistance?

[00:24:21] Speaker 02:
I think the Second Circuit Judge Killard has actually cleaned this up quite a bit in the Kaplan and the Honickman cases.

[00:24:26] Speaker 02:
For aiding and abetting liability, I think the state of mind requirement is general awareness.

[00:24:32] Speaker 02:
And as the Kaplan case explained, that's actually less than fully focused knowledge.

[00:24:38] Speaker 02:
Linda Hamilton did not even know about the murder for which she was held liable.

[00:24:42] Speaker 02:
She didn't even know that Bernard Welch was committing burglaries.

[00:24:45] Speaker 02:
So it's general awareness of the defendant's role in an illegal activity from which terrorism was a foreseeable risk.

[00:24:52] Speaker 02:
That is the standard the Second Circuit has adopted, and I think it's correct.

[00:24:56] Speaker 02:
Now, you're correct that the state of mind factor for substantial assistance, Judge Pillard, I think the degree of knowledge is relevant to that inquiry.

[00:25:07] Speaker 02:
But, you know, what Judge Leon held was actually the standard is specific intent that the defendant has to be one in spirit with the terrorists.

[00:25:14] Speaker 02:
And that's just not right.

[00:25:16] Speaker 02:
That's not anywhere in the statute.

[00:25:19] Speaker 02:
It's inconsistent with aiding a betting doctrine.

[00:25:21] Speaker 02:
And the Second and the Ninth Circuits have now rejected it.

[00:25:24] Speaker 02:
And the Ninth Circuit in Gonzales actually reversed

[00:25:27] Speaker 02:
the district court case that Judge Leon cited for that requirement.

[00:25:30] Speaker 02:
So I think degree of knowledge is one of the factors.

[00:25:35] Speaker 02:
And I don't think it's seriously contested here.

[00:25:38] Speaker 02:
Judge Leon acknowledged that these defendants knew, but it's certainly not specific intent.

[00:25:43] Speaker 02:
And I think it's very, very important for the court to reject that standard.

[00:25:47] Speaker 01:
You have these two theories, two separate counts on aiding and abetting.

[00:25:51] Speaker 01:
One is the RICO count and the other is the more direct authorization.

[00:25:57] Speaker 01:
If we were to believe that Judge Leon erred with respect to dismissing one, do we need to reach the other?

[00:26:05] Speaker 01:
Do we need to reach both?

[00:26:08] Speaker 02:
I think you do judge pillared because he their separate counts and judge Leon dismissed both so I do think you need to reach the Rico count and if I can address that just briefly.

[00:26:18] Speaker 02:
It all depends on what is the word act me it can the word act encompass a multi year terrorist campaign.

[00:26:24] Speaker 02:
I think Judge waltz opinion in Halberstam answers that question.

[00:26:28] Speaker 02:
the court there defined the act assisted, that is the court's words, as the multi-year burglary campaign.

[00:26:36] Speaker 02:
We know Congress wanted Halberstam to provide the legal framework for how aiding, abetting liability should function.

[00:26:42] Speaker 02:
And that's an argument I think you'll find conspicuously missing from the district court opinion and from my friend's briefs.

[00:26:50] Speaker 01:
Well, why do you even need RICO?

[00:26:52] Speaker 01:
I mean, in a way, it seems like it's almost a factual question.

[00:26:55] Speaker 01:
Like, either, as you say, either, I mean, like, there's no RICO claim in Halberstam.

[00:27:00] Speaker 01:
Why isn't it just, you know, either the individual acts or a whole campaign in more common sense problems?

[00:27:07] Speaker 01:
Somehow, I mean, you know, RICO is a hornet's nest.

[00:27:13] Speaker 01:
That's technical terminology.

[00:27:15] Speaker 01:
And so I just wonder, is RICO as such doing any work for you?

[00:27:21] Speaker 02:
Well, the reason we cited RICO is because, Judge Pillard, as you noted, I think, in your questions earlier, there needs to be a predicate criminal violation of US criminal law for the definition of the act of international terrorism.

[00:27:35] Speaker 02:
And so we defined RICO, and I realized RICO can scare some people off.

[00:27:40] Speaker 02:
There have been a lot of bad RICO cases.

[00:27:42] Speaker 02:
that have been brought in history.

[00:27:43] Speaker 02:
But we're not claiming the defendants violated civil RICO.

[00:27:47] Speaker 02:
What we're claiming is that Mutata al-Sadr's terrorist enterprise was a RICO violation.

[00:27:53] Speaker 02:
And that is what the defendants aided under count two.

[00:27:57] Speaker 02:
And in terms of whether RICO's predicates had been met, that issue is not on appeal before this court.

[00:28:03] Speaker 02:
I think you treat that as true.

[00:28:05] Speaker 02:
And so really the only question is, can a multi-year campaign be an act in the context of this statute?

[00:28:12] Speaker 02:
And we've explained why in our brief we think it can.

[00:28:15] Speaker 02:
But again, I think Calverstam provides the answer.

[00:28:19] Speaker 02:
Judge Pillard, I think your question is a clever one.

[00:28:22] Speaker 02:
And I think you can also incorporate this concept into count one for the reasons you described it.

[00:28:30] Speaker 02:
This is a factual question.

[00:28:31] Speaker 02:
And you'll find some support for that in the Second Circuit's Kaplan decision.

[00:28:37] Speaker 02:
and in the Ninth Circuit's Gonzales decision, which both took care to define the act assisted, the principal violation, not as the individual bomb going off that injured the plaintiffs, but the broader terrorist enterprise perpetrated by the person that the defendants aided.

[00:28:54] Speaker 02:
And so I think those cases also provide some ammunition, Judge Pillard, to write the opinion in the way you were just suggesting, if you were inclined to go down that route.

[00:29:04] Speaker 02:
I see a- If act of terrorism is-

[00:29:08] Speaker 02:
Sorry, Judge Wilkins.

[00:29:09] Speaker 04:
If act of terrorism is defined that broadly and planned is defined broadly to include basically training, which is the way that it appears that you're arguing this, then it would appear that that

[00:29:37] Speaker 04:
even in circumstances where kind of the FTO is kind of in the background, maybe years in the past involved in training someone who goes out and commits an act of terrorism.

[00:30:04] Speaker 04:
And even if that's not really

[00:30:07] Speaker 04:
very apparent or publicly known, there's going to be aiding and abetting liability.

[00:30:15] Speaker 02:
Well, Judge Wilkins, I think there's got to be some sort of a nexus between the training and the attack.

[00:30:21] Speaker 02:
So if, for example, we don't plead any of these claims, but let's say there was a suicide bombing in Iraq that J. Shalmadi conducted to blow up an American.

[00:30:32] Speaker 02:
Hezbollah training them how to use penetrators doesn't have a nexus to that attack, so I don't think that would constitute planning.

[00:30:39] Speaker 02:
But the other point that I think should address your concern, Judge Wilkins, is go back to my specific intent point that the FTO has to be doing it for the purpose of causing

[00:30:50] Speaker 02:
the type of terrorist attacks at issue.

[00:30:53] Speaker 02:
And I think that's been pleaded here in spades.

[00:30:56] Speaker 02:
And, you know, Judge Wilkins, to your question about whether it's publicly known or not that the FTO's role, that's not an element of the statute.

[00:31:05] Speaker 02:
There's no suggestion that a defendant has to be aware of the FTO's role.

[00:31:11] Speaker 02:
It's just they have to be aware that they're assisting

[00:31:14] Speaker 02:
a person, a terrorist group that's that's committing acts of international terrorism.

[00:31:19] Speaker 02:
And, you know, to give you Judge Wilkins an example of something that's outside the line.

[00:31:23] Speaker 02:
Look at the only case that my colleagues and Judge Leon cited the Sixth Circuit case from the Crosby versus Twitter case.

[00:31:29] Speaker 02:
That was a lone wolf shooter that shot up a nightclub in Orlando, Florida, the pulse nightclub never had any contact with ISIS wasn't part of ISIS ISIS didn't didn't train him didn't give him anything didn't authorize the attack didn't say anything to legitimize it.

[00:31:45] Speaker 02:
That's an example of something that our theory of the statute would still rule out, but but I would encourage the court, not to treat the planning and authorizing element as though Congress intended that to substantially circumscribe the scope of the statute there's no textual or structural evidence that that's the case and if you look.

[00:32:04] Speaker 02:
At Congress's declaration of purpose in the Justice Against Sponsors of Terrorism Act, there's no reference to foreign terrorist organizations and the Congress has declared that its purpose is for this to sweep broadly.

[00:32:17] Speaker 02:
So the fact that this might cover lots of terrorist attacks, that's a feature, not a bug, of our interpretation.

[00:32:24] Speaker 02:
Because remember, a defendant is only liable if they aid and abet the terrorist group, and if they're generally aware that by doing so, they're playing a role in illegal activity from which terrorism is a foreseeable risk.

[00:32:36] Speaker 01:
I missed what you just said.

[00:32:38] Speaker 01:
You said there's nothing in the JASTA reports or whatever referring to foreign terrorist organizations, but in the text,

[00:32:46] Speaker 01:
there's a requirement that the act be committed, planned, or authorized by a foreign terrorist organization.

[00:32:53] Speaker 01:
It's striking that even though aiding and abetting is typically easier to meet, in this statute, the aiding and abetting provision has this requirement that's not in the direct liability part.

[00:33:09] Speaker 01:
So it does feel like it is a narrowing or

[00:33:14] Speaker 01:
you know, boundary setting provision?

[00:33:17] Speaker 02:
There's no question it's boundary setting.

[00:33:18] Speaker 02:
And I'm not suggesting that the court should treat this as not an element.

[00:33:21] Speaker 02:
It is.

[00:33:22] Speaker 02:
But I was attempting to address Judge Wilkinson's specific point, which is when you're interpreting the words planning and authorizing, which I submit are very broad words, the court should not be thinking about this from the perspective of we have to really narrow this to a very limited set of attacks.

[00:33:40] Speaker 02:
There's no evidence that that's what Congress wanted this limitation to do.

[00:33:44] Speaker 02:
I would submit that what Congress wanted this limitation to do would be to rule out the lone wolf shooter type situation, the Crosby case.

[00:33:53] Speaker 02:
that the defendant cite.

[00:33:55] Speaker 02:
And so you're absolutely right, Judge Pillard, I'm not suggesting read the element out of the statute.

[00:33:59] Speaker 02:
It's an element, we have to meet it.

[00:34:01] Speaker 02:
But these words on their own, it's not as though my friends on the other side or Judge Leon defined the word plan and authorize in a way that limit out our attacks.

[00:34:10] Speaker 02:
I mean, we've defined the words, we basically all agree on what they mean.

[00:34:14] Speaker 02:
The question is just how do you apply them to terrorism?

[00:34:17] Speaker 02:
And I would suggest

[00:34:18] Speaker 02:
in light of the statute's purpose.

[00:34:21] Speaker 02:
If there's any question about that, the court should not be looking to limit this to attacks that actually look like they're committed by a foreign terrorist organization, because that would be atextual, and I think that would do violence to Congress's purpose as, again, not to beat a dead horse, but as I think very persuasively explained in the commander's amicus brief.

[00:34:42] Speaker 01:
I'm sorry, I know we've kept you a long time, but I'd appreciate it if you could address personal jurisdiction over the foreign defendants.

[00:34:50] Speaker 02:
Thank you, Judge Pillard.

[00:34:51] Speaker 02:
The foreign defendants purposely availed themselves of the United States by sourcing US drugs, by working with their US affiliates, by procuring US documentation, and by certifying the US origin to their terrorist counterparties.

[00:35:05] Speaker 02:
I think there's no question in this posture that that constitutes meaningful jurisdictional contacts.

[00:35:12] Speaker 02:
The question before this court is whether they are sufficiently suit related to support specific jurisdiction.

[00:35:18] Speaker 02:
And after the Supreme Court's decision in Ford this year, I think that case confirms that that test has been met.

[00:35:25] Speaker 02:
We know right out of the gate that Judge Leon applied the wrong legal standard.

[00:35:30] Speaker 02:
This is at JA 819, where he said that for contacts to be suit related, the contacts need to be such that would expose the defendants to liability.

[00:35:40] Speaker 02:
under the Anti-Terrorism Act.

[00:35:42] Speaker 02:
We know that's not correct now after Ford.

[00:35:45] Speaker 02:
A contact does not need to be tortious.

[00:35:47] Speaker 02:
It does not even need to be causally related to the claims in order to qualify.

[00:35:51] Speaker 02:
I think the question under Ford is whether the contacts demonstrate a meaningful affiliation between the forum and the controversy.

[00:36:00] Speaker 02:
And I think certainly in this procedural posture, taking our allegations is true.

[00:36:05] Speaker 02:
We have more than satisfied that burden.

[00:36:08] Speaker 02:
And I'll just make three points on that if I could.

[00:36:10] Speaker 02:
The first is that the U.S.

[00:36:13] Speaker 02:
sourcing was not a coincidence.

[00:36:14] Speaker 02:
I know my friends in their brief repeatedly characterize it as happenstance or kind of accidental.

[00:36:20] Speaker 02:
That's not what we allege.

[00:36:22] Speaker 02:
The complaint alleges in detail for every defendant that the sourcing was a deliberate choice designed to be able to obtain these contracts in the first place and to magnify the value of the bribes being delivered to J. Shalmati.

[00:36:36] Speaker 02:
So that's the first point.

[00:36:38] Speaker 02:
The second point is that they were working with their U.S.

[00:36:42] Speaker 02:
affiliates.

[00:36:43] Speaker 02:
The way these transactions worked is that it's not as though the foreign defendants in isolation handle the contract with no interaction with their U.S.

[00:36:51] Speaker 02:
affiliates.

[00:36:52] Speaker 02:
We've alleged for every defendant that there were these what we call cross-functional teams where the U.S.

[00:36:57] Speaker 02:
manufacturer and the foreign supplier work in concert to fulfill these orders.

[00:37:02] Speaker 02:
And that is

[00:37:03] Speaker 02:
very much suit related conduct.

[00:37:06] Speaker 02:
And then the third point is.

[00:37:07] Speaker 04:
Was that alleged for all of the manufacturer defendants as opposed to the supplier defendants?

[00:37:16] Speaker 02:
Yes, Judge Wilkins, it was.

[00:37:18] Speaker 02:
So the manufacturer defendants, just to be clear, those are all American companies.

[00:37:22] Speaker 02:
So the manufacturer defendants, there's not a jurisdictional question pending before this court, I suppose, other than the dependent jurisdiction question for state law that I think my friends and I agree on.

[00:37:35] Speaker 02:
But the manufacturer defendants are US companies and they are not raising the personal jurisdiction challenge.

[00:37:40] Speaker 02:
So we're only talking about supplier defendants.

[00:37:43] Speaker 02:
And for the supplier defendants.

[00:37:46] Speaker 02:
Yes, the answer is yes we've alleged it for for every defendant that that they worked with their US affiliates, and I think, Judge Wilkins, your question is a good one because it brings me to my next point which is at a minimum, we should be entitled to jurisdictional discovery.

[00:38:02] Speaker 02:
This court has made clear many times, most recently in the Urquhart-Bradley case, that where the plaintiffs can show they may be able to supplement their jurisdictional facts, the court should liberally grant jurisdictional discovery.

[00:38:19] Speaker 02:
We asked for that before Judge Leon.

[00:38:21] Speaker 02:
He did not respond.

[00:38:23] Speaker 01:
You want contracts?

[00:38:24] Speaker 01:
What is it that you want for jurisdictional discovery?

[00:38:27] Speaker 02:
We want contracts and we want the contract related documents that go to this question all of the factual inferences that are that are being debated in the personal jurisdiction section.

[00:38:38] Speaker 02:
We want discovery on so, for example, how material was the US sourcing to the contracts.

[00:38:43] Speaker 02:
That is a question that I think discovery could answer.

[00:38:47] Speaker 02:
Did the foreign suppliers to Judge Wilkins's question, did they in fact cooperate with their US affiliate manufacturers in fulfilling the contracts?

[00:38:55] Speaker 02:
We would want discovery on that as well.

[00:38:58] Speaker 02:
And just as a very basic matter, we want to see all the contracts themselves.

[00:39:04] Speaker 02:
One of the problems with what Judge Leon found was that some of the defendants, GE Healthcare submitted no evidence whatsoever.

[00:39:12] Speaker 02:
Roche, to take another example, we alleged four contracts in the complaint.

[00:39:17] Speaker 02:
They submitted a declaration attaching two of the four and said nothing about the other two.

[00:39:23] Speaker 02:
Yet Judge Leon with this factual record drew sweeping factual inferences in my view about whether the US sourcing was or wasn't material.

[00:39:32] Speaker 01:
I would submit you can't even start to answer that question until we have all of the contracts and your theory that it was material and when you're talking about the connection to the tort is as you said that it was it enhanced the value of

[00:39:51] Speaker 01:
the goods that increased the ability of the defendants to get the contracts.

[00:40:01] Speaker 01:
What other meaningful affiliation are you referring to?

[00:40:05] Speaker 02:
Judge Pillard, I think those are the most important two.

[00:40:07] Speaker 02:
I would add a third, which is that the bribes were given in violation of a US federal statute and injured American citizens who felt injury in this forum.

[00:40:19] Speaker 02:
and I think that is a very relevant question that goes to the affiliation between the forum and that's fcpa and are what's the status of those cases well I'm sorry it's not it's not an fcpa uh issue your honor I was referring to the anti-terrorism act uh that that congress in section 2a6 of the justice against sponsors of terrorism act made a finding

[00:40:41] Speaker 02:
that these types of cases are vital to us national security.

[00:40:45] Speaker 02:
And so, I think, you know, of course my friends say that's all irrelevant, because that's just Congress trying to wish away a constitutional provision but but that's, that's not true I think if you read forward, you'll see the Supreme Court.

[00:40:57] Speaker 02:
placed quite a lot of weight on Montana's interest in hearing the controversy, and I would submit, you're rarely going to find a civil lawsuit in which the forum's interest is stronger than in this one.

[00:41:10] Speaker 02:
Now, Judge Pillard, you asked me, I think, about the status of the FCPA criminal investigation.

[00:41:15] Speaker 02:
I believe that's where you're asking

[00:41:18] Speaker 02:
I don't have a lot of visibility into that.

[00:41:20] Speaker 02:
I don't know.

[00:41:20] Speaker 02:
I know the defendants have said that it's been closed.

[00:41:24] Speaker 02:
What I can tell you is my understanding is that the key time period of our case, 2004 to 2008, was outside of the limitations period that I believe DOJ was working with under the FCPA.

[00:41:35] Speaker 02:
I think they might have had, there may have been issues with the beyond a reasonable doubt evidentiary standard.

[00:41:42] Speaker 02:
There may have been issues of prosecutorial resources.

[00:41:44] Speaker 02:
I just don't know.

[00:41:45] Speaker 02:
But what I do know is that Congress intended the Anti-Terrorism Act to provide a supplement to criminal enforcement.

[00:41:52] Speaker 02:
And whatever DOJ may or may not have decided about these allegations, I think should have no bearing on this court's decision about whether we have pleaded a cause of action under the Anti-Terrorism Act.

[00:42:04] Speaker 01:
To the extent that your theory relies on notions of agency as between manufacturing defendants and supplier defendants or

[00:42:15] Speaker 01:
even in Iraq, what law do we look to?

[00:42:19] Speaker 01:
You cite the restatement.

[00:42:21] Speaker 01:
Isn't there a complicated choice of law question there?

[00:42:26] Speaker 02:
I would submit it's US law because this claim arises under the Anti-Terrorism Act.

[00:42:30] Speaker 02:
So I cited the restatement because I thought general US common law principles provide the best answer to that.

[00:42:36] Speaker 02:
Judge Pillard, to go back to one of your earlier questions, I can confidently say, I think this one is not a question the court should reach in this posture.

[00:42:46] Speaker 02:
My friends devoted literally a half of a sentence to it in their brief.

[00:42:50] Speaker 02:
And if the court actually wanted to hear argument about whether the suppliers were agents of the manufacturers, we would have a lot to say.

[00:42:57] Speaker 02:
I don't really think that's a question the court should reach.

[00:43:00] Speaker 02:
But if you are inclined to do it, I would submit US laws is the place to look.

[00:43:10] Speaker 02:
I see I am very far over my time, so of course I'm happy to answer any other questions, but otherwise I'm happy to rest.

[00:43:20] Speaker 01:
My colleagues have questions for Mr. Branson?

[00:43:24] Speaker 04:
No.

[00:43:26] Speaker 01:
Thank you.

[00:43:26] Speaker 01:
We did go over your time, but we will give you a short amount of time for rebuttal.

[00:43:33] Speaker 02:
Thank you.

[00:43:39] Speaker 01:
Mr. Shamigun.

[00:43:41] Speaker 05:
Thank you, Judge Pillard, and may it please the court.

[00:43:44] Speaker 05:
Taking plaintiff's allegations is true.

[00:43:45] Speaker 05:
The district court correctly dismissed the complaint for failure to state a claim.

[00:43:50] Speaker 05:
At the request of the United States government, defendants stepped forward to help rebuild Iraq's nationalized health care system after years of neglect.

[00:43:59] Speaker 05:
defendants manufactured or supplied life-saving goods to Iraq's Ministry of Health at a time when the United States government and many others were providing similar support.

[00:44:09] Speaker 05:
Yet plaintiffs in this case allege that by providing their goods to the ministry, defendants were knowingly supporting armed attacks on American soldiers by the Mahdi army, which stole those goods from the ministry.

[00:44:22] Speaker 05:
Plaintiffs have failed to state a valid claim for direct or aiding and abetting liability under the Anti-Terrorism Act.

[00:44:28] Speaker 05:
and they cannot cite any case permitting an ATA claim to proceed on even remotely similar facts.

[00:44:35] Speaker 05:
As to direct liability, plaintiff's claims fail, first, because defendant's transactions with a legitimate sovereign ministry do not establish proximate causation under this court's decision in Owens IV, and second, because the supply of medical goods does not constitute a violent terrorist act, in the words of the statute, an act of international terrorism.

[00:44:58] Speaker 05:
As to aiding and abetting liability, plaintiffs' claims fail first because defendants did not provide substantial assistance to the Mahdi Army, and second because defendants were not aware of their role in terrorist activities.

[00:45:11] Speaker 05:
In addition, plaintiffs' claims are barred by the statutory act of war exclusion and they cannot establish personal jurisdiction over the foreign defendants.

[00:45:19] Speaker 05:
A contrary decision would have a severe chilling effect on the willingness of companies and non-governmental organizations to conduct essential activities, often at the government's request, in troubled regions.

[00:45:32] Speaker 05:
The District Court correctly dismissed plaintiff's complaint and its judgment should be affirmed.

[00:45:38] Speaker 05:
Now I'd like to start, if I may, with direct liability and then proceed to aiding and abetting liability.

[00:45:44] Speaker 05:
As I mentioned, there are really two issues here, proximate causation and the requirement that there be an act of international terrorism.

[00:45:53] Speaker 05:
On proximate causation, I think our submission is quite straightforward.

[00:45:57] Speaker 05:
Under this court's decision in Owens IV, which is consistent with the law of numerous other circuits, the presence of a legitimate sovereign intermediary breaks the causal chain.

[00:46:10] Speaker 05:
And the real relevant question for purposes of this analysis is whether that government entity was performing legitimate sovereign functions.

[00:46:20] Speaker 05:
Now, in this case, there's really no dispute that that is true.

[00:46:24] Speaker 05:
And we know that from the allegations of plaintiff's own complaint.

[00:46:29] Speaker 05:
In paragraphs two and 72 of the complaint, which can be found at pages 97 and 121 of the Joint Appendix, plaintiffs allege that the Ministry of Health was responsible for administering Iraq's system of socialized medicine.

[00:46:44] Speaker 05:
And there's no suggestion that the ministry was simply acting as a front for a terrorist organization.

[00:46:51] Speaker 01:
Mr. Kamigan, under Owens IV,

[00:46:56] Speaker 01:
even if you have an independent intermediary, that just raises the need for a robust showing approximate cause.

[00:47:06] Speaker 01:
It doesn't give an immunity any time you have an entity that might have some legitimate function.

[00:47:13] Speaker 01:
Isn't that right?

[00:47:14] Speaker 01:
And the district court didn't go on to analyze that, but did just treat the governmental character of the Ministry of Health as a block

[00:47:23] Speaker 01:
to any finding approximate cause, isn't even just that under the terms of O and four incomplete?

[00:47:31] Speaker 05:
Judge Pillard, I think it's fair to say that the court in O and four left the door slightly ajar.

[00:47:38] Speaker 05:
The court said that where the intermediary is a sovereign state, the need for additional allegations supporting substantiality, a substantial connection is all the more acute.

[00:47:50] Speaker 05:
And our fundamental submission, and I think this is a fair reading of Judge Leon's order, is that the allegations here are simply insufficient to meet that high bar.

[00:48:01] Speaker 05:
We simply don't think that the allegations in the complaint match up to this characterization of the ministry as acting simply as a front or alias for Jaishal Mahdi.

[00:48:13] Speaker 05:
At most, the complaint alleges that affiliates of Jaishal Mahdi infiltrated the ministry, that some of the officials in the ministry were acting as agents of Jaishal Mahdi.

[00:48:26] Speaker 05:
And the Jaishal Mahdi, or the Mahdi army, was certainly using the ministry as an instrument in some instances to commit terrorist acts.

[00:48:35] Speaker 05:
We take all of that as true.

[00:48:37] Speaker 05:
But our fundamental submission is that that is not enough to make this like a case where you have, say, a charity.

[00:48:43] Speaker 05:
that is acting as a front for Hamas or Hezbollah.

[00:48:46] Speaker 01:
This is a very different situation from those in which you have a nation state that is the independent intermediary and that's I guess Owens for Kaplan, you know where

[00:48:59] Speaker 01:
that I think your brief is leaning on, where it's a nation state, it's a government of an entire country, and the notion that by being a state sponsor of terrorism, it is somehow equated with the terrorists that it supports, that seems to me a much more challenging obstacle to a finding of probable cause than, as alleged here, there is, even if you don't believe a full takeover and that there's some

[00:49:27] Speaker 01:
you know, provision of healthcare to people who are not anathema, to the jam-affiliated folks who control the ministry.

[00:49:38] Speaker 01:
So they may be providing some legitimate healthcare, but this seems quite different from the cases on which Judge Leon relied in the sense that as alleged, there's a major, major sort of terrorist function that's being sponsored.

[00:49:56] Speaker 01:
I just, are there other cases or other ways that you can help us think about why nonetheless the agency character of the Ministry of Health should prevent a finding of approximate cause?

[00:50:15] Speaker 01:
That's the only holding really that Judge Leon made.

[00:50:18] Speaker 05:
I would flip that around and respectfully submit that if anything, this case is a weaker case for the reasons you identified and let me explain why that is so you're certainly right to note that in the other Court of Appeals cases that address this issue.

[00:50:36] Speaker 05:
The intermediary is typically one that has been designated as a state sponsor of terrorism.

[00:50:42] Speaker 05:
And indeed, in many of those cases, you have defendants who are actually evading sanctions regimes in order to transact with those foreign intermediaries.

[00:50:54] Speaker 05:
And yet, courts have still said that that is insufficient.

[00:50:57] Speaker 05:
By contrast, here you have a government ministry and there's no dispute that it's a cabinet level ministry within a sovereign government.

[00:51:07] Speaker 05:
But it's one that is actually being supported by the United States government during the relevant time period, and I would note parenthetically because

[00:51:16] Speaker 05:
My friend Mr Branson at argument, as in his brief, sort of strains to say that the United States government was somehow not supporting the ministry during this time period.

[00:51:27] Speaker 05:
I think that the allegation in paragraph 113 suggests otherwise.

[00:51:32] Speaker 05:
And to the extent that Mr. Branson is trying to insinuate that the United States government was dealing only through other means, that it was not transacting with the ministry, I do think that that is belied by the government reports on which we rely at page 31 of our brief and on which this court certainly can take judicial notice that indicates the United States government was providing

[00:51:58] Speaker 05:
millions of dollars of support to the ministry and encouraging the defendants to transact with the ministry, which accords with the common sense reality here, which was that the United States government in the immediate period after the fall of Saddam Hussein was attempting to once again stand up the Iraqi health care system.

[00:52:20] Speaker 05:
But leaving all that aside, Judge Pillard, even if you disagree with everything that I've just said,

[00:52:25] Speaker 05:
you're left with the fundamental problem that Judge Wilkins identified in his colloquy with my friend, which is that if you think that the plaintiffs here have sufficiently alleged that the ministry was somehow a front for or an alias or an agent of the Mahdi army, you're left with the fundamental problem that the illogical consequence of that would be that the United States government and anyone else, the United Nations, whoever else who dealt with the ministry,

[00:52:53] Speaker 05:
would somehow be responsible for proximately causing these attacks on American service members.

[00:52:58] Speaker 05:
Now, I think in an effort to avoid that implication, what plaintiffs are trying to do is to suggest, well, this is different because there is corruption involved, because the supplier defendants here somehow structured their transactions in a way to provide free goods to the ministry or bribes to Mahdi Army terrorists.

[00:53:19] Speaker 05:
Now, you know, I would vigorously dispute the characterization that the allegations here support corruption and indeed as Mr Branson acknowledges and as we point out at footnote to.

[00:53:31] Speaker 05:
to the extent that the Justice Department was investigating those allegations, it has indicated that it does not intend to go forward with any further investigation.

[00:53:43] Speaker 05:
But leaving all of that aside, this is not an FCPA case.

[00:53:47] Speaker 05:
The question here is not whether corruption was taking place or even whether defendants knew that corruption was taking place.

[00:53:54] Speaker 01:
The question here- Well, under Halberstam though, it seems actually that our circuit has viewed

[00:54:00] Speaker 01:
You know, other illegality as relevant to the question at least of aiding and abetting I mean in a way that on reading might even seem somewhat shocking that that you know knowing about someone's

[00:54:15] Speaker 01:
apparent burglary makes you liable for murder.

[00:54:21] Speaker 01:
So what's the pushback on that analog, which Congress has clearly embraced.

[00:54:27] Speaker 05:
Yeah.

[00:54:28] Speaker 05:
Judge Pillard, I want to be very clear about how I'm signposting the issues here because they are obviously discreet.

[00:54:34] Speaker 05:
I think that goes to the issue of state of mind, both as an element of substantial assistance and also as a standalone requirement for aiding and abetting liability.

[00:54:45] Speaker 05:
My point here is simply that to the extent that plaintiffs are attempting to rely on these allegations of corruption as an effort to sort of get around the fundamental problem with their corruption theory, it just doesn't work here because there are insufficient allegations that this is a case where what was taking place was that defendants were somehow supporting Jaishal Mahdi directly.

[00:55:11] Speaker 05:
I want to say just a word about the allegations and the complaint, because this is such a central part of plaintiff's argument.

[00:55:19] Speaker 05:
With regard to the free goods, the complaint actually at numerous points alleges that the free goods weren't even distinguished from other goods.

[00:55:29] Speaker 05:
And so it's a little bit unclear exactly how the plaintiffs can allege that the free goods

[00:55:35] Speaker 05:
somehow we're going directly to jam and we're bypassing the ministry.

[00:55:41] Speaker 05:
Indeed, the complaint itself alleges that this was actually a common practice, that to this day it still appears on the standard bid instructions.

[00:55:51] Speaker 05:
And as we explained in our brief, it's a common practice more generally as a way simply of providing a discount from the reference price for drugs that are being provided.

[00:56:00] Speaker 01:
Although they would dispute that a discount from the reference price is something that's quite different and doesn't facilitate the evasion of inventory controls to the extent that there were any.

[00:56:15] Speaker 01:
That's a different move on the part of defendants.

[00:56:22] Speaker 05:
To the extent that that's true though, I think the plaintiffs still have the problem that in paragraphs 120 and 123, and I would note that the complaint is no model of clarity on this point, but at various points, the complaint suggests that the free goods were not being distinguished from other goods.

[00:56:38] Speaker 05:
And so to the extent that what plaintiffs are trying to do is to suggest that somehow free goods are going directly to jam, I don't think their allegations get there.

[00:56:46] Speaker 01:
But I want to really just reading in the, you know, the light most favorable to the point if I take them to be saying their package altogether there, they arrive in a way that doesn't, you know that they travel in a way that doesn't single some out.

[00:56:59] Speaker 01:
In fact, on their telling, Darsha Omari has free play on the receiving end and can sell even things that doctors have said they need, sell them on the black market.

[00:57:12] Speaker 01:
But it's really, I think, a way for them of saying, maybe we would have a case

[00:57:19] Speaker 01:
if only the amount ordered were being sent because the defendants knew or should have known that this was not a ministry of health, but a terrorist hotbed, but at least where they are sweetening the pot and sending goods that aren't, you know, they're over and above, they're basically engaging in bribery of bad actors who they know will use that money for ill.

[00:57:48] Speaker 05:
Well, a further problem with that Judge pillard is that I really don't hear plaintiffs to dispute that their whole theory here is that these goods were being provided to the ministry.

[00:57:59] Speaker 05:
And then at that point they were being looted or stolen or whatever verb you want to use by ministry employees.

[00:58:06] Speaker 05:
who in their view were typically jam agents.

[00:58:09] Speaker 05:
And that just underscores the fundamental causal problem with their theory.

[00:58:12] Speaker 05:
And before we get off this subject entirely, I do want to specifically address the allegations concerning bribes, because that was where my friend Mr. Branson started with his very first sentence.

[00:58:23] Speaker 05:
And those are obviously the most lurid allegations in this complaint.

[00:58:28] Speaker 05:
And I think Judge Leon correctly found

[00:58:30] Speaker 01:
Oh, I don't know.

[00:58:31] Speaker 01:
I think there's some other allegations that have a higher claim to being lured.

[00:58:35] Speaker 05:
But go ahead.

[00:58:37] Speaker 05:
Can I say one thing about these so-called bribes, which is that Judge Leon, I think, correctly determined that there were simply insufficient allegations of that.

[00:58:47] Speaker 05:
And the one

[00:58:48] Speaker 05:
Specific example to which plaintiffs point are these transactions by GE Healthcare, which plaintiffs rely on both in their opening brief and in their reply brief, these so-called six and $10 million bribes.

[00:59:02] Speaker 05:
I would invite the court to look at the relevant paragraphs of the complaint and particularly paragraph 214 in Joint Appendix 188.

[00:59:08] Speaker 05:
The complaint does not allege a $10 million bribe.

[00:59:12] Speaker 05:
It alleges that there was a contract

[00:59:14] Speaker 05:
worth $10 million that, quote, caught the eye of investigators and that the contract was linked to GE, quote, on information and belief.

[00:59:24] Speaker 05:
And I think that there are sort of analogous deficiencies with the allegation concerning the $6 million bribe.

[00:59:31] Speaker 05:
But I think that, in fact, if you look at that paragraph, it's not alleging a $10 million bribe.

[00:59:37] Speaker 01:
Oh, it's quoting.

[00:59:37] Speaker 01:
It actually is quoting a source

[00:59:40] Speaker 01:
saying of Dr. Zabili saying that Dr. Adel took a $6 million bribe from a foreign company.

[00:59:52] Speaker 01:
All right.

[00:59:55] Speaker 01:
I mean, it's just that's just what it says.

[00:59:58] Speaker 05:
Yes, on contracts that one confidential witness understood to concern GE healthcare.

[01:00:05] Speaker 01:
And so there are not disputing there is an allegation of a $6 million bribe from a foreign company.

[01:00:09] Speaker 05:
Correct, correct.

[01:00:10] Speaker 01:
But I pretty straight up.

[01:00:13] Speaker 05:
But I think that the link to GE Healthcare there is fairly spare.

[01:00:17] Speaker 05:
And again, I make the point simply to sort of underscore.

[01:00:21] Speaker 05:
And the overarching point with regard to the so-called bribes, Judge Pillard, is that there's no dispute here that the complaint itself, and this is in paragraph,

[01:00:33] Speaker 05:
145 but also in paragraph 142 alleges that payments were made to Ministry of Health officials who are at most also members of jam there's no suggestion that payments are going directly to jam.

[01:00:48] Speaker 05:
I don't want to consume the entirety of our time on this one issue, but I'm content to sort of rest on the fundamental proposition that to the extent that this court left the door open to the possibility that there might be sufficient allegations in a case involving a sovereign intermediary, our fundamental submission is that these allegations simply don't meet that high bar.

[01:01:09] Speaker 05:
Now, I do want to turn to the act of international terrorism requirement, because a number of you had questions about that to my friend, Mr. Branson.

[01:01:18] Speaker 05:
And I think that while Judge Leon did not rest on that ground, Mr. Branson acknowledged that that's a pure legal issue that I think this court could comfortably resolve.

[01:01:28] Speaker 05:
And our fundamental submission on this is fairly straightforward.

[01:01:31] Speaker 05:
The definition of act of international terrorism is really meant to differentiate between

[01:01:36] Speaker 05:
conduct that can constitute primary or direct liability, and conduct that can constitute secondary or aiding and abetting liability.

[01:01:44] Speaker 05:
And an act of international terrorism under Section 2331-1 has to satisfy two requirements.

[01:01:50] Speaker 05:
First, it has to be a violent or dangerous act.

[01:01:54] Speaker 05:
And second, it has to be an act that an objective observer would conclude was intended to intimidate or coerce a civilian population.

[01:02:01] Speaker 05:
There are other potential intents, but that's really the relevant one here.

[01:02:05] Speaker 05:
And I think with regard to these sorts of claims of providing effectively material support, that these are at most fits for secondary liability and not primary liability.

[01:02:18] Speaker 05:
And the case on which Mr. Branson primarily relied today, as he does in his briefs, the contrary view is the Seventh Circuit's decision in Boyle.

[01:02:26] Speaker 05:
And I think that opinion is frankly a somewhat confusing opinion.

[01:02:29] Speaker 05:
And I think it's fair to say that the court in that case seemed to really be straining to find

[01:02:35] Speaker 05:
a way of characterizing the conduct as primary liability, because aiding and abetting liability was not yet available.

[01:02:41] Speaker 05:
But as the Seventh Circuit in Judge Wood's very lucid opinion in Kemper explained, that was a case in which the defendant was making a direct donation to a known terrorist organization.

[01:02:53] Speaker 05:
And that's obviously not the case here.

[01:02:56] Speaker 05:
And I think with regard to the objective intent requirement, all I would say is that the only thing that the complaint alleges is that the supplier defendants had a commercial motive, namely to grow their market share in Iraq.

[01:03:08] Speaker 05:
And I would once again point to Judge Wood's very thoughtful opinion in the Kemper case, which held that very similar allegations were insufficient.

[01:03:17] Speaker 01:
But a commercial again like like I mean just thinking about, you know, the logic of these tort doctrines, like independent intermediary, it seems to me that one can can see that there may be some independence or some non terroristic function.

[01:03:33] Speaker 01:
going on at the Ministry of Health, and it might even be the intent of these defendants, you know, the dearest wish that whatever they're doing stays within that lane.

[01:03:44] Speaker 01:
But, you know, if, if there's a huge amount of terrorism also being sponsored out of that building with that staff.

[01:03:54] Speaker 01:
you know, is the independent intermediary doctrine really applicable?

[01:03:58] Speaker 01:
That's one question.

[01:03:59] Speaker 01:
And then parallel with the commercial motive, sure, of course, you know, these entities, these defendant entities are businesses and they can say, look, we just want to do business.

[01:04:11] Speaker 01:
But is again, is that a block against liability?

[01:04:15] Speaker 01:
Is that a defense if they're willing to exercise the commercial motive in a way that is knowingly

[01:04:24] Speaker 01:
providing support to terrorist organizations and clearly not.

[01:04:30] Speaker 01:
So the recognition that there may be a commercial motive or the recognition that there may be some sovereign function that even the plaintiff's complaint seems to acknowledge, I guess the question is just legally

[01:04:49] Speaker 01:
Can we at the complaint stage categorically kind of lean on that or to what extent can we and why?

[01:04:56] Speaker 05:
So I think with regard to the act of international terrorism requirement and Judge Pillard, I think we're really talking now about the second component of that, the objective intent requirement.

[01:05:07] Speaker 01:
Are you talking about appears to be?

[01:05:10] Speaker 05:
Yes, that is to say the requirement that the act be one that in the language of 2331 one appears to be intended, and I'm ellipsizing some language to intimidate or coerce a civilian population.

[01:05:26] Speaker 05:
I think that that is something that the court can determine as a matter of law, as, again, I think Mr. Branson acknowledged.

[01:05:33] Speaker 05:
And I think here our submission is quite straightforward, which is that transacting with the ministry is not an act that is intended to intimidate or coerce the civilian population and not one that an objective observer would think was intended to have that effect.

[01:05:50] Speaker 05:
And again, you have to satisfy both requirements to have an act of international terrorism

[01:05:54] Speaker 05:
And the act here simply was not an act that is violent or dangerous to human life.

[01:06:00] Speaker 05:
And that's why I think aiding and abetting liability would ordinarily be a more natural fit if the plaintiffs could satisfy the requirements for that.

[01:06:09] Speaker 05:
And the only other thing I would say on primary liability before we move to aiding and abetting liability is that

[01:06:15] Speaker 05:
I think with regard to the causation analysis, the manufacturer defendants do stand at a further causal step removed from the supplier defendants.

[01:06:26] Speaker 05:
And there simply are not allegations in the complaint, nonconclusory allegations in the complaint to support the notion that the supplier defendants were acting as the agent for the manufacturer defendants.

[01:06:39] Speaker 05:
And so I think at a minimum,

[01:06:40] Speaker 05:
If this court were to disagree on primary liability, it should at least make that clear and make clear that the manufacturer defendants were.

[01:06:46] Speaker 01:
Do you have a view of what what source of law applies?

[01:06:49] Speaker 01:
I mean, it seems just in common sense parlance, it seems pretty clear that if you're a manufacturer and you want to sell to a market, you work with a supplier.

[01:06:58] Speaker 01:
to send your stuff there.

[01:07:00] Speaker 01:
I mean, it doesn't have to be day-to-day control in every aspect.

[01:07:02] Speaker 01:
We're not talking about a general agency to act in all respects.

[01:07:05] Speaker 01:
We're talking about the manufacturers getting these specific goods to these specific customers.

[01:07:12] Speaker 01:
Is there really any question that the suppliers are their agents for that purpose?

[01:07:16] Speaker 05:
I don't think I would disagree with Mr. Branson's suggestion that this is governed by restatement type principles.

[01:07:24] Speaker 05:
My point is simply that the complaint, again, and we set this out in our brief, doesn't really contain any non-conclusory allegations of that.

[01:07:33] Speaker 05:
And there's undoubtedly, we're talking about proximate causation here, so there's undoubtedly a further causal step that would have to be satisfied as to those defendants.

[01:07:42] Speaker 05:
I do want to turn to aiding and abetting liability, because while I said a second ago that I think that that would otherwise be a natural fit if the requirements can be satisfied, of course, our fundamental submission is that there are two basic requirements that haven't been satisfied here.

[01:08:01] Speaker 05:
First, the substantial assistance requirement, and second, the general knowledge requirement.

[01:08:08] Speaker 05:
As to substantial assistance, we believe that Judge Leon correctly applied the Halberstam factors, which are, of course, incorporated into the ATA under JASTA.

[01:08:19] Speaker 05:
And I want to try to simplify the analysis here because I think whenever a court has a multi-factor test like this, it can turn into a morass fairly quickly.

[01:08:29] Speaker 05:
I think I would try to categorize the factors here

[01:08:32] Speaker 05:
You know, into three.

[01:08:34] Speaker 05:
The first is the nature of the act and the kind of assistance.

[01:08:37] Speaker 05:
The second is the presence of defendants and defendants relationship with the perpetrators, and the third is really the defendant's state of mind.

[01:08:45] Speaker 05:
I think with regard to the kind of assistance.

[01:08:48] Speaker 05:
plaintiffs really tried to run from the language that this court used in Halberstam.

[01:08:53] Speaker 05:
But the court repeatedly referred to whether the injurious act was heavily dependent on the alleged assistance, whether the assistance was essential or important to the illegal activities.

[01:09:06] Speaker 05:
Clearly, that was true in Halberstam itself.

[01:09:09] Speaker 05:
There's no question that Hamilton played an essential role in the overall criminal enterprise.

[01:09:15] Speaker 01:
But here there is a-

[01:09:18] Speaker 05:
No, but the whole point of course is that that that is not required as a matter of secondary viability and this court I think correctly drew on principles from the aiding and abetting and the conspiracy context to say that you don't have to play a role in every single act of the criminal

[01:09:34] Speaker 05:
enterprise, whereas here there is an obvious mismatch between defendants transactions and the Mahdi army's terrorist acts and the complaint really doesn't allege that defendants transactions intensified the terrorist campaign.

[01:09:50] Speaker 05:
Indeed, the complaint itself alleges that Iran supplied the Mahdi army with its weapons.

[01:09:56] Speaker 05:
And so again, I'm willing to acknowledge that the plaintiffs don't have to show that the terrorist activities would not have taken place absent the assistance.

[01:10:10] Speaker 05:
My point is simply that this court has said that the conduct has to be important, essential, that the injurious acts have to be

[01:10:19] Speaker 05:
dependent on that assistance and plaintiffs can meet that requirement here.

[01:10:24] Speaker 05:
And I think with regard to the second category of factors, the presence of the defendants and defendants relationship with the perpetrators, I think plaintiffs all but concede that those factors favor the defendants.

[01:10:35] Speaker 05:
And that brings us to the defendant's state of mind.

[01:10:38] Speaker 05:
And I think here, once again, the plaintiffs are really struggling with the language that this court used in Halberstam.

[01:10:45] Speaker 05:
This court said that the defendants have to be one in spirit with the perpetrators.

[01:10:52] Speaker 05:
And while plaintiffs, I think, try to sort of file that down to a very generic knowledge requirement, that is language that courts in engaging in the substantial assistance analysis have routinely relied upon

[01:11:07] Speaker 05:
And there's obviously no dispute here that defendants did not share the Mahdi Army's intention of harming American service members.

[01:11:16] Speaker 05:
Now, we think that the complaint fails plausibly to allege even knowledge.

[01:11:21] Speaker 05:
And I'll get to that in a minute.

[01:11:23] Speaker 05:
But I think for purposes of the substantial assistance analysis, this court in Halberstam was really, I think, drawing on principles in other contexts, such as conspiracy.

[01:11:34] Speaker 05:
To say that the real question is, does the defendant share the aims of the enterprise?

[01:11:41] Speaker 05:
And in applying that requirement in the Halberstam case, the court concluded that the defendant Hamilton's knowledge, quote, evidences a deliberate long-term intention to participate in an ongoing illicit enterprise.

[01:11:55] Speaker 05:
And so Judge Pillard, while Hamilton may not have specifically intended that the murder be committed, the court nevertheless found that that factor weighed in favor of a conclusion that there was substantial assistance.

[01:12:08] Speaker 04:
But even in a criminal case where a defendant is subject to aiding and abetting liability, let's suppose aiding and abetting a first degree murder,

[01:12:27] Speaker 04:
The government, the prosecution doesn't have to prove, if I hand a knife to someone and then that knife is used to murder someone else, they don't have to prove that I had premeditation and deliberation, kind of the same intent required of the principal.

[01:12:53] Speaker 04:
It's something

[01:12:57] Speaker 04:
And so saying the kind of one in spirit language in Halberstam, I mean, we can't take that too far, right?

[01:13:06] Speaker 05:
I think that's a fair point, Judge Wilkins.

[01:13:09] Speaker 05:
And I don't think I would disagree with something that the plaintiffs said in their brief, and I believe in their reply brief, which is that, you know, this is something of a sliding scale.

[01:13:19] Speaker 05:
This is, after all, a multifactor inquiry.

[01:13:23] Speaker 05:
I just don't think that it's a one way ratchet.

[01:13:24] Speaker 05:
In other words, I think that the absence of a shared intent here is significant.

[01:13:30] Speaker 05:
That's a point that other courts have, I think, attached significance to in engaging in the substantial assistance inquiry.

[01:13:36] Speaker 05:
It certainly isn't dispositive.

[01:13:39] Speaker 05:
And of course, our submission is that to the extent that knowledge is sufficient to meet the independent state of mind requirement, that the allegations here fall short of the required level of knowledge.

[01:13:51] Speaker 05:
And I'm happy to turn to that because I do think

[01:13:54] Speaker 01:
Yeah, I mean, that might be helpful.

[01:13:56] Speaker 01:
My question when you were characterizing Halberstam is it just seems that you're going to have situations in which you have corporate defendants, which frankly are really in it for the buck.

[01:14:11] Speaker 01:
And so they're not a deliberate long-term intention like

[01:14:17] Speaker 01:
the domestic partner of a criminal?

[01:14:19] Speaker 01:
No, it's not really a perfect fit, but the fact that they're really in it for the buck doesn't get them off the hook where they're willing to go after that buck in a way that really is heedless.

[01:14:35] Speaker 01:
to an ongoing, I mean, as alleged by these plaintiffs, an ongoing, obvious, open, violent, you know, campaign of terrorism.

[01:14:46] Speaker 01:
It's like, you know, not our problem.

[01:14:49] Speaker 01:
And then sending along the support.

[01:14:53] Speaker 01:
And so I guess

[01:14:55] Speaker 01:
If that were proved, I know that your position is that these allegations don't rise to the level of even the way Mr. Branson would characterize them.

[01:15:05] Speaker 01:
But if you did have a case that presented a corporation in that position, you wouldn't be limited by Halberstam in the way you just described, would you?

[01:15:17] Speaker 05:
If you had allegations that rose to that level, Judge Pillard, and I really don't think that the allegations in this complaint rise to that level.

[01:15:24] Speaker 05:
But if you did, it would obviously be harder for a defendant in those circumstances to make an argument that the requisite state of mind didn't exist.

[01:15:32] Speaker 05:
But let's go right to the state of mind requirement, because I do think that that provides an independent way of disposing of the aiding and abetting claims here.

[01:15:41] Speaker 05:
Now, first, what is that requirement?

[01:15:44] Speaker 05:
In our view, the proper understanding of that requirement is that a defendant has to be aware that it was playing a role in terrorist activities.

[01:15:54] Speaker 05:
Where do we get that from?

[01:15:55] Speaker 05:
We get that from the language of Halberstam itself, which says that a defendant must be, quote, generally aware of his role as part of an overall illegal or tortious activity

[01:16:07] Speaker 05:
At the time he provides the assistance.

[01:16:09] Speaker 05:
Now I think the proper understanding here is that the relevant activity the relevant illegal activity is the terrorist activity.

[01:16:17] Speaker 05:
Now my friend Mr Branson relies on some language from the Second Circuit's recent opinion in Kaplan.

[01:16:24] Speaker 05:
where the Second Circuit slightly modifies that and says that a defendant may be liable if it was quote, generally aware of its role in an overall illegal activity from which an act of international terrorism was a foreseeable risk.

[01:16:39] Speaker 05:
Now, I think that that's probably a somewhat imprecise gloss on the relevant statutory language.

[01:16:44] Speaker 05:
I really do think that the illegal activity is the terrorist activity.

[01:16:48] Speaker 05:
It certainly has to be the activity of the alleged perpetrator.

[01:16:52] Speaker 05:
But even if you accept that gloss, we think that that requirement is still simply not satisfied here.

[01:16:58] Speaker 05:
And I wanna go directly to the sources on which plaintiffs rely for the alleged knowledge.

[01:17:05] Speaker 05:
Now I think at bottom plaintiffs are really relying on three things they're relying on press reports, they're relying on visual cues, and they are relying once again on the allegations of corruption.

[01:17:20] Speaker 05:
Now with regard to the press reports we address these at some length in our brief at pages 54 to 55.

[01:17:27] Speaker 05:
Our fundamental submission is that there were no allegations of diversion of resources in the public domain at all until 2007 when the Deputy Ministry of Health was arrested.

[01:17:40] Speaker 05:
And I think even at that point, I think that the fair inference from the press reports was that the government was dealing with the issue of militia influence.

[01:17:51] Speaker 05:
But our submission is that these sorts of press reports are simply not sufficient to get to general awareness of the role in terrorist activities.

[01:17:59] Speaker 05:
And I would point this court to two Second Circuit opinions, the Siegel case and the Honeckman case, for the proposition that these sorts of press reports in and of themselves are not enough.

[01:18:12] Speaker 05:
And I would note parenthetically that to the extent that Mr. Branson today

[01:18:19] Speaker 05:
relied primarily on a US embassy report for this proposition.

[01:18:25] Speaker 05:
This is at Joint Appendix, I believe, 123, but that report isn't really helpful for CNTER purposes because they're citing an internal US government document that doesn't even appear to be available publicly.

[01:18:38] Speaker 05:
It's marked

[01:18:39] Speaker 05:
sensitive but unclassified.

[01:18:41] Speaker 05:
Leaving that aside, let's get next to the visual cues.

[01:18:44] Speaker 05:
And I think on the visual cues, our submission is that even if the complaint alleged that defendants own employees actually visited the ministry.

[01:18:53] Speaker 05:
And the most of the complaint alleges is that some

[01:18:58] Speaker 05:
scientific bureaus that were allegedly agents of the defendants visited the ministry, but even if they did visit the ministry and even if they did see these posters that that would not be enough to put defendants on notice that the mighty army was stealing and selling medical goods and using the proceeds to finance

[01:19:16] Speaker 05:
terrorist attacks once again particularly given that this was a time period during which the United States government was providing support, and to the extent that there are, you know, allegations that there was a room with AK 47 and that there's no allegation that anyone went to that room during the relevant time period and so again,

[01:19:34] Speaker 05:
Our submission is that these allegations of state of mind are weaker than those in other cases where the court has said that state of mind is insufficient.

[01:19:43] Speaker 05:
In the Segal case, the defendant bank was aware of public reports of an organization's links to terrorists.

[01:19:50] Speaker 05:
And indeed, the bank itself was committing sanctions violations.

[01:19:54] Speaker 05:
And the court still said that that was insufficient to satisfy the general awareness requirement.

[01:20:00] Speaker 05:
Again, to the extent that plaintiffs point to the allegations of corruption more generally, the most that could be said is that that would suggest, and I don't think it sufficiently does, but even if it were, the most that it would do is to suggest that defendants were aware of corrupt practices at the ministry and not that defendants were aware that they were playing a role in terrorist activity.

[01:20:24] Speaker 05:
So I think that to the extent that the court

[01:20:26] Speaker 05:
has any concern about affirming on the ground that there was not substantial assistance here, and I do think Judge Leon's analysis of that was correct.

[01:20:35] Speaker 05:
The court can affirm on the ground that the state of mind requirement here was not satisfied.

[01:20:40] Speaker 03:
Why do you think on the aiding and abetting that this case can be properly, assuming we're bound, can be properly distinguished from Kaplan?

[01:20:49] Speaker 03:
Kaplan distinguishes Siegel, so I'm not persuaded that

[01:20:54] Speaker 03:
your analysis of Siegel is anywhere dispositive.

[01:20:57] Speaker 03:
Kaplan has a very strong statement against your position.

[01:21:02] Speaker 03:
You and those on that side of this world cheered by the Second Circuit decisions before Kaplan.

[01:21:10] Speaker 03:
Judge Kears really whacked you away on a lot of these questions on aiding and vetting.

[01:21:15] Speaker 03:
How can you distinguish?

[01:21:17] Speaker 03:
If I'm persuaded that Kaplan's right at this point,

[01:21:22] Speaker 03:
What would your response be?

[01:21:26] Speaker 05:
I think I would respectfully say, Judge Edwards, that this case is more like the cases that preceded and followed it, Siegel and Honickman, and less like Kaplan.

[01:21:37] Speaker 05:
That is because in Kaplan, the party with whom the defendant was transacting,

[01:21:44] Speaker 05:
was, you know, persons who were known to be in the words of the court integral parts of Hezbollah, and who were so closely intertwined with Hezbollah's violent activities, that one could reasonably infer that the bank had general awareness and

[01:22:00] Speaker 05:
Again, as we discussed earlier in the argument, I don't think that the allegations here rise to that level.

[01:22:07] Speaker 05:
And so we don't dispute that Kaplan came out correctly.

[01:22:11] Speaker 05:
Our view is simply that this case is more like the cases where courts have said that allegations are insufficient.

[01:22:17] Speaker 01:
Mr. Tramigan, there's, I mean, you know that, and this is a very, very tough issue for courts because of the, you know, the tremendous burdens of discovery.

[01:22:30] Speaker 01:
But, you know, when there are allegations of state of mind, it's pretty hard to be, you know, super definitive at the pleading stage about what your opposing parties knew

[01:22:45] Speaker 01:
what kind of due diligence they did, what they uncovered when they did that due diligence, to what extent they were actually acting reasonably and really unaware, or to what extent they were on notice and putting their heads in the sand.

[01:23:01] Speaker 01:
As I said, I recognize that these are very difficult and frankly,

[01:23:08] Speaker 01:
issues that are hard to resolve in a satisfactory way because of the implications of opening the door to that kind of inquiry.

[01:23:18] Speaker 01:
But if the law is making state of mind relevant,

[01:23:27] Speaker 01:
consistent with the law, you think we can nonetheless demand more at the pleading stage.

[01:23:32] Speaker 05:
I don't think we're asking you to demand anything more, Judge pillar but as I think your as your question reflected courts have not hesitated to dismiss these cases at the motion to dismiss stage, including on the issue of

[01:23:47] Speaker 05:
knowledge with regard to aiding and abetting claims.

[01:23:49] Speaker 05:
And indeed, the Siegel case and the Honigman case are both examples of that.

[01:23:55] Speaker 05:
And if a court applying the plausibility standard concludes that the plaintiff's allegations are insufficient, I do think that that is the right thing to do, particularly given the burdens of this type of litigation and the potential for

[01:24:08] Speaker 05:
really a challenging discovery.

[01:24:11] Speaker 05:
But the only other thing I would note with regard to state of mind here generally is that I think the issue of state of mind here has to be read against the backdrop that makes this case so fundamentally different from all of the other cases that we've been discussing, namely that during this time period, the United States government

[01:24:30] Speaker 05:
Far from labeling the Iraqi Ministry of Health somehow problematic or the equivalent of a state sponsor of terrorism, far from labeling Jaish al-Mahdi as a foreign terrorist organization was providing support for the Iraqi Ministry of Health and indeed encouraging defendants to do so.

[01:24:49] Speaker 01:
You started your argument, Mr. Shanmugam, saying that these defendants answered the call of the United States.

[01:24:57] Speaker 01:
They stepped forward at the request of the United States government.

[01:25:01] Speaker 01:
And your citation for that, I'm sure it's in the introduction to your brief, but you're relying for that on

[01:25:08] Speaker 05:
What?

[01:25:09] Speaker 05:
On government reports, of which I think that this court can take judicial notice.

[01:25:13] Speaker 05:
And I would point the court to page 31 of our brief, where we point out that the United Government encouraged companies to supply the ministry and even contracted with some of the defendants to supply medical equipment for ministry facilities, citing a report from the Special Inspector General for Iraq Reconstruction.

[01:25:33] Speaker 05:
And, you know, again, I think that that is comfortably in the category of things of which the court can take judicial notice.

[01:25:43] Speaker 05:
Not least because this court has repeatedly said that it is settled that the court can take judicial notice of records that reflect the United States government's official position.

[01:25:55] Speaker 05:
That's all that we're asking the court to do, I think, consistent with the familiar standard from Rule 201.

[01:26:01] Speaker 05:
I think that that's a really pretty modest proposition for the court to take judicial notice of.

[01:26:07] Speaker 05:
I would note that to the extent that the plaintiffs seek to supplement their third amended complaint in this case,

[01:26:13] Speaker 05:
with amicus briefs to try to sort of cast doubt on the nature of the United States government support.

[01:26:20] Speaker 05:
I think the amicus brief on which they rely stands at most for the proposition that some within the United States government were concerned with corruption at the time as they were before, during, and after the relevant time period.

[01:26:35] Speaker 05:
And for purposes of the state of mind requirements, again,

[01:26:40] Speaker 05:
The question is, you know, did defendants know that by transacting with the ministry that they were potentially supporting terrorist attacks on American service members and leaving aside the obvious implausibility that these defendants would want to do anything

[01:26:57] Speaker 05:
to endanger the lives of American service members, an allegation that is obviously deeply upsetting to these defendants.

[01:27:06] Speaker 05:
The fact remains that that is the touchstone of the inquiry here for purposes of aiding and abetting liability, as it is for purposes of primary liability with regard to the objective intent requirement we were discussing earlier.

[01:27:19] Speaker 03:
I know that the time is

[01:27:20] Speaker 03:
I just want to add one thing.

[01:27:22] Speaker 03:
Both Kaplan and Gonzalez rely on news reports for general awareness.

[01:27:26] Speaker 03:
I don't think you can sweep them away as quickly as you're doing.

[01:27:29] Speaker 03:
They clearly are making fun of you.

[01:27:32] Speaker 03:
You may disagree with them, but they certainly have adopted an approach.

[01:27:36] Speaker 03:
You're right.

[01:27:37] Speaker 03:
The earlier cases were very grudging.

[01:27:40] Speaker 03:
But Congress has amended in willingness to find liability.

[01:27:44] Speaker 03:
But Congress has amended the statute and has tried to give very strong statements as to what their intended purpose is.

[01:27:51] Speaker 03:
Purpose of Congress is sweeping.

[01:27:52] Speaker 03:
But one other thing, I'm just curious on this government support.

[01:27:56] Speaker 03:
It's an interesting argument.

[01:27:58] Speaker 03:
Are you saying these are mutually exclusive notions that is the existence of government support and the support of terrorists?

[01:28:08] Speaker 03:
If you can find the existence of government support, you cannot find supportive terrorism.

[01:28:14] Speaker 03:
I mean, because you're trying to get away with too much.

[01:28:17] Speaker 05:
No, I'm not trying to get away with that.

[01:28:19] Speaker 03:
I don't mean that.

[01:28:20] Speaker 03:
There's no bad intent.

[01:28:21] Speaker 03:
But I mean, that given the world in which we're living in now, I mean, I think you and I could agree over cocktails.

[01:28:29] Speaker 03:
Of course, there are situations where the United States is probably supporting a piece of this.

[01:28:34] Speaker 03:
And there were parts of the ministry that were perfectly OK in what they were doing.

[01:28:39] Speaker 03:
there's a part of that group, the ministry and those with whom they're hanging out are doing bad things.

[01:28:44] Speaker 03:
And so you can have both US support and you can have supportive terrorism, right?

[01:28:49] Speaker 05:
So I would say three things in response to that.

[01:28:50] Speaker 05:
First, Judge Edwards, I am not trying to argue for that sort of a bright line rule.

[01:28:54] Speaker 05:
My view is simply that the United States government support is relevant to the analysis.

[01:28:59] Speaker 05:
Second, I take your point that plaintiffs now have two cases at the court of appeals level that have found allegations of knowledge to be sufficient, the Kaplan case and the Gonzalez case, which found allegations in part to be sufficient.

[01:29:12] Speaker 05:
But the allegations there were much more substantial.

[01:29:14] Speaker 05:
And in the Gonzalez case with regard to the part of the claim that the court allowed to proceed against the social media companies, the court cited the fact that, quote, defendants allowed ISIS accounts and content to remain public

[01:29:27] Speaker 05:
even after receiving complaints about ISIS's use of their platform.

[01:29:32] Speaker 05:
So again, I think that the allegations there were more substantial.

[01:29:35] Speaker 05:
And my third point, and then I do want to turn briefly to Hezbollah and then personal jurisdiction.

[01:29:40] Speaker 05:
And I know that we've gone over time.

[01:29:42] Speaker 05:
But my third point, Judge Edwards, is that this brings us back in some sense to where I started, which is really the concern with permitting broad liability in contexts like this, where you have the United States government encouraging

[01:29:55] Speaker 05:
defendants to do business.

[01:29:57] Speaker 05:
If you permit liability under these circumstances, it is going to chill companies and non-governmental organizations from doing business in precisely the sort of troubled reasons that you were alluding to.

[01:30:09] Speaker 05:
If we were discussing this issue over your cocktail, we might be talking about what's going on right now in Afghanistan.

[01:30:17] Speaker 05:
You're going to have similar problems in other troubled areas of the world where

[01:30:22] Speaker 05:
parties are going to be concerned about potential liability for transacting with government entities, and that does actually bring us to the issue of Hezbollah, because the reason that there is a foreign terrorist organization requirement here is, I suspect, in part to provide some degree of clarity.

[01:30:44] Speaker 05:
As to who you can deal with, and who you can't deal with.

[01:30:48] Speaker 05:
And so while the foreign terrorist organization argument would not dispose of the entirety of the complaint in this case, because we acknowledge that there are at least some attacks, as to which

[01:31:00] Speaker 05:
the complaint alleges some degree of involvement by Hezbollah, it simply can't be enough simply to inspire a non-FTO perpetrator or to train its fighters or even to provide weapons.

[01:31:17] Speaker 05:
If I say to you that it's a good idea to get married, no one would say that I was planning your wedding.

[01:31:23] Speaker 05:
Even if I provided the ring to you,

[01:31:26] Speaker 05:
I don't think I could be said to have planned or authorized your wedding.

[01:31:31] Speaker 05:
Judge Wilkins's example involving briefs is exactly right.

[01:31:35] Speaker 05:
While we would acknowledge that you could plan a campaign, that you could plan a series of acts, there has to be a greater degree of involvement than simply inspiration or providing weapons.

[01:31:47] Speaker 01:
Maybe that's why- Planning a wedding is more complicated than planning the detonation of a penetrative missile.

[01:31:56] Speaker 05:
Well, that may very well be true, but the mere provision of the missile is insufficient.

[01:32:02] Speaker 05:
And one thing we know is that Congress didn't use terms like material support, it required planning or authorization.

[01:32:11] Speaker 05:
And I think that that tends to confirm that mere supply is not enough.

[01:32:17] Speaker 05:
Now I do want to turn, because I know that we're well over time just a personal jurisdiction, and in the last couple of minutes here because I do think that should this court disagree with us on the merits here that at a minimum judge Leon's dismissal on personal jurisdiction grounds was sufficient.

[01:32:36] Speaker 05:
Mr. Branson is certainly correct that the Supreme Court's decision in the Ford case makes clear that a causal connection is not required.

[01:32:45] Speaker 05:
But even in the wake of Ford, our fundamental submission is that there is an insufficient nexus between plaintiff's claims and the presence of United States manufacturer defendants in the foreign defendant's supply chains.

[01:33:00] Speaker 05:
Now plaintiffs have considerably narrowed their theory of personal jurisdiction on appeal.

[01:33:05] Speaker 05:
They're relying only on the allegation that the foreign defendants source from the United States, some of the medical goods that they supplied to the ministry, but I think Judge Leon correctly determined

[01:33:17] Speaker 05:
that those forum contacts are incidental to plaintiffs' claims.

[01:33:22] Speaker 05:
The foreign defendant's liability here was rooted in their alleged misconduct in Iraq.

[01:33:28] Speaker 05:
It was not rooted in the sourcing of goods from the United States.

[01:33:32] Speaker 05:
Now, Mr. Branson suggested that Judge Leon got the legal standard wrong.

[01:33:37] Speaker 05:
I would encourage the court to look at the page that he cited.

[01:33:40] Speaker 05:
It's joint appendix page 818 or page 11 of Judge Leon's slip opinion.

[01:33:45] Speaker 05:
He does note that the plaintiffs do not allege that the foreign defendants' manufacturing or sourcing practices were themselves unlawful or could otherwise subject the foreign defendants to liability under the ATA, or otherwise that would be sufficient to establish personal jurisdiction.

[01:34:00] Speaker 05:
Then he goes on in the next sentence.

[01:34:01] Speaker 05:
He doesn't stop there and he says, nor do those practices constitute the suit-related conduct underlying plaintiffs' ATA claims.

[01:34:11] Speaker 05:
And that's the fundamental problem here.

[01:34:13] Speaker 05:
At bottom, plaintiffs are really relying on a single allegation.

[01:34:17] Speaker 05:
It's the allegation in paragraph 153 of the complaint at Joint Appendix 158.

[01:34:21] Speaker 05:
It is incorporated earlier, I think, in paragraph 121.

[01:34:25] Speaker 05:
But it's the allegation that the solderist, quote, placed a premium on importing medical goods manufactured in the United States and Europe, noting that other goods were more likely to be counterfeit.

[01:34:37] Speaker 05:
That is simply not enough.

[01:34:40] Speaker 05:
And this case is a far cry from a case like the Leachie case on which plaintiffs rely in their reply brief from the Second Circuit, where a US bank account is really being used as the instrumentality of the relevant misconduct.

[01:34:53] Speaker 05:
And so we think that the mere fact that some of the goods were sourced in the United States is insufficient.

[01:34:58] Speaker 05:
And we don't think the jurisdictional discovery would affect the analysis, because the question here is not.

[01:35:02] Speaker 01:
It almost sounds like, Mr. Shanmugan, you're going back to the causal

[01:35:06] Speaker 01:
test because here there's no question that they were in fact sourcing vast quantities of goods from the US and so it sounds like you're saying well their USness has to somehow be you know their their character as American goods which you know granted the plaintiffs have as you say also allege that but putting that aside does it

[01:35:30] Speaker 01:
Does it matter for personal jurisdiction or is it required for personal jurisdiction that the American trade dress of these products be relevant to the terrorism allegations?

[01:35:47] Speaker 01:
Or is it enough that the suppliers are sourcing all of this stuff from the US?

[01:35:56] Speaker 05:
So the question is, is there a tight enough relationship between the suit related contacts, so here the US related contacts and plaintiff's claims?

[01:36:08] Speaker 05:
And our view is that even if you don't think about it in terms of causation, that the mere presence of US goods in the supply chain is insufficient.

[01:36:16] Speaker 05:
There's no dispute.

[01:36:17] Speaker 01:
It's not mere presence.

[01:36:18] Speaker 01:
They're buying, they're taking US goods and selling them in huge quantities.

[01:36:26] Speaker 01:
I mean, they are the instrument of this support for terrorism allegation.

[01:36:33] Speaker 01:
These are American goods.

[01:36:34] Speaker 01:
These are companies that the suppliers are benefiting in the selling of these goods in Iraq.

[01:36:45] Speaker 01:
They're benefiting from the protection of US contract law, from the protection of US food and drug law, from the protection of US intellectual property law.

[01:36:53] Speaker 01:
And all of these, that's how they make their business is that they're selling US goods in other countries.

[01:36:59] Speaker 01:
And so I guess I'm missing why

[01:37:02] Speaker 01:
the potential, you know, the questions that you raise about the terrorists particularly liking American goods, like put that aside.

[01:37:20] Speaker 01:
Is there a question about personal jurisdiction, even if we didn't have those allegations?

[01:37:26] Speaker 05:
Well, I think what we know I think we can't say you know how much of these goods were sourced in the United States, I think I take that point that on this record we don't know the answer to that question.

[01:37:38] Speaker 05:
What we do know is that many of the contracts did specify

[01:37:41] Speaker 05:
other countries as the source of origin for the contracted goods.

[01:37:47] Speaker 05:
But our submission is that I think for legal purposes, that doesn't matter.

[01:37:52] Speaker 05:
In other words, that the exact quantification, which seems to be what Mr. Branson would want from jurisdictional discovery, wouldn't somehow establish a tighter nexus between the United States and plaintiff's actual claims here, which again, do not depend in any way

[01:38:09] Speaker 05:
on the fact as a legal matter on the fact that the goods are being sourced from the United States.

[01:38:14] Speaker 05:
And so again, I think at a minimum, it is not the case that Judge Leon adopted a legal test that turns on the unlawfulness of the United States conduct.

[01:38:25] Speaker 05:
And because he applied the correct legal test, we believe that he in fact reached the correct result and that that is true even in the wake of the Supreme Court's decision.

[01:38:34] Speaker 05:
Unless the court has any further questions, I think I would just sort of close where I began, and it goes without saying that the defendants here condemn the attacks on us service members in Iraq and sympathize with the plaintiff's plight here with their desire to hold someone accountable for the injuries that they and their loved ones have suffered.

[01:38:54] Speaker 05:
But as Judge Wood said in her opinion for the Seventh Circuit in Kemper, this is a case in which my clients are simply the wrong defendants and there's no valid legal theory on which they can be held liable, either as a matter of direct liability or aiding and abetting liability under the ATA.

[01:39:11] Speaker 05:
And unless the court has any further questions, we believe that the district court correctly dismissed those claims and that its judgment should be affirmed.

[01:39:19] Speaker 01:
Thank you.

[01:39:22] Speaker 01:
Mr. Branson, if you would like it, you can have, given the length and the complexity of the issues, you can have four minutes for rebuttal.

[01:39:41] Speaker 01:
You're on mute.

[01:39:45] Speaker 02:
Thank you, Judge Pillard.

[01:39:46] Speaker 02:
And Judge Edwards, I'd like to start with your question.

[01:39:49] Speaker 02:
You are exactly right about Kaplan.

[01:39:51] Speaker 02:
Judge Kearse rejected virtually every legal argument that my friends have made on aiding and abetting liability.

[01:39:58] Speaker 02:
And Mr. Shane McGann attempted to distinguish it by saying that the intermediaries there were integral parts of Hezbollah.

[01:40:05] Speaker 02:
That's their argument.

[01:40:06] Speaker 02:
That was plaintiff's characterization in the complaint, sourced primarily to anonymous, undated websites.

[01:40:13] Speaker 02:
That is why the Second Circuit accepted that characterization.

[01:40:17] Speaker 02:
And I think all this court needs to do is compare paragraph 78 to 79 of the Kaplan complaint

[01:40:24] Speaker 02:
which were the basis of that characterization with paragraphs 165 to 187 of our complaint.

[01:40:30] Speaker 02:
It's no contest who has more detailed allegations to draw the inferences that Judge Kearse properly drew in Kaplan.

[01:40:38] Speaker 02:
And I would just note that the lead intermediary in Kaplan was the Shaheed Foundation.

[01:40:42] Speaker 02:
The defendants argued vehemently, just like Mr. Shanmugam just did, that that was a medical institution that built hospitals and provided medical services to orphans.

[01:40:52] Speaker 02:
That's what the defendant said in their brief, but the Second Circuit accepted the allegations in the complaint because it's a motion to dismiss.

[01:41:00] Speaker 02:
And if this court does that here, the logic of Kaplan, which I think is very persuasive, dictates a reversal.

[01:41:07] Speaker 02:
Mr. Shamigim also said repeatedly that the US government encouraged them to do these transactions.

[01:41:14] Speaker 02:
There is not a shred of evidence in the Joint Appendix that says that.

[01:41:18] Speaker 02:
I'm happy to walk through every document that they've cited.

[01:41:21] Speaker 02:
I've read every one multiple times.

[01:41:24] Speaker 02:
There's no evidence of that.

[01:41:25] Speaker 02:
The best Mr. Shamigim has is this vague spreadsheet from a special inspector general for Iraq reconstruction report at JA, I believe, 691 to 96.

[01:41:37] Speaker 02:
Those are talking about direct US government contracts where the US ran the procurement and then supervised the installation of the goods and the services as part of its effort to rebuild Iraq's health infrastructure and their own lead amicus.

[01:41:54] Speaker 02:
In a interview given to the Special Inspector General for Iraq reconstruction, acknowledge the difference between the two.

[01:42:02] Speaker 02:
So this idea that the US government asked the defendants to sell to Komadia, it's not true, and there's no evidence of it.

[01:42:09] Speaker 02:
And that's even assuming the court should take judicial notice of these reports, which

[01:42:14] Speaker 02:
I don't think it should.

[01:42:15] Speaker 02:
I mean, most of them are these anonymous weekly reconstruction update documents that I've been unable to authenticate.

[01:42:23] Speaker 02:
We've served FOIA requests on USAID to find them.

[01:42:26] Speaker 02:
USAID can't find them.

[01:42:28] Speaker 02:
The defendants downloaded them from some third party website.

[01:42:31] Speaker 02:
For all I know, they were written by an intern.

[01:42:34] Speaker 02:
in USAID and never made public.

[01:42:36] Speaker 02:
So the idea that in a case of this magnitude, the court should find what official US policy in Iraq was based on anonymous newsletters that nobody's been able to authenticate.

[01:42:48] Speaker 02:
That's not what this court should do.

[01:42:50] Speaker 02:
By contrast, here are the facts about the US government in Iraq.

[01:42:53] Speaker 02:
By 2007, U.S.

[01:42:55] Speaker 02:
officials could not even go into the ministry building because it was too dangerous and they were getting death threats.

[01:43:00] Speaker 02:
That's paragraph 180 of the complaint.

[01:43:02] Speaker 02:
We've spoken about the military operation to arrest and prosecute Haqqam Zamali, who was these defendants, essentially their counterparty and one of the worst terrorists in Iraq.

[01:43:12] Speaker 01:
I hate to interrupt when you have limited time and you're

[01:43:15] Speaker 01:
and you're clearly trying to use it efficiently, but when you talk about the agents of the defendants or the defendants, it's a little bit unclear in the pleading going into the building.

[01:43:26] Speaker 01:
As you've said, Americans couldn't go in.

[01:43:27] Speaker 01:
I assume that you're talking about the scientific bureau.

[01:43:30] Speaker 01:
Is there any reason to think that if the scientific bureau, who I understand to be local Iraqi people that are working on behalf of

[01:43:41] Speaker 01:
the defendant companies, any reason to think that they would communicate back how many AK-47s they saw leaning against the wall or whether they saw Death to America posters on the wall or anything like that.

[01:43:54] Speaker 02:
Yes, the scientific bureaus were their local agents in Iraq responsible for these businesses' relationship with the ministry.

[01:44:02] Speaker 02:
So yes, there is an entirely plausible reason that they would have reported it back.

[01:44:07] Speaker 02:
But I would also note, Judge Pillard, we've alleged that they were agents.

[01:44:11] Speaker 02:
That's paragraph 158 of the complaint.

[01:44:13] Speaker 02:
And so an agency relationship, the knowledge is imputed to the principal.

[01:44:17] Speaker 02:
So even if there was not a communication back to the companies themselves, and to be clear, we're entitled to discovery on that.

[01:44:25] Speaker 02:
That is not an inference this course should resolve on a motion to dismiss.

[01:44:29] Speaker 02:
But we don't think we need that, because as a matter of fundamental agency law, the knowledge was imputed.

[01:44:36] Speaker 02:
And I would just stress that for all of Mr. Shanmugam's discussion about knowledge, Judge Leon

[01:44:43] Speaker 02:
went as far as to say there was knowledge at J.A.

[01:44:45] Speaker 02:
835.

[01:44:46] Speaker 02:
I quoted that in my opening brief.

[01:44:48] Speaker 02:
He said that the defendants, quote, were aware that their goods, quote, would be used by J.Shalmadi to support terrorist attacks as alleged, of course.

[01:44:56] Speaker 02:
And so this knowledge issue, again, I think Judge Edwards had it right.

[01:45:01] Speaker 02:
I mean, you compare the knowledge allegations here to the ones in Kaplan, and I think the case needs to be reversed.

[01:45:08] Speaker 02:
On Hezbollah, just very briefly, Mr. Shanmugam characterized our allegations as merely providing the weapon or merely giving inspiration.

[01:45:17] Speaker 02:
That's not what we allege.

[01:45:19] Speaker 02:
Yes, they did provide the weapon, but they did a lot more than that.

[01:45:22] Speaker 02:
They trained them how to use the weapons.

[01:45:24] Speaker 02:
They had operatives on the ground dictating day-to-day tactical decisions about how to use them.

[01:45:30] Speaker 02:
They encouraged Jaysh al-Mahdi to use these weapons against Americans in Iraq.

[01:45:35] Speaker 02:
And that is why I think the easiest way to see this is at paragraphs 395 to 96 of the complaint talking about these explosively formed penetrators.

[01:45:44] Speaker 02:
The idea that all Hezbollah did was give them the weapons and nothing else, that is not what we allege.

[01:45:50] Speaker 02:
And at a minimum, Judge Wilkins, I know that you had some questions about how to draw the line on this, and I acknowledge that there are going to be hard cases.

[01:45:59] Speaker 02:
at the margins.

[01:46:00] Speaker 02:
I would encourage the court, if it's concerned about that, to draw those sorts of lines on a summary judgment record when the factual record has been fully developed.

[01:46:10] Speaker 02:
Because I think no matter what the legal test is, and I would note that my friend didn't actually articulate what he thinks the test is.

[01:46:16] Speaker 02:
I'm surmising he thinks that it means that a Hezbollah person has to show up to the street corner and blow up this bomb and kill that tank.

[01:46:26] Speaker 02:
If that's the test, and I don't think it is, we're entitled to discovery because we have at least alleged a plausible nexus between what Hezbollah did and each individual attack, such that discovery may well yield the sort of evidence that I think my friend is demanding.

[01:46:44] Speaker 01:
I'm going to let you go.

[01:46:46] Speaker 01:
What are the best responses to the concerns that many have voiced in opinions and in the argument today about casting a net so wide that entities or individuals that really want to provide humanitarian aid to people in distress, of which there are many,

[01:47:07] Speaker 01:
in areas that are under terrorist control or besieged by terrorists that they would be snared in this law?

[01:47:19] Speaker 02:
Well, Judge Pillard, it depends on what the facts are, of course.

[01:47:22] Speaker 02:
I'm thinking of the charity's amicus brief that the other side submitted.

[01:47:27] Speaker 02:
If all you're doing is providing humanitarian assistance in an area that has terrorists in it,

[01:47:34] Speaker 02:
That's not going to be enough to create liability.

[01:47:36] Speaker 02:
I mean, the statute, I think my friend quite rightly said, has two key elements.

[01:47:41] Speaker 02:
You need substantial assistance and you need general awareness.

[01:47:44] Speaker 02:
And those are not easy bars to meet.

[01:47:47] Speaker 02:
I think they're met here by the complaint.

[01:47:50] Speaker 02:
But it's not as though every charity in the world is going to be subjected to a lawsuit like that.

[01:47:55] Speaker 02:
And I think there's been no showing that there would be.

[01:48:00] Speaker 02:
To create an action under this statute, you have to substantially assist terrorists that are attacking Americans.

[01:48:07] Speaker 02:
And I guess Judge Pillard, I'd close by saying this law is broad and it's because Congress really doesn't like it when companies fund terrorists.

[01:48:15] Speaker 02:
And so there may well be some competing policy considerations that might rear their head in some future case.

[01:48:23] Speaker 02:
But very heavy in the calculus is Congress's determination that you shouldn't fund terrorists.

[01:48:28] Speaker 02:
And when you do, that is an extraordinary interest that Congress was entitled to legislate against.

[01:48:34] Speaker 02:
And I think when you apply this statute to these facts, the case should be reversed.

[01:48:40] Speaker 01:
Thank you, counsel, both of you, for a very able argument and a very difficult, not just legally, but in other ways, very difficult case.

[01:48:51] Speaker 01:
Case is submitted.